Draghi vs Weidmann

By Mike Peacock
July 14, 2014

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European Central Bank President Mario Draghi makes a lengthy appearance in the European Parliament in Strasbourg. He will doubtless reassert that the ECB would start printing money if necessary but, as we reported last week, policymakers are fervently hoping they won’t have to and that a raft of measures announced in June will do enough to lift the economy and inflation.

EU lets genie out of the bottle in Cyprus bailout

March 18, 2013

Breaking with previous EU practice that depositors’ savings are sacrosanct, Cyprus and international lenders agreed at the weekend that savers would take a hit in return for the offer of 10 billion euros in aid.

Spanish rescue could cause collateral damage for Italy

September 21, 2012

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Mounting speculation that Spain is prepping for a bailout begs the question – what happens to Italy?

Channels of contagion: How the European crisis is hurting Latin America

June 8, 2012

If anything positive can be said to have come out of the global financial crisis of 2008-2009, it may be that the theory arguing major economies could “decouple” from one another in times of stress was roundly disproved. Now that Europe is the world’s troublesome epicenter, economists are already on the lookout for how ructions there will reverberate elsewhere.

Risk of contagion if Greece exits euro: WestLB

May 11, 2012

What happens if Greece leaves the euro? No one can say for sure. But John Davies at WestLB, finds it difficult to envision a benign outcome.

For insatiable markets, Spanish steps fall short

April 6, 2012

So much for the lasting power of the ECB’s 1 trillion euros in cheap bank loans. Spain is again looking like a basket-case, more because of market dynamics rather than any particular policy misteps.

Europe’s clear and present danger to U.S. economy

December 15, 2011

Jason Lange contributed to this post.

Suddenly the shoe is on the other foot. The financial crisis of 2007-2008 had its roots in the U.S. banking system and then spread to Europe. Now, it’s Europe’s political debacle that threatens economic growth in the United States.

Contagion strikes Europe’s core

November 23, 2011

Any lingering illusion that the European crisis could be contained to so-called peripheral countries with high debt levels was shattered on Wednesday. German government bonds, which had thus far been seen as a safe-haven, slumped sharply after investors shunned the country’s auction of new 10-year debt.

Is Europe’s core rotten?

August 3, 2011

Europe’s debt problems had thus far been largely contained to the so-called periphery, places like Greece, Ireland and Portugal. But increasingly, doubts are rising about countries once seen as insulated — Spain, Italy, even Belgium and France.

Greek Contagion: One Hell of a Tail Risk

February 14, 2010

The crisis of confidence in Greece’s fiscal health has dented U.S. equities, though not enough to compromise a budding American economic recovery. Even a significant slowdown in European growth prospects might have limited immediate impact on the United States. However, that benign backdrop could vanish, economists at Morgan Stanley say, if the Greek situation were to turn in to an outright credit crisis.  They call it the “contagion tail risk”: