Welcome to the weekly roundup of great articles, facts and figures. These are the weekly finds that made our eyes pop.
Fed Chair Bernanke Warns on Europe, Jobs Crisis
It's astounding to me, that even the big banker in chief knows the jobs crisis and what's going on in Europe can bring the U.S. to it's knees, unlike most of the punditry these days:
The financial news from Europe is getting increasingly distressing.
A new EU report warns that economic conditions in Portugal and Spain could "result in a high ‘snowball’ effect on the government debt.”
French financial group AXA says "there is a fatal flaw in the system and no clear way out." They are predicting the Eurozone to break in half or completely disintegrate in the next 18 months.
Over 13% of Europe's investors are betting on a Black Monday-style collapse in stock prices (think 1987).
In an article several months ago in the UK's Telegraph, the sovereign credit default swap market made the news. Until now, not that much was made of the sovereign CDSes; in fact, many didn't even realize the existence, and contagion, of such a market.
European policy makers unveiled an unprecedented loan package worth almost $1 trillion and a program of bond purchases as they spearheaded a global drive to stop a sovereign-debt crisis that threatened to shatter confidence in the euro.
Jolted into action by last week’s slide in the currency and soaring bond yields in Portugal and Spain, the 16 euro nations agreed to offer financial assistance worth as much as 750 billion euros ($962 billion) to countries under attack from speculators. The European Central Bank will counter “severe tensions” in “certain” markets by purchasing government and private debt.
So, instead of bailing out banks, this sounds similar to TARP except it is to bail out European countries.
Meanwhile, the Federal Reserve is opening up currency swaps to loan to foreign central banks. From their press release:
Press Release
Federal Reserve Press Release
Release Date: May 9, 2010
For release at 9:15 p.m. EDT
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