Friday 18 November 2011
Can the Euro make Christmas?
As always lets review the day's news:
1. Spain and Italy bonds under 7% only due to ECB bond buying
2. ECB Finance chief points out that Germany has 82% Debt to GDP ration and is not safe
3. Reports that Japanese investors are liquidating Euro assets
4. Rumours in the City that Germany is preparing to exit the Euro
5. Realisation that Germany's funding commitments total nearly e500 billion and could sink the Country.
6. Cameron and Merkel meeting so that he can tell her the Financial Tobin tax is off.
So, another typical day in the Eurozone with each point being worthy of a crisis and yet this is just today's news. With no real plan the EFSF forgotten about already and continuing riots in the the new Authoritarian states of Italy and Spain, the clock ticks closer to midnight.
The worst issue is that the failure to grasp the nettle and move to a two speed euro or a managed set of defaults is going to make the end of the crisis even worse. Yesterday a senior Fund Manager at a major US institution remarked to me: 'It's all over and this is going to make 2008 look like a picnic.'
Oddly, the more people tell me that the more I think something will turn up - the general view is often wrong - but what that might be I can't see.