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AND NOW?
14 juin 2012 par Paul Jorion
And now? What are we going to do? Now that Spain has lost access to capital markets for its debt?
True, the downgrading yesterday evening of Spain’s rating by three notches by Moody’s, from an A3 to Baa3 has not helped…
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NOW THE CHAINS ARE GIVING WAY, by François Leclerc
Guest post. Translated from the French by Tim Gupwell
The chorus of voices is becoming increasingly strident and events are moving very fast: the now inevitable Spanish request to benefit from a rescue package; plus the impending recognition of the failure of the second Greek plan, followed by the negotiation of a third…
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THE CHAINS ARE GOING TO GIVE WAY, by François Leclerc
Guest post. Translated from the French by Tim Gupwell
Financiers loathe risk, though they don’t mind so much if it is others bearing it. When they refer to it they juxtapose terms of risk aversion or, its opposite, appetite for risk, but this is only another of their manners of speaking (of which…
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SPAIN IN STORMY WATERS
12 juin 2012 par Paul Jorion
The 10 year rate for Spanish debt has just reached a historic high. On the 25th November of last year, the rate had beaten a record when it reached 6.72%. Yesterday early in the morning, when…
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HOW CREDIT DEFAULT SWAPS WILL HAVE DESTROYED THE EURO
How credit default swaps will have destroyed the Euro
12 juin 2012 par Paul Jorion
And what of the CDS (credit-default swap) speculators who don’t pay taxes? Why don’t we hear anything about them? We hear a lot about the Greeks not paying their taxes, and at…
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THE GOLDEN TOUCH, by François Leclerc
Guest post. Translated from the French by Tim Gupwell and Bernard Bouvet
In spite of the promise of a hundred billion Euros which has been brought to the table, the markets are still not convinced, and it didn’t take them long to react. By late afternoon, Spanish borrowing rates were edging up again,…
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WHEN THE WISE MAN POINTS AT THE MOON… (I), by François Leclerc
Guest post. Translated from the French by Tim Gupwell.
The chaotic ups and downs of the deleveraging process continue inexorably, affecting not only the debt of the member states but also a European banking system which is now in the same mess. What it had been concealing has now been revealed: it is…
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THE RAMIFICATIONS OF THE SPANISH BANKING BAIL-OUT, by François Leclerc
Guest post. Translated from the French by Tim Gupwell.
Some important details are still lacking with regard to the Spanish banking bailout plan: its final amount, which is going to depend on the results of the audit commissioned by the government; its rate, which we will be coming back to; and the stabilizing…
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THE INSURERS WILL NOT BE LEFT UNSCATHED, by François Leclerc
Guest post. Translated from the French by Tim Gupwell.
In the United States, bad news often arrives via the Congressional Budget office (CBO). Reputed for its analyses, this non-partisan Congressional body has just produced a forward-looking report on American debt. According to the CBO, if the tax cuts are renewed and public spending…
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WHEN FATE INTERVENES…, by François Leclerc
Guest post. Translated from the French by Tim Gupwell.
In the blink of an eye, discussions have switched focus. The issue of growth which was at the forefront has rapidly surrendered its place to the elaboration of a plan for the supervision of the banks and the rescue of those in need. Improvisation…
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LE MONDE-ÉCONOMIE, Ordinary scandals, Monday 4 – Tuesday 5 June 2012
My most recent column in the French daily paper Le Monde : Les pigeons de facebook. Translated from the French by Tim Gupwell.
In the book which he dedicated to the 1929 Crash (*), John Kenneth Galbraith, made the remark that if everyone talks frequently of fraud during periods of crisis, it is not…
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APPEAL TO ALL THE PARLIAMENTARIANS WHO ENVISAGE VOTING THE “BALANCED BUDGET RULE”
Translated from the French by Tim Gupwell.
The inept formulation of the financial stability pact, as well as the “balanced budget rule” which is derived from it, require (as I recalled in a recent column for Le Monde-Économie) a nation’s growth rate to be equal or superior to the level of the “average” coupon…
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THE DESTRUCTION OF OUR PLANET IS PROGRAMMED
Translated from the French by Tim Gupwell.
In our capitalist system, the « advances » which are consented to by some, the holders of capital or « capitalists », in order to render a production process possible or to allow a consumer to consume are remunerated by interest payments. In my book Le prix (2010),…
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THE TOWERING MOUNTAIN, SWAYING FROM SIDE TO SIDE, by François Leclerc
Guest post. Translated from the French by Tim Gupwell.
“There is a first assessment, then a second, a third, a fourth…..It’s the worst possible way of doing things because everybody ends up doing the right thing but at the highest possible cost and price”. Who was it speaking so harshly yesterday of…
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SPANISH PIPE DREAMS, by François Leclerc
Guest post. Translated from the French by Tim Gupwell.
A Euro trading this morning at 1.2389 dollars, and sharply rising bond rates, reveal that capital continues to flow out of the Euro zone and that investors are selling Spanish and Italian bonds (both tarred with the same brush) whenever they can. They are…