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Reply #16: Europe Short on Cash as Bond Fears Deepen [View All]

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xchrom Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 07:16 AM
Response to Reply #13
16. Europe Short on Cash as Bond Fears Deepen,1518,79939...

Josef Ackermann is a busy man this autumn. Hardly a day goes by that the Deutsche Bank chief, despite his impending departure from the bank, doesn't hold a speech on the current financial crisis that has gripped Europe. And more often than not, his talk centers on the immense problems faced by the sovereign bond market. Nobody, it would seem, wants state bonds anymore.

Germany's top banker is not alone with his concern about the problem. The entire financial world is in turmoil this autumn. Once seen as iron-clad investments, state bonds are no longer seen as secure -- particularly since the European Union agreed to a 50 percent debt haircut for Greece in October. It can, warned Andreas Schmidt, president of the Association of German Banks, earlier this week, no longer be taken for granted that countries can turn to the capital markets to finance their budgets.

The truth of Schmidt's statement became readily apparent this week. On Tuesday, Spain auctioned off three-month and six-month bonds, a sale that in normal times would be quick and easy. Interest rates of 3 to 4 percent on such sales are normal. But this week, Madrid had to pay 5.11 percent and 5.23 percent respectively, the highest it has had to pay on such bonds in 14 years -- and up significantly from the 3.30 percent it paid on six-month paper as recently as October 25. Even Greece didn't have to pay as much on a similar offering recently.

And the problem isn't just limited to indebted euro-zone countries. Banks too have run into difficulties as a result of the sudden aversion to sovereign bonds. Most of them, after all, have significant amounts of sovereign bonds on their balance sheets -- making other banks extremely wary of lending to them. Indeed, the European Central Bank said on Tuesday that 178 banks borrowed 247 billion in one-week loans from the ECB -- the most since early 2009 when the last financial crisis was at its peak.
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  -STOCK MARKET WATCH, Wednesday, November 23, 2011 Pale Blue Dot  Nov-23-11 06:06 AM   #0 
  - Millions of reports today  Pale Blue Dot   Nov-23-11 06:07 AM   #1 
  - Duirable-goods orders fall 0.7% in October  Roland99   Nov-23-11 07:35 AM   #21 
  - Personal income up 0.4%, spending 0.1% in October  Roland99   Nov-23-11 07:35 AM   #22 
  - Weekly U.S. jobless claims rise 2,000 to 393,000  Roland99   Nov-23-11 07:35 AM   #23 
  - Four-week claims average falls 3,250 to 394,250  Roland99   Nov-23-11 07:38 AM   #28 
  - Continuing claims rise 68,000 to 3.69 million  Roland99   Nov-23-11 07:39 AM   #29 
  - Core PCE index increases 0.1%  Roland99   Nov-23-11 07:36 AM   #24 
  - PCE price index falls 0.1% last month  Roland99   Nov-23-11 07:36 AM   #25 
  - Core capital goods orders drop 1.8%  Roland99   Nov-23-11 07:38 AM   #26 
  - Orders minus transportation rise 0.7% last month  Roland99   Nov-23-11 07:38 AM   #27 
  - Nov. UMich consumer sentiment 64.1 vs 60.9 Oct.  Roland99   Nov-23-11 08:57 AM   #44 
  - Oil falls below $97 amid weak US economic growth  Pale Blue Dot   Nov-23-11 06:08 AM   #2 
  - Hi!  Tansy_Gold   Nov-23-11 06:09 AM   #3 
  - a wild turkey of a day!  Roland99   Nov-23-11 06:11 AM   #4 
  - Yup. World stocks hit six-week lows. China, Germany hard landing intimations.  Ghost Dog   Nov-23-11 06:12 AM   #7 
  - Mercury retrograde, too  Demeter   Nov-23-11 06:14 AM   #8 
  - Check out the toon!  DemReadingDU   Nov-23-11 07:20 AM   #17 
     - another toon  DemReadingDU   Nov-23-11 07:45 AM   #31 
        - +1  xchrom   Nov-23-11 08:25 AM   #37 
  - Stock futures drop on economy worries, Europe  Pale Blue Dot   Nov-23-11 06:11 AM   #5 
  - Futures pointing much lower  Roland99   Nov-23-11 06:12 AM   #6 
  - That's not "much" in my book.  Tansy_Gold   Nov-23-11 06:40 AM   #10 
     - heh. Well, they're a bit more down after the morning reports  Roland99   Nov-23-11 07:40 AM   #30 
  - Fitch warning of French downgrade  Roland99   Nov-23-11 06:40 AM   #9 
  - German Bund Auction a "complete and utter disaster"  Roland99   Nov-23-11 06:40 AM   #11 
  - morning!  xchrom   Nov-23-11 06:53 AM   #12 
  - europe: Turkish lira on the slide  xchrom   Nov-23-11 06:55 AM   #13 
  - An Irish village says no to the banks  xchrom   Nov-23-11 07:07 AM   #14 
  - Tens of billions of private business debts, transferred to the citizens,  Ghost Dog   Nov-23-11 10:11 AM   #50 
  - Brussels to put bad pupils under tutelage  xchrom   Nov-23-11 07:09 AM   #15 
  - Europe Short on Cash as Bond Fears Deepen  xchrom   Nov-23-11 07:16 AM   #16 
  - Eurozone crisis: "Worst ever" German debt auction sends euro sliding {live}  xchrom   Nov-23-11 07:30 AM   #18 
  - I wish they would put the Euro out of our misery  Demeter   Nov-23-11 08:21 AM   #35 
  - Bank of England calls for less owner occupation. The Treasury wants more  xchrom   Nov-23-11 07:34 AM   #20 
  - European Union unveils euro bond proposals  Roland99   Nov-23-11 07:57 AM   #32 
  - Pressure builds on Rajoy to reveal plans  xchrom   Nov-23-11 08:45 AM   #42 
  - Catalonia to cut public sector wages next year  xchrom   Nov-23-11 08:46 AM   #43 
  - Nokia Siemens to cut 17,000 jobs, 23% of its workforce  xchrom   Nov-23-11 10:23 AM   #56 
  - Eurozone surveys and Chinese factory slowdown add to global economic woes  xchrom   Nov-23-11 07:32 AM   #19 
  - k&r n/t  Hotler   Nov-23-11 08:20 AM   #33 
  - "Nearly Half of Americans Struggling to Stay Afloat"  bread_and_roses   Nov-23-11 08:21 AM   #34 
  - The only question is--what comes to replace it?  Demeter   Nov-23-11 08:24 AM   #36 
  - cities with budget woes sell out to the highest bidder  xchrom   Nov-23-11 08:27 AM   #38 
  - Hold onto your hats folks...might be a rough ride today.  Roland99   Nov-23-11 08:27 AM   #39 
  - JPMorgan Said to Buy MF Global Stake in London Metal Exchange  xchrom   Nov-23-11 08:40 AM   #40 
  - Congressional Panel Seeks to Question Corzine  xchrom   Nov-23-11 08:43 AM   #41 
  - 10:05am - ain't nobody happy  Roland99   Nov-23-11 09:06 AM   #45 
  - I am.  Tansy_Gold   Nov-23-11 09:26 AM   #46 
  - ...  Roland99   Nov-23-11 09:44 AM   #47 
  - I'm with you, Sister (n/t)  bread_and_roses   Nov-23-11 09:57 AM   #48 
  - Me too  Demeter   Nov-23-11 10:06 AM   #49 
  - Re-framing a sad day -  InkAddict   Nov-23-11 05:55 PM   #74 
     - My dear friend, condolences  Demeter   Nov-23-11 06:15 PM   #75 
     - Sorry for your loss.  Hotler   Nov-24-11 08:56 AM   #80 
  - Closing Wall Streets casino David Cay Johnston  Demeter   Nov-23-11 10:12 AM   #51 
  - 11:13am - new daily low. Might bounce soon as Moody's maintains AAA rating for U.S.  Roland99   Nov-23-11 10:14 AM   #52 
  - Moody's Isn't Going to Maintain Anything  Demeter   Nov-23-11 10:19 AM   #55 
  - Five Ways that Financial Elites are Destroying Democracy  Demeter   Nov-23-11 10:17 AM   #53 
  - A PITHY QUOTE  Demeter   Nov-23-11 10:18 AM   #54 
     - I have no hope. I see no future. eom.  Hotler   Nov-23-11 10:40 AM   #59 
     - Recovery not going to happen  DemReadingDU   Nov-23-11 10:47 AM   #60 
  - Immortal Technique on Occupy Wall Street: "Some of You Billionaires Are Going to Have to Go Bankrupt  Demeter   Nov-23-11 10:25 AM   #57 
  - Cyrus Mistry to lead Tata Group  Demeter   Nov-23-11 10:32 AM   #58 
  - A Personal Observation from a 99%er in this Christmas Season of Failure  Demeter   Nov-23-11 11:24 AM   #61 
  - I'm Wishing All the Best Thanksgiving Possible  Demeter   Nov-23-11 11:31 AM   #62 
     - ....  Hotler   Nov-23-11 01:16 PM   #63 
     - and wishing you a good turkey day tomorrow  DemReadingDU   Nov-23-11 01:40 PM   #65 
     - We could do a cross-country drinking tour  Demeter   Nov-23-11 06:17 PM   #76 
     - Indeed!  hamerfan   Nov-23-11 02:41 PM   #66 
  - 90 min. to close and at new daily lows  Roland99   Nov-23-11 01:30 PM   #64 
  - oh, the Thanksgiving Faeries are trying something  Roland99   Nov-23-11 02:47 PM   #67 
  - And they failed. Fell off a cliff at the close!  Roland99   Nov-23-11 03:06 PM   #68 
  - And a Happy Thanksgiving to you all!  Roland99   Nov-23-11 03:07 PM   #69 
  - Is 11,000 the new 12,000?  RUMMYisFROSTED   Nov-23-11 03:10 PM   #70 
  - remember "Dow 36,000"?  alterfurz   Nov-23-11 03:49 PM   #72 
     - This Black Friday you can get it for 12,000.  Fuddnik   Nov-23-11 04:06 PM   #73 
     - hey but "I didn't say WHEN it would hit 36,000"  wordpix   Nov-23-11 09:33 PM   #79 
  - Not only has my Butterball been recalled, it's part of a Muslim plot!  Fuddnik   Nov-23-11 03:32 PM   #71 
     - Are you kidding?  Demeter   Nov-23-11 06:19 PM   #77 
        - It's a Butterball joke.  Fuddnik   Nov-23-11 06:40 PM   #78 

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