EU

Greece A Result Of A Greedy Goldman? Nahhhh…

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Back in 2001, Greece had a problem.  The struggling country’s debt levels were simply too high to qualify for admittance to the European Union.  While these regulations were in place to protect the structure of the European economy, Goldman Sachs was more than willing to step in with a timely loan which provided the necessary liquidity to hide the nation’s accumulated debt load.  Essentially a perfect solution for both Greece and Goldman, here is the situation illustrated by Bloomberg: “The Goldman Sachs transaction swapped debt issued by Greece in dollars and yen for euros using an historical exchange rate, a mechanism … Read more

Paulson Calling For A Greek Default

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According to Paulson & Co., a hard default by Greece could spell economic disaster of unprecedented proportion along with the breakup of the Euro.  In his 2011 recap letter to clients, he estimates $117 billion will be needed to recapitalize banks and satisfy other monetary needs. Paulson & Co.: “We believe a Greek payment default could be a greater shock to the system than Lehman’s failure, immediately causing global economies to contract and markets to decline,” the hedge fund said in the letter, a copy of which was obtained by Bloomberg News. The euro is “structurally flawed and will likely eventually … Read more

‘s Purchase of Motorola Cleared by EU

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Looks like one more hurdle is out of the way for Google to challenge Apple in the wireless world.  The European Union allowed the deal to pass, but warned against excessive fees charged for licensing technology.  The addition of Motorola’s portfolio of patents would provide the search engine giant a strong defense against infringement claims on its Android operating system. From WSJ: “The European Union on Monday approved Google Inc.’s $12.5 billion acquisition of smartphone and tablet developer Motorola Mobility Holdings Inc., setting the stage for U.S. antitrust clearance expected this week.  The deal will give Google a powerful arsenal … Read more

Greece: 20% Cut in Minimum Wage and 15,000 Public Sector Jobs Lost? Ouch..

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Prime Minister Papademos, Finance Minister Venizelos, and Greek Bank Governor Provopoulos are expected to sign a draft agreement to secure a $172 billion dollar rescue plan desperately needed by the insolvent country.  However a couple of stipulations in the document are sure to create backlash, specifically the large cut to the minimum wage and the loss of 15,000 public sector jobs. From Businessweek: Greece will pledge permanent spending cuts, including lower pension payments and a 20 percent reduction in the minimum wage, as the economy contracts this year at a faster pace than originally estimated, according to the draft of … Read more

Like Herding Cats? Try Trading Oil

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Today’s rampant fluctuation in oil was a perfect example of how much political and headline risk from Iran surround the markets.  While nothing fundamental has changed from our initial assessment of the Iran situation seen here, all it took was Iran reiterating they are pissed and the IEA emphasizing to the EU that reserves exist for a reason. NEW YORK—Iran’s threat to immediately halt oil sales to the European Union pushed prices above $101 a barrel, but crude retreated after the International Energy Agency later said it could release strategic inventories if a supply emergency occurred.  Light, sweet crude oil for … Read more

France Said to Seek Faster Start to EU Iran Oil Embargo

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Oil markets see a bit of a boost from France’s push toward cutting the grace period before implementing a ban on Iranian crude in half, breaking a 4 day loosing streak. Jan. 17 (Bloomberg) — France is pushing for faster enforcement of the European Union’s proposed ban on oil imports from Iran, two officials with knowledge of the matter said. France wants the embargo to be delayed by no more than three months to allow nations including Greece, Italy and Spain to find alternative supplies, according to a French government official, who declined to be identified, citing state rules. While … Read more

‘s Left With The Bill for the Eurozone Bail-out

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The latest chapter in Europe’s never-ending sovereign debt crisis comes about a year after Greece received a 110 billion euro ($158 billion) bailout package from the EU and IMF. That bailout was supposed to buy time for Greece to adopt austerity measures without having to tap the public debt markets. Lets take a look at exactly where funding is coming from for the various PIIGs bailouts. The total €865 billion ($1.2 trillion) pot available for euro-area rescues is rather enormous. (Whether it will be sufficient to cope with Greece, Ireland and Portugal’s needs is yet to be determined). The sources … Read more