This weekend the European Union, again, failed to do anything to alleviate the PIIGS’ problems. Eurocrats continue to put Band-Aids on the problems of potential insolvency of the weakest sovereigns. Even though the official communique left more questions than it answered for investors and European citizens, there were two solid pieces about the why and how of some type of real bailout program. Nouriel Roubini had an insightful piece on Slate, but while economically sound it fails to deal with the political machinations that are in play in Europe. Adding to Merkel’s problems is the fact that her coalition lost a vote in Parliament on an education issue. While it’s not a serious affront to the chancellor’s coalition, it does reflect the serious political winds that are blowing and gathering force in Germany.
Posts Tagged ‘Nouriel Roubini’
Notes From Underground: While Europe Slept…
December 19, 2010Notes From Underground: Chinese announce that they will make YUAN more flexible
June 20, 2010The weekend’s financial news is being dominated by the announcement from the People’s Bank of China, who said it will break the dollar peg and give the Reminbi greater flexibility. The PBC said it would allow greater currency flexibility but will not let the currency move more then 0.5 percent per day in keeping its present bands in place–that is, up or down. Directly from the PBC statement:
“With the Balance of Payments[BOP] accountmoving closer to equilibrium,the basis for large-scale appreciation of the RMB exchange rate does not exist … the People’s Bank of Chinahas decided to proceedfurther with reformof the RMB exchange rate regime and to enhance the RMBexchange rate flexibilty.”