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Draghi Speech: Everything Is Awesome In Europe, No Signs Of Systemic Risks
Draghi Speech: Everything Is Awesome In Europe, No Signs Of Systemic Risks Mario Draghi gave the keynote speech at the Frankfurt European Banking Congress this morning in which he focused on the strong outlook for the Eurozone economy and how his monetary policy is playing a vital role. The speech was peppered with upbeat phrases […]
Is There a Way Out of the ECB’s Trap?
IS THERE ANY WAY OUT OF THE ECB’S TRAP? The ECB faces the Devil’s Alternative that Frederick Forsyth mentioned in one of his books. All options are potentially riskly. Mario Draghi knows that maintaining the so-called stimuli involves more risks than benefits, but also knows that eliminating them could make the eurozone deck of cards collapse. […]
European Banking Crisis
European Banking Crisis There is intense resistance building against the stricter new rules on bad loans among the European banks. This will hit Italy hard and may push off the edge more than one Italian bank. With the elections coming next year in Italy, the banking rules may be the straw that breaks the back. […]
Mind the Junk—-This Ain’t Your Grandfather’s Capitalism
Mind the Junk—-This Ain’t Your Grandfather’s Capitalism The financial system is loaded with anomalies, deformations and mispricings—-outcomes which would never occur on an honest free market. For example, the junk bond yield at just 2% in Europe is now below that of the “risk-free” US treasury bond owing solely to the depredations of the ECB. Indeed, madman Draghi has […]
Is There Any Way Out of the ECB’s Trap?
Is There Any Way Out of the ECB’s Trap? The ECB faces the Devil’s Alternative that Frederick Forsyth mentioned in one of his books. All options are potentially riskly. Mario Draghi knows that maintaining the so-called stimuli involves more risks than benefits, but also knows that eliminating them could make the eurozone deck of cards collapse. Despite […]
What Hayek Tells Us About the Link Between Ultra-Loose Monetary Policy and Political Instability
WHAT HAYEK TELLS US ABOUT THE LINK BETWEEN ULTRA-LOOSE MONETARY POLICY AND POLITICAL INSTABILITY The European Central Bank will increase the overall volume of its bond purchase program to 2.550.000.000.000 euros by September 2018. The main refinancing rate will remain at zero. Mario Draghi has stressed that this policy shall continue until inflation picks up […]
Italy Target2 Imbalance Hits Record €432.5 Billion as Dwindling Trust in Banks Plunges
Italy Target2 Imbalance Hits Record €432.5 Billion as Dwindling Trust in Banks Plunges Contrary to ECB propaganda, Target2 imbalances are a direct result an unsustainable balance of payment system. The imbalances represent both capital flight and debts that can never be paid back. If you think Italy can pay German and other creditors a record […]
The Swiss National Bank Now Owns A Record $88 Billion In US Stocks
The Swiss National Bank Now Owns A Record $88 Billion In US Stocks In the third quarter of 2017, one in which the global economy was supposedly undergoing a unprecedented “coordinated growth spurt”, and in which central banks were preparing to unveil their QE tapering intentions, in the case of the ECB, or raising rates […]
Dear Mario Draghi: About Your Victory Over Deflation Speech in March
Dear Mario Draghi: About Your Victory Over Deflation Speech in March In March, ECB President Mario Draghi declared victory over deflation. Let’s take a look at Eurozone inflation since his victory speech. On March 10, 2017, I reported ECB Declares Victory Over Deflation: Hallelujah! My lead-in comment was “ECB President Mario Draghi Declares Victory Over […]
Germany Also Engages in Political Prosecution
Germany Also Engages in Political Prosecution The Alternative for Germany party (AfD) in Germany has asked the Federal Government to file a lawsuit against all decisions of European Central Bank (ECB) regarding the purchase of government bonds and corporate bonds as well as derivatives since 2015. They are petitioning to file in the European Court of […]
The $2 Trillion Hole: “In 2019, Central Bank Liquidity Finally Turns Negative”
The $2 Trillion Hole: “In 2019, Central Bank Liquidity Finally Turns Negative” In all the euphoria over yesterday’s “dovish taper” by the ECB, markets appear to have forgotten one thing: the great Central Bank liquidity tide, which generated over $2 trillion in central bank purchasing power in 2017 alone – which as Bank of America […]
Europe’s Economic Death Spiral
Europe’s Economic Death Spiral QUESTION: Mr. Armstrong, you said when you were here in Berlin that the EU Commission is about as incompetent as the US Congress. You also said Macron is trying to federalize Europe as the solution Could you elaborate on that comment? ANSWER: The EU Commission at present is composed of 28 Commissioners, […]
Nonsensical Global Worries Over Subdued Inflation: Yellen, Draghi, Kuroda
Nonsensical Global Worries Over Subdued Inflation: Yellen, Draghi, Kuroda Central bank presidents at the Fed, the ECB, and Bank of Japan are all concerned over low inflation. The Fed wants to hike anyway, but the Bank of Japan will keep pursuing aggressive monetary easing. Meanwhile, asset prices are in the biggest ever bubble. Bank of […]
The Upcoming Increase in Interest Rates
THE UPCOMING INCREASE IN INTEREST RATES Last week, both Janet Yellen of the Fed and Mark Carney of the Bank of England prepared financial markets for interest rate increases. The working assumption should be that this was coordinated, and that both the ECB and the Bank of Japan must be considering similar moves. Central banks […]
