Frases sueltas

- Is the European Central Bank, or maybe the whole EU, a good candidate for a Darwin Award? There doesn't seem to be a category for institutions that bring about their own demise through their own self-destructive behaviour, but perhaps there should be. In the very long run we should perhaps be thankful for dysfunctional systems' destroying themselves. But in the short run they tend to take a lot of other people and institutions down with them. Nick Rowe en darwin-awards-and-other-random-thoughts-on-the-euro

- Over the past 18 months, Germany has tried every trick to limit its contribution to the euro bailouts. It has pushed self-defeating austerity onto bankrupt countries. It has called in the International Monetary Fund. It has tried to pass the hat to China. It has discovered an improbable and futile taste for leveraging up the European Financial Stability Facility. But now these tricks have uniformly failed, and the continent approaches the abyss – with Germany itself suffering the humiliation of a failed bond auction. It is time for Germany to decide once and for all: how much will it pay to save Europe? Sebastian Mallabi en FT Germany is the real winner in a transfer union.

- Spain Will Be Forced to Restructure Its Debt; 

Is the Incoming Government a Game Changer?

Further, the size of the government’s overwhelming mandate for change should not disguise the extent of the challenge posed by Spain’s worsening domestic economic climate and the EZ crisis contagion. The muted market reaction in the days following the election showed that—in line with our view—markets remain skeptical over the capacity of Rajoy’s new government, however effectively it performs, to lead Spain through the debt crisis without having to request external financial assistance. We think that the incoming government, despite its commitment to fiscal austerity and economic reforms, will be able to do little to turn things around in the short term for the fourth-largest EZ economy. Rather, Spain’s fate will be determined by decisions made in Brussels (or Berlin, for that matter). The apparent inability of EZ policy makers to tackle the debt crisis with a comprehensive approach hence bodes extremely ill for Spain staying afloat without external financial assistance. In our view, it is very unlikely that policy makers will come up with a credible backstop for EZ debt or that the ECB will step up to the plate, and hence we view a Spanish debt restructuring, as early as 2013, as the most likely outcome. en Roubini Global Economics, LLC.