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"With Greece we have reached the
end of the road. There must not be any further aid. A country which does not
have the will to fulfill the conditions, or is not able to do so, must get a
chance outside the euro," Dobrindt told the daily Die Welt.
The CSU has often been more
critical of EU
bailouts than Merkel's party, but his comments
underline the degree of German frustration with Athens over its continued
failure to meet reform targets under its 130 billion euro aid programs.
"Greece should start to pay half
of its civil service wages, pensions and other expenditures in drachmas now,"
Dobrint added. "A soft return to the old currency is better for Greece than a
drastic move. Having the drachma as a parallel currency would allow the chance
for economic growth to develop."
“You got to understand that U.S.
Treasurys are at 1.6, 1.7 (percent), or pick a number on a given day, you’re
getting 5 times the risk-free rate of return for a sovereign which does have
taxing power and does hold hostage the northern European countries,” Scaramucci
told CNBC Asia’s “Squawk Box”
on Monday.
Roubini believes the U.S. economy
will slow further this year and next as expectations of the “fiscal cliff” keep
spending and growth lower — and uncertainty about the outcome of the
presidential election dogs markets.
The
fiscal cliff could knock 4.5 percent off 2013 growth
if all tax cuts and transfer payments were allowed to expire and spending cuts
where triggered, according to Roubini.
“Of course, the drag will be much
smaller, as tax increases and spending cuts will be much milder. But, even if
the fiscal cliff turns out to be a mild growth bump — a mere 0.5 percent of GDP
— and annual growth at the end of the year is just 1.5 percent, as seems likely,
the fiscal drag will suffice to slow the economy to stall speed: a growth rate
of barely 1 percent,” he wrote.
The
U.S. consumer, which drives plenty of the global
economy as well as the U.S., will not be able to keep spending when $1.4 billion
worth of tax cuts and extended transfer payments come to an end according to
Roubini.
“In 2013, as transfer payments are
phased out, however gradually, and as some tax cuts are allowed to expire,
disposable income growth and consumption growth will slow. The U.S. will then
face not only the direct effects of a fiscal drag, but also its indirect effect
on private spending,” he wrote.
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| 12822.57 | 12540.0 | -233.00 | 12764.57 | 12540.0 | -224.57 | ||
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| FUTURES | FUTURES FAIR VALUE (-0.34) | ||||||
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| 1362.66 | 1336.5 | -21.70 | 1357.86 | 1336.5 | -21.36 | ||
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| 2618.04 | 2552.75 | -60.50 | 2611.94 | 2552.75 | -59.19 | ||
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Advertisement
The problems in the euro zone, a
slowdown in
China and emerging markets, added to the chance that
oil prices could be driven higher by tensions over Iran’s nuclear program, will
also add to America’s economic woes, Roubini argued.
He does not advise clients to put
all their money into Spanish debt but says that it is a “very interesting play”
over the longer term because he believed that it is a matter of time before the
euro zone nations agreed to combine their debt and underwrite risks across the
region.
If GDP continues to be disappointing, then fiscal revenues could be lower than expected - which would limit Spain's ability to repay creditors if it has to take a bailout from the troika of the International Monetary Fund (IMF - for an explanation click here), European Central Bank (ECB - for an explanation click here) and European Commission
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1 comment:
Very long and narrow list of letters and numbers. Do not forget about some of the broader indexes.
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