The Balkanization of the Debt Markets: Devolution in Uncharted Waters
As we are drafting this commentary, the news is that a deal for the US debt limit is very close to be completed, that will involve the raising of the limit by at least $3 trillion in two phases. It seems that the political theater is approaching its end. Our opinions...Anchoring Optimism in an Era of Anxiety: Reflections on Debt & Financial Stability
As an opening statement allow us to paraphrase David Liss’ claim in his novel A Conspiracy of Paper, where he claims that finance is an animal, and the government needs to decide how big the cage should be. In a few days we will be entering August. The memories of...An Italian Twist in the Eurozone Crisis: Ave Europa Nostra Vera Patria
The old anthem of imperial Europe cried out, “Hail, Europe, our true Fatherland”, and Italy nowadays enters its own phase of the Eurozone crisis. Italian bonds’ spreads over Germany’s Bunds have risen to their highest levels since 2002, as the following graph shows....On Risks, Currencies, and Asset Classes: Mispricing, Imbalances, and Credit Extensions
As of yesterday (July 4th), it seems that the European debt crisis is entering into a new phase, with the expected new downgrades of Greek paper by the major rating agencies, which warned that “selective default” is at hand, due to the terms of the rescue package...Sign Up for Our Publications
