On Central Banking Dogmas: The Euro in a Rear-View Mirror Perspective
In March 1914, the Federal Reserve Bank (Fed) started its operations in the US. Within fifteen years the depression was taking root in the US. Seventy years later, the European Central Bank (ECB) was starting its operations and in a twist of fate, in about ten years...An Alaric Moment for the Euro Zone: Liquidity Concerns in the Times of the New Visigoths
Almost 1600 years ago the first signs of Rome’s demise appeared in the horizon. Around 411 AD the Visigoths under Alaric’s leadership attacked and ravaged the city. Smoking ruins and destructions was left behind. This was not the first sign that the end of the Western...The Athens-Rome Express: Next Stop Paris
Since early July we have posted comments about Italy’s shaky position. In late 2009 the ten-year spread of Greek bonds over the German Bunds was approximately 400 bps. Greek ten-year bonds were yielding about 7%, as the graph below shows. Two years later the spread is...The ECB and the Eurozone Crisis: The Role of a Lender of Last Resort (LLR)
As those lines are being drafted, the ECB announced – under its new leadership – a reduction in its interbank lending rate by 25 bps. The EU and the US markets seemed to like it, in the midst of the Greek political and economic developments. It is widely expected that...Sign Up for Our Publications
