Death Star Economics



Spanish yields up, all else down



Throughout the week people will theorize and hypothesize over the US Q2 GDP figures that come out on Friday. A Dow Jones survey shows that economists expect 1.2% GDP growth between April and June, down 0.7% from Q1, which would make it the slowest quarterly growth rate since Q1 2011. The FT reports an estimate of 1.5%.

The UK’s GDP data will be published on Wednesday, potentially showing a 0.2% contraction and therefore no change from Q1.

Meanwhile, the secretary general of the German CSU (sister party of Merkel’s CDU) said half of all Greek wages and pensions payments should be paid in drachma to induce the Grexit – a generally pretty useless statement. Thanks. read article

But that’s not the only thing that brings Greece back onto the scene. Assessments from the troika say it’s far from certain that Greece will be able to fulfil its bailout conditions and service repayments. On August 20, €3.1bn Greek debt mature, exactly that chunk that made everyone queasy in March. Fortunately, most of that pile is held by the ECB… you know the drill.

Spanish 10-year bond yields grew to 7.3% on Friday and are sitting at 7.56% now. Argh. This brings us back to talking about Spain as the last domino before the eurozone finally officially crumbles. Over the weekend, Jose Manuel Garcia Margallo, Spanish Foreign Minister, argued that the euro needed life-support from the ECB now. Although it is unclear how much he intended to respond to the statement, Mario Draghi said in an interview on Saturday

“Our mandate isn’t to solve the financial problems of states, but to ensure price stability and contribute to the stability of the financial system quite independently.”

And as though that wasn’t enough, an official of the Chinese central bank claimed that Q3 GDP may be up to 0.4% below the estimate of 7.8%, leading Japan, its main trade partner, to cut China’s economic outlook.

Virtually all other news regard the expected breakdown of all infrastructure in London due to the Olympics.

So long.



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One Response

  1. princess1960 says:

    thank you finely i finish reading after 1h ..
    US growth is better than EU
    GR is not now in Great Depression .but is ready 1 -2 year so IFSamaras saw now this is bad ..he did not have any idea what happining in him country.
    nothing will change if the GV dont take all the ”metra” for rethmisis in all the mechanisme to this satate ..I THINK NEEDED RADICAL CHANGE tax system .PUBLIC SECTOR constutition too ..AND GR never will find all this money ..this is sure .
    M DRAGhi is not honest with the EUZ (is not safe) have very very big problem and you know that..
    CHINA is in inflation and problem with export ..(is natyral) because of EU problem
    SP can make recapitalise her banks’ but what will happining with IT ? so EU have to find solution ?(she can not) ..SO ALL THIS MAKE ME FEEL MUCH MUCH BETTER we are a good company …(lol)
    so long too again thank you

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