The inflation rate in September in the Euro Zone was 3%. That was the highest rate since October, 2008, well above the target rate of just below 2%. The ECB won’t be able to lower the interest rate because of… Continue Reading →

If the EU requires all member banks to recapitalize all at once it could create a credit crunch. Everyone would be looking for money that didn’t exist. There would be no lending available for anyone else. The same thing would… Continue Reading →

Today Slovakia approved the expansion of the EU bailout fund. It was the last holdout among the 17 nations to agree to it. Yesterday it seemed to be stalling or even refusing to approve of it. And even one nation… Continue Reading →

It’s always the East — the Balkans or Eastern Europe. It caused World War I. Now it’s causing the collapse of the plan to save the Euro Zone and the euro. Slovakia has voted against the expansion of the bailout… Continue Reading →

Dexia’s collapse is like Lehmann Brothers. It’s starting a domino effect in France, Belgium, Luxembourg, Greece, and even Austria. Other banks are now showing signs of extreme stress. The Erste Group issued surprising profit warnings because of its exposure to… Continue Reading →

The French and Germans can’t agree on measures to make up a comprehensive package to deal with the euro Zone crisis. The Germans want a hierarchy of measures: 1)banks dealing with it themselves 2)national governments dealing with their own banks… Continue Reading →

Dexia Bank had such vast holdings, that trying to back it up may damage the credit ratings of France and Belgium. Dexia held much sovereign debt from Greece, Italy, and Spain. If France and Belgium don’t guarantee those holdings, there… Continue Reading →

The Euro governments looked for a way to restore confidence in Europe’s banks. Fitch downgraded Spain to AA- and Italy to A+. On Friday Moody’s placed Belgium’s AA1 rating under review because of the governments high debts. After the Dexia… Continue Reading →

The Bank of England continued to buy British bonds, which is the same as printing money. The ECB extended loans to European banks in the Euro Zone in a crisis that everybody thinks mimicks the 1930’s. Germans are suspicious of… Continue Reading →

Angela Merkel has proposed that European countries in the Euro Zone should agree on a system of back stops for banks. Countries should announce what they are willing to do now. They should also plan on drawing on the Euro… Continue Reading →