EUR

djellal
my response to ur commen o ffrench gvt passing pension law reform during WC

after period of convergence in monetary policy by central banks in order to geostrategically poistion its forces in the next decades, govt ahve planned austerity measure, i dont really like the term but i deal with it. Technically from an econmic point of view this period is here to restore the capabilities to borrow on the intermarket in a few years time; thats the principle of economics, a capacity to borrow.
this measures are here as for other opinion to counter the mood of notation agency and to restore confidence in credit market. BUT there is a but; the overall market condition are not present any more to restore confidence and ecb knows it ; they will inject massive liquidity in the system by the third quarter of this year. Europe is in deep structural problem. Continental Europe is like a haven in a stable universe composed of cold gas and particles whom moves are calculated but when it comes to an open spaces and this open spaces encounter instabilities the side effect on the so called system that is europe get affected and create instability which is difficult to resolve due to unknown components. i said earlier on the forum under this thread or another one that "the plan is simple; the instability is complex". well this is what is coming in europe; we are at the tip of the iceberg and the structural problem if not contained will lead to confidence crisis and frozen of circulatiing money.
on any case i disagree with the measures taken and the imf style decision making because on any case we loose our triple A rating
BUT it doesnot mean that france will lose its ability to borrow on the international market: other nations in order to protect their last year and half investment will buy french oat auction at discounted rate.
The overall is a problem that reside in the effective pricing of the euro and thus oat not bund, even if the latest will be affected but later than the oat; it will need its futures to be disrupted.
ALL comes from actual imbalances in payment account between USA and asia and that affect all the rst of the world economy

the model look simple
the instability is complex

Europe 'Unlikely' To Have Double-Dip Recession

BRUSSELS -- The European Union and the euro zone aren't very likely to slip into a double-dip recession, and will instead experience several years of "modest, uneven" growth," European Central Bank Governing Council member Guy Quaden said Wednesday.

Quaden, who was due to step down on August 5 as head of the National Bank of Belgium, said he will stay at least until the formation of a new government, following Sunday's inconclusive Belgian elections. Talks, taking place mainly between Flemish nationalist and French-speaking socialists, could take weeks and go well past August 5.

"I will continue to be in this position until a government is formed," Quaden said.

He called on the political parties to quickly form a governing coalition and said there shouldn't be major elections for another four years to allow the government to make longer-term plans.

"It would not be positive if it were to take too much time," Quaden said.

Quaden said the ECB is determined to withdraw liquidity from the market caused by its purchases of euro-zone government debt, mainly due to German fears about inflation.

"It is a fear I think of some people in Europe and more particularly in Germany," he said.

"The fear is that inflation one day will rise again," he added.

Euro Rally Stumbles As Nerves Resurface

By Katie Martin
Of DOW JONES NEWSWIRES


LONDON -- The uneasy rally in the euro and other risk-sensitive currencies faltered in European hours Wednesday, as euro-area bond markets showed new signs of stress and concerns built over fiscal strains in Spain.

As the head of the International Monetary Fund prepares to meet the Spanish prime minister Friday, nerves are frayed. The gap in yields between 10-year Spanish and German government bonds hit the widest level since the single currency was introduced, at 2.235 percentage points, as investors headed for safety.

Spanish officials deny the IMF visit is connected to persistent speculation that the country may seek financial assistance soon. Resulting nerves in the financial markets, which are so far modest, may therefore prove to be a blip.

The dollar, which is viewed as a safe haven in troubled times, climbed against the euro and sterling in early European trading hours Wednesday, and nervous market participants suspect that the buoyant sentiment in global markets over recent days may be about to evaporate.

"Yesterday, equities and the euro rallied despite the volatile environment in the bond markets. Now that seems to be fading, and the only real surprise is how far the euro climbed," said Ian Stannard, a currencies analyst at French bank BNP Paribas in London.

"The euro is once again a clear sell," he added.

The daily pivot point is at 1.2283. Looks like it might hole. R1 would be at 1.2398. I have the TP for my longs there, SL at 1.2269