In an odd escalation over the Grexit fiasco, where Greece is now expected to provide yet another detailed reform proposal today by midnight at the very latest, it was the one man whose decision will make or break the Eurozone when (if) he decides to impose even more ELA collateral haircuts (or yank ELA entirely) forcing Greece to Grexit by imposing its own currency (since there is no legal mechanism to kick a nation out of the new Berlin Wall) that made
WASHINGTON: The world's financial leaders see a number of threats facing a global economy still on an uneven road to recovery with US and European officials worrying that Greece will default on its debt. The finance ministers and central bank governors ended three days of meetings in Washington determined to work toward ``a more robust, balanced and job-rich economy'' while admitting there are risks in reaching that objective, the steering committee of the International Monetary Fund said in its communique Saturday.
FRANKFURT — The European Central Bank left interest rates unchanged on Thursday, and markets turned their attention to ECB chief Mario Draghi’s news conference for any signs a eurozone recovery will affect the bank’s policy stance.
Abandoning its tradition of never pre-committing on future moves, the ECB said in July it would keep its rates at current or lower levels for an “extended period” — its first use of forward guidance.
European Central Bank (ECB) boss Mario Draghi is currently speaking at the European Parliament, being quizzed by elected members. If you're that way inclined, you can watch the whole thing here. Investors are looking out for new comments on quantitative easing (QE), the health of the eurozone economy, and most importantly, Greece.
The endless Italian bailout story that keeps on giving, has just given some more. It turns out Italy's insolvent Banca dei Monte Paschi, which has been in the headlines for the past month due to its role as political leverage against the frontrunning Bersani bloc, and which has been bailed out openly so many times in the past 4 years we have lost track, and whose cesspool of a balance sheet disclose one after another previously secret derivative deal on an almost daily basis, can now add a previously unannounced bailout by the Bank of Italy to its list of recent historical escapades.
It’s nearly that time again. On the heels of December’s “big disappointment” wherein Mario Draghi cut the depo rate by a “measly” 10 bps and extended PSPP by an underwhelming six months, the ECB meets again next week, and this time around, expectations are low. Despite the fact that markets have descended into outright turmoil, the ECB “is very unlikely to change its QE dynamics or cut the deposit rate at the upcoming meeting,” Barlcays says. “The earliest QE tweak opportunity for the ECB is the March meeting, if at all.”
When it comes to stress tests, especially for European banks, the one thing history suggests is the tests will be essentially stress-free, by design. Why should this time be any different?
Nonetheless, European Central Bank President, Mario Draghi Says ECB Won’t Hesitate to Fail Banks in Stress Tests.
For those of you who do not speak Draghize I offer these translations.
Spanish bank Banco Santander was halted on Thursday, followed by an announcement it would raise capital. When the bank reopened its shares plummeted as much as 14%, with the Spanish stock market down about 4%. Banco Santander passed the last "stress test" so allegedly it had no need to raise capital.With that thought in mind, let's recap the ECB's love affair with stress tests that seldom find much need to raise capital.