Reuters - European stocks are slated for another fall on Friday after Asian stocks slumped on growing fears the U.S. economy was sliding into recession and as some European lenders faced short-term funding strains, raising fears of a systemic banking crisis on the continent.
European and Asian shares rose again and S&P futures were little changed, as world stocks were set for a weekly gain and held near 16-month highs on Friday, while the euro steadied after swings following the European Central Bank’s decision to extend its stimulus program. Oil rose a second day before a meeting between OPEC and other major producers on output cuts, industrial metals gain.
TOKYO: Asian stocks and oil fell on Monday after Wall Street suffered another bruising blow as deepening concerns over the slowing Chinese economy continued to unnerve global equity markets. The safe-haven yen rallied and key government bonds were bought from the widespread unrest in the financial markets, set in motion nearly two weeks ago when China devalued its currency and generated fears about the state of its economy.
A minor adverse shock to financial markets can be propagated by liquidity strains, leading to a major crisis. This column suggests a novel measure to address systemic liquidity risk – a Macroprudential Liquidity Buffer, which would require financial institutions to hold systemically liquid assets in proportion to their liabilities less regulatory capital. This proportion varies positively with growth in system-wide funding needs, so the liquidity buffer increases when non-equity funding is growing.
The IMF 2009 country report on Canada discusses there current economic condition. As part of that they explore the success Canada had in regulating their banking sector (which stands in stark contract to the catastrophic regulatory failures in the USA and Europe). And also provide ample evidence of that wise regulation did indeed prevent the financial crisis.
The Dow Jones Industrial Average (DJIA) tumbled more than 300 points or 1.9% on Thursday, however gold prices lost 100 basis points (bps) despite the market slow down. Moreover, the SPDR S&P 500 ETF Trust (SPY) also dropped by nearly 2%. Prices have shown a mixed trend since the start of the year, influenced by the instability in the Middle East and Ukraine as well as the recovery in the US economy, especially employment data.
ATHENS – Political resistance and potential court challenges are among “very large” risks to reforms required for Greece’s bailout program, the country’s European lenders said on Monday.
The long-awaited report from the European Commission and the European Central Bank details the findings of the “troika” of the EC, ECB and the International Monetary Fund on Athens’ efforts to meet targets under its 130-billion-euro (US$170-billion) bailout.