Europe Strategy 2010: Impact Of The Greece Crisis
On this week’s podcast, Business Monitor Chief Economist Tim Cooper, Head of Europe Analysis Justin Patrie and Senior Europe Analyst Bruce Jeffery discuss European investment strategy on the back of the Greek fiscal crisis and news of an EU support package for Athens. In addition to providing analysis on the most recent market developments in the Eurozone, panellists give their core views on the long-term macroeconomicand market implications of fiscal austerity programmes and deleveraging. Structural repercussions from the crisis on the Eurozone ‘project’ are also assessed.
February 13th, 2010 at 7:36 pm
Dear Risk Watchdog,
Do you think the sovereign risk crisis could spread beyond the eurozone? You mentioned that once markets are done with punishing the Greek, they will go after the other euro fiscal sinners. What about the UK, or the US for that matter? PIMCO thinks that UK gilts sit on nitroglycerin, and Neil Furgeson recently mentioned in the FT that the UK and the US will be by no means better off in the near future. What’s your position on that?
Thanks!
February 16th, 2010 at 10:07 am
The Economist ran an interesting article this week, detailing the average-weighted years to maturity of OECD sovereign debt. Surprisingly, the UK has by far the highest number: 13.7 years, compared to an OECD average of roughly 6 years. If that’s true, the UK debt markets are under far less pressure than made out by certain commentators!
February 19th, 2010 at 9:22 am
Thank you for the comments. Broadly speaking I am much more concerned about the UK over the US, but at least in the UK’s instance, the depreciation of sterling will help the macroeconomic adjustment – an option not available to eurozone members. As for the US, the debt accumulation is certainly a concern though charted out relative to other developed states, the level of leverage in the US is actually not particularly egregious and certainly nowhere near the problem states of Japan, Italy (and the UK!). Moreover, I think the political momentum to cut the deficit is already showing signs of strength across the country, so the ability of the Americans to engage in fiscal austerity is another positive in their corner. In short, sovereign debt crisis in the US? Unlikely, and certainly not in 2010. The UK might be another story though.
May 7th, 2010 at 3:01 am
Greece and Spain won’t pay back. The only thing Germans can do is:
REPOSES 170 Leopard 2AEX Battle Tanks from Greece, and 190 Leopard 2A6E Battle Tanks from Spain.
U.S.A must REPOSES 170 F-16 Jet Fighters from Greece, the rest is gone with the wind …forever …
Greece must stop paying lucrative pensions with borrowed money, reform the health care system, and cut 4 times the military budged.
December 2nd, 2010 at 7:56 pm
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