Free Republic

Transcribed from a speech given by Paul Singer of Elliott Management Investing is an art, more so than a science. And for me, what I get paid for is managing the “dark art,” if you will, of risk management and trying to be a visionary and having a dark vision at all times about what can go wrong. It’s a particularly fruitful and impactful time to be thinking about risk management and the thing I want talk about today is what I’ve described as “The Shape of the Next Crisis.” That doesn’t mean we’re going to be talking about the...

FRANKFURT: Bank lending to private households in the euro area, which has practically dried up in recent months, contracted again last month in face of the region's crippling debt crisis, European Central Bank (ECB) data showed on Wednesday. Eurozone bank loans to the private sector declined by 0.7per cent in October compared with the level in the same period last year after already shrinking by 0.9per cent the previous month, the European Central Bank said in a statement. President Mario Draghi has said that weak lending to the private sector reflected a pessimistic view of eurozone growth prospects and heightened...

Here are a couple of interesting economic links from Italy courtesy of reader Andrea. The translations from Italian are a bit choppy, but the gist of the articles is easily understandable. Non-Performing Loans Jump 15.3%, Write-Downs 21.6% From Thompson Financial News: Non-Performing Loans Jump 15.3% Non-performing loans amounted to approximately 117.6 billion, 1.8 billion more 'than in August and 15.6 billion in more' than in September 2011, marking an annual increase of 15.3%. With regard to loans net of write-downs at the end of September totaled 67.2 billion, about 1.5 billion more 'than a month before and almost 12 billion...

Talks to agree the European Union's budget for next year broke down amid rows involving among member states including Britain – sparking a new funding crisis. Eight hours of negotiations in Brussels ended in walkouts after MEPs refused to drop demands for an extra £13.8 billion in European Union spending for this year and 2013. The failure of the talks casts a fresh doubt on whether a major summit to agree to the EU's future funding from 2014 to 2020, scheduled for later this month, can go ahead. There had already been speculation that the summit would be cancelled because...

Stock markets skidded across the world and investors retreated to safe-haven assets on fears that Europe’s festering crisis has spread to Germany and a bitterly-divided Washington may struggle to avert a fiscal crisis. Mario Draghi, the European Central Bank’s president, warned that Germany is no longer insulated from the slump in southern Europe. "The latest data suggest that these developments are now starting to affect the German economy," he said, triggering an immediate sell-off on Europe’s bourses and pushing the euro down to almost $1.27 against the dollar. Germany’s industrial output dropped 1.8pc in September and orders fell 3.3pc, far...

George Soros has put the matter nicely at the National Association for Business Economics in New York. If the world could somehow persuade Germany to pull out of EMU, Europe’s never-ending crisis "would disappear in thin air". The residual euro would fall to a level that better reflected economic fundamentals in Southern Europe. Competitiveness would largely be restored at a stroke, without the need for debt-deflation. There would be no further risk of large sovereign defaults. Mr Soros said — as he has many times before — that the current course is pushing euroland into a "lasting depression, and...

Vince Cable has warned that Europe could be plunged into war if the crisis in the eurozone results in the collapse of the currency. The Liberal Democrat Business Secretary said that the potential consequences of the failure of the Euro were "incalculable" and that there was "no automatic guarantee" that the continent would not disintegrate into conflict. … Speaking at the Cheltenham Literary Festival, Mr. Cable said: "I think we need to take stock that if the eurozone were to unravel in a way that destroyed the European project—and there is a risk that could happen—the consequences would be absolutely...

The International Monetary Fund has demolished the intellectual foundations of Europe's debt crisis strategy. Drastic fiscal tightening in a string of interlinked countries does two to three times more damage than assumed, especially if there is no offsetting monetary stimulus. Pushed beyond the therapeutic dose, it is self-defeating. At a certain point it becomes pain for pain's sake. The error has long been obvious in Greece. The EU-IMF Troika originally said the economy would rebound quickly, growing 1.1pc in 2011, and 2.1pc in 2012, and on from there to sunlit uplands. In fact, Greek GDP contracted by 4.5pc in 2010,...

Large banks, toast. What about U.S. exports ? I hear this from the talking heads. We must be concerned about our exports ! EEEeek ! If Europe "collapses", we won't be able to sell them our goods and services ! Well, here are our top 15 export clients, according to census.gov: Rank Country Exports (Year-to-Date) Percent of Total Exports --- Total, All Countries 1,480.7 100.0% --- Total, Top 15 Countries 1,061.9 71.7% 1 Canada 280.9 19.0% 2 Mexico 197.5 13.3% 3 China 103.9 7.0% 4 Japan 66.2 4.5% 5 United Kingdom 56.0 3.8% 6 Germany 49.1 3.3% 7 Korea, South...

All of a sudden, the talk is of the breakdown, not just of the single currency, but of the parliamentary system on which it rests. Commentators across Europe fret that Spain, which emerged from dictatorship less than 40 years ago, might give up on multi-party politics. Every round of economic figures is worse than the last. The deficit is massively larger than forecast. A bailout of unprecedented size is becoming inevitable, even as the prime minister gives his countrymen a ‘one hundred per cent assurance’ that he won’t apply for one. (He said much the same thing a few days...

'Two-faced' politicians have opened the door to an EU superstate by giving up on democracy, says Václav Klaus, the veteran Czech statesman. The new push for a European Union federation, complete with its own head of state and army, is the "final phase" of the destruction of democracy and the nation state, the president of the Czech Republic has warned. In an interview with The Sunday Telegraph, Václav Klaus warns that "two-faced" politicians, including the Conservatives, have opened the door to an EU superstate by giving up on democracy, in a flight from accountability and responsibility to their voters. "We...

anyone thought the bad blood between Germany and the rest of the insolvent proletariat, aka the part of the Eurozone which is out of money (most of it), and which has been now confirmed will be supporting Obama (one wonders what the quid for that particular quo is, although we are certain we will find out as soon as December), complete collapse of the Greek neo-vassal state of the globalist agenda notwithstanding, had gone away, here comes former ECB chief economist Juergen Stark to dispel such illusions. In an interview with Austrian Die Presse, the former banker said what everyone...

Wall street is being occupied. Europe is collapsing in on itself. Around the world, people are consumed by fear and anger, and one question is on everyoneÂ’s lips: Is the financial crisis over, or are we headed towards economic disaster? End of the Road is a 55 minute documentary film that chronicles the global financial collapse. Told in an entertaining and easy to follow style, the film tells the story of how the world came to be in such a state, from the seeds sown after WWII, to the current troubles facing us today, and to the possible future that...

So we wait for the Verfassungsgericht to deliver its verdict of life or death for the euro at 10 AM Wednesday, Karlsruhe time. The German constitutional court is not to be trifled with. Its ruling on the Lisbon Treaty in June 2009 was a thunderous defence of German national sovereignty, the greatest legal shock to the European order since the launch of the Project in 1957. The eight judges fired a cannon shot across the bows of Brussels and the European Court, asserting the supremacy of the German Grundgesetz over EU law as a permanent principle. They reminded those with...

German Finance Minister Wolfgang Schaeuble questioned on Tuesday how the United States could deal with its high levels of government debt after November's presidential election.

Even as Greece desperately tries to avoid defaulting on its debt, American companies are preparing for what was once unthinkable: that Greece could soon be forced to leave the euro zone. Bank of America Merrill Lynch has looked into filling trucks with cash and sending them over the Greek border so clients can continue to pay local employees and suppliers in the event money is unavailable. Ford has configured its computer systems so they will be able to immediately handle a new Greek currency. No one knows just how broad the shock waves from a Greek exit would be, but...

Spain said Monday it is urgently injecting 4.5 billion euros ($5.7 billion) into Bankia, a state-rescued lender still losing billions of euros. The state-backed Fund for Orderly Bank Restructuring (FROB) said its governing board had agreed to pump in the capital "with immediate effect" to restore its balance sheet. Bankia lies at the heart of Spain's financial sector crisis, which led to eurozone members agreeing in June to extend a rescue loan to Madrid of up to 100 billion euros. The FROB said it would inject the money by subscribing to a capital increase by Bankia, stressing that the decision...

Even as Greece desperately tries to avoid defaulting on its debt, American companies are preparing for what was once unthinkable: that Greece could soon be forced to leave the euro zone. Bank of America Merrill Lynch has looked into filling trucks with cash and sending them over the Greek border so clients can continue to pay local employees and suppliers in the event money is unavailable. Ford has configured its computer systems so they will be able to immediately handle a new Greek currency. No one knows just how broad the shock waves from a Greek exit would be, but...

French government to rescue mortgage lender CIF France’s government plans to intervene to rescue Credit Immobilier de France after the struggling mortgage lender was hit by a liquidity crisis following a recent downgrade by credit rating agency Moody’s, Le Figaro newspaper reported Saturday. CIF’s board met Friday night and formally demanded government help, the newspaper said, without naming its sources. The lender, which has about 300 branches throughout France, did not return a phone call seeking comment. The government was not available for comment. As a condition of a state guarantee backing the group, the government demanded the resignation of...

Even as Greece desperately tries to avoid defaulting on its debt, American companies are preparing for what was once unthinkable: that Greece could soon be forced to leave the euro zone. Bank of America Merrill Lynch has looked into filling trucks with cash and sending them over the Greek border so clients can continue to pay local employees and suppliers in the event money is unavailable. Ford has configured its computer systems so they will be able to immediately handle a new Greek currency. No one knows just how broad the shock waves from a Greek exit would be, but...