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Originally posted by Cyanhide
reply to post by Vitchilo
So if I wanted to see the real state of the economy, what should I look at ? I'm spending allot of time on zerohedge.
A collapse of the euro and break-up of the European Union would have catastrophic consequences for the global financial system, billionaire investor George Soros was quoted as saying.
"Today, the euro is potentially endangering the political cohesion of the European Union," the Business Line newspaper cited Soros as saying in the south Indian city of Hyderabad.
"If the common currency were to break down, it will lead to the break up of the European Union itself. And this will be catastrophic not only for Europe but also for the global financial system."
The euro zone crisis is "more serious and more threatening than the crash of 2008," the Economic Times reported, quoting Soros.
In the near term, some of the euro zone countries may have to take more austerity measures because of the imbalances between the "creditor and the debtor countries," Soros said at a business school event, the Mint newspaper reported.
"Unfortunately, they haven't yet solved the acute financial crisis and that is causing the situation to deteriorate...and (it) is not at all clear it will have a solution," he said.
Italian and Spanish government bonds were under pressure Friday, pushing up yields as both countries prepared to auction debt next week in a key test of market confidence. The yield on 10-year Italian government bonds rose back above the 7% level to trade at 7.11%, a rise of 16 basis points. Borrowing costs above 7% are widely seen as unsustainable over the long run. Spain's 10-year bond yield rose by around 5 basis points to 5.63%. A basis point is a hundredth of a percentage point.
The US economy created 200,000 jobs in December, marking the sixth month in a row of gains, official figures show.
The rise was much more than expected. Analysts had forecast an increase of about 150,000 jobs.
The unemployment rate dropped to 8.5%, which was the lowest level in nearly three years, from a revised 8.7% in November, the Labor Department said.
Nearly 250,000 state and local government employees lost their jobs in 2011, with the ax falling particularly hard on public school teachers.
And the bleeding is likely to continue in 2012, experts say.
These numbers stand in stark contrast to the private sector, which gained 1.6 million. The December unemployment rate fell to 8.5% after the economy added 200,000 jobs, the Labor Department reported Friday.
Things were not as rosy in the public sector. Some 181,000 local workers and 63,000 of their state peers were let go last year as the economic downturn continued to wreak havoc on government budgets. Teachers accounted for 113,000 of those losses.
Germany sold 3.9 billion euros of six-month Bubills on Monday at a yield of -0.0122 percent, the first auction with a negative yield.
Bundesbank data showed the auction drew bids for 1.8 times the amount on offer, compared with 3.8 times at the previous auction in December.
Hungary’s currency and assets will remain volatile as the country’s officials prepare for meetings with the International Monetary Fund and the European Union in the coming two weeks to launch talks about a potential credit line for the EU country.
Steps to be settled in the new week follow officials late last week seeking to cool fears that the government in Budapest was steering away from democratic norms and putting IMF support at risk.
On Friday, Fitch ratings agency joined Moody’s and Standard & Poor’s in downgrading Hungary’s debt to junk status, but the move was offset by the government’s promise to compromise on terms for a potential IMF deal and the country’s bonds firmed...
Any objections to Hungary’s revised central bank law are political rather than professional, Prime Minister Viktor Orban said in an interview with state news agency MTI published Sunday. The law–widely criticized because of its structural revisions allowing for bigger influence on monetary policy–is fully in line with European Union laws, and there hasn’t been a single professional argument stating otherwise, Orban said.
Believe it or not, you now have to pay for the privilege of lending to the German government, on six-month funds at least. Berlin managed to sell €3.9bn of bonds yesterday on a yield of minus 0.0122pc.
So scared are eurozone investors of capital destruction that they would rather lose out to inflation than the perceived greater risk of anything else.
The same goes for the banking sector, which according to the latest data has a record €464bn of money on overnight deposit with the European Central Bank. These are funds which otherwise banks would be lending to each other.
Some investors are prepared to pay when lending to the most creditworthy governments in exchange for the assurance of getting their capital returned as a solution to the euro-region debt crisis, which forced Greece, Ireland and Portugal to seek bailouts, eludes policy makers. Yields on three-month U.S. Treasury bills fell below zero for the first time in December 2008 after the collapse of Lehman Brothers Holdings Inc.
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“It just underpins how nervous the overall market is,” said David Schnautz, a fixed-income strategist at Commerzbank AG in London. “There are investors out there who really worry about the return of their money. That's why they are OK donating some of their money to Germany, just to make sure they get it back.”
Originally posted by marg6043
US government is the biggest employer in the nation, if they get to do what they want to do to the military and government employees Obama's election will be in jeopardy.
Originally posted by thoughtsfull
reply to post by surrealist
Wow, thanks for the clarification, that really demonstrates for me how close we are to the cliff edge edge again.
It just leave that one question in my mind, how long can this last?
Both Spain and Italy are due to hold bond auctions this week as they struggle to raise funds in the open markets. The cost of borrowing for Italy remains above 7pc – a level that is considered to be unsustainable by economists although the current EU bailout fund is not big enough to save that country because of its size.