Guardian: Reports how the delay in power transfer between the out going Socialist Government of Spain and the incoming Conservative Party is damaging Spain on the bond market. The New Government the article states will have to do “ ..further massive spending cuts or tax hikes.. ”. The Spanish bond is close enough to 7% mark for the EU to have backup plans to rescue Spain, thus far we have seen Governments fall due to the Euro in Ireland, Greece, Italy, in Greece we have a technocrat in charge, but the main Opposition Party is refusing to play ball, it wont sign an agreement with the EU to fallow through with its austerity package. In Italy the PM and the Cabinet is full of technocrats, the new PM has stated that he expects to last in till the planned election of 2013 as to follow through with his austerity package. It wont happens folks, former PM Silvio Berlusconi is making noises of a comeback, thus the Government of Greece and Italy are on political life support but they don’t know it, they don’t have years, months if they are lucky, to push through tough austerity packages, to deal with the mass protests, then for the Parliaments to pull the plug on them, the Greek people might want to be in the Euro, but if they wont pay the taxes something has to give, if the austerity package is either stalled or slowed down by the Greek system then the EU will have to throw Greece out of the Euro, Italy is 50/50 folks. Expect more ups and downs on the markets folks, will be interesting to see the Asian Markets after the failure of the Super Committee in the US.
Monday, November 21, 2011
The Spanish Election and the EURO
Guardian: Reports how the delay in power transfer between the out going Socialist Government of Spain and the incoming Conservative Party is damaging Spain on the bond market. The New Government the article states will have to do “ ..further massive spending cuts or tax hikes.. ”. The Spanish bond is close enough to 7% mark for the EU to have backup plans to rescue Spain, thus far we have seen Governments fall due to the Euro in Ireland, Greece, Italy, in Greece we have a technocrat in charge, but the main Opposition Party is refusing to play ball, it wont sign an agreement with the EU to fallow through with its austerity package. In Italy the PM and the Cabinet is full of technocrats, the new PM has stated that he expects to last in till the planned election of 2013 as to follow through with his austerity package. It wont happens folks, former PM Silvio Berlusconi is making noises of a comeback, thus the Government of Greece and Italy are on political life support but they don’t know it, they don’t have years, months if they are lucky, to push through tough austerity packages, to deal with the mass protests, then for the Parliaments to pull the plug on them, the Greek people might want to be in the Euro, but if they wont pay the taxes something has to give, if the austerity package is either stalled or slowed down by the Greek system then the EU will have to throw Greece out of the Euro, Italy is 50/50 folks. Expect more ups and downs on the markets folks, will be interesting to see the Asian Markets after the failure of the Super Committee in the US.
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