Eurozone

Stock Market Today Will Move on GDP Numbers and Eurozone QE Talk

Stock Market Today

Stock market today, August 28, 2014: This morning, the U.S. Commerce Department revised second-quarter GDP upward to 4.2% growth, while jobless claims slipped to 298,000 for last week.
Last week, European Central Bank President Mario Draghi affirmed his commitments to Eurozone QE. Despite the optimism, many analysts remain divided on whether the ECB will act as soon as next week or wait until some point in the fall.

Here’s what you should know to make your Wednesday profitable…

YHOO, JPM, and GS Earnings Top Today's Wall Street News

Wall Street News

Wall Street news today, July 15, 2014: U.S. markets rallied on Monday as concerns over European debt subsided and investors took a more optimistic stance on second-quarter profit season. The financial sector led the charge ahead of their earnings this week. Today's futures were mixed as the markets prepare for Federal Reserve Chair Janet Yellen's semiannual testimony before Congress.

Investors will also keep a close eye today on earnings reports from Yahoo! Inc. (Nasdaq: YHOO) and Goldman Sachs Group Inc. (NYSE: GS), among others.

Here’s what you should know to make your Tuesday profitable:

Stock Market News: DJIA Hits Another Record, BAC, JPM, and GS Lead Financial Sector

stock market today

Stock Market News, July 14, 2014: U.S. markets rallied on Monday as concerns over European debt subsided and investors took a more optimistic stance on second-quarter profit season. The financial sector led the charge ahead of their earnings this week. Bank of America Corp. (NYSE: BAC), JPMorgan Chase & Co. (NYSE: JPM), and Goldman Sachs Group Inc. (NYSE: GS) were all up more than 1% on the day.

Here are the top stock market news stories of the day:

Here's Why Gold Stocks Are on the Rise – Plus Three Picks That Will Benefit

gold price

Gold stocks are poised for an upswing.

Just recently, the European Central Bank (ECB) announced a new policy to promote lending and, ultimately, inflation in the Eurozone. The move sent investors flocking to precious metals like gold and silver. And a recent election in April saw the seating of a new government in India. On account of the platforms of these new leaders, the Indian press has indicated to expect a considerable decrease in import duties.

With the upward pressure on gold prices, here are three gold stocks that can benefit from a potential price spike...

These U.S. Natural Gas Stocks Are Critical to the EU's New "Master Plan"

natural gas stocks

The ongoing civil war in eastern Ukraine, along with the corresponding crisis between Kiev and Moscow, means that Russian gas supplies to the EU could be cut off again come September.

In 2009, the last time Russia said nyet to European natural gas deliveries, the continent barely survived one of the coldest winters in years. This time around, Europe's savior could be U.S. liquefied natural gas (LNG) exports.

And that's good news indeed for these natural gas stocks...

Eurozone Risks Don't Rule Out These Solid Income Opportunities

Europe has a bigger combined economy than the US and we've been economic partners for decades. If things don't turnaround in Europe, the US revival will certainly falter.
Our chief investment strategist, Keith Fitz-Gerald, just got back from "across the pond" and answered some questions about the risks and opportunities unfolding in Europe right now.
He also brought back some great inflation-beating, solid income stocks...

Eurozone Debt Crisis: Now It's a Hopeless Game of Whac-a-Mole

wackamolehome

The Eurozone debt crisis that was supposed to have blown over long ago instead has become more like an endless game of Whac-a-Mole, with both new and old problems popping up faster than European leaders can bop them.

As Europe's finance ministers gathered in Dublin today (Friday), they faced at least half a dozen major issues threatening the fiscal health of the Eurozone.

Although Europe's leaders, in concert with the International Monetary Fund (IMF), have succeeded in keeping a lid on each successive crisis over the past three years, that streak can't survive in the face of the new and old fiscal woes that have been peppering the Eurozone.

U.S. investors can't let those past successes deceive them into thinking the Eurozone is no longer a worry.

When the Eurozone debt crisis finally implodes - and sooner or later, it has to - it will hammer stock markets around the globe.

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The Eurozone Hangs On By a Whisker

Four days after the Italian elections, only one thing is really clear: A majority of Italian voters have rejected austerity.
The problem is, their victory came up short by the slimmest of margins.
0.36%.
That's the difference between a firm new government that could move Italy out of the Eurozone and the constitutional logjam Italian voters woke up to the next day.
Here’s why that's likely bad news for us all...

Berlusconi is Back, and So Is the Eurozone Debt Crisis

Since the beginning of the year, the markets have been behaving as if the Eurozone debt crisis has been magically solved.
Yields on Spanish and Italian debt are trading more than 1% lower than at their peak, while world stock markets have soared close to all-time highs.
Unfortunately, you can expect that all of this euphoria will fade when the Italian elections take place on February 23 and 24.
The reason is summed up in two words: Silvio Berlusconi.

2013 Eurozone Forecast: Why A Eurozone Breakup Is Now More Likely Than Ever

To the complete shock of several analysts, the Eurozone managed to make it through 2012 without breaking up. However, 2013 is another story.

Now that Italy's Prime Minister Mario Monti has resigned, there's a good chance that Italy will be in the forefront of a new Eurozone crisis.

That means 2013 doesn't look to be a good year for the euro, either-especially with new Italian elections likely to take place in February.

Of course, the EU establishment hopes that Monti can remain in office, but with four very different candidates now jockeying for position, Italy is one of the continent's great question marks.

Here's why...

The leading candidates in this crucial contest include:
  • Silvio Berlusconi, leading the remnants of his former rightist coalition,
  • Monti himself, currently in negotiations with several centrist parties,
  • Luigi Bersani, leading the left-wing Democrats, currently regarded as most likely to win
  • And comedian Beppe Grillo, whose Five Star Movement is leftist and anti-authoritarian.
Of these four, only Monti and Bersani would represent the continuation of the status quo.

Meanwhile, the return of Berlusconi, whom the establishment forced out in 2011, would be a nightmare for the euro. That goes for the ascension of Grillo as well.

In the balance of this pivotal contest could be the fate of the Eurozone itself.



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Try as He Might, Mario Draghi Cannot Save the Euro

Of all the pyramid schemes that governments and banks have perpetrated in the last decade, the Eurozone debt crisis is the most damaging.

No amount of posturing by European Central Bank President Mario Draghi can change that fact.

The market may like what Draghi has to say about the fate of the euro, but tomorrow's big ECB meeting will change little.  

The massive amount of money Draghi will need to print is far too great for the German taxpayer or the ECB's balance sheet.

Eventually, the Eurozone will break up and drag the global economy right down with it.

In the long run, that will mark the beginning of the recovery, but in the short run it will precipitate a banking and economic crisis that will make 2008 look like child's play.

As investors, we had better be prepared.

Politicians Doomed the Euro

The Euro was a reasonably sensible idea, although without political integration it was always likely to cause trouble.

What's more, the technical side of it was for the first ten years handled very well by Otmar Issing at the European Central Bank.  Issing spent his career in the Deutsche Bundesbank and knew what a decent currency looked like.

However, two decisions taken by politicians doomed the currency.

One was to admit Greece into the union, which to any competent observer was a hopelessly corrupt and uncompetitive economy propped up by giant EU subsidies.

More important, though, was the design of the TARGET (Trans-European Automated Real-time Gross Settlement Express Transfer System) payments system which was replaced in November 2007 by TARGET 2.

As I wrote in an earlier article, it is the secret system that blew another hole in the euro.

Target 2 requires all payments between banks in different countries to go through the national central banks (thus giving those otherwise redundant entities something to do).

Theoretically that's the same system as in the U.S., where many payments are made through the regional Federal Reserve Banks.

However, in the U.S. the larger banks deal direct, and outstanding payments in the regional Fed banks are cleared regularly. What that means is that if Alabama runs a payments deficit with New York, no large balances are allowed to build up.

Conversely, there has been no automatic clearing between the central banks in Europe. This may sound arcane and boring, but I promise you it is not.

These payment imbalances have two nasty side effects.



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