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eurozone interest rates

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Desperation in the Eurozone Is a Profit Play for Us

By , Global Credit Strategist, Money Morning • @MichaelELewitt -

Eurozone conflict

On September 4, the European Central Bank lowered the interest rate on its main refinancing operations by 10 basis points to 0.05%. In addition, the interest rate on its marginal lending facility was reduced by 10 basis points to 0.30% and the interest rate on its deposit facility was reduced by 10 basis points as well to -0.20%.

These rate cuts came as a bit of a surprise to the markets since only three months ago the central bank cut interest rates and was waiting for these cuts to stimulate economic growth.

Unfortunately, growth has slowed rather than jumped since then...

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Does the Eurozone Have Its Own Lehman Bros?

By , Chief Investment Strategist, Money Map Report -

Does the Eurozone have its own American International Group Inc. (NYSE: AIG), or worse, its own Lehman Bros. when it comes to Greece?

I believe it does.

Why else would the European Union have bent over backwards to "save" a member nation that: A) Accounts for 2.01% of the EU by trade volume; and B) Would essentially be like letting Montana go out of business - no offense to Montanans or Montana!

More to the point, if things really were under control, why would European Central Bank President Jean-Claude Trichet say that risk signals for financial stability in the euro area are flashing "red" as he did following a meeting of the European Systemic Risk Board in Frankfurt?

The short answer: Because he knows what the European banks are desperately trying to hide from the rest of the world - that there are still enormous risks and they're even more concentrated now than they were in 2008 at the start of the financial crisis.



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