Showing posts from February, 2015

The Greek Bailout Explained:

The Greek Bailout Explained:
How to Protect Yourself February 18, 2015 Greece's bailout expires at the end of this month. Athens needs to either secure a fresh bailout from its Eurozone lenders or find an alternative source of financing; otherwise, it is at risk of bankruptcy. Ahead of the bailout deadline on 28th February, Greece and the Eurozone finance ministers (known as the Eurogroup) have held talks, but a compromise has not been achieved. How this may impact markets: A failure to reach a deal for Greece could cause a spike in volatility for financial markets and large swings in prices. To help you plan your trading strategy around this important event, we've outlined some potential scenarios Greece may face in the coming days: Scenario 1: Greece doesn't secure a deal: The next meeting between Athens and the Eurogroup takes place on Friday 20th February. If no deal is reached, then we could see volatility jump and the EUR sell off alongside European stocks. Scenario …

Repost from Barron's - Currency Wars

It’s the central banks’ world, and we’re just living in it. Never in history have their monetary machinations so dominated financial markets and economies. And as in Star Trek, they have gone boldly where no central banks have gone before—pushing interest rates below zero, once thought to be a practical impossibility.

At the same time, central bankers have resumed their use of a tactic from an earlier, more primitive time that was supposed to be eschewed in this more enlightened age—currency wars.

The signal accomplishment of these policies can be encapsulated in this one result: The U.S. stock market reached a record high last week. That would be unremarkable if central bankers had created true prosperity.

But, according to the estimate of one major bank, the world’s economy will shrink in 2015, in the biggest contraction since 2009, during the aftermath of the financial crisis. That is, if it’…

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