Portugal, and Yields, and Iran . . .

Portugal, and yields, and Iran - oh my! None of these are new stories. Portugal is bigger than Greece - but we knew that. Moreover, we knew Portugal was in dire straits. We knew Germany was already hesitant to provide more assistance and would demand higher guarantees.Viewing the remainder of this article requires a Subscription

Straight line

The euro is starting off 2012 weak - that's not news - Spain is having a tough time with sovereign auctions, and Greece will soon be testing the euro's exit mechanisms.Viewing the remainder of this article requires a Subscription

Quants and currencies

I have been thinking about vested interests. It seems like everyone talks about vested interests in some way, and usually the conversation trends towards what happens when interests conflict. Here's the problem: interests always conflict.Viewing the remainder of this article requires a Subscription

Remember when the USD was dying?

Remember when the USD was gasping for its last breath? Remember when Russia decided to diversify its foreign cash holdings along with China and bought up more euros? Remember . .Viewing the remainder of this article requires a Subscription

I hate to bring this up again…

Over the past two years I've brought up 1987 periodically as just a mere possibility that has to be factored. I don't want to think back to those days of currency wars, political grandstanding, and crazy volatility, but alas, every time I try to clear my mind . . .Viewing the remainder of this article requires a Subscription

The yen, and portfolio management

I have been short the yen since November 2009, but today, I'm closing the directional position (although we're still short yen against Japanese equities). This was a portfolio decisions, rather than a directional decision.Viewing the remainder of this article requires a Subscription

Bank Runs Are Deflationary First, Inflationary Second

It is Thanksgiving, so for most Americans an opportunity to spend time with family, go crazy, and use the excuse to purchase some frivolous electronics at half of what our neighbors paid last month - a truly feel-good holiday.Viewing the remainder of this article requires a Subscription

The Euro in One Sentence

Paul Krugman said it better than I could, and while I'm not generally a fan of Krugman, it's worth noting:

What has happened, it turns out, is that by going on the euro, Spain and Italy in effect reduced themselves to the status of third-world countries that have to borrow in someone else’s currency, with all the loss of flexibility that implies. (H.T.

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And another thing on the euro

This will not be my last thought on the euro . . . Italy is NOT the problem, it is just a manifestation of the problem. Political and economic leaders want investors and citizens to view Greece and/or Italy as the problem.Viewing the remainder of this article requires a Subscription

What’s a quadrillion?

G-Pap and Berlusconi are having some bad days, but do they know how to count to a quadrillion? Monday morning, Marketwatch reported:

Japan's debt to exceed 1 quadrillion yen: report HONG KONG (MarketWatch) -- Japan's national debt is on track to exceed 1 quadrillion yen ($12.8 trillion) by the end of the fiscal year next March, with the debt rising faster than Ministry of Finance forecasts because of spending tied to aid and rebuilding from the devastating earthquake and tsunami earlier this year, according to a report Monday in the Nikkei newspaper.

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All euro, all the time

Forget about MF Global's bankruptcy - it's a symptom, not the cause. Forget about Italy - again, symptom. Investors are waking up to the harsh reality that the European Union, through the euro, is structurally flawed.Viewing the remainder of this article requires a Subscription

Finishing the week, finishing the quarter

And the news keeps rolling in . . . (in no particular order):

• German retail sales down. Interesting in light of the fact that US sales are up while incomes are down (yes, lower savings rate - AGAIN). What does it mean? Consumers will be tapped out faster without HELOCs.

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ECB Executive Board Member Jürgen Stark Resigns

From the WSJ.com:

Today, Jürgen Stark, Member of the Executive Board and Governing Council of the European Central Bank (ECB), informed President Jean-Claude Trichet that, for personal reasons, he will resign from his position prior to the end of his term of office on 31 May 2014.

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All eyes on euro

Well, maybe it's just my eyes that are glued to the euro. First, I increased my short euro position, so maybe there's some confirmatory bias in looking at it more closely, but I'm not sure that's it.Viewing the remainder of this article requires a Subscription

Europe in a tizzy

While US markets are closed for Labor Day, Europe is certainly NOT closed today. The German DAX was down 5% and the rest of the continent was off anywhere from 3-5%.Viewing the remainder of this article requires a Subscription