Thursday, March 21, 2013

Some good signs

Currently, Spanish and Italian bonds are still unaffected by the situation in Cyprus. I wrote, that this was to be expected. Still I consider it a good sign. Greek 10 year bonds reacted a little but no signs of panic as of now. The Euro is still worth 1.29 Dollars so we can conclude that as of now All quiet on the southern front.

There is a "solidarity fund" planned. What ever that means exactly. It is still unclear if Germany is going to accept it. Reuters quotes a German representative saying that:

The German representative[..]emphasized that "we stand ready to find a solution immediately" as long as the parameters of the bailout agreed among euro zone finance ministers on Saturday are respected.

Which leads me to think that this is increasingly a matter of principle for Germany, because that quote means nothing, Germany basically still says NEIN!(We are prepared for a compromise as long as it is exactly, the plan that you did not get through parliament?!). The Euro-Sceptic party will be extremely happy with any outcome that could still be achieved.

Additionally, Cypriots will not tolerate the banking situation much longer. One and a half weeks (until Tuesday next week)? And no real end in sight? No rescue. No reopened banks.

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