Monthly Archives: December 2011

Partial EU Pact Reached

There’s a joke told about Gorbachev who, when asked to say one word about the state of the Soviet economy responded: GOOD. When asked for two words: NOT GOOD. The same could be said about the agreement reached Friday. The agreement is good in that the pact on fiscal union gives the ECB what it […]

France and Germany Push Deal

The fiscal union that German Chancellor Merkel has been pushing is a side show to the real game, but a necessary one.  It gives the ECB an excuse to act as a lender of last resort, to stop the market pressure on Italy and Spain and contagion to France.  It also keeps German voters and […]

Merkel Warns Crisis Will Last

Merkel’s modus vivendi has always been to go slowly, to wear her opposition out, and to wait. This strategy, which enabled her to become Chancellor, will be her undoing.  The markets don’t wait.  Treaty reform and even the idea of deeper fiscal union are sideshows to the real event.  Unless Merkel agrees to the ECB […]