Opening Quotes: Optimistic Symmetries

I blame Wednesday’s ‘ESM-Bank Recapitalization’ balloon, but – in the face of horrendous $SPX price action – last week I found myself becoming way more optimistic about Europe.

I wrote about the ‘why’ last week – and please be careful as I’ve a desperate (& painful) habit of getting on the right side of the ‘macro strory’ before the technicals fall into line  ……

But this morning I unexpectedly found my favorite <long-time uber bear> Eurozone commentator offering a similarly <surprising optimistic> analysis.

It is now or never (again?) but – from an Irish perspective – I absolutely believe the seeds of the Eurozone crisis were sown in the everyone for themselves botched response to the Lehman collapse in September 2008.

Huge problems remain, but any sort of fully fledging BANKING UNION would be a seriously BIG DEAL and more importantly  – its ACHIEVABLE!!

Wolfgang Munchau (FT):

“Unlike six months ago, officials now realise there is no alternative to a banking union. The biggest danger now is that eurozone leaders change their minds. Ms Merkel has not made the case back home. A proper banking union would come as a shock to many Germans, including those in the media. It is still easier to be a pessimist, but I am not yet quite ready to give up what will probably be the last chance to save the euro.”

Closing Quotes: Europe – The Final Frontier?

Mario ‘maybe I’m too German’ Monti:

“Their own best product for export which we are very grateful to the Germans for having invented and promoted — the culture of stability — risks being undermined because of lack of promptness in setting up the necessary instruments to limit the contagion,” Monti said.

With Italian 10years once more flirting with 6% & the MIB40 back at the November lows, the usually calm confidence of Mr.Monti sounds a little thin.

The Italian Central Bank Governor Visco said what he really wanted to say, according to Bloomberg evoking: “the possibility of intervening promptly in the securities markets and directly in favor of banks, with procedures that are more flexible and less penalizing for the beneficiary countries that respect the rules.”

Naturally, the Germans will bargain hard, but some sort of deal on the ESM directly funding bank recapitalizations – hopefully aligned to a Eurozone-wide deposit guarantee scheme – has to happen.

Soon.

Or else.

 

 

 

 

Opening Quotes

http://www.bloomberg.com/news/2012-02-26/geithner-schaeuble-spar-over-sovereign-debt-crisis.html

Sixty-two percent of German voters said they want lawmakers to reject aid for Greece in today’s vote, an Emnid poll of 500 people for Bild am Sonntag newspaper showed yesterday. Thirty-two percent said they backed the bailout.