Rescue of the euro: Berlin reservation assistance

Pushed to its limits by the political support to Greece and the massive plan to stabilize the euro, Germany resumed its offensive. It determines, for each country, the outbreak of the plan of 750 billion euros to express a green light of the Bundestag. Berlin is also up to the load on its proposal to amend the EU treaties in order to punish, to the exclusion, the capitals recalcitrant to fiscal discipline.

Angela Merkel defended Tuesday stiffening. "The euro area can only work if we adopt a culture of stability, which means solid finances. (…) For Germany this culture of stability and strength is not negotiable, "Merkel said in an interview given to farm rather several European newspapers.

The sixteen finance ministers of the Eurogroup, and twenty-seven of the EU had the premiere at a double appointment in Brussels.Combative despite a weakened health, the German finance minister, Wolfgang Schauble, surprised his colleagues by questioning the principles they believed acquired for more than a week. Only the Belgian Minister Didier Reynders, ventured to publicly criticize the incoherence of speech come from Berlin.

Debate Lagarde Schauble

Jean-Claude Juncker, the Eurogroup chairman, acknowledged Tuesday that it had to mobilize "patience" during the debate behind closed doors, among others to intercede in the middle of the night between Wolfgang Schauble and Christine Lagarde. Ultimately, the Sixteen were separated without text or definitive agreement on the implementation of the 750 billion the new "European Stability Facility (ESF).Appointment was made on Friday in Brussels, officially in order to tie 'details practices and legal issues " payday loan lenders.

It is still the control exercised by the Federal Parliament is the heart of the debate. At the launch of the ESF, nine days ago, Germany's partners – including France – have understood that the Bundestag would have something to say once, to vote en bloc from the German plan for stabilizing euro. To the astonishment of his colleagues, Wolfgang Schauble has just announced that German MPs intend to vote each time a country in trouble will come from ticket sales, or for each disbursement."The game is not over," says a German source.

In practice, Berlin wants to have a veto at every stage of the process and content of any austerity plan submitted by a country strangled by debt. In the letter, Germany does not come back on his word. The ESF is European in name only, it is in fact an intergovernmental body to sixteen, with a headquarters in Luxembourg and a board of directors. By law, each country is free to make decisions according to the political career of his choice. "For Germany, this procedure should be a German," the source added.

Concern mounts to oil markets

Mown in full swing. Oil prices fell Friday morning as the 74 dollars a barrel in electronic trading in Asia. A barrel of light sweet crude for June delivery yielded 62 cents to 73.78 dollars while Brent North Sea due to identical, lost 34 cents to 79.77 dollars. Monday again, trading at 77.35 dollars a barrel in New York and 80.50 dollars in London. The euphoria that had gripped the stock markets in Europe and New York had spread on the oil markets.

But as of Tuesday, prices were beginning a decline that on Thursday, brought down the barrel in New York at 73.62 dollars, its lowest level since Feb. 12. In three sessions, the price dropped $ 2.40, completely erasing the rebound Monday.

Between high inventories and uncertainties

This pressure to lower prices is explained partly by continuing high inventories in the United States.On Wednesday, the U.S. Department announced a further increase in crude inventories of 1.9 million barrels and most importantly, a record for the reserve terminal in Cushing, Oklahoma's largest oil terminal in the United States. At 37 million barrels, these reserves are approaching the maximum capacity of the terminal that serves as the delivery point for Nymex oil contracts. Result: not finding a place to store their oil for June delivery, the nearest maturity, the investors selling off to get rid of.

This unusual situation has overshadowed the announcement of a sharp decline and surprise 2.8 million barrels in gasoline stocks in the United States. An announcement, analysts said, would support the course.

On the other hand, concern about the strategy for ending the crisis in the euro area continues and installs a negative climate in the markets.While European stock markets tumbled again Friday, the euro fell back again to its lowest level since 18 months. Around noon, he fell from 0.64% to 1.2448 against the dollar, thus penalizing oil purchases.

Strategic shift at NYSE Euronext

The transatlantic exchange operator NYSE Euronext is preparing to change the model. He announced the creation of its own clearing houses in Paris and London, and end at the end of 2012, its trade relations with its current service provider LCH Clearnet on the two financial centers.

This decision represents a reversal. In 2007, when Euronext was to choose a partner from the U.S. NYSE and German Deutsche Borse, the group preferred the former because it does not recognize himself in the vertical integration model of the second. The trade of the stock market is indeed a value chain in three stages: the "place" where exchange transactions are carried out, the clearinghouse that records and transactions settlement. Euronext is an operator to date, business-focused transactions.In developing its own clearing houses, goes up the value chain.

This shift fits by NYSE Euronext in the times of political and strategic place in Paris where it argues for the existence of localized market infrastructures in the euro zone. However, compensation is dominated by LCH Clearnet and by great American actors as DTCC. This business is also known to have an increasing role in securing the derivatives market: everywhere regulators are considering forcing a maximum of derivative transactions to go through clearing houses, thereby reducing the counterparty risk of potential systemic transactions.

Another reason, however, pushes NYSE Euronext to expand its field of activity.While its historical business transaction is fierce price competition from entering the competition at alternative platforms in Europe, the conditions are much less harsh on the job of clearing. In short, the incumbent, shaken by the loss of its monopoly, will seek margins where they still exist …

"The euro area does not have the ingredients to stay"

Lefigaro.fr / jdf.com – What do you think the rescue plan proposed by the European Union?

Christian Saint-Etienne This tactical decision is welcome, I support it fully. She ends the madness of markets, which had lost their compass quick payday loans. These days, the assets were under-dimensioned in relation to their fundamentals. The rebound today is a return to levels before the fall of the markets.

Photo credits: Le Figaro

Stock Exchange: Europe falls again at the close

This week's eventful European markets ended with another heavy decline. In Paris the CAC 40 fell at the end of 3392 to 4.6%, 59 points, its lowest level since July 29, 2009. The key index in Paris lost 11.12% on only 5 days.

The DAX index of the Frankfurt Stock Exchange ended down 3.27% at 5715.09 points (-6.86% on the week). In London, the FTSE-100 lost 2.62% to 5123.02 points (-7.75%). The Madrid Stock Exchange ended on a further sharp decline of 3.28% to 9046.1 points. The Ibex index, which lost 5.41% Tuesday, a victim of rumors about a need Spanish assistance from the IMF, cowardly 13.78% on the week.

Italy was also concerned by reports of infection, despite denials by the rating agencies. In Milan, where the negotiations were suspended on the main platforms due to "technical problems" to 4:40 p.m. this Friday, the stock ended down 3.27%.A decrease of 10.43% in 5 days.

Nordic Scholarships are not spared the nervousness in Copenhagen, the OMX index-20 star has unscrewed the closing today of 4.14% to 371.12 points, while in Helsinki, the OMX 25 fell 4.1% to 2001.08 points. In Stockholm, the main square Nordic OMX 30 index finished down sharply from 3.34% to 944.57 points, while in Oslo, the benchmark index has lost 2.87% to 348.98 points.

The Athens Stock Exchange, to whom all eyes are turned, closed the week down 2.86% to 1630.47 points.

Panic

In the wake of Wall Street, which yesterday saw a historic fall 9% in session yesterday after a "computer error or human, the European stock exchanges have experienced panic attacks. Around 4:40 p.m., the ACC let go of 5.70% to 3353.35 points, the Brussels Stock Exchange plunged 4.19% to 2,300 points.Same thing in Madrid where the Ibex-35 index fell by 4.26% to 8954.2 points. The Dax took down sharply from 3.49% to 5701.80 points. London lost 4.1% to 5045.3 points. Even the Moscow stock exchange gave up 5.54%!

"There is no fundamental to explain, if not very deep nervousness in the markets. The volatility is very important, and uncertainty, fueled by the approach of the German elections weigh, "said Frederic Rozier, manager of equity in Meeschaert Private Banking.

Yesterday, Jean-Claude Trichet failed to reassure European markets or Wall Street.The markets fear that the problems of Greece are not being passed in other European countries, and have in particular strong impact on banks cash advance to savings account.

Visit Brussels and conference call of G7

On the macroeconomic front, while the austerity plan was adopted by the Greek Parliament, Heads of State and Government of the eurozone meeting in Brussels from 19 o'clock tonight.Angela Merkel and Nicolas Sarkozy to defend this time the need to strengthen in the future budgetary control of the eurozone countries, sanctions and possible revisions of the treaties in support.

The finance ministers of the G7 major industrial countries have them held a conference call urgently on the crisis that has engulfed the markets.

Barack Obama also spoke on the topic Friday. The American president wanted to be reassuring, saying the U.S. had continued to cooperate with EU authorities and the International Monetary Fund deal with the crisis of debt. "We've agreed on the importance of a vigorous policy response in the countries concerned and on that of a robust financial response of the international community," he said.

In the United States precisely, the U.S. Department of Labor announced that the economy had created more jobs than expected in April: 290,000 jobs were created last month, is the highest number since March 2006. But these new, "very encouraging" by Barack Obama, went unnoticed on the markets …

Side currencies, the euro rebounded against the dollar after a plunge yesterday, under $ 1.26 for the first time since March 2009. Around 18 hours, the single currency climbed from 0.70% to 1.2740 dollar.

Bank penalty

On the values front, as saying that the values are nonexistent on the rise in Paris. The titles are the most attacked, of course, those in banking / insurance, the most exposed. Company g?n?raleperd 8% and won the title of the largest drop of ACC. Just behind, cowardly Dexia 7.54%, Credit Agricole7, 20%, BNP Paribas 5.68%.Axa slipped 6.56%.

Veolia Environment (-5.27% to 21.67 euros) is the sentence after the publication of its quarterly results.

NicOx pharmaceutical value fall -10.29% to 6.79 euros after the announcement of 7.2 million euros in losses in the first quarter.

Aid to Greece in five questions

• What is the plan?

The total amount loaned to Greece for three years, is 110 billion euros. The International Monetary Fund will lend 30 billion, 80 billion European states. For the first year alone, the total amounts to 45 billion euros.

Countries in the euro area will lend at a rate of about 5%, well above that at which they borrow their own markets. They must therefore, ultimately, make money with this operation. Assuming that Greece will repay many loans.

• Is it enough?

It is still uncertain. "The loan size is substantial and should fill most of the financial needs of Greece," say economists at BNP Paribas, which predict a total requirement of about 120 billion euros.Rumors from the German Ministry of Budget, Greece would need more than 150 billion euros.

Still, the plan means, Athens will not return to tap capital markets before the first quarter of 2012, according to the Greek Finance Minister George Papaconstantinou.

But everything depends on the success-or failure of the austerity plan set up by Athens. If public spending is poorly controlled, then the budget deficit will fly, Greece will take over, the debt will increase. The deficit will worsen if the recovery is also softer than expected. So the rescue plan would prove insufficient.

• When will funds be disbursed?

It was one of the obsessions of the markets before the official announcement of the plan. Greece was indeed an urgent need for funds: it must find eight billion euros by May 19It should eventually find them without worries thanks to the quick release of the aid by major contributors that are notably France and Germany.

Many states have approved the plan this week (or are about to do), such as Belgium, Portugal, the Netherlands, Italy, Cyprus, Luxembourg and Austria. France has voted the text on the night of Thursday to Friday. The outcome of the vote is no doubt right and left supporting the rescue plan. In Germany, after much wrangling, the plan should also be voted on Friday.

Italy, part of major contributors, will decide the payment by decree and may publish it immediately if needed. Same in Spain.• • •

• • • Other States show less eagerness, such as Slovakia, who refuses, or Ireland, Finland and Slovenia.

• Is it risky to lend to states in Greece?

to believe the rating agency Standard & Poor's, the most severe, Greece 23.08% of risk of default within three years. This is reflected in its 'BB +' rating assigned to it by the agency.

But "if European countries lend to Athens is that they do not believe the risk of default," said Jesus Castillo, an economist at Natixis. The European Central Bank, as the International Monetary Fund believes that a default is "beyond question".

However, "if repayment problems appeared after three years, the loans could be extended," said during the debates in the National Assembly Chairman of the Finance Committee Jerome Cahuzac.to believe the MP, who auditioned Budget Minister Francois Baroin, the latter "has not ruled out a rescheduling of Greece against the eurozone countries since it was envisaged that such debt is not repaid at maturity of three years, but later ".

• How a State debt can borrow to lend to another debt?

Spain and Portugal, being attacked by the markets and in financial difficulty, will lend to Greece respectively 9.79 billion and 2.06 billion euros.

Not to worry, according to Jesus Castillo, "they always have access to the market to finance", in contrast to Greece. Spain has also successfully raised 2.345 billion euros on Thursday at an average rate of 3.532%. Although lower than that at which it will lend to Greece.The Greek operation should be profitable for both countries of the Iberian Peninsula.

On the other hand, the loan granted to Greece will not fill the deficit under Maastricht. For France, the loan will weigh initially 3 billion euros over the budget deficit, it will not affect the deficit calculated by Brussels, by Representative Charles de Courson related remarks Bercy.