I don’t know a hell of a lot about John Corzine. And what really is or was ‘MF Global?’
But what I do know is that it is difficult for me to see anything like a ‘crisis’ in any of the current metrics surrounding the US Dollar, the euro, and the interest rate differentials involved.
Are there going to be other ‘banks,’ ‘brokerages’ or ‘financial institutions’ to fold over the drop in bonds in Italy…? I mean there SHOULD be; I can’t imagine MF Global being the only thing to have caused yields to rise there!!!
From way back when – when the euro was first devised – I recall saying that it was designed to offset China and create a counter for the obvious long term recessionary heading of the US domestic market. For this to have been realised it was ALWAYS necessary to make the euro go up first, and then force bond yields up by having holders sell off early. Corzine is said to have leveraged his firm’s money about 30 or 40 : 1 in short term eurozone bonds. Hey that would have made him sell off early when the mechanics took too long to fix the country-by-country trade and GDP differences! Makes me wonder why Corzine is on Wall Street at all – unless, that is, he was told he was going to be one of the fall-guys and that he had better be in a position in which he would have to push some fire sales of euro-zone bonds to help those yields go up.
So now we have 6/7% yield in a euro-zone bond backed by the most powerful industrialized nations on earth (not China, but its technology supplier – Germany) Er, crisis? What eff’n crisis?!
You seriously could do a lot worse than pay forty cents in the dollar for a ten year Italian Government security. I would certainly take a few million dollars of Ferraris in case the country ‘defaults’ in money terms!!!!!
The real problem going on here is that the entire political spectrum in governments around the world are so fixated on pandering to a bunch of lying thieving ‘investment banksters’ playing the ‘let every taxpayer in the world fund our global bond hedging’ that they have no interest in finding a way to cause money to circulate into actual economies and engender growth. And then you have Wikipedia defining and discussing ‘economic growth’ in just plainly fraud bankster-speak and, I would say, DELIBERATELY avoiding the circulation and financial asset evaluation significance so that no one in the public will be alerted to exactly how simple it is to create jobs and economic growth.
A ‘technocratic government’ means installing insider mechanics so that the taxpayer has to pay insider investment banksters.
There is a crisis. It’s a crisis of negative economic growth around the world. And I don’t see Merkel or Lagarde having a clue about how to fix that.
Calvin J. Bear