Eurozone Bond Chatter Continues (Financial Times) "Proposals for common eurozone bonds have been around for as long as the euro itself. For years they made no progress. Germany understood that it would incur higher interest rates as a result of sharing bonds with Greece and other fiscal delinquents. In the end, German taxpayers would pick up the bill—an unacceptable proposition, whatever the notional attractions of European solidarity. These arguments were just as compelling in countries such as Austria, Finland and France whose bonds enjoyed top-quality status."
"Germany Reluctant to Expand Bailout Fund" (New York Times) What are the odds of the Germans going along with a pan-European bond issuance—if they're not even willing to kick more cash into the bailout kitty? (Think about it: If you aren't willing to lend your deadbeat brother-in-law the money to buy a new car, what are the odds of you cosigning on his auto loan? I'm going with very close to zero.)
"As ministers from the 16 euro-zone countries met in Brussels, Chancellor Angela Merkel of Germany dampened speculation that the bailout fund, worth $997 billion and now being used by Ireland, could be increased soon. 'I see no need to expand the fund right now,' Mrs. Merkel said in Berlin after talks with Prime Minister Donald Tusk of Poland, Bloomberg News reported."
"Gold Prices Rise on Bernanke Easing Talk" (TheStreet.com) Gold prices are up again. And it's the usual suspects driving them higher: "Fueling inflation sentiment, this announcement, coupled with ongoing uncertainty about the euro-zone's ability to contain its debt crisis, helped gold futures finish in positive territory." It's enough to make you wonder: Does a Fed chairman on 60 Minutes do more harm than good—no matter what he says—merely by reminding people that he may be called upon to lead the monetary component of an economic crisis intervention?
BofA to come out from under the TARP(Financial Times) It's official: Bank of America has announced to U.S. regulators that they intend to pay back their TARP funds. There is only one more hurdle for BofA: Raising $3 billion. The FT explains: "BofA was given until the end of this year to record the gains. US regulators believe the move will help build the bank’s equity as it regains its footing after leaving the government’s troubled asset relief programme (Tarp).If BofA fails to satisfy the Federal Reserve Board, the lender will have to issue additional common shares, diluting its per-share earnings. People familiar with the bank said it had told the Fed that recent moves to pare back its stake in BlackRock and sell its right to buy shares in China Construction Bank’s fundraising would bring them close to the $3bn requirement."
The Fed Gets Beat up—From All Directions (CNN) The Fed is taking heat from every angle—left, right, and center." Federal Reserve Chairman Ben Bernanke has been under such fierce attack that he made an unusual appearance on "60 Minutes" Sunday to defend himself and the Fed's policy." Not a fun a job right now.
Google Throws Down the Gauntlet to Amazon—And Apple Too? (Wall Street Journal) "Google Inc. launched Google eBooks, its long-anticipated digital bookselling enterprise, on Monday. The venture, now rolling out across the Web with hundreds of thousands of popular titles for sale and millions more free, will compete for a slice of the digital books business, which is valued at close to $1 billion and is expected to grow in the coming years."