Financial Markets: Over the Edge

The atmosphere in the financial markets is exactly the same as it was before Lehman brothers did not fulfill its obligations. I remember being almost lonely in thinking that Liman would sink, and the market and the Federal Reserve sought salvage solutions at the last minute. The choice is now similar. Lehman was then perceived as too “difficult” to rescue; In fact, very few people wanted to help them, and do not forget: Lehman paid a significant premium to finance +100/200 bps in one week of deposit much before 2008, according to his latest analytical text on the occasion current situation in Greece chief economist Sakso Bank Steen Jakobsen (Steen Jakobsen).

Lehman was in charge of 30 / 35x in his final account, and the Greek debt was/is similar. The risk is also similar and comes from a thinking system that always tries to buy a little more time, and it never yields results, says Jakobsen.

The US Federal Reserve Plan for Liman brothers was: buy A more time under A, and plan B was a “stick and carrot”. When it all collapsed, Plan C was a panic and a lack of a plan. Liman had no plans, like Greece, says Jakobsen and adds: “The plan can not have a plan, as we can see now.

Now there are difficulties with non-linear movements in the market, so it remains to be hoped and trusted. But the expert of Sakso Bank points out that the greatest risk is inflated value risk and adds that it will cause unwanted consequences, as it had already happened with Bulgarian and Romanian bonds yesterday, and Puerto Rico is unlikely to pay its arrivals as well as higher euro values.

The market is looking for “good risk protection”, which does not actually exist, says Jakobsen and states that during his career while running a risky business, he realized on a number of occasions that there is not enough good risk protection – but that there is only a situation Do not get in the wrong position.

The inability to reach an agreement at the last minute could cause a drop in the Dax Index by an additional 3-5% and a risk explosion in the new member states of the Eurozone such as Hungary, Croatia, Bulgaria, and Romania. Even Poland could feel the consequences, analysts quoted chief economist Sakso Bank as saying.

Stating that investors might have been a good holiday for some six months now, Jakobsen says the Shanghai market, where it is currently located, looks nervous on the eve of the opening, as indices fell by 22% from this year! In the meantime, as illustrated in this article by the Bloomberg Network, he concludes that Siriza continues to play games, even in a situation where we are on the brink of civil unrest and shortages of fuel, the euro, and food.

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