Below, don't be fooled by the similarity of the two lines. The US-Greek spread is increasing as fast as the Greek yield is increasing, which is to say that US 10 year bonds have fluctuated very mildly by comparison.
At some point, a psychological barrier will be breached, and Greece will end up in a disorderly default that, apparently many economists are predicting will lead to the double-dip recession. Which is somewhat amusing, at least insofar that Greece has been desperately slashing spending, to no avail. This seems to have been lost on conservative US politicians and their austerity theory.
Another thing that has seemingly escaped the conservative economic theory: the ECB's rate cutting, after this past April's hike on interest rates -- so much for those fears of headline inflation, mostly due to volatile commodities. You don't so much hear the conservative cry of a fear of inflation these days, but they remain unapologetic over the matter of chasing the wrong theory.
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