Euro Crisis Spreading Like the “Black Death”

“The euro debt crisis has now been going for nearly two years since the end of 2009, and the sovereign debt crisis has spread like the Black Death of the 14th century across the euro zone countries.” The above quote comes from Zhang Zhixiang, a former head of the People’s Bank of China international department, and Zhang Chao, an economist for the China Development Bank.

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QE3 “Most Likely Scenario,” Goldman Sachs Says

A third round of quantitative easing (QE3) by the Federal Reserve is now considered the “most likely scenario,” for U.S. monetary policy, according to Goldman Sachs. In a report to clients, Francesco Garzarelli – chief interest-rate strategist at Goldman Sachs – wrote that “The recent sharp price action in equities and bonds has probably more to do with a focus on ‘tail risks’ in an anaemic US growth environment, concerns about a broader global growth slowdown (as reflected in the sharp moves in global indices and cyclical currencies) and positioning considerations, rather than outright weakness in the incoming data.”

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Emergency talks called to calm global markets turmoil

The European Central Bank is due to hold emergency talks on whether to start buying Italian debt to contain spreading turmoil on financial markets. The BBC’s Business Editor Robert Peston says the ECB is split on the move. Growing worries over debt in the eurozone and the US caused sharp falls on world stock markets last week. Finance ministers from the G7 major economic powers are also to hold emergency talks on how to calm the markets before they reopen on Monday. The main council of the ECB will hold a telephone conference on Sunday afternoon, the BBC has learned. According to an ECB source cited by Reuters news agency, the bank’s president Jean-Claude Trichet wants a final decision on whether to buy Italian debt to be made at the meeting. Low growth Italy is the latest and biggest economy to be hit by the eurozone crisis. The price Italy pays on its government bonds has shot up amid growing doubts it can keep its debt level so high while economic growth is so slow. Spain, too, has been caught up in the crisis – hammered by high unemployment, high government debt and anaemic growth. The high levels of debt …

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