In European Crisis, Experts See Little Hope for a Quick Fix

It has happened time and again in recent months as Europe’s debt crisis has played out. Stocks stage a strong comeback on expectations that a solution has been found. Then they quickly resume their decline as hopes dissipate, leaving investors puzzled and frazzled.

Yuan Forwards Drop Most in a Week on Euro-Debt Crisis Concern

Sept. 29 (Bloomberg) -- Yuan forwards declined the most in a week on concern European leaders will struggle to contain the region’s debt crisis, dimming the outlook for global growth.

China’s economic growth will slow to 5 percent by 2016, from 9.5 percent last quarter, a Bloomberg poll indicated. The European Commission is resisting a push to impose bigger writedowns on bank holdings of Greek sovereign debt than those previously agreed on, a European official said. China may peg the yuan to the dollar or to a basket of currencies again if there is a global recession, Huang Yiping, Barclays Capital’s chief economist for emerging Asia, said in Beijing today.

European Economic Confidence Declines More Than Forecast

ept. 29 (Bloomberg) -- European confidence in the economic outlook dropped more than economists forecast in September to the lowest in almost two years, reflecting growing concern that the worsening debt crisis could push the euro-area economy into a recession.

An index of executive and consumer sentiment in the 17- nation euro region fell to 95 from a revised 98.4 in August, the European Commission in Brussels said today. That’s the lowest since December 2009 and below the 96 projected by economists, according to the median of 31 estimates in a Bloomberg News survey.

Hope for new approach in euro crisis buoys markets

Hopes that European leaders will consider new ways to fight the debt crisis, including a contained Greek default, reassured investors on Monday, though analysts said more specifics will have to emerge before a rally gains traction.

Over the weekend, European officials said Germany and other rich EU countries are pushing for a new strategy to the debt crisis, which is threatening to take down the eurozone's larger economies.

Crude Oil Rises From Seven-Week Low on Hopes for European Rescue Measures

Oil rose from its lowest in almost seven weeks in New York on speculation that renewed measures by the European Central Bank may alleviate the region’s sovereign debt crisis, supporting economic growth and fuel demand.

Futures reversed losses of as much as 3.4 percent after a euro-region central bank official, who declined to be identified, said policy makers are likely to debate the resumption of covered-bond purchases next week. Saudi Arabia, the world’s largest crude exporter, may cut production to prevent prices falling below $90 a barrel in London, according to HSBC Holdings Plc.

Euro nears 8-mth low on doubts over EU crisis steps

The euro dropped sharply on Monday, moving toward an eight-month low hit last week, as riskier assets were hammered across the board with markets waiting for more details on fresh efforts from European officials to tackle the debt crisis there.

The euro started cautiously higher, bobbing up to $1.3585 amid reports that the E.U. leaders were considering beefing up the European Financial Stability Fund and new measures to ring-fence debt-ridden Greece, Portugal and Ireland.

Euro crisis: three perspectives

WASHINGTON D.C. (CNNMoney) -- George Soros, the billionaire hedge fund manager and philanthropist, warned Saturday that failing to resolve the sovereign debt crisis in Europe could lead to a "real meltdown" of the global financial system.

His remarks came while on a panel with Olli Rehn, the top economic and monetary official at the European Commission, and Gao Xiqing, the head of China's sovereign wealth fund, who also commented on the debt crisis in Europe.

Euro, Asian Stocks Fall on Debt Concern

The euro weakened against most of its major peers, Asian stocks dropped to a 15-month low, while U.S. futures and oil pared gains amid concern European policy makers will struggle to contain the region’s crisis.

Europe’s shared currency dropped 0.7 percent to 102.64 yen at 11:28 a.m. in Tokyo and slid 0.5 percent to $1.3433. The New Zealand dollar weakened for a sixth day and the won slumped 1.6 percent. The MSCI Asia Pacific Index lost 0.8 percent and the Nikkei 225 Stock Average sank 1.6 percent after Japan’s markets resumed after a holiday. Standard & Poor’s 500 Index futures rose 0.6 percent, paring gains of as much as 1.3 percent. Oil was little changed in New York and gold dropped a fourth day.

Banks Splinter on Europe Crisis as Tension Pervades Meetings

Sept. 26 (Bloomberg) -- Wall Street leaders, urging coordinated action from world governments to solve the European sovereign-debt crisis, struggled themselves during four days of meetings in Washington to agree on what’s needed to end it.

The chiefs of firms including JPMorgan Chase & Co., Goldman Sachs Group Inc., Deutsche Bank AG and Societe Generale SA met for three hours at the National Archives on Sept. 23. They differed on which government and private solutions may restore confidence in European debt and banks, and on some elements of regulation, said two participants who spoke on condition of anonymity because the meeting wasn’t public.

Europe's Debt Crisis Casts Cloud Over U.S. Economy

With all the worry over the ailing U.S. economy, Europe's debt crisis may have seemed a long way off.

But not anymore. The faint tinkle of alarm bells a few months ago are now clanging loudly. What began as a crisis in smaller countries, like Greece, Portugal and Ireland, is now creating serious issues in much larger economies like Italy, France and Germany.

Sarkozy told Obama euro zone to end crisis: source

French President Nicolas Sarkozy assured U.S. President Barack Obama on Wednesday the euro zone intends to resolve the euro crisis and support Greece, a French presidential source said.

The source, speaking on condition of anonymity, added the two leaders, who met in New York on the sidelines of the annual U.N. General Assembly session, also discussed the idea of including the Chinese yuan in the International Monetary Fund's special drawing rights (SDRs).

European stocks fall on Greek crisis

LONDON — European equities and the euro fell on Wednesday on fresh concerns over banks' exposure to indebted Greece, but losses were capped by expectations of more stimulus measures from the US Federal Reserve.

London's FTSE 100 index of leading shares slid 0.37 percent to 5,344.07 points in midday deals, Frankfurt's DAX 30 lost 0.98 percent to 5,517.05 points and in Paris the CAC 40 dropped 0.87 percent to 2,958.16.

Euro bonds are not the answer

Euro bonds are not the answer to the region’s raging financial crisis. The euro countries aren’t going to agree to guarantee each others’ debts in time to solve it. And, once it is over, neither euro bonds nor fiscal union is desirable. Market discipline is a better way of dealing with the current crisis as well as running monetary union in the long run.

One can understand why fiscally-challenged governments such as Italy’s and Greece’s are in favor of euro bonds. If they could issue debt which was guaranteed by all their partners in the euro zone, they wouldn’t find it so hard to borrow money. They would then no longer be under such pressure to do unpopular things like tighten their belts and reform their economies. One can also understand why investors are clamoring for the introduction of euro bonds. They would recoup the losses on their investments in fiscally-weak countries’ bonds.

Merkel’s Efforts in Euro Crisis Complicated by Berlin Vote

BERLIN — Chancellor Angela Merkel’s conservative party held its own in the closely watched Berlin regional election on Sunday. But her junior coalition partner is now in a political free fall, complicating her fight to contain the European debt crisis despite the infighting within her bloc.

As expected, Berlin’s popular mayor, Klaus Wowereit of the center-left Social Democrats, secured a third term, and his party received the most votes on Sunday for the Berlin city-state legislature with 28.3 percent, according to preliminary official results. That was down slightly from the 30.8 percent the party won in the previous election in 2006.

ECB's Weidmann Criticizes Political Inability To Solve Euro Crisis

(RTTNews) - European Central Bank policymaker Jens Weidmann on Tuesday said that the politicians' attempts to solve the problems in Europe and to erase the crisis symptoms are weakening people's confidence in authorities and in the deals agreed among institutions.

Geithner to take crisis message to European finance talks

Treasury Secretary Timothy F. Geithner plans to urge European Union finance ministers to step up their crisis-fighting strategy when he meets with them this week in Poland, a euro-area official said.

The official spoke on the condition of anonymity because preparations for the meeting, which takes place in Wroclaw, Poland, on Sept. 16 and 17, are confidential. It will be the first time Geithner has attended a session of Europe’s Economic and Financial Affairs Council, known as Ecofin.

Car industry urges bold action over euro debt crisis

Car industry executives from around the globe urged Europe's politicians to take bolder steps to solve the bloc's two-year-old debt crisis, warning its single currency could be derailed without more decisive action.

The euro was under pressure again on Tuesday with debt markets increasingly pricing in a Greek sovereign debt default and the U.S. government voicing its alarm at Europe's inability to get a grip on the crisis.

Debt crisis in euro zone likely to drive crude oil futures higher

Inventories of crude oil are likely to drop for a second-straight week in the U.S., pushing up oil prices on Tuesday, according to published reports.

In anticipation of a not-yet released report from the U.S. Department of Energy stating supplies dropped by as many as 3 million barrels because of tempests manifesting in the Gulf of Mexico, the energy commodity gained in value in the U.S., which is the globe's top consumer of oil. Bloomberg reports the immediate climb was roughly 2 percent within hours of the opening bell on Tuesday morning.

Euro crisis rains on UK bank reform's parade

Reforms proposed this week could make British bank shares attractive again, ringfenced from investment banking risk, but in the short term they are irrelevant to investors running scared of the euro zone debt perils.

A government-sponsored commission unveiled reforms on Monday that said banks should shield retail units from riskier investment banking and hold billions more in extra capital.

German court rejects challenge to eurozone bailouts

Germany's highest court has rejected a challenge to the country bailing out other nations in the eurozone.

The Constitutional Court was responding to a challenge brought by six prominent German Eurosceptics.

But the court did say the government must seek the approval of the German parliament before providing future assistance.

Swiss Central Bank's Gamble on Euro-Zone Crisis

Even the winners from the crisis are starting to suffer.

The Swiss National Bank has set out to halt the franc's relentless appreciation by pledging to buy unlimited amounts of foreign currency. After seeing the euro move close to one Swiss franc in August from 1.25 franc at the start of the year, the SNB has drawn a line in the sand at 1.20 franc. The euro zoomed 8.8% higher against the franc Tuesday, and the 1.20-franc level held. But this is a big gamble.

Barroso says Europe will avoid return to recession

Europe will not slide back into recession, and the euro remains "strong and resilient", the president of the European Commission has said.

Jose Manuel Barroso added that the Commission and national governments were "doing all it takes" to tackle the debt problems in the eurozone area.