The Eurozone faces a source of instability that originates not within finance ministries, but in international financial markets. Hedge funds are steadily expanding their presence in Europe’s sovereign bond market—a market valued at approximately $13 trillion—thereby gaining increasing influence over the transactions that determine yields and, consequently, the borrowing costs for governments. Hedge funds now …
Tag: leverage
The Economic Conclusions of Tomorrow from the Pandemic of Today
World economic activity has reached its nadir due to the Covid-19 pandemic. Both governments and central banks responded with unprecedented fiscal liquidity measures (the former) and increased expansionary monetary policy combined with near-zero interest rates and mass securities markets (the latter). Combined with the easing measures of commercial banks taken by supervisors, they provided ample …