German Auction ‘Disaster’ Stirs Crisis Contagion Concern; Bonds, Euro Fall !
- The Euro will collapse. It will affect all major currencies. The sheeple will wake up and realize that all fiat currencies are a CONfidence Job! It has no intrinsic value and is backed by ZERO! There will be a stampede towards physical gold (and silver) in 2012! (emphasis mine)
German Auction ‘Disaster’ Stirs Crisis Contagion Concern; Bonds, Euro Fall
By Paul Dobson, http://www.bloomberg.com/
Germany failed to get bids for 35 percent of the 10-year bonds offered for sale today, propelling borrowing costs in Europe higher and the euro lower on concern the region’s debt crisis is driving away investors.
“This auction is nothing short of a disaster for Germany,” Mark Grant, a managing director at Southwest Securities Inc. in Fort Lauderdale, Florida, said by e-mail. “If the strongest nation in Europe has this kind of difficulty raising capital, one shudders concerning the upcoming auctions in other European nations.”
Turmoil that began more than two years ago in Greece and snared Ireland, Portugal, Italy and Spain has closed in on France and now risks engulfing Germany, the region’s biggest economy. Political leaders are struggling to find a fix for the crisis, with German Chancellor Angela Merkelrejecting proposals for common currency-area bonds, while the European Central Bank resists calls to boost sovereign-debt purchases.
The yield on Germany’s 2.25 percent securities maturing in September 2021 climbed 15 basis points to 2.06 percent at 4:46 p.m. London time. The price of the bonds slid 1.370, or 13.70 euros per 1,000-euro ($1,335) face amount, to 101.550. The cost of credit default swaps on German debt rose seven basis points to 108, according to CMA prices. The euro weakened as much as 1.3 percent to $1.3327.
Belgian 10-year yields surged 41 basis points to 5.48 percent, after reaching 5.53 percent, the highest since November 2000. French 10-year bond yields climbed 16 basis points to 3.69 percent. The yield on Greek two-year notes jumped to more than 120 percent for the first time, before slipping back to 116.59 percent.
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