Wednesday, July 8, 2015

Tsipras lambasted in the European Parliament | FOMC minutes show little appetite for rate rises

There was a hard hitting speech from the Belgian MEP Guy Verhofstadt at a plenary session of the European Parliament yesterday. You can see the video of it on YouTube by clicking here:

Verhofstadt, who is a former Prime Minister of Belgium, brought some home truths to the Greek Prime Minister and indeed to the Greek nation. He was particularly scathing of the privileges enjoyed by Greek politicians, shipowners, the military, the Greek islands and even the Greek Orthodox Church.

His final words were to the point. Addressing the Greek Prime Minister, he said:

“How do you want to be remembered? As an electoral accident who made its people poorer? Or as a real revolutionary reformer. Show that you are a leader and not a false prophet”.

Definitely worth a look.

FOMC minutes show little appetite for rate rises

The minutes of the June FOMC meeting, released last evening, show that most of the members of the Fed are very cautious about raising core interest rates. Even at the meeting conclusion, on June 17th, they were worried about the Greek situation, and about China, both of which have the potential to damage the global economy. This is calculated to impact negatively on the US.

If they were concerned on June 17th, they must be really worried now, given all that has happened, or not happened, in both of those economic theatres in the meantime. Yet another development since then has been a significant fall in the price of oil, which would be expected to lower inflation expectations in the US, which also argues for further caution in raising rates.

All-in-all, there is now every indication that US rates will not move at all in 2015.

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