Cypriot Bailout Plan Surprises Few, Impresses Investors Slightly (Market Watch)
In what’s becoming an effective, but nerve-racking habit for investors, the European Union is undertaking another 11th hour plan to bail out member-nation Cyprus. In addition to the usual austerity-related portions of the deal, the Cypriot bailout plan also requires “winding down” one of the nation’s premiere banks. state-owned Popular Bank of Cypress is going to be slowly wound down by transitioning accounts over 100,000 euros into the Bank of Cyprus. Investors greeted the news of this new accord about as we’d expect, by pushing global markets slightly higher. Now, all we need is a summer of actual delivery to judge the effectiveness of this newest round of plans.
Japanese PM Shnizo Leads Japan Away from Recession (YahooFinance)
Japanese Prime Minister Shinzo of Japan spoke for 30 minutes via phone with European Council President Herman Van Rompuy and European Commission President Jose Manual Barroso to begin hammering out the details of “deep and comprehensive” free trade deal. The integration of a free-trade agreement between Japan and the European Union (EU) is seen as a essential component to remedying Japan’s decades-long recession. But such a trade pact will meet quite a bit of opposition from old, hard-line economists. It is hoped that a free-trade agreement between Japan and the EU will boost Japan’s exports by .6 percent. We’ll check back in a couple of months to see if that’s the case.
Behold the Newest Candidate for U.S. Fiscal Phoenix: Detroit (Bloomberg)
The U.S. auto industry’s continued resurrection certainly is a testament to the never-give-up American spirit of the auto companies’ employees. Unfortunately, it also stands in direct contrast to the economic prospects for the majority of Detroit’s population. In fact, today marks the beginning of the tenure of an emergency financial manager for Detroit — that is, the beginning of Michigan Gov. Rick Snyder’s plan to try to turn around the fortunes of this fiscally ailing city. It’s the hope of all concerned that the governor’s move can help right the economic ship in Detroit, where the city currently is running a $375-million annual deficit. Municipal bond investors may want to exercise caution before buying debt issued by the Motor City until the emergency financial manager shows that he is advancing the city’s fiscal situation from its current massive deficits.