The World Is Not Very Flat In Emerging Markets......: Another EU Bailout?

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Another EU Bailout?

So, yesterday the ECB decided to buy massive amounts of Spanish and Italian bonds in the hopes of stabilizing their respective debt markets. It helped the markets gain ground for about 30 minutes, then they went back into a tailspin along with the rest of the worlds markets. I'm not sure if these regulatory bodies realize that bad debt is simply.... bad debt. One cannot assume (not any more) that once a higher rated agency buys the debt of a lower rated agency that the problems merely go away for everyone. During financially volatile times such as these, this type of help is akin to a Trojan horse. I would argue that the credit rating of the EU is no longer as stable as it was two days ago, before the decision to buy bad debt from irresponsible (or maybe naive) governments. It's turning out to be a nightmare scenario for the Germans.... having to single handedly bail out the entire EU! I wonder who will end up bailing out the Germans?

Good luck to them.

Posted by Ozan Isinak on August 09, 2011 in Budget, Economy, Politics, The downturn | Permalink

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The objective of this blog is to share my ever-evolving curiosity and experience with private equity, angel investing, venture capital, macro/micro economics and politics as practiced in the emerging markets across the world. Having lived in many of the ‘developed’ as well as ‘emerging market’ countries, I hope to articulate the similarities as well as the differences of the many investment and entrepreneurial methodologies. This blog is therefore intended for those who are interested in acquiring insight into global as well as local issues with regard to the investment process.