Saxo Bank (Saxo Bank)
Finance  |  December 07, 2010 16:03:35

Euroval and problems of European economies


Corresponds Piovarcsy Karol, Director of Saxo Bank CR

Please explain what is euroval what is and what amount is it?

Euroval to serve as a financial cushion for the euro area, which is supposed to guarantee financial assistance to individual EU countries, and through purchases of government bonds, or direct assistance to certain sectors of the economy (eg banks). Meanwhile, talks about the total amount of approximately 750 billion. At present, the structure of the states involved eurovalu guaranteed by certain contributions from the budget in the future, nor exclude other, mainly private, sources.

Recently, speculation about whether to raise euroval. Markets think so; eurovalu boss thinks it's not needed. How do you see?

In the short term by increasing the total eurovalu operate satisfactorily on the financial markets and thereby contribute to increased confidence in the euro common currency, as well as to individual bonds or shares. In the long run for the transmission of risk across the EU and thus opening space for the rescue of bad farming states. It is therefore questionable whether the national tax payers should pay for the irresponsible behavior of some EU politicians.  

What about Spain at the moment? His application for real help?

Spain is one of the countries PIIG countries and thus an increased risk of state failure to pay its debts. When we compare countries with regard to differences in the CDS, including insurance-linked government bonds, and Spain have for that insurance has to pay 3 times more than Slovakia and is very close to countries such as Hungary or Portugal. It is therefore possible that if the global economy returns to crisis scenarios, Spain will have to ask for help.

According to some responses may request from Spain to cause the fall of the euro. Is it likely?

The question of the fall of the euro is too premature. Of course, this situation can not be completely ruled out, but if we take into consideration the investment of resources, time and effort with the Europeans a great success, which is currently celebrating the EU and the euro to fall farstyle = "mso-spacerun: yes"> no consideration. It would be because of very costly operation, accompanied largely demise of the EU as such. The exclusion of any State of the euro area would be a less costly and certainly less destructive solution.

What developments expect in Ireland?

The Irish Parliament approves its budget for next year, according to our assumptions reduce the living standards of Irish citizens, since they will have to be through higher taxes and lower social support to participate in the rescue of the Irish economy. The government is worth supporting the rescue of the Irish financial sector and thus Irish citizens in this program will also have to participate and contribute to the housing bubble collapse rescue and Irish banks. In the next year, however, may change as the elections in Ireland.Saxo Bank's opinion remains unchanged - the Irish still have a chance to reject the EU-MFF rescue and instead transfer the risk to the financial system, which has economic problems. In other words, the problems of Ireland banks should not pass on to taxpayers, but the banks themselves and their investors and to investors in Irish bonds. This would preserve the balance between investment and risk arising from them.  

 Globální online investiční banka

Saxo Bank je globální investiční banka specializující se na online obchodování a investice na mezinárodních finančních trzích. Saxo Bank umožňuje soukromým investorům a institucionálním klientům obchodovat s FX, CFD, cennými papíry, futures, opcemi a dalšími deriváty a poskytuje i profesionální správu portfolia a fondů díky svým online obchodním platformám oceněným řadou různých ocenění.

Více informací na: www.saxobank.cz

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