There was also an obvious error of timing

The reaction of markets to the rescue of the Ireland appears very cautious or skeptical. For what reason

Talking about the rescue last week, markets suspected therefore that this would happen quickly enough. It has therefore not was of surprise. This is also the revelation that the hole is still more abyssal that it feared at Irish banks. Markets see the invoice to swell, and they do not know to what extent it will swell. Talking about huge amounts for the Ireland. 80 billion euros, it is half of its GDP. Can we really be enthusiastic about the fact that it adds 50 of its interior richness in funding for a State needs Finally, there are all of the following questions: how to implement this assistance in practice What is so good unfold And above all: that after the Ireland

The Portugal seems the interest of the markets...

The Portugal problems are quite different from those of the Ireland. Portuguese banks, unlike the Irish, are not exposed to the risk of leakage of deposits by non-residents. The problems of the Portugal, the great fragility of its economy, its lack of competitiveness plain and the paralysis of its labour market. The country will also face the year next to large fallen of debt. The first half, in April and June, it will have to raise money just to pay for important deadlines. With the risk that markets closed and he is forced to seek outside funds. As long as the three "small" countries, Greece, Ireland and Portugal, will not be under infusion, there will be instability in the markets.

And if the Spain should in turn call for help

Then, it completely changes scenario. The Spanish GDP is 6 to 7 times that of the Ireland. If the Spain can no longer access to normal financing on market conditions, it is not European Stability Fund which will be able to reassure. No mechanism for assistance would be powerful enough to avoid a restructuring or a rescheduling of its debt. And the shock wave would be colossal. But this seems not news to me. The Spain has addressed the crisis with lower debts. Its savings are in poor health, but major banks are strong. The country remains solvent and its access to the market is much more advantageous terms than those of the "small" countries. Very nasty surprises on the State of progress in reducing its public deficit or the evolution of the real estate market should really be this change.

Can the markets to stabilize as long as they did not know about intervention mechanisms after 2013

It is certain that the reflection launched late October on this issue has created more tension to appeasement. The main uncertainty is whether how will be contribution for new interventions private investors. On the merits, it was not open to criticism in 2013 and beyond. But, before putting the subject on the table, it would have been better that the project is already wrapped. There was also an obvious error of timing. Some clarifications have been made since: we know that this will not be past but only the future debts debts. When there will be more clear, it is likely a factor of appeasement.

How will evolve the euro

I still think that the euro is overvalued. First, it is the motto of a monetary zone that is in great difficulty: we will test a mechanism that preserves of the break-up, but it is evidence that it has problems of budgetary control. Then, the consequence of these problems of debts public and private, it is the extension of austerity, which is not frankly positive for growth. Finally, the differential in monetary policy, which was for the benefit of Europe against the United States before the summer, now appears rather "neutral": none of the two central banks should tighten monetary policy next year. All this put end to end, the trend is expected to remain bearish on the euro.