The bulwark of the euro zone is fragile:Karen Millen
Many investment professionals expect interest rates to rise for German government bonds. They fear costly relief operations, which pollute the creditworthiness of the Federal Republic.http://www.karenmillendressesinuk.com
The time for making super cheap debt in Germany is coming to an end.
Hamburg - The euro crisis, Germany is the guarantor of stability - but that image gets visibly cracked. More and more large investors expect the Federal Republic is nearing its limits, given all the impending burden of the debt crisis in southern Europe.
Spain's banking sector has just applied for EU aid, the fourth largest economy in the euro-zone, and it is possible that an appropriate recovery program is far more expensive than previously targeted. At the same time exacerbated the debt crisis in Italy, Greece and probably longer and requires more assistance is provided as yet. When the distressed state has a new government, expected to begin negotiations for a relaxation of the austerity measures.
Increase for countries such as Germany, Karen Millen Dresses the attempt to stabilize the euro-zone,Karen Millen all these operations, the risk of new financial burdens. Investors now fear that the Federal Republic could take over.
"The crisis has not even begun," Jamil Baz, chief investment officer said in the hedge fund GLG Partners, according to the British "Financial Times". The turmoil could employ the Euro-zone up to two decades. Many other hedge funds,Karen Millen Dress according to a survey at an industry conference in Monaco similarly pessimistic. More than half of respondents expect therefore that, that will double yields on German government bonds within one year.
"Germany is losing quality"
In recent months, Germany was able to borrow the supposed safe haven, almost for free fresh money in the capital market. Reason is primarily a capital flight from the southern countries, said Gavyn Davies, founder of hedge fund Fulcrum Asset Management and former chief economist at investment bank Goldman Sachs, but this will not last much longer continue.
Indeed, yields on German bonds have risen significantly recently. Bonds with a ten-year period brought about the beginning of June just 1.13 percent return. On Tuesday, it was 1.53 percent. This is still an extremely low value, but many hedge fund managers are betting that the yields increase in the coming months. The time of the super-cheap borrowing tends obviously to the end.
The other investment professionals see also Sun The world's largest bond investor Pimco has about only a few government bonds in its portfolio. "Germany loses the growing risks to quality," said Andrew Bosomworth, a fund manager and head of Pimco, Germany. Finally, the federal budget threatened by the multibillion-dollar rescue packages and other losses enormous loads. If countries such as Greece and Portugal do not repay their loans more from the bailout fund, threaten billions in losses.
According to the pessimists in the industry before long the first threatening losses. Georg Schuh, a senior investment manager at Deutsche Bank, as already expected a quick exit from the monetary union of Athens. It would hardly be likely that the country could repay its assistance in this case credit. A breakup of the euro zone keeps shoe is "very likely".