The Political Crisis in Germany Changes the Game

 

Merkel faces the worst crisis of her career and many behind the curtain are starting to wonder if she will even survive. The German Federal President Steinmeier could not actually order new elections immediately. The procedure in this regard is quite complicated in Germany. The earliest possible alternative would be to hold new elections come the spring of 2018. It is likely that the AFD is likely to gather even greater support from new elections. Nonetheless, the CDU will continue to support Merkel at least right now. However, the CDU has been severely weakened by the election and if we do not see new elections until the spring, there is a distinct possibility that Merkel’s support even within the CDU could collapse if they see the AfD will win even greater support.

Ten more countries that may default on debt after Argentina

Ecuador, Egypt, Pakistan, Venezuela, Belize, Cuba, Cyprus, Greece, Jamaica and Ukraine are all on the verge of a default, according to Moody’s ratings.

Argentina defaulted for the second time in 12 years after hopes for a midnight deal with holdout creditors were dashed, setting up stock and bond prices for declines on Thursday and raising chances a recession could worsen this year.

After a long legal battle with hedge funds that rejected Argentina’s debt restructuring following its 2002 default, Latin America’s third-biggest economy failed to strike a deal in time to meet a midnight deadline for a coupon payment on exchange bonds.