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James Kanter, New York Times

Nov 14, 2012|

James Kanter, New York Times

Transcript - will not be 100% accurate

Welcome back into the financial exchange at 933 that's the opening bell the Dow is down 61 points NASDAQ opening up down 26 S&P down eight. Oil is trading down 58 cents 8498 gold trading down as well 1180. And then you -- that ten year US treasury very that is sitting at one point five. 83. Happy rainy Tuesday. -- -- They we're joined now by James -- from the New York Times and you know I read an article about in the Wall Street Journal by European banks there's stuff going on in Greece. Issues in Spain. James good morning and welcome to the show RE doing today. -- James in layman's terms can you explain what what is going it just seems like European problems. Re emerge every thirty to 45 days at least in terms of headline. What's what's going on in Europe and and how can we understand it here in the United States. Well what -- on at the moment and that finance ministers there are having on that there. Regular. Meeting they happen. About once a month anyway and what's come up on the agenda this time. Is they need you work out how to deal but it. Re not -- it earlier requirements. Aren't that has led to quite a lot of debate. First ball. Making sure and it and he will be -- given his crease between Maryland and sixteen. Can. Something that the -- can or. And at the second issue really concerned and stipulations were laid down by the international literature on what you. Of course that the creditors when it comes to -- European bailout. Concerning. Deep way act concrete make you able to. I needed. Need to build truth and expect. You know I guess the part that did that I have difficulty understanding is why the Swiss -- the Germans the French. Would wanna make the Social Security payments for Greek citizens made it in and maybe I'm oversimplifying this but it just seems like. Greece and Spain are expecting the rest of Europe Northern Europe to pay their bills for them or might it it might. It in my being to support the simplest ones. Well no -- it in that. One like edit to clear the court inquiry. There -- in the political. And giving more money. -- That in certain. He in Portland. On the other hand there are. Makers in. Like currently in. Where are where. -- if you -- Out of your. Pain. If you let. In an out of control and turn it on market in Italy and you could have a degree -- a year. In which case. Yeah. Export market or mart and captured in Germany a little threatened. And intern. -- nature and how united they wanna see Europe already. All on even more now. Further at collector interest earning your. And the -- a moment. And after. Years are. Still your inquiry. -- and it it seems like -- in order to. -- you're gonna make bad loans right to Greece and Spain Portugal you're gonna give them money you know they're never gonna pay back. But the reason. The rest of Europe and the United States in the rest of the world will bail out those three countries I think is what you're telling me. It's less expensive to do even though it's a moral hazard right even though it's the wrong thing to do and you wouldn't do with a corporation or an individual person. It's the wrong thing to do but we do it because it's less expensive than letting them fail it is is that accurate. Well well for our country think there and -- Kamal. I think it's. It's become quite clear over recent years that there are complaining. Even in the united state and -- institutions that are too big -- and certainly you know you can make an elegy. -- -- countries this year include current C even. You know even -- the -- -- and too big failed because on speculators and then turned -- Portugal Italy Spain. And the script it would -- -- and you'd Harry heard around now. He. So -- and I think. That's one important -- an important point a bit but not left barely true. Lenders will not ever see their mounting a big. -- -- have to keep rolling over the and that they expanded. And there is an expectation. That over the long run and we will be talking. More than a decade here. Money will come back in in one form or another. But again in terms of the people who are paying now they are looking at ever larger. You know now they aren't I don't know maybe I'm ninety but it just shoot it's it seems like. You know the old term money down the raffle you know in and it's discouraging because if it is holding up the rest of the worldwide economy in these three countries. Hey you know they they are there issues. Are holding back Europe that's why the European banks are sitting on the other capturing the -- There they're hoarding their cash because they don't want to take any risk and they're not making loans is just. It's like a domino effect it would seem so. Yeah I ain't Derek there are a lot of inter related issues here and -- I think it credit you. Summer -- international institutions that are overseeing. What it's supposed to be a -- -- as the economic and an intriguing in Europe. As well as he patients in the Europe found that are -- that. There are initiatives underway. To rebuild the banking system and make sure that would be a great actors. If I be concerned about -- -- -- Spain and Art -- or. A lot of a lot of the lending that is not happening and also can be attributed other -- and there are. There are a little effort under way you got what's called a bank in union that would make sharing your -- A lot more. -- -- possible. Between -- -- nations that we may still be I'm currently bat because they're still curtain wearing. About doing. While they always wanna wait till the very last minute write in never never solve the problem early in the total right. All right James got to write about it is great great job on the article by the way I am and I appreciate your time. Right James Kanter to today's New York Times the spells lasting KAT and TER it seems that we spent. As long as I can remember June. Licking our wounds over the problems in Greece I know and India and Europe in general and kicking the can down the road and using all those dumb phrases -- nobody -- pay their bills and -- and they want somebody else to bail out. Itself that's exactly it shouldn't Aetna. And and with that said the market continues to move downward you know the stock market is is continues to sell off we'll have updated numbers for you also have Jim Mueller from the Motley Fool I think we have some stock -- Coming up next on the financial exchange two quick things. Text number 68680. My email address is -- Armstrong at wrko.com.