Forex, the euro is not helped by the firewall

After you stop looking only to Greece, since after the last aid the country could breathe a sigh of relief now that wobbles dangerously Spain, with Portugal and Italy could still follow the Iberian country.

The firewall of the euro area has been strengthened to a sum of 700 billion euros, but it is still not nearly enough if the major Eurozone economies, like Italy and Spain, should you need to be saved.

This is a difficult balancing act, given that increasing too much the bailout fund would send a clear message that there are serious doubts about Spain and Italy on economic survival.

The calming effect of the firewall market was short-lived. In Forex, the euro has had a beginning of the week is not too interesting, and has lost ground. Unfortunately, the eurozone is suffering from rising unemployment and inflation stubbornly high.

The other problem is the origin of the money that strengthens the bailout fund, given that international bodies are already showing signs of exasperation at the inability of the euro area to give an order. The key question is whether this approach will be enough to appease the international community and all those who think that Europe must do more to help themselves, even before asking for additional support from other parties.

The International Monetary Fund effectively continues to be an important lifeline, but in any case must do more.

According to many, it is unlikely to see a dramatic fall in the value of the euro in the short and medium term.

To date there is still a strong possibility that one or more countries may be forced to leave the euro area over the next two years, unless you can actually do something to help out all those who are looking for a solution concrete and definite.

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Japan New Minister

Japan has appointed a new Prime Minister, the sixth in five years. Already, the former finance minister, Yoshihiko Noda, could formally get the job. The challenges are enormous and Noda faces include primarily the help Japan recover from devastating natural disasters related to nuclear power. The problem is that in Japan there is no leadership, no consistency to follow. According to the final solution could be Noda.

The most important issues are the recovery from the tsunami and a too strong yen, which affects the power of the nation and the strength of the Nipponese companies. The politicians up to now have not been able to show any clear direction on what to take in the coming months on. For Japan is at stake in these days could not be higher.

Almost six months after the tsunami that devastated the country, the government has yet to begin rebuilding in earnest and continues to leak radiation. The opposition strategy is to tie the legislation, Japan is in a political deadlock that discredits the government. Noda for his part promised to work with the opposition.

Another serious problem is the yen, as strong as ever in recent decades, which is damaging the competitiveness of exports. Noda is the finance minister, knows everything about the situation of the Japanese currency, then the markets would be likely to welcome his election. Luna fundamental part of the work of Noda will be to raise taxes to finance reconstruction after the tsunami. Obviously this will not improve the economy of Japan, but for many it is essential.

Noda will replace the former Prime Minister Naoto Kan, even after 15 months in office, which has been criticized for his handling of the disaster of March. We'll see what happens.

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Bernanke's speech in Jackson Hole

Those whose expectations were low relative to the speech by Federal Reserve chairman, Ben Bernanke, held in Jackson Hole, were not disappointed. Those who sought a recovery in the words of Bernanke are disappointed, as when the same Fed chairman last year has provided the basis for further purchases by the Fed, what became the QE2, which led to 600 billion dollars purchases of Treasury securities.

This year, the Fed chief said in essence that the temporary problems are less to blame than previously thought. The structural problems, particularly in the area of housing, preventing monetary policy to have its usual effect on the economy.

Bernanke mentioned the word "tax" 15 times as much "money". The Fed chief said that most of the economic policies that sustain robust economic growth in the long run are beyond the powers of the central bank. But the Fed chief did not specify other economic initiatives, which should be revealed next month. The proposals could include a cut in taxes and spending for public works.

Meanwhile, the FOMC will consider all options available to him in a meeting of the expanded two-day, on 20 and 21 September in order to give full practical implementation issues still outstanding.

In reality there is much to talk about, including the idea of a lengthening of maturities of the securities portfolio of the Fed, in an attempt to bring down interest rates in the long term. What the Fed is planning to do does not depend on the length of the next FOMC meeting, but the current economy. Bernanke admitted that growth has remained significantly behind the expectations that the Fed did itself.

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