Bank stocks are circling the drain this morning, prompting the usual swirl of risk aversion.
The one asset class not participating today is government debt as fears swirl over how all these obligations being entered into will be repaid. Here’s a hint: with more government debt. Investors are having having one of their periodic crises of confidence in government today, odd considering that a shiny new administration is unpacking the moving vans. 10-year notes trade at 2.475.
On the wires, ECB permanent board member Tumpel-Gugerell is on the wires saying that the ECB is seeing weakening of business activity around the world. They must do everything to rebuild confidence in the financial system and overcome the collapse in growth, she says.
EUR/USD has punctured 1.2900 after the comments, which can be read dovishly. 1.2850 bids are eyed on dips, dealers report.
