Archive - Jul 27, 2014

It continues to go from worse to worser for Africa's "deadliest ever" Ebola epidemic which has officially claimed well over 600 lives, and unofficially many more. Following the death of a Liberian government worker two days ago who collapsed in the international airport of Nigeria's 20-million megacity, Lagos which resulted in a "red alert" Nigeria clamping down into a quasi-quarantine state, sending specialists to airports and seaports fo containment, overnight we got an update on the other major Ebola story from last week, namely the female patient whose family broke her out of a hospital in Sierra Leone's capital Freetown, and who had been on the loose of several days, leading to a nationwide hunt. She has passed away, dying in an ambulance on the way to hospital, Reuters reports. And while the US public has been generally unaware of the severity of the breakout, this may soon change following news that a 33-year-old US doctor in Liberia was the latest to test positive for the disease.

An overview of the major events next week within the context of the capital markets, which could be at inflection points.

Within the European economic context Germany has been a star performer in recent years, outgrowing in GDP terms its Eurozone peer group as a whole in all but one year since 2006 (complete with a magnificent football/soccer team). This was quite a reversal of fortune from the ten years prior, when Germany consistently lagged in wealth creation. Together with its size and unwavering historical commitment to the EU project, this has created the expectation in political and even financial circles that if Europe faces another major economic crisis Germany will have no choice but to support the most vulnerable member states, possibly even relenting to the mutualisation of the Eurozone's debts. While this is a very complex topic, the following graph puts the odds in favor of one outcome: the next time push comes to shove in a big way, Germany will likely say NEIN!