European Crisis Over? Not So Fast

As we recently noted, despite the incessant chatter that the worst is behind them and the unending belief that if European politicians repeat a lie often enough it will become truth, the following chart perhaps better than many others shows the sorry state that exists in Europe's core and periphery - no green shoots, no second-derivative shifts, and only the 'Merkel-Draghi' wager holding things together.



And despite US equity strength, European markets disappointed today with EURUSD back under 1.3000...


European stock indices closing red (not holding US equity-driven gains)...


and Italian and Spanish bond spreads leaking wider into the close (about 10bps off their intrday tights).



Source: Bloomberg and AEI


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