Friday, August 31 11:01:37
Dolmen Stockbrokers note the increasing market scepticism that Ben Bernanke will not announce anything significant at Jackson Hole this afternoon. "The Fed chairman used the gathering of leading policymakers to front run QE2. On this occasion he is likely to recommit to do what is necessary to keep the economy on a sound footing" Dolmen says "Overall he will adopt a wait and see approach to establish a clearer picture on the trend in the US economy, awaiting the outcome of political developments both at home and abroad. In Europe overnight it has been reported that the Bundesbank head, Jens Weidmann has threatened to resign over the ECB's new planned bond buying programme but has been persuaded by the German Government to stay". In an attempt to ensure fissures within the ECB governing council are not exacerbated, Germany has asked both Italy and Spain not to formally request bailouts for the time being. "The departure of Mr. Weidmann would call into question the ECB and Bundesbank's independence given the last head of the German Central Bank, Axel Weber quit last year due to unhappiness over the ECB's now dormant SMP initiative. The European Commission has also released proposals for the new European Banking Authority to have control over the 6,000 Eurozone banks, which could place it on a collision course with Berlin who would only like the new authority to have control over the top 25 more systemic banks."