If the risk of economic contraction has increased and the governments are in the mode of spending cuts, can the banks refinance themselves with their shares under severe selling pressure?
Unfortunately, additional federal borrowing will be a significant part of government funding for many years to come unless we want to risk major disruptions to various federal programs and a contraction of our economy.
The mighty dollar is supported by risk aversion and economic recovery, while the EUR remains vulnerable to Eurozone contraction and rate differentials favoring U.S. Treasury securities.