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Is Germany Losing the Political Will to Defend the Euro?

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    Philadelphia Trust Company CEO Mike Crofton weighs in on the global markets.

  • Duration 3:22
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-- -- -- -- Classical -- we have the ECB and the Bank of England taking action today to boost the European economy.

-- is Germany's economy slows is it losing the political will necessary to keep defending the mighty Euro.

Joining -- now my trapped in president and CEO of Philadelphia trust company.

-- you know Germany -- German retail sales industrial production all down.

Germany -- has it used to be I mean is it losing its gulf.

I'll biggest losing its own blood domestically the people of Germany are really beginning to get a little bit tired of the maneuvers -- -- nations of the EU.

So Angela Merkel has to -- very fine line because actually if the Euro was going to survive it's going to be due to German efforts.

And if -- German people lose the interest in in sustaining those efforts -- the problem just gets a lot bigger and deeper.

But -- -- grant but your point -- Germans are losing interest in.

Defending this Euro and then what do we worry about a run -- European banks if that's the case.

I think that that's a distinct possibility if that's the case I think that you could get a Lehman like liquidity event in Europe a run on the bank -- also liquidity somewhere along the line.

Doesn't have to be anything big -- started with some very small.

Small incidents but -- it's definitely possible so it's it's a tight rope that Merkel -- one.

She's gonna have to pacify I think the politicians and he in Germany wanna keep the Euro but the people in Germany beginning to get tired of the -- nations.

Right and you start to see quite a divide let's let's not received a little bit and bring it to China right now last ten -- on we talked about China China still a real big concern for you isn't it.

Absolutely and I think you see China's rate cut today.

While the market's -- thought that was interesting and maybe positive maybe that's what we're seeing here this afternoon -- I'm shocked by the markets move this afternoon.

That's a very negative signal that's basically indicating -- Chinese.

Economy has slowed a lot more precipitously than they've been they've telegraphed that it perhaps maybe may -- already hard landing.

Right let's talk about the market here at home now.

-- point that you're surprised that the move your surprise that we came back -- points.

At.

So -- I didn't think the market really should have done this today.

You know that the rate cuts to me are.

Short term positive and -- -- positive to those who believe in government intervention in the markets I certainly don't believe in that I think long term that's a very bad thing.

Sell the rate cuts today I think -- been read as a big negative in the market I think reacted.

Appropriately initially and now -- come back so I I don't think the market is.

Really thinking clearly.

Perhaps what we're seeing is some short covering in front -- tomorrow because tomorrow's number.

While everyone says it's real important it's a backward looking number.

And may not be that important.

Four for the future moves in the market we'll just have to see I think but -- unemployment rates going to be unchanged in the payroll Reagan maybe a 100000.

But quickly it it is important -- that whether or not the Fed.

Puts more money into this economy isn't -- so it's somewhat -- more important to traders and we thank.

I don't know if it's important to the Fed not the Fed's running out of ammunition is not much more they -- -- -- they may wait longer this time before they act.

I'm not sure the Fed's gonna act as quickly as everyone would like -- -- A because they're running out of ammunition the next -- -- -- nuclear option what that is they don't know but then their balance sheet is strained there there are almost out of ideas.

Right not a lot of comments -- -- my -- in -- Philadelphia just company thanks to be near them.

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