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Tuesday, 10 January 2012

Lenders pay to lend money to Germany

Lenders are paying Germany to lend money to Germany.  For the first time ever, Germany has sold short term debt with negative yield.  This indicates confidence in the German economy despite failing confidence in Germany's currency, the Euro. 

See this article.  For a cautionary perspective, see "Germany should beware of celebrating negative yields", which proposes that the re-affirmed confidence in the German economy also signals that Europe is "experiencing an accelerating disengagement of the private sector from the region’s economic integration project".

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