Tuesday, March 6, 2012

Super Tuesday: While many in GOP hope for a clean sweep, many in media hope for a muddled mess; financial community remain concerned with European debt levels

One of the uglier traits of the media business is its glee in reporting the pain of others. Whether it is intruding on the pain being experienced by the families of tragedies (which is at the core of the phone hacking scandal in the U.K.), or interviewing the running back who fumbled away the game, the media sometimes seems to enjoy the pain of others. Of course, this may explain why the media loves stories of its own demise.

One painful situation that is making good copy right now is the Republican primary race. The group of contenders that resemble the Keystone Cops now face the voters today on what is euphemistically called Super Tuesday. Looking at the expected results – with Mitt Romney expected to win many of the races, but both Rick Santorum and Newt Gingrich also expecting win – it looks like the race will continue on into the spring, if not the summer.

The GOP, on the other hand, want this all to come to a close so that their candidate, and the party itself, can begin concentrating on the general election. If Romney can win in Ohio this may well happen. And while many journalists relish the idea of a brokered convention, it is unlikely that any modern political party could survive such a thing.

Journalists seem to love to cover disaster stories. For now they have one, we'll see if that changes tonight.

Stock index futures are down this morning, and European stock markets are falling, as well. While it is never certain as to the causes of such things, the financial newspapers are pointing to continued unease over the situation in Greece, and the large amount of debt held by European companies that is coming due over the next few years.

A report in this morning's Wall Street Journal reviews the situation.

"A wave of leveraged-buyout debt is beginning to crash down on Europe's shores," writes Dana Cimilluca in the Murdoch-owned financial paper. Cimilluca writes that a new report estimates that $550 billion worth of loans to European companies will come due over the next five years.
The scale of the maturing debt is daunting in itself, but a number of additional factors—including weak economies in Europe and tightening capital requirements for banks—could make it particularly acute for lenders and borrowers, according to the report, titled "Negotiating Europe's LBO debt mountain."
Meanwhile, the markets are on apparently on edge as Greece faces yet another important deadline – Greek creditors have until Thursday to accept the latest bond swap deal. Creditors must accept huge losses on their bonds in hope of getting something back on their investments.

Reports this morning appear, however, to show that the bond swap is progressing well. But despite this, the German DAX down almost one and half percent, with markets in the U.K. and France down sharply, as well.