• Afghanistan  –  capital flight
  • Ecuador  –  an asset glut as banks must rush to sell off non-core businesses
  • India – implementation of troublesome tax rules is postponed
  • United States  –  good news concerning the Eximbank.

Other Markets:

FRANCE: Financial market conditions will be volatile until it becomes clear just how far the new tenant at the Elysee is prepared to go in seeking to fulfill the promises of his campaign, or whether and to what extent economic reality will force him to compromise.

GREECE: The country’s membership in the Eurozone was at stake in last weekend’s elections, and the outcome brings an exit from the common currency into the realm of the possible.  On present trends, another election may need to be held next month. If its results are similar to those of last Sunday’s go-around, the odds of Greece leaving the Eurozone will be very high.

ISRAEL: PM Netanyahu has formed a new governing coalition with the opposition Kadima party, which gives him a freer hand for dealing with the Iran problem. The Palestinian Authority is confronted with an increasingly crippling cash crunch. But Israel’s overall economy is in pretty good shape, an ongoing slow-down notwithstanding.

JAPAN: The worst trade deficit on record is largely due to energy imports and the strength of the yen. The shut-down of nuclear power will worsen the first problem, Fed and ECB policy the second. There is little the Bank of Japan can do, and more fundamental issues are not beingaddressed.

RUSSIA: Putin and Medvedev have completed the switch-back in positions on which they agreed four years ago. Their new terms in office will be more difficult than the just completed ones, not only for political reasons but also because the Russian economy is showing more vulnerabilities.

SERBIA: The presidential run-off election on May 20 may have a decisive influence on whether Serbia continues to pursue the difficult changes it needs to make in order to become a member of the EU, or whether it will turn Eastward and establish closer ties with Russia.  Also at issue are Belgrade’s relations with Kosovo.

SPAIN: The country has slipped back into recession and this makes official austerity goals unrealistic. Given that Spain has already made significant progress with an“internal devaluation,” though, the other members of the Eurozone are likely to give it extra leeway on the fiscal front.

ZIMBABWE: The regime’s bid to gain majority control of foreign owned mines remains mired in confusion that is not exactly helping to attract new venture capital to the country. In fact, anyone wanting to see what a truly failed economy looks like need only take a glance at that of Zimbabwe after 32 years of rule by Robert Mugabe.

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