In an interview with CNBC-TV18, Tim Condon of ING Financial Markets talks about the global economic outlook on the back of negative news stemming from the Eurozone and the US.
Below is an edited transcript. Watch the accompanying video for more. Q: Do you expect things to get a lot worse on the global turf? Do you think Germany is likely to get dragged into these debt problems given how weak the bond auction turned out last night?A: That is certainly the big worry. Germany is a very strong and a very rich economy. I expect it will be fine but investors are obviously anxious that the turmoil in the European Union will spread and engulf not only France now but also the Northern Europeans including Germany. It is not our baseline scenario but in a period in which investors are frightful of just about everything, it seems nothing in Europe is safe. Q: The slightly technical problem of the credit default swaps (CDS) on sovereign bonds in the Eurozone appears to be now taking centre stage which may escalate the problem even before the sovereign bond issue does. If Greek lenders have to take a deep haircut of maybe 50%, the CDS holders still can
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