Grounds for optimism on the eurozone

ON EUROPE

"Bull-markets are born on pessimism, grow on scepticism, mature on optimism and die on euphoria".

If the words of the late Sir John Templeton are true then, in contrast to the markets in bonds, emerging nations and commodities, we are still closer to the beginning than the end of the current stock market cycle in Europe. For the last few years we have worried about the solvency of the eurozone banking system, of southern European governments and the potential for a disastrous deflationary bust. Although the European Central Bank (ECB) has assumed the role of lender of last resort to the eurozone’s banks and governments, preventing them from running out of money, while expectations...