The European Debt Crisis and the Euro - Page 53
Forum Index > General Forum |
Black Gun
Germany4482 Posts
| ||
maartendq
Belgium3115 Posts
On November 26 2011 05:22 Black Gun wrote: a downgrade of belgium shouldnt be overrated as their political crisis explains it, at least in parts. Scratch "in parts". No running government = no trust in the financial situation of our country = downgrade. Everyone saw this coming from miles away. Here's to hoping that our politicians finally wake up! | ||
DeepElemBlues
United States5079 Posts
![]() | ||
maartendq
Belgium3115 Posts
On November 26 2011 08:02 DeepElemBlues wrote: Belgium forgot that the EU isn't it's real government? ![]() On the contrary, we blatantly ignore everything the EU tells us to do. We're in a situation that's not unlike the one in the US. The country is basically split in half: the northern part is rather rightist while the majority in the south is more left-oriented. Neither of them really wants to get along, except for the green parties on both sides, of course. New elections would only make matters worse, so we're actively avoiding them. All this would not be so bad were it not that we've still got a budget to balance and a deficit of 8 billion euros to get rid of. | ||
Mango
Belgium522 Posts
| ||
maartendq
Belgium3115 Posts
On November 27 2011 01:15 Mango wrote: Well after 531 days without a government (the old one was still taking care of running cases though), it seems that Belgium will finally have one in the following weeks. The financial markets pushed them towards one, and let's hope they stabilize now around us. I find it a good thing that the financial markets are finally able to push Di Rupo and company to come an agreement. This has childish bickering between left and right (wallonia and flanders) has been going on for far too long. It's actually surprised me how long it took the financial markets to crack down on Belgium though. I guess they were too preoccupied with Greece and Italy. | ||
Skilledblob
Germany3392 Posts
rating agencies serve no purpose. The only purpose they have is helping the people who pay/bribe them, which are the banks they make ratings about so this whole system is a huge pile of dog crap | ||
Shymon
United States620 Posts
On November 27 2011 03:05 Skilledblob wrote: so where is the downgrade of the US? rating agencies serve no purpose. The only purpose they have is helping the people who pay/bribe them, which are the banks they make ratings about so this whole system is a huge pile of dog crap Why would you downgrade the USA atm? The current level of debt is around 100% of the GDP which according to most is still in the manageable range, As opposed to Greece's ratio of 158%. The government is currently very divided but also very stable, there is zero pressure to say rewrite the constitution. and the US dollar is in the middle of a small rally versus the currencies of most of the world including the euro which thanks to Greece and Spain may be in for a sharp downturn. Furthermore the general public has indicated that debt reduction is a major issue for upcoming elections which should (key word here is should) allow the elections of officials who would work to lower the debt of the USA at a national level. Add to all this some positive if slightly conflicting economic indicators; inflation at 3.5%, GDP up 2.5% last quarter, and positive early numbers for consumer confidence and spending. This is tempered by a still high 9% unemployment rate, which has not dropped as fast as other positive indicators would have suggested. However all in all i would still say the overall trend would still not be adverse to the credit rating of the USA as a whole. As a side note i am not an economist so this is a layman's opinion of the subject. | ||
kevint
Denmark42 Posts
On November 26 2011 08:17 maartendq wrote: On the contrary, we blatantly ignore everything the EU tells us to do. We're in a situation that's not unlike the one in the US. The country is basically split in half: the northern part is rather rightist while the majority in the south is more left-oriented. Neither of them really wants to get along, except for the green parties on both sides, of course. New elections would only make matters worse, so we're actively avoiding them. All this would not be so bad were it not that we've still got a budget to balance and a deficit of 8 billion euros to get rid of. do you know the difference of left and right political wings? i wont claim to know much about politics outside of Denmark but i know that the rest of Europe pays less taxes than we do and it is usually the socialists who want high taxes and they are of course left wing so i don’t see how it can be split up like America with south being left wing and north being right wing | ||
fofa2000
Canada548 Posts
| ||
{CC}StealthBlue
United States41117 Posts
BERLIN (Reuters) - German Chancellor Angela Merkel and French President Nicolas Sarkozy are planning more drastic means - including a quick new Stability Pact - to fight the euro zone sovereign debt crisis, Welt am Sonntag reported on Sunday. The Sunday newspaper reported in an advance before publication that if necessary Germany and France were ready to join a number of countries in agreeing to tough budget discipline. The report, which echoed a Reuters report on Friday from Brussels, quoted German government sources as saying that the crisis fighting plan could possibly be announced by Merkel and Sarkozy in the coming week. The report said that because it would take too long to change existing European Union treaties, euro zone countries should avoid such delays be agreeing to a new Stability Pact among themselves - possibly implemented at the start of 2012. Source | ||
Maenander
Germany4926 Posts
On November 27 2011 03:26 Shymon wrote: Why would you downgrade the USA atm? The current level of debt is around 100% of the GDP which according to most is still in the manageable range, As opposed to Greece's ratio of 158%. The government is currently very divided but also very stable, there is zero pressure to say rewrite the constitution. and the US dollar is in the middle of a small rally versus the currencies of most of the world including the euro which thanks to Greece and Spain may be in for a sharp downturn. Furthermore the general public has indicated that debt reduction is a major issue for upcoming elections which should (key word here is should) allow the elections of officials who would work to lower the debt of the USA at a national level. Add to all this some positive if slightly conflicting economic indicators; inflation at 3.5%, GDP up 2.5% last quarter, and positive early numbers for consumer confidence and spending. This is tempered by a still high 9% unemployment rate, which has not dropped as fast as other positive indicators would have suggested. However all in all i would still say the overall trend would still not be adverse to the credit rating of the USA as a whole. As a side note i am not an economist so this is a layman's opinion of the subject. Why should short term economic indicators matter? Just a few substantial numbers: GDP in 2010 (World Bank): United States $14,582,400 millions Eurozone $12,174,523 millions public debt in 2010 in % of GDP: United States 89.4% according to treasurydirect Eurozone 85.4% according to eurostat If the Eurozone can get into trouble, so can the US. | ||
Blix
Netherlands873 Posts
On November 27 2011 17:18 Maenander wrote: Why should short term economic indicators matter? Just a few substantial numbers: GDP in 2010 (World Bank): United States $14,582,400 millions Eurozone $12,174,523 millions public debt in 2010 in % of GDP: United States 89.4% according to treasurydirect Eurozone 85.4% according to eurostat If the Eurozone can get into trouble, so can the US. The difference is that the FED is allowed to do more than the ECB. I think that the FED will just create money, to limit the interest rate on govt bonds and if necessary prevent default. So banks that hold US bonds don't need to be afraid they don't get repaid. The dollars they receive may worth much less, but that doesn't matter if the obligations are also in dollars. Although obviously the US may get into trouble (i think it already is), the effect on the stability of the financial system should be less severe. But then again, if EU system goes down, so will the US and the rest of the world imho. Secondly, you shouldn't pool the EU debt like that (although the politicians are trying with their EU-bond abomination), because for example a German does not feel responsible for Italian debt. | ||
BrTarolg
United Kingdom3574 Posts
From a traders point of view - game over. People have clocked on germany is no longer a safe haven, and everyons is rushing out from contagion. We all expect an exit from germany which could cause a bund rally, or an exit of the insolvent states Problem is that the crisis dragged too long so now more states are becoming insolvent, it won't be long before germany is forced to pullout All the money is rushing into dollar as a result as it is literally the only and last safe haven | ||
RvB
Netherlands6213 Posts
On November 27 2011 02:54 maartendq wrote: I find it a good thing that the financial markets are finally able to push Di Rupo and company to come an agreement. This has childish bickering between left and right (wallonia and flanders) has been going on for far too long. It's actually surprised me how long it took the financial markets to crack down on Belgium though. I guess they were too preoccupied with Greece and Italy. I don't think it will last long anyway, doesn't the new government have like 6 parties? That won't go well for to long and they probably will be known for not doing a fuck because it's almost impossible to reach an agreement with 6 parties... | ||
Maenander
Germany4926 Posts
On November 27 2011 19:27 Blix wrote: The difference is that the FED is allowed to do more than the ECB. I think that the FED will just create money, to limit the interest rate on govt bonds and if necessary prevent default. So banks that hold US bonds don't need to be afraid they don't get repaid. The dollars they receive may worth much less, but that doesn't matter if the obligations are also in dollars. Although obviously the US may get into trouble (i think it already is), the effect on the stability of the financial system should be less severe. But then again, if EU system goes down, so will the US and the rest of the world imho. Secondly, you shouldn't pool the EU debt like that (although the politicians are trying with their EU-bond abomination), because for example a German does not feel responsible for Italian debt. You can't really think inflation doesn't matter to creditors. In the new, globalized world inflation is a less viable tool than ever before, because investors have more alternatives. That said, financial players are not rational and might fall for the cheapest tricks. And yes, I can't pool the Eurozone debt like that. What it goes to show is that the risk of contagion is overstated by the market. But once again, economics is not hard science because the players are not rational. Madness abounds. | ||
lOvOlUNiMEDiA
United States643 Posts
| ||
x2fst
1272 Posts
interesting repost over at zerohedge of a report from kyle bass, a hedge fund manager who has garnered a bit of a following for predicting (and profiting from) the us housing bubble and the current euro sovereign debt crisis. serves as a timely reaffirmation that all the liquidity in the world won't change the reality of the debt situation read here (20 pages, nothing technical) | ||
Robinsa
Japan1333 Posts
On November 30 2011 18:13 lOvOlUNiMEDiA wrote: "The Euro Area is coming to an end" Im going to point this out because I think its important. Almost all of the media saying the Euro is going down is either American or Brittish media as far as I know. I have yet to see any serious arguments for that in the European or Japanese newspapers I read. I think its a way for americans to scare the market and influence it. I wish EU had the same sort of power in the media establishment. Edit: Neither do I think its possible. Europe will never let the Euro fall. It wont happen. | ||
Cubu
1171 Posts
On December 01 2011 21:50 Robinsa wrote: Im going to point this out because I think its important. Almost all of the media saying the Euro is going down is either American or Brittish media as far as I know. I have yet to see any serious arguments for that in the European or Japanese newspapers I read. I think its a way for americans to scare the market and influence it. I wish EU had the same sort of power in the media establishment. Edit: Neither do I think its possible. Europe will never let the Euro fall. It wont happen. Funny. Ever since this talk of euro crisis in tl, whenever i read the posts here, it almost seemed like the americans were quick to critisize the euro. | ||
| ||