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lol. that's a convenient interpretation
edit:
i mean not saying that outsiders aren't more likely to criticize the euro, but many think such eventualities are possible. plenty of potentially "destabilising" news has originated from euro nations too. particularly germany ldo, where there is significant political pressure to reduce german risk as a result of this mess
at the end of a day it's a reaction to perceived absurdity of european responses to the crisis. the feeling that all the measures thus far are simply delaying the inevitable and that germany ultimately won't allow itself to be dragged down by the 'mistakes of others'
anyway, i don't there's ever any attempt to represent these "euro breakup" reports as anything other than speculative, the scenarios take on many forms. if the crisis is as bad as many think it is, it's fair to consider "extreme" outcomes iyam
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On November 27 2011 19:29 BrTarolg wrote:
The bund has dropped like 500 points
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
well newest news is that German short term bonds are sold at negative interest rates and Germany is therefore making money for lending them (now dragons will spawn and the five horsemen will make black holes in CERN. It is paradoxical!). Same goes for Switzerland as the only other country in the world.
A few blissful words from the biggest central banks in the world has stabilized the markets a lot. Even Italian bonds are taking a nosedive in interest rate.
It seems that part of the crisis is something the right people can make disappear with a nodge. Now the thing is more about starting the growth in economy again.
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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.
I don't even want to imagine the Euro falling. It's such a scary thought. Politics can't let this happend.
And dropping countries out of the Euro would be even worse.
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it's not going to be the end of the world when the euro comes down ... and with it our worldwide financial system.
it will be though but maybe we can build something better out of it. And Ending is always a new beginning ...
and let's be real we need some real change on this planet ... and one major factor that prevents us from being just better people is our financial system that needs to be completely rebuild.
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United States, you can see the future. You don't need a crystal ball, you don't need a vision or revelation. Just take a good, long look at what's going on in Europe. That's your future. It takes ten times the effort to cut a benefit as it does to increase it. Government is a one way street.
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On December 02 2011 01:41 liberal wrote:
United States, you can see the future. You don't need a crystal ball, you don't need a vision or revelation. Just take a good, long look at what's going on in Europe. That's your future. It takes ten times the effort to cut a benefit as it does to increase it. Government is a one way street.
The US are not as tied by the notation agency tho.
It will not be exactly the same.
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On December 02 2011 01:43 Noocta wrote:Show nested quote +On December 02 2011 01:41 liberal wrote:
United States, you can see the future. You don't need a crystal ball, you don't need a vision or revelation. Just take a good, long look at what's going on in Europe. That's your future. It takes ten times the effort to cut a benefit as it does to increase it. Government is a one way street. The US are not as tied by the notation agency tho. It will not be exactly the same.
The US has future liabilities totaling 123+ trillion USD. We can't pay off the interest on our 15 trillion if bonds go up to 20%. I'd say the US is in an even worse position, and what's going to happen to the Euro is...
Australia and Canada are actually doing well (considering how well you can be doing right now). So not all hope is lost.
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On December 02 2011 01:22 radiatoren wrote:Show nested quote +On November 27 2011 19:29 BrTarolg wrote:
The bund has dropped like 500 points
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 well newest news is that German short term bonds are sold at negative interest rates and Germany is therefore making money for lending them.
I looked up on wikipedia about negative interest rates and understood it but this seems to be a different case. I get what bonds are (basically governments borrowing money) but could you please explain more on that?
Why buy negative interest rate bonds?
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On December 02 2011 01:22 radiatoren wrote:Show nested quote +On November 27 2011 19:29 BrTarolg wrote:
The bund has dropped like 500 points
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 Even Italian bonds are taking a nosedive in interest rate. .
Italian bonds are a complete joke - if you ever actually look at the market for them the volumes are so thin, theres like 1/2 people doing the bids/offers in the market (literally)
You could shove 100 lots on there and it will change the interest rates of italy by 0.1% lol
The whole thing is just random intervention by ECB doing secret bond purchases
I saw people buying negative yield calls on the schatz, pretty funky stuff going down
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On December 02 2011 01:57 SnK-Arcbound wrote:Show nested quote +On December 02 2011 01:43 Noocta wrote:On December 02 2011 01:41 liberal wrote:
United States, you can see the future. You don't need a crystal ball, you don't need a vision or revelation. Just take a good, long look at what's going on in Europe. That's your future. It takes ten times the effort to cut a benefit as it does to increase it. Government is a one way street. The US are not as tied by the notation agency tho. It will not be exactly the same. The US has future liabilities totaling 123+ trillion USD. We can't pay off the interest on our 15 trillion if bonds go up to 20%. I'd say the US is in an even worse position, and what's going to happen to the Euro is... Australia and Canada are actually doing well (considering how well you can be doing right now). So not all hope is lost.
This is one of the reasons why I think it is crazy that the current government is so hell bent on trying to take away what has made and is continuing to allow Canada to be in a decent position and trying to Americanize the country. It is utterly insane.
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On Monday, S&P's announced that it had placed its "long-term sovereign ratings" on 15 eurozone nations on credit watch "with negative implications".
The ratings agency said the decision was prompted "by our belief that systemic stresses in the eurozone have risen in recent weeks to the extent that they now put downward pressure on the credit standing of the eurozone as a whole".
As well as Germany and France, Austria, the Netherlands, Finland and Luxembourg also currently have top AAA rating.
S&P's announcement means that there is a one in two chance that those countries would see their credit rating fall within 90 days.
Eurogroup Chairman Jean-Claude Juncker, meanwhile, described S&P's move as "a wild exaggeration and also unfair".
"I am not unsettled by this, but I am astonished, after the significant efforts in recent days to overcome the crisis, such as savings programmes in Italy and Ireland," Reuters news agency quoted him as telling German radio.
It might actually be "the right" move to downgrade, but why threaten now so shortly before the summit on friday?
American ratingbureau trying to blackmail european economic policies?
This is a problematic choice, by an already less respected rating bureau.
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These rating agencies are a complete joke. If you want a crisis, you can just create one from thin air. Not saying we didn't have the current crisis coming though. I'm pretty certain Euro won't fall - Germany and France will not allow it to happen, Besides, many non-eurozone EU countries are said to sign the new euro agreement (currently in the works), including Poland (aka 6th largest economy in the EU and pretty much the only one with any GDP growth during the crisis), which recently became very active and involved in the upcoming treaty - perhaps because it currently holds EU presidency and probably because the current plan is to join the eurozone the moment it stabilizes itself (within the next 4 years, I hear, although I do not believe it will be possible).
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The Standard & Poor's ratings agency has carried out a mass downgrade of more than half of the euro zone countries.
S&P stripped France and Austria of their top AAA ratings on Friday in a move that may complicate efforts to solve a two-year old European debt crisis.
Those were just two of the nine member-states of the euro area that had ratings cut.
However, Francois Baroin, the French finance minister, said the loss of the AAA rating was not "a catastrophe" and underscored that France still had a solid AA+ rating.
"The United States, the world's largest economy, was downgraded over the summer,'' he said.
"You have to be relative, you have keep your cool. It's necessary not to frighten the French people about it."
Besides France and Austria, Malta, Slovakie and Slovenia suffered a one-notch downgrade while Portugal, Italy, Spain and Cyprus were cut by two notches.
The downgrades come as crucial talks on cutting Greece's massive debt pile appeared close to collapse on Friday.
A pact being negotiated to tighten budgetary discipline is not a breakthrough for the eurozone's problems and may lead to self-defeating fiscal austerity, Standard & Poor's.
The pact, which EU leaders agreed to negotiate at a December 9 summit, "has not produced a breakthrough of sufficient size and scope to fully address the eurozone's financial problems," S&P said as it announced the downgrades.
S&P had warned 15 European nations in December that they were at risk for a downgrade.
France is the second-largest contributor behind Germany to Europe's financial rescue fund. The fund still has a rating of AAA. That means that it can borrow on the bond market at low rates.
The cut in the French credit rating may lead bond traders to raise borrowing costs for the financial rescue fund, said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott, a financial firm.
"There's a legitimate reason to be concerned," he said. "A weaker France means a weaker bailout fund."
S&P reaffirmed the ratings of Belgium, Estonia, Finland, Germany, Ireland, Luxembourg and the Netherlands.
Source
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I've been buying all I can of EUO since like 2 months ago. I'm only 19 so I don't have much in my brokerage account but it's maxxed on the double short Euro FFT, EUO. Obviously I don't belive it can continue as it with deadbeats and overachveirs drawing from same currency and will fail.
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On December 02 2011 01:57 SnK-Arcbound wrote:Show nested quote +On December 02 2011 01:43 Noocta wrote:On December 02 2011 01:41 liberal wrote:
United States, you can see the future. You don't need a crystal ball, you don't need a vision or revelation. Just take a good, long look at what's going on in Europe. That's your future. It takes ten times the effort to cut a benefit as it does to increase it. Government is a one way street. The US are not as tied by the notation agency tho. It will not be exactly the same. The US has future liabilities totaling 123+ trillion USD. We can't pay off the interest on our 15 trillion if bonds go up to 20%. I'd say the US is in an even worse position, and what's going to happen to the Euro is... Australia and Canada are actually doing well (considering how well you can be doing right now). So not all hope is lost.
Yeah and we have coal reserves alone worth 120 trillion on future dollars you are talking about. 18 trillion currently. Not to mention land, oil, mineral rights to exploit and future GDP. You think people would loan us without any backing? Let alone at almost zero % interest like we get? Laymens People worries about US are unfounded as we are only half broke, countries like Greece are totally broke.
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This will be a "I told you so" post. I love making these kinds of posts.
Here's an article from BBC today about the credit rating downgrades.
http://www.bbc.co.uk/news/business-16552623
Misdiagnosis
Austria, like France has lost its top AAA rating, and been downgraded to AA+. Its economy exports a lot to recession-struck Italy, while its banks are facing losses on subsidiaries they own in financially troubled Hungary.
S&P's rating of Italy - currently at the epicentre of the crisis - has been cut two notches from A to BBB+.
Spain was also cut two notches from AA- to A, as was Portugal, whose rating fell from BBB- to a "junk" rating of BB - indicating a very high level of risk for lenders.
Apart from Germany and lower-rated Slovakia, all the other countries being reveiwed were given a "negative outlook", meaning there is a 30% chance of a further downgrade.
"Today's rating actions are primarily driven by our assessment that the policy initiatives that have been taken by European policymakers in recent weeks may be insufficient to fully address ongoing systemic stresses in the eurozone," said S&P in its statement.
The agency said the plan currently being discussed by eurozone leaders - to limit governments' future borrowing - was based on a misdiagnosis of the cause of the financial crisis.
It said the crisis was more to do with trade deficits and a loss of competitiveness by "periphery" eurozone economies such as Italy and Spain, than excess borrowing by governments.
The agency also praised the ECB for taking action to stop a total collapse in market confidence in the eurozone late last year.
I told you so: http://www.teamliquid.net/forum/viewmessage.php?topic_id=299151
The European debt crisis was NOT caused by too much government debt, despite the false claims from Germany, the media, and right-wing commentators. And cutting government spending will just make the problem worse and plunge Europe into recession...
... just as S&P has said today.
I told you so.
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On December 02 2011 01:57 SnK-Arcbound wrote:Show nested quote +On December 02 2011 01:43 Noocta wrote:On December 02 2011 01:41 liberal wrote:
United States, you can see the future. You don't need a crystal ball, you don't need a vision or revelation. Just take a good, long look at what's going on in Europe. That's your future. It takes ten times the effort to cut a benefit as it does to increase it. Government is a one way street. The US are not as tied by the notation agency tho. It will not be exactly the same. The US has future liabilities totaling 123+ trillion USD. We can't pay off the interest on our 15 trillion if bonds go up to 20%. I'd say the US is in an even worse position, and what's going to happen to the Euro is... Australia and Canada are actually doing well (considering how well you can be doing right now). So not all hope is lost.
http://www.nytimes.com/2012/01/02/opinion/krugman-nobody-understands-debt.html
Also, as the above poster said: people are giving money to the US government at near 0% interest rates. You think they would do that if they feel that the US can't handle their debt problems?
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Interest is only so low becasue the fed buys 90% of the us bonds themselves lol (with monney they dont have, but create)
If you look up who owns the us foreign debt you will see that the fed owns like 90% of it, china owns 9% of it, and 1% is owned by other countrys/ investors/banks
How can debt ever be a problem when you can just print monney to pay it off.
The monney is just slowly devaluating.
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I don't think this will be the death of the euro, but it's certainly going to hurt for a while.
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EPT
