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Spain faces junk status, Greeks pulling $800m/day, Eurozone cash withdrawals could be capped; Is the Eurozone recession speeding up and panic setting in?
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Topic Started: 14 Jun 2012, 03:01 PM (887 Views)
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TED BULLPIT
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20 Jun 2012, 07:43 PM
Post #16
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- Starlightdiscs
- 20 Jun 2012, 07:22 PM
Well done Ted and well said. Yes ruin is close. To the person that asked where the spaniads retirement has gone, well ask the bankers and politicians. The minute the fractional reserve banking system was created this was always going to happen. 1934
2 biggest banks in France their share price has dropped 90% over the
Last couple of years. It funny how this site has become a world economy discussion board. Demographic is people searching for info on property, this is how I stumbled on a lot I have read over the pas 14 months. The world economy will faulter and break. ALL BE aware only 2% of the currency of Australia is in cash, the rest is just digital nothingness ready to disappear. Cash will be king. I feel it doesn't, take a lot of imagination this scenario.
The most frustrating thing to me is the USA is in the worse shape. MEGA unemployment, 55 million people on food stamps and more money owed than Europe combined.
My last point to JULIA, thanks for entering my lounge last night an saying how special Australia is. One sentence later how vulnerable we are.
Last last point, if you want to make some money, the universal cheers seems to be for gold , silver and shorting all banking stocks.
Great post 
Yes unfortunately , the worst gets closer , where it stops or ends is a complete mystery .
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peter fraser
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20 Jun 2012, 07:48 PM
Post #17
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- Starlightdiscs
- 20 Jun 2012, 07:22 PM
- TED BULLPIT
- 20 Jun 2012, 06:42 PM
You want a real answer Peter, not that you have answered some of my basic questions , but the answer was in my post that you responded to , and the answer is there is no solution that does not involve the collapse of the world economy.
Its not Spain , they are no more to blame than many others , its just that , as I have explained before they will break the camels back , greece , ireland and potugal were peanuts by comparison . Next will be italy and then france , this cannot be solved Peter. I told you three months ago that in a few months Spain will take center stage , greece will be out if the spotlight as attention now focuses on Spain. Things are not good and only getting worse by the day just as I have tried to explain , but still get met with a stonewall by people who have failed to educate themselves where necessary here.
Well done Ted and well said. Yes ruin is close. To the person that asked where the spaniads retirement has gone, well ask the bankers and politicians. The minute the fractional reserve banking system was created this was always going to happen. 1934 2 biggest banks in France their share price has dropped 90% over the Last couple of years. It funny how this site has become a world economy discussion board. Demographic is people searching for info on property, this is how I stumbled on a lot I have read over the pas 14 months. The world economy will faulter and break. ALL BE aware only 2% of the currency of Australia is in cash, the rest is just digital nothingness ready to disappear. Cash will be king. I feel it doesn't, take a lot of imagination this scenario. The most frustrating thing to me is the USA is in the worse shape. MEGA unemployment, 55 million people on food stamps and more money owed than Europe combined. My last point to JULIA, thanks for entering my lounge last night an saying how special Australia is. One sentence later how vulnerable we are. Last last point, if you want to make some money, the universal cheers seems to be for gold , silver and shorting all banking stocks.
Starlight - are you absolutely we have fractional reserve banking?
If so what is your evidence?
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Enjoy The Ride
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20 Jun 2012, 08:16 PM
Post #18
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- peter fraser
- 20 Jun 2012, 07:48 PM
Starlight - are you absolutely we have fractional reserve banking?
If so what is your evidence?
Peter- Engaging in the semantics yet again on this forum over Fractional Reserve banking only confuses the issue. We all know banks do not lend money that is "on deposit". The name we use to describe this loan creation isn't the issue.
You are well aware of the mechanisms used to create loans. Setting Starlight up like this is a cheap shot.
Enjoy The Ride!
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Enjoy The Ride!
“Money is the barometer of a society’s virtue. When you see that trading is done, not by consent, but by compulsion–when you see that in order to produce, you need to obtain permission from men who produce nothing–when you see that money is flowing to those who deal, not in goods, but in favors–when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you–when you see corruption being rewarded and honesty becoming a self-sacrifice–you may know that your society is doomed. Money is so noble a medium that does not compete with guns and it does not make terms with brutality. It will not permit a country to survive as half-property, half-loot” -Ayn Rand
"I, on the other hand, am a fully rounded human being with a degree from the university of life, a diploma from the school of hard knocks, and three gold stars from the kindergarten of getting the shit kicked out of me." Blackadder.
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peter fraser
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20 Jun 2012, 09:47 PM
Post #19
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- Enjoy The Ride
- 20 Jun 2012, 08:16 PM
- peter fraser
- 20 Jun 2012, 07:48 PM
Starlight - are you absolutely we have fractional reserve banking?
If so what is your evidence?
Peter- Engaging in the semantics yet again on this forum over Fractional Reserve banking only confuses the issue. We all know banks do not lend money that is "on deposit". The name we use to describe this loan creation isn't the issue. You are well aware of the mechanisms used to create loans. Setting Starlight up like this is a cheap shot. Enjoy The Ride!
Then you can give him the news.
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Starlightdiscs
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21 Jun 2012, 01:34 AM
Post #20
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- TED BULLPIT
- 20 Jun 2012, 07:27 PM
Oh Peter , they have rioted in Greece which has only subsided for now because we gave them some more money to pay the police firce and pensioners and bludgers. You see , what happens Peter when they can no longer pay both the police and the unemployed?
I saw some footage in greece last week where an old lady said the soup kitchens they now have remind her of the great depression.
Spain is now rioting in the street. What more evidence do you need , like I have told you all and explained there is no solution and this will get worse and worse. Basically Peter , you have seen nothing yet.
Yes but it is only the beginning, BUT I may add USA fox news is telling me everything will be alright. Mmmmmmm very late I must go to bed, I was going to watch the Ben Benanke free money print run~o well I guess I will have to read about it tomorrow. Print the mone, print the money, austerity is near, time to print the money, soon I will need a wheelbarrow to buy a loaf of bread, hang the bankers, hang the bankers let's face it they are ?......
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Starlightdiscs
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21 Jun 2012, 01:41 AM
Post #21
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- Enjoy The Ride
- 20 Jun 2012, 08:16 PM
Peter- Engaging in the semantics yet again on this forum over Fractional Reserve banking only confuses the issue. We all know banks do not lend money that is "on deposit". The name we use to describe this loan creation isn't the issue.
You are well aware of the mechanisms used to create loans. Setting Starlight up like this is a cheap shot.
Enjoy The Ride!
Yes pretty sure, but I think you will find history may rename it zilch reserve banking, or we're all up shit creek banking. Or maybe we should adapt a NO INTERSTATE banking system, seems to work ver well in Hindu culture. What you think?
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Starlightdiscs
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21 Jun 2012, 01:42 AM
Post #22
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- Starlightdiscs
- 21 Jun 2012, 01:41 AM
Yes pretty sure, but I think you will find history may rename it zilch reserve banking, or we're all up shit creek banking. Or maybe we should adapt a NO INTERSTATE banking system, seems to work ver well in Hindu culture. What you think?
Meant to say no interest bank system
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Strindberg
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21 Jun 2012, 09:01 AM
Post #23
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- Starlightdiscs
- 21 Jun 2012, 01:42 AM
- Quote:
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Yes pretty sure, but I think you will find history may rename it zilch reserve banking, or we're all up shit creek banking. Or maybe we should adapt a NO INTERSTATE banking system, seems to work ver well in Hindu culture. What you think?
Meant to say no interest bank system
You are advocating ZIRP?
You are advocating a system where it's free to borrow money and savers get nothing? Be good for higher house prices.
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Housing costs to Income broadly unchanged since 1994 - re-ratified here
The People of Australia have the highest median wealth in the World
2002-2012 10 year house price growth the SLOWEST since 1952-1962
1990-2010 20 year house price growth the SLOWEST since 1950-1970
CHRIS BECKER NOW NEUTERED
"There are two kinds of people in this world: ones that fiddle around wondering whether a thing's right or wrong and guys like us." (Hugo to Gagin in Ride the Pink Horse)
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TED BULLPIT
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21 Jun 2012, 09:36 AM
Post #24
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- Strindberg
- 21 Jun 2012, 09:01 AM
- Starlightdiscs
- 21 Jun 2012, 01:42 AM
- Quote:
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Yes pretty sure, but I think you will find history may rename it zilch reserve banking, or we're all up shit creek banking. Or maybe we should adapt a NO INTERSTATE banking system, seems to work ver well in Hindu culture. What you think?
Meant to say no interest bank system
You are advocating ZIRP? You are advocating a system where it's free to borrow money and savers get nothing? Be good for higher house prices.
You mean just like in the USA. 
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Alex Barton
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24 Jul 2012, 09:17 AM
Post #25
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Spain sinks deeper but says no bailout neededJuly 24, 2012 - 5:55AM Spain denied that it needed a full international bailout as the economy shrank even faster and its long-term borrowing costs jumped to dangerous highs panicking world markets. The Bank of Spain said the economy had contracted 0.4 per cent in the second quarter, worse than the 0.3 per cent of the first, citing the impact of the debt crisis on consumer spending and confidence. On Friday, the government said the recession would continue next year, instead of ending with modest growth as it had previously forecast. The bad data compounded Madrid's problems, chief among them how to cut an unprecedented unemployment rate of more than 24 per cent while at the same time stabilising a stricken banking system and public finances. Financial markets have turned against Madrid in recent weeks after an initially positive reaction to a massive 65-billion-euro austerity package turned sour. Each new initiative has failed to hold the line. In late afternoon trade, the yield -- the rate of return investors earn -- on the benchmark Spanish 10-year government bond jumped to 7.49800 per cent from 7.225 per cent on Friday, well above the 7.0 per cent danger level for long-term funding. But despite speculation that it might intervene, the European Central Bank stayed out of the fray, refusing to enter the markets to ease debt strains as it had last year when yields from Spain and Italy hit similar danger levels. Italian Prime Minister Mario Monti said he hoped the European Central Bank would help support Europe's financial sector, in comments after talks with Russian President Vladimir Putin. "But I do not think there are grounds for that yet -- grounds for requiring the immediate allocation of funds," the Interfax news agency reported him saying. Despite the market tensions, Monti ruled out another emergency EU summit on the crisis. "I do not think it would be appropriate to have an emergency summit or a European-level meeting," he said. Borrowing costs for other struggling eurozone states were also under pressure despite an EU bank rescue deal worth up to 100 billion euros ($US122 billion) for Spain, which was finalised Friday. The Italian 10-year bond yield jumped to 6.332 per cent from 6.149 per cent. Any yield over 6.0 per cent is widely seen as unsustainable for long-term funds: 7.0 per cent is the level at which Greece, Ireland and Portugal had to ask for outside help from the EU and International Monetary Fund. Read more: http://www.smh.com.au/business/world-business/spain-sinks-deeper-but-says-no-bailout-needed-20120724-22lev.html#ixzz21UTt8aVv
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newjez
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24 Jul 2012, 10:01 AM
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"I do not think it would be appropriate to have an emergency summit or a European-level meeting," he said.
Is that because they are packing their bags for the olympics and don't want to miss the opening ceremony?
Could prove costly that one.
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A plug for my books on kindle Jack - a thin veil of duplicity
and Summer Days
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newjez
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24 Jul 2012, 01:42 PM
Post #27
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http://www.telegraph.co.uk/finance/financialcrisis/9422001/Eurozone-danger-mounts-as-Spain-spins-out-of-control.html
I guess the big question is - after the Euro goes through the floor - what will happen to Chinese trade figures?
Eurozone danger mounts as Spain spins out of control
Spain is battling to avert a fully-fledged sovereign rescue after borrowing costs spiralled out of control, with dangerous knock-on effects in Italy and Eastern Europe.
By Ambrose Evans-Pritchard, International Business Editor
The yields on closely-watched two-year debt surged by 78 basis points to a modern-era high of 6.42pc, leaving it unclear how long the country can continue funding itself. Italy’s two-year yields vaulted to 4.6pc.
“We can’t keep going like this for another 15 days,” said Prof Miguel Angel Bernal from Madrid’s Institute of Market Studies. “The European Central Bank has to bring out its heavy artillery.”
Andrew Roberts, credit chief at Royal Bank of Scotland, said the dramatic spike in short-term borrowing costs marked a key inflexion point in the crisis, replicating the pattern seen in Greece, Ireland and Portugal as they lost access to market finance. “We are fast approaching the endgame,” he said.
Exchange clearer LCH Clearnet raised margin requirements on both Spanish and Italian bonds, a move that will automatically cause further selling by some funds.
Confidence has evaporated since Germany effectively blocked plans for the European Union bail-out machinery to recapitalise the Spanish banking system directly, as originally announced after the EU summit deal in June.
The EU’s €100bn (£78bn) package will be a loan to the Spanish state. This fails to sever the fatal link between banks and vulnerable states, each pulling the other down.
The mood has gone from bad to worse as Spain’s regional governments line up for internal rescues, with Catalonia preparing a €3.5bn bail-out request following moves by Valencia and Murcia in recent days. The regions must roll over €15bn of debt by the end of the year.
The Spanish newspaper El Confidencial reported sources close to premier Mariano Rajoy complaining bitterly that the crisis engulfing Spain was a “failure of the whole European Project and the incompetence of its leaders”.
There is deep shock in government circles that the €65bn austerity package passed by the Spanish parliament last week amid bitter protests across the country – and imposed by the EU – has failed to make any difference.
El Confidencial said the Rajoy team was thinking of “putting on the table” a possible withdrawal from the euro, a dramatic escalation in the game of brinkmanship between the eurozone’s Latin bloc and German-led creditor core.
“We would have our own currency again and restore competitiveness. It would have some disastrous consequences at first, but we would regain control over our own policies and we would escape from the crisis sooner,” a government source reportedly said.
Spain has enough funds to muddle through into the autumn, but it is under mounting pressure from the EU authorities to swallow its pride and accept rescue to halt contagion to Italy, where bond yields are testing danger levels.
Joaquin Almunia, the European Competition Commissioner, said the proper course of action at this stage was direct purchases of Spanish debt by the eurozone bail-out fund (EFSF). “Spain can’t do this alone,” he said.
The surge in Spain’s short-term yields adds another twist to the banking crisis, a cost that now falls on the state. Spanish banks borrowed €315bn from the ECB under the long-term refinancing operation (LTRO) and “parked” a large chunk in Spanish two-year to five-year sovereign bonds until they need the money to cover their own debt rollovers.
While this so-called “carry trade” helped to stabilise the Spanish bond market for a few months during an exodus by foreign investors, it has now backfired badly. The two-year bond has shed 9pc in face value since the second LTRO in February, leaving the banks heavily under water. “This has turned into an unmitigated disaster. They will have to crystallise these losses when they sell,” said Mr Roberts.
The latest Fiscal Monitor by the International Monetary Fund has pencilled in public debt to GDP of 96pc in Spain by next year, up from 84pc just two months ago – a sign of how quickly the situation is snowballing out of control.
Gary Jenkins from Swordfish said the EU may be able to “rustle up” just enough money to finance an EU-IMF Troika rescue for Spain – probably around €400bn – but Italy is too big to handle.
The existing EU bail-out fund (EFSF) is down to about €160bn after covering the needs of Greece, Ireland, Portugal, Cyprus and the Spanish banks. The new permanent fund (ESM) will have €500bn, but is facing a challenge in the German constitutional court. It is far from clear whether these funds can raise large sums on the open market at viable cost.
Mr Jenkins said the fire must be contained before it reached the next big country, either by massive ECB intervention or full fiscal union. Germany is still blocking both. “The battle for Spain is already lost. The battle for Italy has begun,” he said.
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A plug for my books on kindle Jack - a thin veil of duplicity
and Summer Days
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3:35 AM May 21
