Tuesday 12 July 2011

OK, maybe we can have an Italy crisis in July.


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Winners 102 Losers

That is a really nasty wake-up call, the Italian Bourse is down 4.5% this morning. That is even worse.

The Euro 'Elite' really need to get going or else there is big trouble Don;t they remember just two weeks ago uncle Wen visited to say he would help out - did anyone write down his phone number?

Also I am changing my opinion on can-kicking, that Greek rally did not last very long did it? This is in itself a bad sign that there is no long term confidence. Without that, there can be no market led recovery. Either more QE is needed to flush the system with inflation or the banks need to be killed as debt is written off - a nice terrible or disastrous set of options. I wonder what Oil Rehn is thinking today...


Old BE said...

FT Alphaville is talking about fiscal union, but even if there was a will, wouldn't it take several years to get the treaties through?

Anonymous said...

BE - there's nowt like the smell of fear to speed things up!

Fiscal union was only waiting for an event like this - it was never going to happen in 'The Good Times' - why would the populace accept it when they'd 'never had it so good'? We all lived by the old addage 'if it ain't broke why fix it?' But now it (and we) is obviously broke. I mean, its not like we didn't know that this end-game was obvious from the off is it?

CityUnslicker said...

its fiscal union or euro break-up - that is how it will be sold.

BE is right re treaties though - so my money is on the latter if the markets go mental.

However, some liberal use of printed money might buy the time for fiscal union. Will the Germans really want it though?

Mr Ecks said...

There is going to be a major crash. You can have it with deflation which is the market's way of sorting out the mess or the morons can QE and you can have hyperinflation.

Trying to turn the EU into the 1000 year reich now won't work--that's what they are aiming for but it is way too soon yet and in the middle of a crisis to boot.

StevenLings said...
This comment has been removed by the author.
Timbo614 said...

@CU: "that Greek rally did not last very long did it?"

I may have sold a bit early but am glad I did now even tho' the drop has not yet wiped out the Greek "solution" rally (Timbo: 20th June "I'm Outta here")

I don't think there will be fiscal union especially if they (EU Elites) try to bring it in 1) in a hurry, 2) In a crisis situation. 3) The "better off" nations will not want ANY union soon with financial Has-beens (PIIGS). And where would it leave the UK, In? (we are not a EURO member) Automatically Out?(we are not a EURO member) or just shaken all about but with the possibility of an even weaker Pound?

The Banks, and therefore we((UK banks will do badly) must suffer - they have managed to persuade governments and E.Unions and FEDS to kick the can for 3 years - Now the can is getting really, really big and heavy...

Budgie said...

As I said in my comment to the previous post, it's fiscal union or bust. And when the EU elite sees the whites of the eyes of the bust, they will give fiscal union a shot. They have nothing to lose now.

Elby the Beserk said...

Why is that the likes of myself, no economist, no market whizz, know that if you continue lending money to institutions unable to repay their current loans, then sooner rather than later things will go BANG!

Yet EU, the ECB and the IMF persist in doing so. It would seem to me that if you keep your head buried in the sand for too long, you will die of asphyxiation. I can only think that all concerned are terrified of losing their seats driving the gravy train. If it were up to me, I'd have them all banged up, in the interests of the peoples of all countries involved, in the interests of us suckers who are paying for these utter utter twunts.

Mr Ecks said...

Budgie--They have their fucking lives to lose...

andrew said...

The views of the man on the clapham omnibus (us) are of little or no import right now.

The views of the man on the Hamburg tram and the woman on the Athens bus are. He will be getting the bill for some of this, and she will be paying the rest.

Does anyone know such people?

My geuss is that the willingness to support re-unification is a positive sign, but the prospect of paying for Greek civil servants to retire at 50 something on a full pension, when they get to retire at 65 or later will be a bit of a deal breaker.

On the flip side, if I was Greek, the propect of having my living standards radically slashed in a short space of time is also a deal breaker.

Since the Germans will absolutely not allow inflation to run in the Euro, I think default is inevitable.

Sean said...

Fiscal union is a no no as for as the geman constitution is concerned....not that will stop the euro-crooks, which will of course make the fall much harder.

Anonymous said...

Of course, this crash is the first which to be compounded by peak oil, peak food and end-to-end corruption amongst the elite.

The next step will be state seizure of private assets in exchange for 0.5% perpetuals.

The 'long emergency' is well under way!

Electro-Kevin said...

Andrew - a Greek default 'inevitable' ?

I could have sworn that had already happened.

Anyway. I'm not sure what is meant by 'fiscal union'. Does this mean ... ab-Zorba the Greek ???

Timbo614 said...

EK: ab-Zorba the Greek - thanks for my first laugh of the day. :))

James Higham said...

or the banks need to be killed as debt is written off


Timbo614 said...

JH: Surely that amount of debt write-off would create the bank run to end all bank runs as no-one really knows which bank is holding the biggest can or which ones will get left with no chair when the music stops. The banks get automagically killed, 99% of all known banks, dead; stone dead.