Posted on 07/10/2011 8:26:21 PM PDT by bruinbirdman
Once again Europe's debt crisis has metastasized, and once again the financial authorities face systemic contagion unless they take immediate and dramatic action.
If the ECB's Jean-Claude Trichet is right in claiming that Europe was on the brink of a 1930s financial cataclysm a year ago - and I think he is - it is hard see how the threat is any less serious right now.
Fall-out from Greece flattened Portugal and Ireland last week. It is engulfing Spain and Italy, countries with €6.3 trillion of public and private debt between them.
Yields on Italian 10-year bonds hit a post-EMU high of 5.3pc on Friday. This is not just a theoretical price: the Italian treasury has to roll over €69bn (£61bn) in August and September; it must tap the markets for €500bn before the end of 2013. The interest burden on Italy's €1.84 trillion stock of public debt is about to rise very fast.
Spanish yields punched even higher, through the danger line of 5.7pc. The bond markets of both countries are replicating the pattern seen in Greece, Portugal, and Ireland before each spiraled into insolvency. And the virus is moving up the European map. French banks alone have $472bn (£394bn) of exposure to Italy and $175bn to Spain, according to the Bank for International Settlements.
"We believe the European sovereign crisis might be entering a new phase with contagion reaching the larger economies," said Jacques Cailloux, chief Europe economist at RBS.
"It is unclear to us how this latest negative shock to confidence is going to be undone in the absence of a 'shock and awe' policy response."
Italy's premier Silvio Berlusconi has chosen this moment of acute danger to undermine his own finance minister, Giulio Tremonti, the one figure in his cabinet respected by global bond vigilantes. "He's
(Excerpt) Read more at telegraph.co.uk ...
Forget it. They’re done. People will die and lots of them. No hope remains for Eurozone... well maybe Germany and UK... but even there it’s going to be awful. I hope we can avoid it here.
italy and spain?
hell, i’m busy.
i barely care what happens in Kansas.
Italy and Spain, get real
On a serious note, when the libs use the excuse we are in trouble because of the aforementioned reasons, I say, so why is Greece and California bankrupt? watch them try to respond and after 20 seconds of them stumbling around, just say, "too many freeloaders riding in the cart and too few people pulling it, same as here"
The leftists who have taken over Spain and Italy no longer believe in God. Who do they pray to for their “miracle” - Karl Marx?
Inevitability, much like karma, is an SOB and cannot be avoided save by the grace of God. As such, despite the continued insistence by the defunct and corrupt IMF, it is a near given...an inevitability...that Spain, Portugal, and Italy will default either before or soon after Greece.
Wonderland Ping.
Thanks bruinbirdman.
Too many ticks and not enough dogs.
Excellent post. I see the same thing.
Well, there it is. We’re seeing a consequence of socialism and a few other mistakes. Yields will continue higher, and prices, lower there. The dollar might continue up a little relative to the Euro, for a short time (might), but the contagion might also commence. All very risky and frightful there and here.
Country Comparison :: Current account balance - CIA Home
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2187rank.html
you talk to libs??
bad mistake
you should only speak to them with a bat
i will put my hatred of those $%^%$ against anybody
“too many freeloaders riding in the cart and too few people pulling it, same as here”
Read an article in an European paper last week after they upped the bank rate, the economist was talking about the situation inItaly, and he said quote “The average hourly wage in Italy is three dollar more than in the US, and the productivity is 14 dollars less” end quote, so if we are having problems here, and we are, how is it going to turn out well for them. Stop spending more than you earn is the only way to fix it
It's not going to happen.
The German Taxpayer is NOT going to borrow money so that they can lend it to drunkards to piss away.
They are tired of it and will put their foot down.
That will be the end of the EU, Euro and EMU.
And just what are these calamitous effects to German foreign policy? Everyone is going to mad at them because the cut up the credit card? You can bet the German people don't care.
When the New Mark is issued, buy it and other assets dominated in it. Or buy something else substantial.
Too many ticks and not enough dogs
Well said, best analogy of the situation I have seen so far,
how about putting some of those ticks to labour so they can suport themselfs instead of sucking the blood of us working dogs. Actually, we have plenty of ticks around here to, and not everything are done yet, work for welfare insted of handouts will change attitude both there and here, I actually have fixes for most of out ailments, but it would take a magor attitude adjustment both from political point and those with theit hands out demanding more
This is really sad, and it’s made even worse by the fact that it was entirely predictable. Socialism is unsustainable. What was sold as an emergency safety net has become an unsustainable hammock for millions upon millions. People can’t retire at 50 and spend the rest of their medically extended lives living off of other people. There simply aren’t enough workers to pay for the modern social welfare state.
Mark Levin says it better than I, but the gist is this: Medicare, Medicaid, Social Security, etc. have already failed. We are broke. The leftists tempt foolish people with talk about free stuff, shared responsibility, etc., but they can’t balance the books. If these programs are so great, then why can’t we pay for them? Hint: there’s not enough money, even if we confiscated every dime from the rich, to pay for it all!
If California is so great, then why can’t they balance the books? It appears most Californians want socialism. Fine! Seriously! That’s fine with me, as they should be entitled to run their lives so long as they are paying the bills. There’s the rub. They are NOT paying the bills! They are failing, and even if every Hollywood actor and actress (yeah, I’m old school) gave up everything they owned to the state, California wouldn’t even remotely come close to paying what they owe. They can’t even pay for what they’ve already spent, much less the billions upon billions of future obligations. That is, by definition, FAILURE.
Ambrose Evans-Pritchard ...... looks like he’s back. He got out of town for a few months, to some place unreachable by cell phone as I remember
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