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Greece gonna Default on Tuesday?

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Comments

  • Closed Accounts Posts: 595 ✭✭✭books4sale


    Slydice wrote: »
    What do you think?

    I think yer blowin' sh*t through the pipe dude...what's your agenda?

    Those 2 websites you quote ....those are regular Joe opinions... what kind of substantial source of info. is that?

    http://www.economonitor.com/blog/201...k-default-day/
    http://www.zerohedge.com/news/septem...ek-default-day

    Bit like me using this forum as a source of info when at the best times....it makes for some amusing fictious reading...just like your post.

    Anyway, good luck with your crusade, come Wednesday, there'll be no changes.

    I'll be right.....and well ...you should probably get a new user name and spout on about the collapse of the Euro or some other doomsday scenario.

    Protecting the world against another numpty...Books4sale.


  • Registered Users, Registered Users 2 Posts: 10,501 ✭✭✭✭Slydice


    looks like it's quietened down a bit except for the greek finance ministry coming out to deny it:
    http://www.ibtimes.com/articles/215608/20110917/eu-finance-ministers-take-stock-of-progress-on-debt-crisis.htm
    Greece's finance minister on Saturday dismissed talk that the debt-strapped country was headed for default, while saying Prime Minister George Papandreou canceled a trip to the United States because tough decisions had to be made imminently.

    "The comments and analyses about an imminent default or bankruptcy are not only irresponsible but also ridiculous," Finance Minister Evangelos Venizelos said in a statement.

    "Every weekend Greece ... is subject to this organized attack by speculators in international markets," he added.

    Venizelos said Papandreou decided to return to Athens not because of an economic emergency but because the government had to take tough decisions as talks resume with its international lenders before a next bailout tranche is released.


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    books4sale wrote: »
    I think yer blowin' sh*t through the pipe dude...what's your agenda?

    Those 2 websites you quote ....those are regular Joe opinions... what kind of substantial source of info. is that?

    http://www.economonitor.com/blog/201...k-default-day/
    http://www.zerohedge.com/news/septem...ek-default-day

    Bit like me using this forum as a source of info when at the best times....it makes for some amusing fictious reading...just like your post.

    Anyway, good luck with your crusade, come Wednesday, there'll be no changes.

    I'll be right.....and well ...you should probably get a new user name and spout on about the collapse of the Euro or some other doomsday scenario.

    Protecting the world against another numpty...Books4sale.

    Well, he also used the bond markets as a source of info...which as Soros said, have an infallible way of predicting the future...because they create it...as we have already seen.

    Does Greece default on Tuesday? I have no idea if Tuesday is the day...but default they will at some point...preparations are already well underway for that event.

    Amberman

    PS - The two sites he mentioned are widely read and very highly regarded by traders...zerohedge being arguably the most highly regarded trading blog out there.

    Maybe you should pop over and have a read for yourself? It is informative, thought provoking and very entertaining.


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    Amberman wrote: »
    Well, he also used the bond markets as a source of info...which as Soros said, have an infallible way of predicting the future...because they create it...as we have already seen.

    Does Greece default on Tuesday? I have no idea if Tuesday is the day...but default they will at some point...preparations are already well underway for that event.

    Amberman

    PS - The two sites he mentioned are widely read and very highly regarded by traders...zerohedge being arguably the most highly regarded trading blog out there.

    Maybe you should pop over and have a read for yourself? It is informative, thought provoking and very entertaining.

    zerohedge could also be described - and has been, repeatedly - as full of conspiracy theorists, and as having a relentlessly apocalyptic world-view. Its analysis is intellectually underpinned by the theory that Goldman Sachs 'graduates' form a powerful and secret cabal that dominates global finance, and the longed-for apocalypse is the destruction of their influence and a huge reset of the global financial system that ushers in a golden age of truly free capitalism. Hence the "Tyler Durden" pseudonym.

    The blog has predicted the end of capitalism as we know it roughly once a fortnight for the last 3 years or so. Presumably Goldman Sachs read zerohedge, which allows them to consistently foil the financial Rapture - further proof of their evil, probably.

    Something in general to consider in reading any 'trading' source is that you're hearing the voices of people who make their money out of rapid market movements, and who therefore regard even the smallest of those movements as vitally important and incredibly meaningful - after all, otherwise they'd just be gamblers betting on white noise. Most trading sources have the attention span of a goldfish, likely to switch from positive to negative "analysis" several times over the course of the week - zerohedge stands out for its relative consistency, even if that consistency does stem from an underlying conspiracy theory.

    cordially,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 208 ✭✭Debtocracy


    Scofflaw wrote: »
    zerohedge could also be described - and has been, repeatedly - as full of conspiracy theorists, and as having a relentlessly apocalyptic world-view.

    Yeh some of conspiracy theories on this website are ridiculous. Here are some of my favourites:

    1. High levels of public and private debt (Debt Saturation) will stifle economic growth within Western economies, with the problem not being solved by adding more debt.
    2. Western governments face an insolvency rather than a liquidity crisis.
    3. The U.S. government will severely devalue the dollar (relative to hard assets) in an effort to stave off a depression.
    4. Commodities prices will rise due to an expansion in the dollar money supply and peak resources. Stagflation will occur as the wages of the middle classes and lower will not increase correspondingly.

    I don’t know what those guys at Zerohedge are drinking? Next they'll be claiming that that Johnny Giles owns the ECB or that European banks are too highly leveraged.


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  • Closed Accounts Posts: 2,324 ✭✭✭Cork boy 55


    Strauss-Kahn in first tV-interview since maidgate says everyone must accept losses on Greece,

    Going to happen someday.

    “They can’t pay,” Strauss-Kahn said in his first interview since charges of assaulting a Manhattan hotel maid were dropped. “The efforts of European leaders have been too little, or too late, or often both too little and too late.”

    http://www.bloomberg.com/news/2011-09-18/strauss-kahn-says-everyone-must-accept-losses-on-greece.html


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    Strauss-Kahn in first tV-interview since maidgate says everyone must accept losses on Greece,

    Going to happen someday.




    http://www.bloomberg.com/news/2011-09-18/strauss-kahn-says-everyone-must-accept-losses-on-greece.html

    Sure - they've had at least one restructuring already.

    cordially,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 10,501 ✭✭✭✭Slydice


    Ok, so it looks like there's a teleconference on tomorrow between the Greek finance minister and the heads of the troika (EU/IMF/ECB):
    http://www.reuters.com/article/2011/09/16/greece-troika-idUSA8E7K802L20110916

    There was a statement earlier by the Greek Finance Minister where he finished with:
    Following tomorrow’s discussion with the troika, the governmental committee will convene again and analyze all the decisions that move, in any case, within this safe and clear framework which I now present before you, which at the same time constitutes the decision of the governmental committee.

    So, it looks like they are only looking at non default options. Also, they that they will have their meeting and we might get some indications on whether anything (default related or not) will happen soon.


    Meanwhile, it looks like some predict further austerity will happen in Greece:
    http://www.forbes.com/feeds/ap/2011/09/18/business-eu-greece-financial-crisis_8686266.html
    Greek minister: focus on spending cuts in 2012
    Associated Press, 09.18.11, 02:29 PM EDT

    ATHENS, Greece -- Greece's finance minister says the country will focus on expenditure cuts in 2012 but does not exclude imposing new taxes this year to plug a hole in the 2011 budget.

    http://www.reuters.com/article/2011/09/18/us-greece-economy-idUSTRE78H19R20110918
    Greece braces for more austerity to avert default
    By George Georgiopoulos and Dina Kyriakidou
    ATHENS | Sun Sep 18, 2011 5:21pm EDT

    (Reuters) - Greece on Sunday pledged to take the tough decisions needed to avoid default but announced no new austerity measures to secure international bailout funds next month.

    Then, at the same time, others predict Default to happen soon:
    http://www.nytimes.com/2011/09/19/business/global/19iht-euro19.html
    Greece Nears a Tipping Point in Its Debt Crisis
    By JACK EWING
    Published: September 18, 2011
    (later)
    “Greece’s imminent default is assured,” Carl B. Weinberg, chief economist at High Frequency Economics in Valhalla, New York, wrote in an e-mail Sunday. “Without an injection of cash within the next weeks, the nation will run out of resources to service its debt.”

    http://www.huffingtonpost.com/dimitri-b-papadimitriou/endgame-for-the-euro_b_968623.html
    Dimitri B. Papadimitriou
    President, Levy Institute; Executive vice president and Jerome Levy Professor of Economics, Bard College

    Endgame for the Euro - Posted: 9/18/11 02:16 PM ET
    (later)
    Meanwhile, the ECB is keeping the show on the road by making even more austerity demands.

    Despite this climate of denial, the tottering Greek government is going to fall and -- Presto! -- a complete default will follow.

    and of course, it seems that zerohedge is being consistent:
    http://www.zerohedge.com/news/dsk-says-greece-done
    DSK Says Greece Is Done
    Submitted by Tyler Durden on 09/18/2011 15:22 -0400

    Funny how all it takes for people to tell the truth is to no longer be part of the status quo.
    (later)
    From Bloomberg:

    STRAUSS-KAHN SAYS GREECE CAN'T PAY BACK ITS DEBTS
    STRAUSS-KAHN SAYS EVERYONE MUST ACCEPT LOSSES ON GREECE

    And in other news...

    STRAUSS-KAHN SAYS HE WON'T RUN FOR PRESIDENT OF FRANCE


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Scofflaw wrote: »
    Its analysis is intellectually underpinned by the theory that Goldman Sachs 'graduates' form a powerful and secret cabal that dominates global finance

    Some of it's analysis is...I agree.

    Consider that Ex-GS people are in the US treasury, the ECB, most central banks, most influential think tanks...and they HAVE ALREADY paid off 100 cents on the dollar to AIG CDS liabilities, some of which found it's way back to GS.

    However, their political and regulatory capturing looting spree may soon be at an end...Blankfein is panicking right now and is worried about jail time if his recent hiring of a top lawyer is anything to go by.

    They pretty much shafted the Eurozone via Greece, they sold their clients "crap" and then betted against it, they are being taken to court by many money managers, robosigning etc etc.

    While I wouldn't call it a secret cabal (because its not secret and its not a cabal), I would say that there is compelling evidence of fraud, collusion, manipulation and deceit at very high levels inside GS ...and that ex GS alums act in ways which favour GS at the expense of their current employer.

    Who knows what levels of soft commissions (insider knowledge, offshore payments, envelopes of cash etc) are passed to ex GS alums for work they put the way of their ex-employer? I sure as hell don't...but I know for a fact they happen in financial services.

    Hardly a conspiracy (they make no real effort to hide it), more like a closely linked network of capitalist self interest...and to be honest with you, I wish I worked at Goldman Sachs...because fools and their money deserve to be parted in a casino...GS just fulfills that role in the food chain and has built the political clout to do it with little risk to themselves (so far...though this may be changing).

    I have immense admiration for GS. They are the apex capitalists on the planet. They play the cards they are dealt very well...and its their game...Good luck to them I say.

    As for the ZH end game scenario...meh...all Fiat currencies eventually return to their intrinsic value. This is usually not a good time.

    This is an underlying theme on ZH...and quite rightly so.


  • Registered Users, Registered Users 2 Posts: 10,501 ✭✭✭✭Slydice


    Looks like tomorrow is being made out to be another Greek make or break day.

    For tomorrows discussion, the Greeks seem optimistic - (Reuters):
    Greece hopes to clinch aid tranche deal by Tues: source
    ATHENS | Mon Sep 19, 2011 4:48pm EDT

    (Reuters) - Greece hopes to conclude an agreement with its international lenders on Tuesday so it can receive an 8 billion euro ($11 billion) aid tranche slated for October, a finance ministry official told Reuters on Monday.

    "The climate was better than we expected," the official said

    I'm not sure though, government officials always seem to be optimistic about their own countries.

    Looks like there are worries spreading in the market about what is being discussed between Greece and the Troika (EU+ECB+IMF) - (wsj)
    SEPTEMBER 19, 2011, 4:54 P.M. ET
    Greece Eyes Fresh Cuts as Default Fears Grow
    By ALKMAN GRANITSAS And STELIOS BOURAS

    ATHENS—Greece's government scrambled Monday to meet conditions for a fresh infusion of official aid, as worries about a looming default further undermined sentiment in financial markets across the globe.

    Stock markets went into retreat in Europe, with the Paris bourse falling by 3% and Germany's by 2.8%, and government bond prices slid across most of the euro zone. The U.S. and most Asian stock markets sank under Greek-induced gloom, while the euro also fell.

    The worries might be from uncertainty about Greek reactions to demands being made of them - (ft):
    September 19, 2011 9:58 pm
    Lenders harden their stance on Athens
    By Peter Spiegel in Brussels and Dimitris Kontogiannis in Athens

    Greek authorities made a fresh attempt on Monday to convince international lenders they had a credible plan to close a growing financing gap, amid signs negotiators were hardening their line over a €8bn aid payment that Athens needs in three weeks to prevent it running out of cash.

    The Greek proposal, made in a conference call with heads of the so-called troika of European Union and International Monetary Fund lenders, came after a German-led group of European creditor countries made clear they were unsatisfied with measures unveiled just last week.

    So, only the market seems to be indicating a worry of default. All discussions seems to point to optimism from the participants but some hard lining from people who are owed money.


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  • Registered Users, Registered Users 2 Posts: 11,205 ✭✭✭✭hmmm


    After tomorrow passes, will someone volunteer to start the 3rd Greece default day ZH thread? Because at this stage they're pulling dates from a hat. Plus no-one seems to have noticed that Greece isn't due to repay debt until later in the year, so they can only "default" on wages and pensions they're paying their own people.

    8 billion is nothing, the French & Germans will pay that to buy their banks a few more months of time. Given enough time, the Greeks can default all they want without too much damage (and that time is probably already here).


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    Slydice wrote:
    Looks like tomorrow is being made out to be another Greek make or break day.

    Er, your OP makes it out to be the make or break day, no?

    perplexed,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Scofflaw wrote: »

    Something in general to consider in reading any 'trading' source is that you're hearing the voices of people who make their money out of rapid market movements, and who therefore regard even the smallest of those movements as vitally important and incredibly meaningful - after all, otherwise they'd just be gamblers betting on white noise. Most trading sources have the attention span of a goldfish, likely to switch from positive to negative "analysis" several times over the course of the week.

    cordially,
    Scofflaw

    Missed this last time strangely...so thought I'd call you on it.

    Do you know many market participants who trade as you outline? Are they successful?

    Your view of traders rolling about with newsflow from one position to the other is false in my experience. The reason is that most traders operate on a time horizon of longer than a day...i.e., they aren't day traders and their positions are often open for months at a time and only ever are entered into after careful analysis...the competition is simply too tough for it to be otherwise...(though they do welcome "rapid" price moves if those moves are in their favour ;)

    ZH regularly carries big macro stories and pretty deep analysis in addition to news stories that have the potential to impact the market...as they should.

    The aggregated news flow can cause a sensible trader to reach a buy or sell tipping point...so it is important...but to imply that traders have the attention span of goldfish or low levels of conviction about their positions which change with every new story...is generally wrong for most successful traders...though likely true for most novices who would be well advised to cease trading against the pros.

    Many hedge funds tell their clients that they will lose money until the market recognises that they are right in their thesis. Some are willing to burn through 20% of their equity each year...and yet sophisticated investors still invest in them if they believe the underlying thesis.

    Hugh Hendry is a good example of this. He lost money as he waited patiently for the China story to turn and for the market to recognise the reality he saw unfolding before they did...but is now up 32% in the past 6 weeks as the market has begun to recognised that his thesis was correct...and this isn't good news for Europeans hoping for China to buy their bonds.

    He has a few choice words to say about European banks as well...this is well worth watching.

    I wouldn't be so quick to dismiss ZH Scofflaw...a lot of people make a lot of money following them, regardless of their editorial policy or intellectual underpinnings.

    ZH is read widely for this reason and this reason alone IMO...they are frequently right-on-the-money. I have lost count of the number of times they start a post with the following statement...

    "As predicted on ZH"


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    I wouldn't be so quick to dismiss ZH Scofflaw...a lot of people make a lot of money following them, regardless of their editorial policy or intellectual underpinnings.

    ZH is read widely for this reason and this reason alone IMO...they are frequently right-on-the-money. I have lost count of the number of times they start a post with the following statement...

    "As predicted on ZH"

    I don't think there's any contradiction between being a useful trading blog and not offering useful political analysis - mind you, I'd be impressed if zerohedge somehow manage to buck the general rule that forecasters and analysts rarely come out better than pure chance when it comes to predictive power (and usually come out a good bit worse).

    Perhaps zerohedge is the single source that the scientists have been missing when they compare market analysts' predictive capabilities with blindfolded darts-throwing chimpanzees...but, to be honest, I doubt it.

    Take the post that this thread references - "Is September 20 Greek Default Day?". It's a very good piece of bet-hedging in the way it's written. If Greece defaults tomorrow, ZH could say "as predicted on ZH", and undoubtedly would...but it's not really predicted, is it? In fact, the article states that it's "as good a day as any, and better than most, if Greece is going to default". Strictly speaking, that doesn't amount to a prediction that Greece will ever default, let alone do so tomorrow - Tyler is "just saying" - but if it happens, it will be claimed as a prediction.

    So we can read the same material, and I see a whole load of such claims, carefully written in a "just saying" style, or claims that something general and not all that specific will happen (bad things...in Greece, exposures...in banks), or claims that, frankly, aren't in the least contentious (China supporting the euro is a good example) - and people read into that a record of successful predictions because they're willing to ignore the predictions that didn't come to pass, because, hey, they weren't really predictions in the first place. This neatly cherry-picked 'record' is then contrasted with material that's self-evidently worthless, such as this year's growth rates as predicted late last year by government forecasters, and the disparity claimed as evidence of just how acute ZH (or favourite other source) is.

    To put it another way: http://www.smbc-comics.com/index.php?db=comics&id=1908#comic

    cordially,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Scofflaw wrote: »
    I don't think there's any contradiction between being a useful trading blog and not offering useful political analysis - mind you, I'd be impressed if zerohedge somehow manage to buck the general rule that forecasters and analysts rarely come out better than pure chance when it comes to predictive power (and usually come out a good bit worse).

    Well, the reasons for the dismal macro performance of analysts and classically trained economists are well understood in many circles and it is because of their training. If one good thing comes out of this crisis, it might be an abandonment of Keynesianism...but not before we get a further blast of QE I think.

    Many Austrian trained money managers are starting to pull in attention grabbing returns...though their models aren't perfect either, because they fail to adequately account for government intervention in the markets...which as we have seen can go on for quite some time and make the Austrians appear perfectly wrong for long periods.

    Perhaps zerohedge is the single source that the scientists have been missing when they compare market analysts' predictive capabilities with blindfolded darts-throwing chimpanzees...but, to be honest, I doubt it.

    There are aleady many examples of outperformance by investors. I suppose Buffet is the most notable.

    Take the post that this thread references - "Is September 20 Greek Default Day?". It's a very good piece of bet-hedging in the way it's written. If Greece defaults tomorrow, ZH could say "as predicted on ZH", and undoubtedly would...but it's not really predicted, is it? In fact, the article states that it's "as good a day as any, and better than most, if Greece is going to default". Strictly speaking, that doesn't amount to a prediction that Greece will ever default, let alone do so tomorrow - Tyler is "just saying" - but if it happens, it will be claimed as a prediction.

    OK...you can post that here when he claims it.

    So we can read the same material, and I see a whole load of such claims, carefully written in a "just saying" style, or claims that something general and not all that specific will happen (bad things...in Greece, exposures...in banks), or claims that, frankly, aren't in the least contentious (China supporting the euro is a good example) - and people read into that a record of successful predictions because they're willing to ignore the predictions that didn't come to pass, because, hey, they weren't really predictions in the first place. This neatly cherry-picked 'record' is then contrasted with material that's self-evidently worthless, such as this year's growth rates as predicted late last year by government forecasters, and the disparity claimed as evidence of just how acute ZH (or favourite other source) is.

    Cherry picking indeed. You just did it. :p

    But your point is valid in that article. I wouldn't predict a specific day for much going on in Europe. Even if you are right about the outcome, the time line is another story entirely which is subject to far too many cross currents to accurately navigate.

    If you dig deeper though, you will find lots of really useful material that did come true. They were roundly ridiculed when they sniffed out issues at Sinoforest, Lehman, Bear, BoA (literally days before the Buffet deal)...but guess what...they were right. You might not like it for political or other reasons, but I love it for this type of research...the thing is, as with everything online, to exercise a little discernment...and take nothing at face value.

    Their latest focus is SocGen and Credit Agricole as the two most likely candidates to blow up or require another bailout.

    Also, China supporting the Euro isn't contentious? Sure, if they buy $1m in bonds they are supporting it, but the degree if support is important. Didn't premier Wen just say that countries must get their own houses in order?

    Many took that to mean that mass bond purchases are soon coming off the table. I have no idea...but we'll soon see.

    They seem to be facing some stiff, emerging headwinds at home in their giant property bubble and all that goes with that.


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    If you dig deeper though, you will find lots of really useful material that did come true. They were roundly ridiculed when they sniffed out issues at Sinoforest, Lehman, Bear, BoA (literally days before the Buffet deal)...but guess what...they were right. You might not like it for political or other reasons, but I love it for this type of research...the thing is, as with everything online, to exercise a little discernment...and take nothing at face value.

    Hmm, no, you've kind of missed the point. It's unreliable (over and above the usual unreliability of economic predictions) because it has a strong conspiracy-based and apocalyptically-oriented agenda. So whatever value it may have in terms of the occasional useful content is over-shadowed by the fact that it's neither neutral nor limited to mere reality. It's most useful as a source of negative news, but even the negative news will be slanted towards the agenda, if by nothing more than the fact that positive news isn't of interest to it at all.

    cordially,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Scofflaw wrote: »
    Hmm, no, you've kind of missed the point. It's unreliable.

    cordially,
    Scofflaw

    My investment returns beg to differ....and thats really all I care about.

    Is the FT reliable in your opinion? I read it for almost 2 decades every day in work and rarely got the sort of actionable info I get from ZH almost weekly. Reggie Middletons team of banking analysts would be at home at any of the big hedge funds for example.

    I have NEVER seen a comparable level of outstanding analysis in the FT...not once. I don't pay their monthly fee now and I don't miss it.

    In my time as an investment broker, I was privy to internal analysts reports that approached Reggies level of sophistication. ZH gets some of those internal reports (which I no longer enjoy) which are made for staff, paying HNW clients and favoured institutions and publishes or links to them for everyone to see...stuff like research notes from the big banks.

    That is worth something to me.

    Also, and I hate to bring this up since you skirted it, but ex-GS staff ARE in multiple key positions in multiple key institutions...but openly so...so its not really a "secret cabal"...is it?

    If my ex-colleagues call me up with a potentially mutually profitable idea, I will always listen. Why should Goldman staff be any different?

    Their post GS positions in the world must throw up a huge array of profitable opportunities. I think it's naieve to think otherwise...or that they aren't in contact with people from their old company. After all, who in their right mind throws out a GS contact list?


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    Amberman wrote: »
    My investment returns beg to differ....and thats really all I care about.

    Which is kind of the point.
    Amberman wrote: »
    Is the FT reliable in your opinion? I read it for almost 2 decades every day in work and rarely got the sort of actionable info I get from ZH almost weekly. Reggie Middletons team of banking analysts would be at home at any of the big hedge funds for example.

    I have NEVER seen a comparable level of outstanding analysis in the FT...not once. I don't pay their monthly fee now and I don't miss it.

    In my time as an investment broker, I was privy to internal analysts reports that approached Reggies level of sophistication. ZH gets some of those internal reports (which I no longer enjoy) which are made for staff, paying HNW clients and favoured institutions and publishes or links to them for everyone to see...stuff like research notes from the big banks.

    That is worth something to me.

    Also, and I hate to bring this up since you skirted it, but ex-GS staff ARE in multiple key positions in multiple key institutions...but openly so...so its not really a "secret cabal"...is it?

    If my ex-colleagues call me up with a potentially mutually profitable idea, I will always listen. Why should Goldman staff be any different?

    Their post GS positions in the world must throw up a huge array of profitable opportunities. I think it's naieve to think otherwise...or that they aren't in contact with people from their old company. After all, who in their right mind throws out a GS contact list?

    And UCD alumni are in positions of power throughout Ireland - but perhaps I simply don't get the mailing list.

    What's fairly likely is that GS alumni share a particular mindset, but on the other hand it's a mindset that's aspired to quite widely. If one broadens the spotlight a little, one can see ex-members of the big consultancy companies in major roles throughout the capitalist world. Again, that doesn't have to produce any connected conspiracy, but it's likely to lead to a certain similarity of thought, with the downside risk that implies.

    cordially,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Scofflaw wrote: »
    Which is kind of the point.



    And UCD alumni are in positions of power throughout Ireland - but perhaps I simply don't get the mailing list.

    What's fairly likely is that GS alumni share a particular mindset, but on the other hand it's a mindset that's aspired to quite widely. If one broadens the spotlight a little, one can see ex-members of the big consultancy companies in major roles throughout the capitalist world. Again, that doesn't have to produce any connected conspiracy, but it's likely to lead to a certain similarity of thought, with the downside risk that implies.

    cordially,
    Scofflaw

    Not only the mindset is aspired to widely, but the access to key decision makers and centers of influence. Their access across the world is unmatched IMO.

    What separates GS from, say, McKinsey, among other things, is their political clout and their ability to access and lever capital.

    This combination does makes them dangerous...but you can't really blame them...they are just doing what they should be doing...which is getting away with as much loot as they think they can get away with.

    You really have to look at the regulators.


  • Registered Users, Registered Users 2 Posts: 1,588 ✭✭✭femur61


    Tuesdays here.


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  • Registered Users, Registered Users 2 Posts: 16,686 ✭✭✭✭Zubeneschamali


    femur61 wrote: »
    Tuesdays here.

    World doesn't seem to have ended yet. Greece "close to a deal" with troika on next tranche of the bailout, conference call later.


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    femur61 wrote: »
    Tuesdays here.

    And the Chinese jeer...
    In an article about the reasons for China's increased purchase of U.S. Treasuries, the newspaper cited Yan Xiaona, a researcher with the Chinese Academy of Social Sciences, as saying that the dollar "is relatively safer than the euro" because of the unfolding sovereign debt crisis in Europe.



  • Closed Accounts Posts: 21,727 ✭✭✭✭Godge


    Has anything happened with Greece today? Maybe for the first time this website with all the answers got something wrong?

    Or maybe I need to wait another few hours? The tension is killing me.

    Have they made any predictions for the rest of the week?


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Yes, they paid the @769m coupon they were due to pay IIRC. No default today...More successful can-kicking. Quite impressive really when you think about it....and ZH has shut down in shame ;)

    Italy got downgraded, China seen moving into more US bonds and away from "risky" Europe. French banks get hammered again....just the usual calamities...nothing to worry about...and none of it really surprising.


  • Closed Accounts Posts: 21,727 ✭✭✭✭Godge


    Amberman wrote: »
    Italy got downgraded, China seen moving into more US bonds and away from "risky" Europe. French banks get hammered again....just the usual calamities...nothing to worry about...and none of it really surprising.


    Were these predicted to happen on Tuesday as well? If not, then they got more than Greece wrong.


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Godge wrote: »
    Were these predicted to happen on Tuesday as well? If not, then they got more than Greece wrong.

    No, they weren't predicted these happen on Tuesday...but that doesn't necessarily make them wrong, does it? I mean they didnt predict that stock ABC would rise by x.xx% either. Are they therefore wrong about that? Do you see why your position is pretty weak??

    Each of thse three scenarios, French banking troubles, Chinese bond purchase backoff and Italian downgrades had previously been covered in some detail and aren't really a surprise...more of an expectation.

    Actually, less than 24 hours ago, before the Chinese announcement, I challenged Scofflaw on his assertion that the Chinese would continue to support Europe in this very thread. He said...not 24 hours ago...
    So we can read the same material, and I see a whole load of such claims, carefully written in a "just saying" style, or claims that something general and not all that specific will happen (bad things...in Greece, exposures...in banks), or claims that, frankly, aren't in the least contentious (China supporting the euro is a good example)

    I replied...
    Also, China supporting the Euro isn't contentious? Sure, if they buy $1m in bonds they are supporting it, but the degree if support is important. Didn't premier Wen just say that countries must get their own houses in order?

    Many took that to mean that mass bond purchases are soon coming off the table. I have no idea...but we'll soon see.

    They seem to be facing some stiff, emerging headwinds at home in their giant property bubble and all that goes with that.

    And hey presto, thanks to the reading ZH...I was able to see past the noise and realise there was a real issue here...(and that Chinese bond purchases were contentious going forward when others couldn't see it...as has today been highlighted by a flurry of announcements by the Chinese...not 24 hours after that post.

    The key, as I have already said is to be discerning in what you read and not take everything at face value.

    The French banking crisis particularly has been covered in minute detail.

    Have a read of this...just published.

    It's one of those..."As we predicted" posts.

    Lots of pretty pictures in it for you to enjoy.


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Looks like the Slovenian government may collapse today according to ZH.

    It has just collapsed.

    Though in fairness, I have no idea how "odds-on" this was. Probably strongly odds-on.


  • Registered Users, Registered Users 2 Posts: 11,205 ✭✭✭✭hmmm


    I'm sitting here in my bunker and my beans are going cold. Why hasn't Greece defaulted? I thought there are people here making millions in trading profits on the back of ZH "predictions"?


  • Closed Accounts Posts: 21,727 ✭✭✭✭Godge


    Amberman wrote: »
    Looks like the Slovenian government may collapse today according to ZH.

    It has just collapsed.

    Though in fairness, I have no idea how "odds-on" this was. Probably strongly odds-on.


    If that link is the quality of the advice on the Greek default, I wouldn't be relying on it. In a short piece (three paragraphs or so) I counted three explicit "not sure"s and there were more implicit in other statements. At least four possible times for a Greek default included in the piece - today, Friday, sooner, later.

    As for the Slovenian government collapse, it was a bit like predicting a ball will roll down a hill.


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  • Registered Users, Registered Users 2 Posts: 12,895 ✭✭✭✭Sand


    On the nature of predictions:
    First they ignore you, then they laugh at you, then they fight you, then you win.
    Mohandas Gandhi

    FYI - The Greek "default" rubicon was crossed back in July. Before July people swore no Eurzone government would ever, ever, ever default. Then they did.


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    Actually, less than 24 hours ago, before the Chinese announcement, I challenged Scofflaw on his assertion that the Chinese would continue to support Europe in this very thread. He said...not 24 hours ago...
    So we can read the same material, and I see a whole load of such claims, carefully written in a "just saying" style, or claims that something general and not all that specific will happen (bad things...in Greece, exposures...in banks), or claims that, frankly, aren't in the least contentious (China supporting the euro is a good example)
    I replied...
    Also, China supporting the Euro isn't contentious? Sure, if they buy $1m in bonds they are supporting it, but the degree if support is important. Didn't premier Wen just say that countries must get their own houses in order?

    Many took that to mean that mass bond purchases are soon coming off the table. I have no idea...but we'll soon see.

    They seem to be facing some stiff, emerging headwinds at home in their giant property bubble and all that goes with that.
    And hey presto, thanks to the reading ZH...I was able to see past the noise and realise there was a real issue here...(and that Chinese bond purchases were contentious going forward when others couldn't see it...as has today been highlighted by a flurry of announcements by the Chinese...not 24 hours after that post.

    Dear me...it's a shame you don't read me with the same attention you give ZH, but then I suppose I should hardly expect that!

    There was nothing contentious in ZH's claim that the Chinese would support the euro. That is, it was something that was generally regarded as being in China's interests, and the claim being made by ZH that China would support the euro was therefore not a claim uniquely made by ZH when all other sources were blind to the situation...despite which, it was something claimed by another fan as an "as predicted by ZH":
    As predicted by @zerohedge - China's Wen: "we will support Europe and the euro" http://goo.gl/C96dW

    http://twitter.com/#!/Scrataliano/status/84620358900133888

    Of course, what you're pointing out is that ZH was then your source for China not supporting the euro...so we have two claims about China made by ZH, and each acclaimed by its readers: (a) that China would support the euro; and (b) that China won't support the euro. The first was claimed as a ZH prediction by another blogger, the second is being claimed as a ZH prediction by you.

    Perhaps you see my problem with that? I appreciate your attempt to reconcile them by saying "ah, but what degree of support?" - when turning 180 degrees one has to go though 90 on the way, of course.

    amused,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 11,205 ✭✭✭✭hmmm


    Sand wrote: »
    FYI - The Greek "default" rubicon was crossed back in July. Before July people swore no Eurzone government would ever, ever, ever default. Then they did.
    Such revisionism. Of course a country can default, the argument was whether or not it would be "allowed". Nothing has changed on that score, it's still a debate over whether or not countries like Ireland, Greece, Portugal will be allowed to default.


  • Registered Users, Registered Users 2 Posts: 11,205 ✭✭✭✭hmmm


    Scofflaw wrote: »
    so we have two claims about China made by ZH, and each acclaimed by its readers: (a) that China would support the euro; and (b) that China won't support the euro. The first was claimed as a ZH prediction by another blogger, the second is being claimed as a ZH prediction by you.
    Don't forget the other regular "prediction" on ZH, that China will not support the dollar, and everytime some minor functionary says anything vague about the US it is jumped on by the mass ranks of ZH-ites. So China, with 3 trillion in reserves, has (apparently) variously decided not to support the US dollar, or the Euro. For historical reasons, they won't want to support the Yen. They can't support the Swiss Franc.

    So instead they are currently investing their 3 trillion in, well, US dollars and Euros. Reality interferes with the doom agenda.


  • Registered Users, Registered Users 2 Posts: 12,895 ✭✭✭✭Sand


    @hmmm

    Such, such revisionism indeed.

    What a wonderful, flexiable and evolving view point.


  • Registered Users, Registered Users 2 Posts: 10,501 ✭✭✭✭Slydice


    Looks like Greece has, indeed, made the payment of €769 which appears to have helped the markets (wsj).

    Also looks like the (EU-ECB-IMF) Troika team are to return to Athens next week (reuters):
    The mission of top inspectors from Greece's international lenders will return to Athens early next week to resume its review of the country's progress in a 110 billion euro ($150 billion) bailout programme, a source close to the team said on Tuesday.

    The representatives from the European Union, International Monetary Fund and European Central Bank had earlier held a conference call with Greece's finance minister on steps Greece must take to receive an 8 billion euro aid tranche it needs to avoid running out of cash next month.

    The source close to the so-called troika said good progress was made during the call and technical discussions would continue in Athens in the coming days.

    Looks like this pushes back the date to October (wsj):
    SEPTEMBER 20, 2011, 4:25 P.M. ET
    Heads Of Troika Expected To Visit Greece In October -Report

    ATHENS (Dow Jones)--The heads of a troika of international inspectors are expected to arrive in Athens in early October, Greece's semi-official news agency reported Tuesday, amid signs that a deal appeared close on further austerity measures the country must take.
    (later)
    At a weekend meeting of European finance ministers in Poland, officials warned that Greece may not receive an EUR8 billion aid tranche next month if it fails to bring its budget back in line with targets. Without that aid, Greece will run out of cash by mid-October.

    Though Forbes points out there'll be a visit next week (aswell?):
    Associated Press
    EU: Debt inspectors to return to Athens next week
    By NICHOLAS PAPHITIS and GABRIELE STEINHAUSER , 09.20.11, 04:44 PM EDT

    ATHENS, Greece -- International debt inspectors will return to Greece next week to resume a review of the cash-strapped government's austerity program after making progress late Tuesday in a teleconference with the Greek finance minister,
    (but goes on to discuss a default possibility raised by the Fitch ratings agency)
    Most analysts still think the country will have to restructure its debts at some point, especially if the economy remains mired in recession. Fitch Ratings said in a report Tuesday that it expected Greece to eventually default, but to do so while remaining in the eurozone.

    That Fitch announcement is covered elsewhere (reuters):
    Greece to default but not leave euro zone - Fitch
    LONDON | Tue Sep 20, 2011 4:31pm IST

    (Reuters) - Greece will probably default but will not leave the euro zone, Fitch credit ratings agency said on Tuesday, as pressure increased on the Greek government to push through with fiscal reforms.

    International lenders told Greece on Monday it must shrink its public sector to avoid running out of money within weeks.

    While widely expected, a Greek default would further unsettle already nervous financial markets, fuelling fears a precedent had been set for other struggling euro zone states and sending yields on other peripheral bonds sharply higher.

    However, Fitch did not expect Greece to leave the euro zone, as some in markets have speculated in recent weeks.


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  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Scofflaw wrote: »
    Dear me...it's a shame you don't read me with the same attention you give ZH, but then I suppose I should hardly expect that!

    There was nothing contentious in ZH's claim that the Chinese would support the euro. That is, it was something that was generally regarded as being in China's interests, and the claim being made by ZH that China would support the euro was therefore not a claim uniquely made by ZH when all other sources were blind to the situation...despite which, it was something claimed by another fan as an "as predicted by ZH":



    http://twitter.com/#!/Scrataliano/status/84620358900133888

    Of course, what you're pointing out is that ZH was then your source for China not supporting the euro...so we have two claims about China made by ZH, and each acclaimed by its readers: (a) that China would support the euro; and (b) that China won't support the euro. The first was claimed as a ZH prediction by another blogger, the second is being claimed as a ZH prediction by you.

    Perhaps you see my problem with that? I appreciate your attempt to reconcile them by saying "ah, but what degree of support?" - when turning 180 degrees one has to go though 90 on the way, of course.

    amused,
    Scofflaw

    Well...to be kind to you...events and positions change stuff...ya know.

    ZH did point out (using other sources) that China WAS buying bonds. You are perfectly correct...and so were they.

    However, their most recent position (as changes in the dynamic came to light between China and Europe regarding Chinas request to have their economy classed as a market economy...i.e. look...we've been buying your bonds. Play nice with us and we'll continue to play nice with you) was that the request by China to have Europe class their economy classed as a market economy would determine future assistance with the mess Europe is in. ZH argues that this was an effort by the Chinese to isolate the US. Not sure if this is true or not.

    And now we know that Europe haven't reclassed the Chinese economy and the Chinese have substantially withdrawn from not only bond purchases...but also business with European banks.

    Ofcourse, the Chinese stated today that the two weren't linked. But then they would, wouldn't they. Instead they kinda stuck the knife in, saying Europe was risky.

    I know its a lot to follow...but that was basically the ZH position over this matter...summary as follows

    1. Chinas was buying bonds in a big way recently...to build political capital for step two...
    2. China wants their economy classed by Europe as a market economy...and ZH said the implicit threat was that they would withdraw from future, meaningful bond purchases unless Europe complied. I didn't buy that argument BTW...I thought that their domestic situation would be enough to make them withdraw...but looks like I was wrong and this looks like a key move on the chess board to try to isolate the US...but Europe didn't take the bait.
    3. The Europeans called their bluff. Stuck to the US position.
    5. China stuck the knife in as they left the building today...calling Europe "risky" and pulling out of business with weakened French banks.

    Equally...I suppose it is difficult for you to accept that Chinas buying bonds now seems just a highly contentious...rather than your position yesterday of not at all contentious?

    Still, don't expect you to address that last point.


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    hmmm wrote: »
    Don't forget the other regular "prediction" on ZH, that China will not support the dollar, and everytime some minor functionary says anything vague about the US it is jumped on by the mass ranks of ZH-ites. So China, with 3 trillion in reserves, has (apparently) variously decided not to support the US dollar, or the Euro. For historical reasons, they won't want to support the Yen. They can't support the Swiss Franc.

    Could you show me the post where they said that "China won't support the dollar?"

    I have read on multiple occassions on ZH excellent pieces which dissect the nature of international trade which makes it impossible for the Chinese NOT to support the dollar.

    Put simply, for trade surpluses the size of Chinas, and with a desire to peg the RMB to the dollar...(in an effort to keep their export machine working) they LITERALLY have no choice. No other market is both big enough to absorb the trade surpluses and achieve the peg.

    You really think the US would hate the Chinese to stop buying dollars? The RMB would move in precisely the way the US wants it to move if that were to happen. You get that various members of the US govt have been calling China a currency manipulator...right?

    I suggest you read this for an overview of why what you are saying is, quite literally, impossible in view of Chinas goal of a dollar peg and the gargantuan trade surpluses. Published...you know where! ;)

    http://globaleconomicanalysis.blogspot.com/2011/08/idea-china-to-stop-buying-treasuries.html
    So instead they are currently investing their 3 trillion in, well, US dollars and Euros. Reality interferes with the doom agenda.

    Indeed. So you didn't hear that they basically walked away from Europe yesterday...and slammed to door behind them?

    FYI, I think many young people in Greece and Ireland feel precisely what can be described as a sense of doom. Have you how many people are leaving Ireland now?

    Have you seen the spike in suicide rates?

    http://www.irishexaminer.com/ireland/kfgbauojidsn/rss2/

    Ultimate doom. Maybe you knew some of these young people? I'm sure plenty of people reading this did.

    Any other feckin' smart-arse comments?


  • Registered Users, Registered Users 2 Posts: 10,501 ✭✭✭✭Slydice


    Looks like the Greek government has decided to try playing ball with the (EU,ECB,IMF) troika (forbes):
    Associated Press - Greek government announces new austerity blitz
    By NICHOLAS PAPHITIS and DEREK GATOPOULOS , 09.21.11, 04:43 PM EDT

    ATHENS, Greece -- Austerity-fatigued Greeks were slapped with new tax hikes and pension cuts Wednesday, while the government also pledged to suspend 30,000 civil servants in a hectic scramble to keep its bailout payments flowing and soothe global market fears that Greece will go bust.
    (later)
    monthly pensions will be cut by 20 percent above a euro1,200 ($1,636) threshold, while retirees aged under 55 will lose 40 percent of their pensions above the sum of euro1,000.

    I wonder if they are trying to test the publics reaction in advanced on the troika return visit (next week or the following I think?).

    The FT article on it kinda hints in that direction:
    September 21, 2011 8:19 pm
    Greece unveils further austerity measures By Dimitris Kontogiannis in Athens
    The Greek government on Wednesday unveiled drastic new austerity measures including swingeing cuts to pensions and public sector salaries
    (later)
    “The discussions with the troika will be completed after the arrival of inspectors early next week,” Ilias Mossialos, a government spokesman, said after the cabinet meeting which lasted more than 6 hours.

    But the new austerity measures came under attack almost immediately from the conservative opposition New Democracy party leading the polls, showing there was little scope for political consensus. The conservatives called the measures unfair and attributed them to the economic policy followed by the government.

    It seems the market is still expecting a default but maybe an orderly one (reuters):
    Analysis: Planning for Greek debt default gathering pace? By Luke Baker
    BRUSSELS | Wed Sep 21, 2011 10:23am EDT

    (Reuters) - Euro zone leaders may reject the notion of a "Greek default." But private sector economists and political analysts are largely agreed that it is only a matter of time.
    (later)
    One finance expert who is advising governments on preparing for a Greek default says the major economies in the euro zone are ready for it, even if they are not yet actively courting it.

    Then, the guardian interestingly asks what about us (Ireland) when Greece defaults:
    What happens to Ireland if Greece defaults?
    Posted by Megan Greene Wednesday 21 September 2011 11.05
    With more job losses feared at Aviva, guest economist Megan Greene believes Ireland will have few practical options if Athens exits the euro
    and some selected quotes:
    - "As long as EU leaders remain committed to the euro project, Ireland should stay the course and continue to implement the terms of the bailout programme."
    - "This would mean Ireland would be unable to raise the requisite funding over the next two years in the markets."
    - "there is a very small risk that EU leaders - faced with angry electorates sick of bailouts and austerity - could choose to hang Ireland out to dry and allow the eurozone to unravel."
    - "Ireland would find itself cut off from EU/IMF funding and frozen out of the markets at a time when it would need money immediately. This hardly seems like something the government should choose.

    A leader would only decide to accept such costs in extremis, with the most likely spur being domestic social unrest. This is extremely unlikely in Ireland. Unlike in Greece, where protesters regularly descend on Syntagma Square in central Athens, the Irish public is largely resigned to the terms of the bailout programme."


  • Registered Users, Registered Users 2 Posts: 3,872 ✭✭✭View


    Slydice wrote: »
    Now, a couple of websites are reporting that "Peter Tchir of TF Market Advisors, who is one of the best tea leaf readers in the trading world" reckons that Greece will default on Tuesday. Here they are:
    http://www.economonitor.com/blog/2011/09/from-the-desk-of-peter-tchir-is-september-20th-greek-default-day/
    http://www.zerohedge.com/news/september-20-greek-default-day

    What do you think?

    That "one of the best tea leaf readers in the trading world" got it wrong? Or was this a "They might at some future date possibly, maybe, default on a Tuesday (rather than over the weekend) but when I don't know" prediction?

    I suppose the thing we really should be alarmed about is the possibility that "the trading world" might be acting based on tea leaf reading but somehow that wouldn't surprise me at all...


  • Closed Accounts Posts: 21,727 ✭✭✭✭Godge


    Slydice wrote: »
    Then, the guardian interestingly asks what about us (Ireland) when Greece defaults: and some selected quotes:
    - "As long as EU leaders remain committed to the euro project, Ireland should stay the course and continue to implement the terms of the bailout programme."
    - "This would mean Ireland would be unable to raise the requisite funding over the next two years in the markets."
    - "there is a very small risk that EU leaders - faced with angry electorates sick of bailouts and austerity - could choose to hang Ireland out to dry and allow the eurozone to unravel."
    - "Ireland would find itself cut off from EU/IMF funding and frozen out of the markets at a time when it would need money immediately. This hardly seems like something the government should choose.

    A leader would only decide to accept such costs in extremis, with the most likely spur being domestic social unrest. This is extremely unlikely in Ireland. Unlike in Greece, where protesters regularly descend on Syntagma Square in central Athens, the Irish public is largely resigned to the terms of the bailout programme."


    wow, that is selective quoting. Take these three paragraphs together and read them. they paint a very different picture to the selective quotes.

    "The lack of social unrest is not the only way in which the Irish case differs significantly from that of Greece. While the bailout programme clearly is not working in Greece, it is in Ireland.
    According to the European Commission's Summer 2011 Review of the Irish bailout programme, Ireland is on track to meet and even exceed some of its targets. The European Commission now forecasts that Ireland's budget deficit will be reduced to 10.2% of GDP in 2011, below the bailout programme target of 10.6%.
    Beyond fiscal consolidation, Ireland's current account has swung into surplus, and there are indications that the country has gained competitiveness since 2008. In the second quarter of 2011, hourly unit labour costs fell by 3.6% in Ireland, compared with 3.5% in Greece and 0.8% in Portugal (they rose by an average 3.6% across the eurozone)."

    As I have said before, I am now convinced that we can get out of our mess. For a time, I did wonder whether it was possible. Now that we can, the only question is whether we will. That depends both on our friends in Europe continuing to support us and our own efforts to get down the deficit.


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  • Registered Users, Registered Users 2 Posts: 6,973 ✭✭✭SafeSurfer


    If Ireland were to exist the euro what would be the effects on domestic interest rates and existing mortgages?

    Multo autem ad rem magis pertinet quallis tibi vide aris quam allis



  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    If Ireland exited the Euro, no one really knows precisely what would happen. This is what I think would happen...
    1. If the Euro still existed, your mortgage would still be in Euros at the prevailing Euro interest rate. Re-mortgaging would probably change this.
    2. If we moved to a new punt, it would almost certainly be substantially devalued compared to the Euro...perhaps by as much as 50%.
    3. This alone means, your mortgage costs would rise, assuming your wages didn't in new punts. It is unlikely wages would rise as much as the new punt fell versus the Euro, so your true cost of carry goes up as a percentage of your income.
    4. Interest rates would without doubt shoot up for new punt borrowers...quickly and very substantially.
    But...it isn't all doom and gloom...Irish exports would become much more competitive...and imports more expensive...which would trigger an upward surge in exports and in the domestic consumption of Irish produced goods...and this should theoretically hasten the recovery and drive down unemployment, all other things being equal (which they wont be!)...but make no mistake, exit from the Euro will be incredibly painful for a while.

    It took Iceland 3 years to be able to return to the bond markets.

    I'd expect a similar time-line in Ireland...but growth could resume faster than this I think...(unless our major trading partners are FUBAR...which is a possibility).

    Edited to say: I genuinely believe that Foreign direct investment would surge. Companies are not the bond markets. Smart companies know that Ireland is a great place to do business...even though our politicians really messed up with the banking sector.


  • Closed Accounts Posts: 21,727 ✭✭✭✭Godge


    Amberman wrote: »
    If Ireland exited the Euro, no one really knows precisely what would happen. This is what I think would happen...
    1. If the Euro still existed, your mortgage would still be in Euros at the prevailing Euro interest rate. Re-mortgaging would probably change this.
    2. If we moved to a new punt, it would almost certainly be substantially devalued compared to the Euro...perhaps by as much as 50%.
    3. This alone means, your mortgage costs would rise, assuming your wages didn't in new punts. It is unlikely wages would rise as much as the new punt fell versus the Euro, so your true cost of carry goes up as a percentage of your income.
    4. Interest rates would without doubt shoot up for new punt borrowers...quickly and very substantially.
    But...it isn't all doom and gloom...Irish exports would become much more competitive...and imports more expensive...which would trigger an upward surge in exports and in the domestic consumption of Irish produced goods...and this should theoretically hasten the recovery and drive down unemployment, all other things being equal (which they wont be!)...but make no mistake, exit from the Euro will be incredibly painful for a while.

    It took Iceland 3 years to be able to return to the bond markets.

    I'd expect a similar time-line in Ireland...but growth could resume faster than this I think...(unless our major trading partners are FUBAR...which is a possibility).

    Edited to say: I genuinely believe that Foreign direct investment would surge. Companies are not the bond markets. Smart companies know that Ireland is a great place to do business...even though our politicians really messed up with the banking sector.


    Incredibly optimistic. Iceland did not have the same level of personal debt held by its citizens. Our property bubble was the biggest in the world. Those two factors alone mean it would take over a decade for this country to recover from a euro exit. The current policies should see a sustained recovery begin in three to four years. As for FDI, the currency stability with our main trading partners is one of the key attractors. We would be lucky to see any FDI for at least three years as companies waited to see what else happens.


  • Moderators, Entertainment Moderators, Politics Moderators Posts: 14,552 Mod ✭✭✭✭johnnyskeleton


    Godge wrote: »
    Amberman wrote: »
    If Ireland exited the Euro, no one really knows precisely what would happen. This is what I think would happen...
    1. If the Euro still existed, your mortgage would still be in Euros at the prevailing Euro interest rate. Re-mortgaging would probably change this.
    2. If we moved to a new punt, it would almost certainly be substantially devalued compared to the Euro...perhaps by as much as 50%.
    3. This alone means, your mortgage costs would rise, assuming your wages didn't in new punts. It is unlikely wages would rise as much as the new punt fell versus the Euro, so your true cost of carry goes up as a percentage of your income.
    4. Interest rates would without doubt shoot up for new punt borrowers...quickly and very substantially.
    But...it isn't all doom and gloom...Irish exports would become much more competitive...and imports more expensive...which would trigger an upward surge in exports and in the domestic consumption of Irish produced goods...and this should theoretically hasten the recovery and drive down unemployment, all other things being equal (which they wont be!)...but make no mistake, exit from the Euro will be incredibly painful for a while.

    It took Iceland 3 years to be able to return to the bond markets.

    I'd expect a similar time-line in Ireland...but growth could resume faster than this I think...(unless our major trading partners are FUBAR...which is a possibility).

    Edited to say: I genuinely believe that Foreign direct investment would surge. Companies are not the bond markets. Smart companies know that Ireland is a great place to do business...even though our politicians really messed up with the banking sector.


    Incredibly optimistic. Iceland did not have the same level of personal debt held by its citizens. Our property bubble was the biggest in the world. Those two factors alone mean it would take over a decade for this country to recover from a euro exit. The current policies should see a sustained recovery begin in three to four years. As for FDI, the currency stability with our main trading partners is one of the key attractors. We would be lucky to see any FDI for at least three years as companies waited to see what else happens.

    I think he is highlighing the massive dangers of leaving the euro balanced with the moderate benefits.


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Godge wrote: »
    Incredibly optimistic. Iceland did not have the same level of personal debt held by its citizens. Our property bubble was the biggest in the world.

    Wow...I can do this all day. Wrong again. China and Australia are NOW bigger on an income multiple basis. Not sure about Canada. Japans WAS vastly bigger in the 80's.
    Those two factors alone mean it would take over a decade for this country to recover from a euro exit.

    What do you mean by "recover"? See GDP ticking upwards or get back to pre-bust levels?
    The current policies should see a sustained recovery begin in three to four years.

    Can you show me an example where such deep austerity has worked in such a short time period inside a currency union?
    As for FDI, the currency stability with our main trading partners is one of the key attractors. We would be lucky to see any FDI for at least three years as companies waited to see what else happens.

    All companies would wait to see what happens? I doubt it. Even during the depths of the Great depression, investment decisions were still made.

    Maybe some CEO's would simply shift production from high cost to low cost countries (of which Ireland would be one under the scenario outlined) to cope with shrinking margins.

    Is that possible?


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    Amberman wrote:
    Equally...I suppose it is difficult for you to accept that Chinas buying bonds now seems just a highly contentious...rather than your position yesterday of not at all contentious?

    Still, don't expect you to address that last point.

    You don't seem to notice when I did, but there we go. The point I made was that the claim wasn't contentious when ZH made it, because it was something a large number of observers and analysts agreed would happen. That the bond-buying programme wasn't contentious within China is not something I said at all, and would be entirely irrelevant to the point I was making, which was that a lot of what ZH fans claims as exclusive ZH insights aren't.

    To put it another way - ZH claimed that the Chinese were going to support the euro. That is something that would be contentious in China, obviously. But if many other analysts also believed that China would support the euro, which they did, then there is nothing contentious about the claim that was made by ZH - which is what I said.

    I can see where your confusion arises, but I'm afraid it's your confusion, not mine.

    cordially,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Scofflaw wrote: »
    You don't seem to notice when I did, but there we go. The point I made was that the claim wasn't contentious when ZH made it, because it was something a large number of observers and analysts agreed would happen. That the bond-buying programme wasn't contentious within China is not something I said at all, and would be entirely irrelevant to the point I was making, which was that a lot of what ZH fans claims as exclusive ZH insights aren't.

    To put it another way - ZH claimed that the Chinese were going to support the euro. That is something that would be contentious in China, obviously. But if many other analysts also believed that China would support the euro, which they did, then there is nothing contentious about the claim that was made by ZH - which is what I said.

    I can see where your confusion arises, but I'm afraid it's your confusion, not mine.

    cordially,
    Scofflaw

    I said that ZH claimed that, or any other statement was an exclusive to them? When? They are feckin news aggregator in a big portion of their stories...OMG...lol!

    I didn't mention ZH when I questioned your claim that bond buying was contentious.
    Also, China supporting the Euro isn't contentious? Sure, if they buy $1m in bonds they are supporting it, but the degree if support is important. Didn't premier Wen just say that countries must get their own houses in order?

    Many took that to mean that mass bond purchases are soon coming off the table. I have no idea...but we'll soon see.

    They seem to be facing some stiff, emerging headwinds at home in their giant property bubble and all that goes with that.

    Please show me in that statement where I said ZH was claimed that statement as an exclusive?

    You LITERALLY said that China supporting the Euro wasn't contentious...Not inside, outside, left, right, up, down...wasn't contentious...FULL STOP.
    claims that, frankly, aren't in the least contentious (China supporting the euro is a good example)

    i.e. China will continute to support the Euro......and you have been proven to be completely wrong. The fact that I said the pressure was internal makes not a jot of difference to your statement.
    That the bond-buying programme wasn't contentious within China is not something I said at all.

    No one said you did. :confused:

    wasn't contentious...FULL STOP. THATS what you said.

    I'm not confused...I'm crystal clear. I beginning to think you're routinely high!


  • Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    Amberman wrote: »
    I said that ZH claimed that, or any other statement was an exclusive to them? When? They are feckin news aggregator in a big portion of their stories...OMG...lol!

    I didn't mention ZH when I questioned your claim that bond buying was contentious.

    Please show me in that statement where I said ZH was claimed that statement as an exclusive?

    I didn't say you did - I said that many of the claims made by ZH were non-contentious (that is, again, not disputed by other analysts) yet were claimed as "as predicted on ZH". I said it because the China claim is one I know to have been claimed by someone else (and again, I did say it was someone else) as an "as predicted by ZH", whereas it was actually "as predicted fairly generally by most analysts".
    Amberman wrote: »
    You LITERALLY said that China supporting the Euro wasn't contentious...Not inside, outside, left, right, up, down...wasn't contentious...FULL STOP.

    No, I didn't literally say that, but I can see that's not going in. This is exactly what I said:
    There was nothing contentious in ZH's claim that the Chinese would support the euro. That is, it was something that was generally regarded as being in China's interests, and the claim being made by ZH that China would support the euro was therefore not a claim uniquely made by ZH when all other sources were blind to the situation...despite which, it was something claimed by another fan as an "as predicted by ZH":

    Nothing in there about whether the Chinese would have any difficulty supporting the euro. No comment is made on the accuracy of the claim at all, only on whether it was disputed by other analysts. You appear to have read no further than the first sentence, or not realised that the second sentence refers to the first and explains what is meant by "not contentious" - although the "that is..." is a fairly standard piece of grammar indicating that the following sentence refers to, and explains, the first.
    Amberman wrote: »
    i.e. China will continute to support the Euro......and you have been proven to be completely wrong. The fact that I said the pressure was internal makes not a jot of difference to your statement.

    Indeed it doesn't, but that's because it's completely irrelevant.
    Amberman wrote: »
    No one said you did. :confused:

    wasn't contentious...FULL STOP. THATS what you said.

    I'm not confused...I'm crystal clear. I beginning to think you're routinely high!

    And I'm beginning to think that perhaps 90% of what I say is lost on you, but there we go. Anyway, you apparently haven't got even a vague a handle on what I said, and I've now explained it four or five different ways without you grasping it, when I didn't think it was particularly complex in the first place, so I guess we'd better move on.

    politely,
    Scofflaw


  • Registered Users, Registered Users 2 Posts: 559 ✭✭✭Amberman


    Please...becuase I think you may have alzheimers.


  • Registered Users, Registered Users 2 Posts: 7,373 ✭✭✭Dr Galen


    Amberman wrote: »
    Please...becuase I think you may have alzheimers.

    This sort of thing really isn't needed and crosses the line into abusing other posters.



    Cheers

    DrG


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