Italian PM Monti Mysteriously Jets Off To Brussels And The Euro Falls Below $1.28

maquiladora

hmmm, whats all this about?

Reuters reports (via ForexLive) that Italian PM Mario Monti is flying to Brussels unexpectedly, and his office is giving no details about who he's going to meet or what he will while in the European capitol.

News of his sudden trip coincided with a momentary drop in the value of the euro versus the dollar below $1.28, a value it hasn't hit since September 2010, according to CNBC. The euro has been falling steadily since Tuesday.

The Italian stock exchange is also getting crushed today. The FTSE MIB is down over 3.6%.

Plans of a meeting between Monti and German Chancellor Angela Merkel surfaced yesterday, as investor optimism from December continues to deflate. That will happen on January 11 in Berlin, two days after Merkel meets with French President Nicolas Sarkozy.

If these last few months are any indication, all these meetings will likely be accompanied by swirling rumors and new predictions of European doom, particularly since it still appears that European leaders are not willing to take radical action to put an end to the crisis.

The crisis appears to be heating up again in the eurozone.

http://www.businessinsider.com/italian-pm-monti-trip-brussels-2012-1

hmmm

"Not willing to take radical action", i.e. the writer wants a snap decision made that will have far reaching consequences and he wants it made immediately. We've all seen what happened in Ireland when that sort of decision was made.

No instead, let's make sure considered decisions are made and let the leaders have as many meetings as they need. No need to be bullied into action by a couple of hedge funds who are looking to make a quick buck.

_Kaiser_

That's all well and good except that while they sit and debate what to do to try and rescue the sinking ship, the (financial) world will move on without them until they reach a point where the decision has been (effectively) made for them.

As for "bullying" - that's an ironic concern considering how Ireland has been treated by our EU "partners" in the last few years

dvpower

Kaiser2000 wrote: »

As for "bullying" - that's an ironic concern considering how Ireland has been treated by our EU "partners" in the last few years

Lending us billions of Euros at low rates. Bastards!:mad:

_Kaiser_

dvpower wrote: »

Lending us billions of Euros at low rates. Bastards!:mad:

Oh dear.. another believer in the "bailout" eh?

If you think that this "charitable" act of kindness was anything more than an attempt to save their own banking system (and scare the Portugese and Spanish into line at the same time) by making the Irish taxpayer carry the gambling debts of others at the expense of our own domestic enconomy, mass unemployment and emigration, and cynical attempts to wring every last cent from already overburdened citizens well then I genuinely am at a loss and despair for the future of this country!

dvpower

Kaiser2000 wrote: »

Oh dear.. another believer in the "bailout" eh?

If you think that this "charitable" act of kindness was anything more than an attempt to save their own banking system (and scare the Portugese and Spanish into line at the same time) by making the Irish taxpayer carry the gambling debts of others at the expense of our own domestic enconomy, mass unemployment and emigration, and cynical attempts to wring every last cent from already overburdened citizens well then I genuinely am at a loss and despair for the future of this country!

Oh dear.. another deficit denier, eh?

Sand

dvpower wrote: »

Oh dear.. another deficit denier, eh?

Where did he deny the deficit? He quite correctly challenged the presumption the "bailout" was in anyway some act of kindness which we ought to be grateful for. Billions werent lent to us at "low rates". They were lent to us at extortionate rates, in exchange for the Irish signing up to the derranged ECB narrative of the crisis - let alone their doomed "solution". A running theme was that Ireland had to be crushed in the bailout terms, to scare the Spanish and Italians.

dvpower

Sand wrote: »

Where did he deny the deficit? He quite correctly challenged the presumption the "bailout" was in anyway some act of kindness which we ought to be grateful for.

A presumption of his own making so.

Sand wrote: »

Billions werent lent to us at "low rates".

Low compared to the rates available to us in the bond markets.

Head The Wall

Sand wrote: »

Where did he deny the deficit? He quite correctly challenged the presumption the "bailout" was in anyway some act of kindness which we ought to be grateful for. Billions werent lent to us at "low rates". They were lent to us at extortionate rates, in exchange for the Irish signing up to the derranged ECB narrative of the crisis - let alone their doomed "solution". A running theme was that Ireland had to be crushed in the bailout terms, to scare the Spanish and Italians.

Wasn't the bulk of the bank bailout loaned to us over 15 years at 1%? It's the 50 billion that has been lent to us to keep the country running that had the higher rates of interest which we have since received a reduction on.

Sand

Wasn't the bulk of the bank bailout loaned to us over 15 years at 1%? It's the 50 billion that has been lent to us to keep the country running that had the higher rates of interest which we have since received a reduction on.

Nope - the bailout terms were costed by source (IMF/EU), not by purpose. The average rate was just over 5.5% IIRC so 1% on 35 billion would imply rates of roughly 8.7% were being applied on the remaining 50 billion. Which was even worse than what the Irish could borrow at on the markets despite ECB efforts to drive us out of the bond markets and into the arms of their crazed "bailout".

It wasnt even lent to us as such - it was a facility we could borrow from, to ensure Irish taxpayers could always borrow to pay the banks debts as they came due. By signing up to it, the Irish government removed a key aspect of a "cant pay/wont pay" default rationale which would limit the damage of default.

The reduction in charged interest only came as a side effect of bad boy Greece's own negotiations.

dvpower

Sand wrote: »

It wasnt even lent to us as such - it was a facility we could borrow from, to ensure Irish taxpayers could always borrow to pay the banks debts as they came due.

... and, of course, our own current spending requirements.
(why is it that some people seem to forget about the deficit? - even if we ignored all bank bondholders, we would still need a 'bailout' to fund day to day spending)

hmmm

Sand wrote: »

Nope - the bailout terms were costed by source (IMF/EU), not by purpose. The average rate was just over 5.5% IIRC so 1% on 35 billion would imply rates of roughly 8.7% were being applied on the remaining 50 billion.

Where are you pulling those figures from? :rolleyes:

Godge

Sand wrote: »

Where did he deny the deficit? He quite correctly challenged the presumption the "bailout" was in anyway some act of kindness which we ought to be grateful for. Billions werent lent to us at "low rates". They were lent to us at extortionate rates, in exchange for the Irish signing up to the derranged ECB narrative of the crisis - let alone their doomed "solution". A running theme was that Ireland had to be crushed in the bailout terms, to scare the Spanish and Italians.

(1) The money was lent to us at lower rates than the markets would lend to us
(2) The current government got the rate further reduced.

Conclusion: fair play to the FG/Labour coalition for reducing the cost of our bailout caused by the FF government.

Sand

:rolleyes:

Roll up, roll up.

@dvpower

... and, of course, our own current spending requirements.
(why is it that some people seem to forget about the deficit? - even if we ignored all bank bondholders, we would still need a 'bailout' to fund day to day spending)

Who has forgotten about them? I havent. Im a fairly strong advocate that we ought to have cut more, sooner. For reasons that are being demonstrated now.

If you really think the "bailout" was because the ECB or EU were at all concerned about ensuring the best paid civil service or social welfare benefits were maintained then you're fooling yourself. If you think that ensuring the best paid civil service or social welfare benefits were maintained was in the interests of the Irish people then you're fooling yourself. The EU/ECB could not give a flying **** what happens to Ireland.

If anything, the "bailout" simply gave less and less urgency to the need to address the deficit as it gave the civil service more opportunity to borrow money to pay themselves at the taxpayers expense.

@hmmm

Where are you pulling those figures from?

Maths.

@Godge

(1) The money was lent to us at lower rates than the markets would lend to us
(2) The current government got the rate further reduced.

Conclusion: fair play to the FG/Labour coalition for reducing the cost of our bailout caused by the FF government.

Typical Irish political thinking right there.

This winter was a lot milder than last years winter.

Conclusion: fair play to the FG/Labour coalition for reducing the harshness of the winter caused by the FF government.

dvpower

Sand wrote: »

:rolleyes:
If you really think the "bailout" was because the ECB or EU were at all concerned about ensuring the best paid civil service or social welfare benefits were maintained then you're fooling yourself. If you think that ensuring the best paid civil service or social welfare benefits were maintained was in the interests of the Irish people then you're fooling yourself.

At what point did you first start fooling yourself that I think any of this sillyness?

Sand

@dvpower

At what point did you first start fooling yourself that I think any of this sillyness?

You tend to presume quite a bit about others views and motives to suddenly play the innocent...

Oh dear.. another deficit denier, eh?

why is it that some people seem to forget about the deficit?

dvpower

Sand wrote: »

You tend to presume quite a bit about others views and motives to suddenly play the innocent...

So you're deliberately misrepresenting me as a punishment?

Grow up.

AllGunsBlazing

Anyhoo... I'm sure they had plenty to chat about.

Not least of which shares in Unicredit going tits up and Italian ten year bond yields going past the dreaded 7% threshold ...again. Which funnily enough was cited as one of the main reasons why Berlusconi had to walk the plank when Italian borrowing costs reached the same level back in November.