The Big Bailout of the Eurozone (Another crisis coming? - Seriously)

[Hardy]

This is how a people with a sense of nationhood, democracy and self respect asserts its sovereignty against any and all forces, domestic and foreign, acting against its interests:

It's a bit more complicated than that Hardy. Have a wee read at

this thread

Ah I know, but you'd find yourself wishing that we had a modicum of the self respect and refusal to be ridden that the Icelanders display.

[passedit]

This is how a people with a sense of nationhood, democracy and self respect asserts its sovereignty against any and all forces, domestic and foreign, acting against its interests:

It's a bit more complicated than that Hardy. Have a wee read at

this thread

Ah I know, but you'd find yourself wishing that we had a modicum of the self respect and refusal to be ridden that the Icelanders display.

Same corrupt self serving elite though i'm afraid.

[fearglasmor]

Anyone who thinks that this German Fiscal Union will be a limited benign helping hand to keep our finances in order is living in a fools paradise. Just as a woman cant be partially pregnant, a country cant be partially sovereign, either it is or it isnt. And if we vote or are shunted by our government into a German Fiscal Union then we are no longer a sovereign state. The days of the small nation veto will be gone, qualified majority decisions will be essential to make the Fiscal Union work. I just hope that the majority of people in this country will shake off their traditional political apathy in time to see whats happening and ensure it is stopped.

Lucinda Creighton, talking about the EU summit next week says that any decisions the Government take will be in the interest of the Irish people.........do you trust them.

The US are constantly criticised for looking to effect regime change through military intervention but teh EU/Germany have effected regime change in Greece and Italy by stealth and no one has batted an eyelid.

[Rossfan]

What a pity the Germans didnt effect regime change in Ireland around 2000 or 2001 when the Bertiecunts were getting their National Destruction policies into full swing 
Harneycunt boasting about being more like Boston and Berlin and all that.
That gang brought us nearer to Harare .

[muppet]

Anyone who thinks that this German Fiscal Union will be a limited benign helping hand to keep our finances in order is living in a fools paradise. Just as a woman cant be partially pregnant, a country cant be partially sovereign, either it is or it isnt. And if we vote or are shunted by our government into a German Fiscal Union then we are no longer a sovereign state. The days of the small nation veto will be gone, qualified majority decisions will be essential to make the Fiscal Union work. I just hope that the majority of people in this country will shake off their traditional political apathy in time to see whats happening and ensure it is stopped.

Lucinda Creighton, talking about the EU summit next week says that any decisions the Government take will be in the interest of the Irish people.........do you trust them.

The US are constantly criticised for looking to effect regime change through military intervention but teh EU/Germany have effected regime change in Greece and Italy by stealth and no one has batted an eyelid.

Good post.

The treaty is not for greater fiscal union, look at Greece and Italy, Germany has exactly what it wants there already. The treaty is about the ability to punish or expel countries. That is why Kenny was happy to piss off Merkel by calling it 'problematic'.

Can you imagine a scenario whereby say Washington had the power to force, for example, California out of the Union due to finances? Think of the leverage that would give the central Government. e.g. Raise corporation tax or you are gone. They could conceivably force the removal of governments.

[muppet]

http://www.irisheconomy.ie/index.php/2011/12/02/time-for-a-deal-on-ela/#comments

The comments below about Anglo are more interesting that the main article. It seems we will be bailing out that despicable organisation until 2031.

[muppet]

http://www.rte.ie/news/2011/1202/euro-business.html

And there it is...........

Merkel said there was "no alternative to treaty change" which would codify budgetary discipline in the euro zone. "Rules must be respected. Respect for them must be supervised. Their violation must have consequences," she said.

[whiskeysteve]

What would ye think of buying gold with any savings you might have? Safe? Crazy? Obviously I'd discuss with a Financial Advisor, but just wondering if anyone else has gone down this way, especially if you have a few bob in a savings account? If the Euro collapses, and we revert to a devalued Punt, I don't want to be left with stuff that can only be used as toilet paper.

How about buying Yen, or Dollars, or even Sterling?

Gold is very volatile at the moment. The Euro probably won't break up. It would destroy the global economy for at least 5 years.
Even the 1% don't want that.

If enough people thought that the Euro was unsafe and pulled their money out of the banks the currency would collapse. The job of the authorities is to make sure this doesn't happen.   It all depends on confidence.

The volatilty of Gold as it stands should not be a major worry IMO. While it is the finite element that it is, it will always retain value (as it has done for thousands of years). Silver should be considered also (precious for use in industry also).

With the central banks around the world now consigned to printing money, debt and fiat currency could well be on an exponential curve (e.g. by the time you know the currency is about to fatally debased, its too late):

http://www.youtube.com/watch?v=8WBiTnBwSWc

The above is a fascinating presentation on the economy, energy and environmental challenges of the coming 20 years. Doesn't look good for us.

Fiat currency is backed by nothing and throughout history has been shown to be anything but sacred. Why couldn't the dollar or euro become worthless at some point in the future with our politicians as short-sighted and divided as they are (in europe at least)?

In my opinion, one of the ways to protect yourself in the coming years (if you have savings) would be to secure your energy requirements or lack thereof. Never pay any heed to broad brush verdict on micro renewables for example, they depend entirely on your circumstances.

We have a micro hydro generator installed on a piece of land for example and it is turning out to be a great investment (the house is totally off-grid for several thousand quid of capital and you earn a tariff for everything you generate, moreso if it goes back into the grid)

Putting yourself and your family in the position of being as self-sustainable as is practible in terms of energy and food requirements is not a bad move, sure even if everything turns out grand with the economy you are adding to the value of your land/property.

Invest in self-sustainability if you can or precious metals if you can.

the gold price hit a record in 1980 . When gordon Brown sold the Uk's gold around 10 years ago the price was 30% or so of what it had been in 1980.
It's like any asset. The price you buy in at is crucial.   

dont have time to respond in full but I think gold may have a while to rise yet - judging by the massive purchasing by central governments the world over at the present, the men in power certainly are scrambling to attain it. Russia, China, Korea and Hugo Chavez demanding all Venezeluan reserves back from London would be a case in point.

I wouldnt look on gold as an investment, more of a hedge and a security or insurance.

As always with finite precious metals it must be emphasised that their intrinsic value stays pretty constant, whilst their currency value can fluctuate wildy over the years. It is the paper that moves the price not the metal, and i think we will a lot more dollars will be buying a lot less gold as the dollar continues to be destroyed by the fed in their panic at an exponential debt rise.

Basically I reckon all commodities in limited supply will continue to soar in price relative to the result of the printing presses, including precious metals.

also the period 1980 - 2006 can also be a misleading time to reference gold in some regards given the unprecedented throughout history credit bubble, the bubble of all bubbles that is now bursting.

However, iif you are an optimist and think the euro, sterling or dollar will recover in the coming years then by all means stay away from gold!

Personally I think the whole she-bang is coming off the rails excentuated by the coming energy crisis - fossil fuels are becoming a lot harder and a lot more expensive to produce now - they will become more and more un-economic. There will be more conflict over them also - the US is under massive pressure to feed the military industrial complex.

I would never plough all the dough into precious metals but I would listen to the likes of jim rogers and marc faber in that they tend to keep about a quarter of their portfolio in silver/gold.

Personally I like the look of silver - for one thing it will always be in massive demand in industry.

But as i said previously, if I had a lot of savings, above all i would try and cut any debt, and secure my own energy and food sources as much as is practically possible. IF I had a LOT of money after that THEN i would seriously consider purchasing some physical silver.

Self-sustainability and Community are still the most important things in getting through these difficult times. You cant eat gold.

[muppet]

http://www.reuters.com/article/2011/12/02/portugal-pensions-idUSL5E7N22HK20111202

Portugal government to transfer 5.6 bln euros from bank pensions

In other words they have seized some private pensions. Private pensions are the last thing to be taken.........before bank deposits. Hungary has already done a version of this.

Going, going.........

[seafoid]

Today's FT has a corker


In Europe, the elected leaders of five European Union members have been swept aside in just 18 months. Silvio Berlusconi's near perpetual grip on power in Italy was broken almost overnight. Further, forced austerity is now spreading across Europe, despite public opposition.

How did the markets amass so much power? The answers lie in globalisation, external imbalances and the surge of financial assets and financial technology. The expansion of global trade over the years led to a rise in global money flows. As Asia, India and Latin America became more global, the capital transfers between these regions and advanced economies grew. And it was the emerging countries that imported capital from advanced nations because internal savings were too small to finance development. But global finance changed when this historical pattern reversed. Many export-centred developing countries adopted conservative fiscal policies, which led to excess savings. China, for example, is sitting on $3tn of accumulated monetary reserves. In the US, savings declined and a large current account deficit developed. The result was an unprecedented recycling of capital from poorer countries to richer ones.

This change – together with a surge in the use of technology, deregulation, the emergence of larger financial institutions and an ageing, and increasingly wealthy, population in the west – expanded the scale of finance and the pressure for investment returns. The ratio of global financial assets to global gross domestic product has grown from 2.5x to almost 4x since 1990. In absolute terms, such assets now total $212tn. America's six largest banks have seen their total assets expand from 17 per cent of US GDP to 63 per cent over the same period.

It was inevitable, then, that global trading volumes in financial assets would rise sharply. Bond and commodity investing, for example, were revolutionised by the introduction of new financial instruments, the availability of greater leverage and new technology.

Whether this power is healthy or not is beside the point. It is permanent. Even a resumption of traditional patterns in global capital flows would not change it.

But, above all, there is no stopping the new policing role of the financial markets. There may be more frequent market crises. We should not rush to conclude that they will end in tears.
By Roger Altman
The writer is chairman of Evercore Partners and was US deputy treasury secretary under President Bill Clinton

[Orangemac]

BBC2 flat out on financial crisis this week

Tonight  7:00      The Partys Over:How the West went bust

Monday 9:00         RBS: The bank that ran out of money.

Wednesday 9:00    Inside Job: Storyville doc narrated by Matt Damon

[bcarrier]

Welcome to our world Germany ...

Shares in Commerzbank have dropped after a report suggested that Germany is prepared to nationalise the bank if needed.

http://www.bbc.co.uk/news/business-16029418

[Main Street]

This is how a people with a sense of nationhood, democracy and self respect asserts its sovereignty against any and all forces, domestic and foreign, acting against its interests:

It's a bit more complicated than that Hardy. Have a wee read at

this thread

Ah I know, but you'd find yourself wishing that we had a modicum of the self respect and refusal to be ridden that the Icelanders display.

Same corrupt self serving elite though i'm afraid.

I think if you examined the response of the Icelanders to their crisis you would find quite some differences to Ireland. Passedit, that link you gave to a discussion board, which is not even based in Iceland, provides almost zero input.

The night before the banks were declared collapsed in Iceland, the conservative gov passed emergency laws, giving priority to depositors and imposed strict capital controls to prevent foreign cash reserves being drained.
What followed was remarkable, new banks were set up in place and overnight all bank accounts were transferred to the new banks. The hole in the wall kept doling out the cash. That fear of all fears, the hole in the wall would dry up, the fear scenario that the Irish public swallowed hook line and sinker, proved to be as real as a threatened plague of zombies.

The bondholders brought legal action to force the assets from the old iceland banks be distributed equally to all creditors, they failed and recently the Iceland Supreme Court upheld the decision. Bondholders have to abide by the laws of the land and the government can decide what is the law, can change their minds, backdate the revision and it's all legal in international law.

The referendums that were held in Iceland were not about citizens deciding not to pay bondholders, that issue was already sorted.
They were about the terms of the agreement the state was making with the UK and Netherlands for reimbursing the minimum €20k  for each deposit holder in the foreign branches of Landsbank and that the confiscated assets of the foreign branches should be first paid to those depositors - according to Iceland law.  If the assets were so distributed according to Iceland law then the state would save a fortune. That's how it panned out in the end.
The UK and Netherlands both had not committed themselves to distributing the assets giving the priority to the deposit holders,  but instead had made some vague promises which the Iceland public rejected in referendums.

The IMF intervention in Iceland way back in 2008 was a good thing. That is the original ideal by which the IMF was founded, to provide assistance to countries going through an intolerable phase.
The IMF could not dictate how the government should run the country. In particular, the IMF repeatedly called for the country to remove the restrictions on capital control but the Icelanders said no and the IMF said okay. They are still saying no, some 2 years later and the IMF still say okay.
The IMF intervention was delayed for months  by the UK and the Netherlands interference, in order to persuade the Iceland Gov to sign an agreement which totally favored the UK & NL.  So foreign cash reserves were at an all time low when the IMF finally decided to ignore the UK & NL and go ahead with the loan program.

The Irish government would have been much better off telling the ECB to go hump themselves with their citizens should pay bank private debts plan. The  could have changed the laws re depositer priority, let the corrupt banks collapse or let the creditors take over the bank,  set up new banks,  if necessary negotiate loans with the IMF to back a new independent currency, impose capital controls and use the cash reserves and pension funds to support the new currency and invest.
Instead of a €250bn sovereign debt, I'd estimate at most a €15bn - €20bn IMF loan would have sufficed. Then the country could have looked at ways to remove the inflated value of household debt.

[fearglasmor]

From RTE website reporting on the meeting today between Merkel & Sarkozy :



"France and Germany have agreed on a series of reforms to address the eurozone debt crisis that will be presented to EU President Herman Van Rompuy on Wednesday.
French President Nicolas Sarkozy said the new proposals would include a modified EU treaty, ideally for all 27 EU members, but that they were also ready to draw up a treaty for the 17 eurozone members though this would be open to others.
Mr Sarkozy was speaking after a meeting in Paris with German Chancellor Angela Merkel.
"We want to make sure that the imbalances which led to the situation in the euro zone today cannot happen again," Mr Sarkozy told a news conference.
"Therefore we want a new treaty, to make clear to the peoples of Europe, members of Europe and members of the euro zone, that things cannot continue as they are," he added.
This treaty would include automatic sanctions for states who fail to meet the 3% deficit rule, the so-called 'Golden Rule', as well as a budget-balancing rule across the euro zone.
The French and German leaders also ruled out eurobonds as a solution to the debt crisis.
The European Court of Justice would not be able to overturn national budgetary decisions, but it could verify whether or not national governments were in breach of their own Golden Rules on deficits, the pair said.
President Sarkozy also said that eurozone leaders should meet each month while the crisis is ongoing.
The Franco-German plan will have to be approved by all 27 member states at this week's summit.
If only eurozone countries approve the plan they may be entitled to forge ahead according to EU rules allowing so-called "enhanced cooperation."
The Paris meeting marked the beginning of a critical week for the eurozone.
The ECB has for the first time signalled that it is ready to play a bigger role and its president, Mario Draghi, has demanded a new fiscal contract to restore long-term market confidence in return.
France and Germany have been working behind the scenes on how that should be achieved.
A potential collapse in the currency has reached the stage of contingency planning by some trans-global companies.
The Irish Government has resisted treaty change, but Taoiseach Enda Kenny has acknowledged that economic governance at eurozone level is now a necessary reality.


Does this mean a referendum is not required if our leader agrees to this on Friday ?

We were warned that the last treaty allowed self modification without reference to the electorate and this was dismissed by the government and all the yes brigade.
And now here we are.
The noises coming from Kenny and Lucinda Creighton (who I had never heard of until the last few days) are extremely worrying, to me at least.

[whiskeysteve]

Creighton - from what ive seen on vincent brown shes a 'back to the markets' loon with an imperious cv who will jump through hoops for gold stars and status from europe. another f**king barrister. badly shown up by vincent, gurdgiev, stephen donnelly and anyone else who pays heed to economic reality