ARmy Rumour SErvice

Watching the BBC news today, it detailed that Spanish bonds were over the 6% critical rate. So thats three countries whose bond rates are unsustainable. Its not looking good. Is this the market liquidity freezing up? Its a genuine question.

No doubt Alsacien will say something like "BBC??? bah, biased, not creditable, etc" but its mainly all I have to go on.

On NghtWatch

...
Greece: The new Greek coalition government that is headed by Lucas Papademos, former European Central Bank vice president, was sworn in 11 November. Evangelos Venizelos remains deputy prime minister and finance minister in Papademos' three-party-team.


Greek officials must provide a signed, written letter to their European partners that Greece is committed to reforms to reduce its debt, a European Commission spokesman said on 15 November. The letter must be convincing and be upheld by all political parties, regardless of future elections, the spokesman said.


Comment: Under the threat of default and expulsion from the Eurozone, Greece now has a new government that must swear in writing to do what European bankers demand and do so regardless of the outcome of future elections. This is the direction of European democracy, if the European Union survives.
...

And likely if it does not.

Originally Posted by mercurydancer

Watching the BBC news today, it detailed that Spanish bonds were over the 6% critical rate. So thats three countries whose bond rates are unsustainable. Its not looking good. Is this the market liquidity freezing up? Its a genuine question.

No doubt Alsacien will say something like "BBC??? bah, biased, not creditable, etc" but its mainly all I have to go on.

My personal view only.

Either Germany overcomes 85 years of fear of inflation and the ECB starts throwing freshly printed money at the problem or the eurozone collapses. One is an orderly decline, the other is not pretty.

Either way, the UK will be affected.

Originally Posted by mercurydancer

Watching the BBC news today, it detailed that Spanish bonds were over the 6% critical rate. So thats three countries whose bond rates are unsustainable. Its not looking good. Is this the market liquidity freezing up? Its a genuine question.

No doubt Alsacien will say something like "BBC??? bah, biased, not creditable, etc" but its mainly all I have to go on.

No, I really cannot be bothered to put the effort in anymore, this thread has never managed to lift itself beyond the days headlines - which usually are related to events that were pertinent several days earlier.
My last roll of the dice was trying to trigger a discussion on what would happen to ES bonds last Friday, but a glance back will show where that led.....

"Either way, the UK will be affected."

Must agree.

john

Originally Posted by Brotherton Lad

My personal view only.

Either Germany overcomes 85 years of fear of inflation and the ECB starts throwing freshly printed money at the problem or the eurozone collapses. One is an orderly decline, the other is not pretty.

Either way, the UK will be affected.

Essentially that's a variation of Alsacien's line and I don't think it's right.

What you're suggesting might be a way out of the immediate problem but the Eurocrats are committed to holding the Eurozone together so you are still left with the fundamental requirement of Germany paying indefinitely or the Greeks and Italians suddenly discovering a Protestant work ethic from somewhere or the cycle will repeat itself.

Ultimately there are political limits to the austerity which can be enforced on the periphery by Paris/Berlin/Brussels and the more the centre tries to force things, the sooner those limits will be reached. I can see what Alsacien's driving at economically but his economic rationalism and clever financial fixes require the political dimension to be suspended indefinitely - and that's not going to happen.

Originally Posted by FORMER_FYRDMAN

Essentially that's a variation of Alsacien's line and I don't think it's right.

What you're suggesting might be a way out of the immediate problem but the Eurocrats are committed to holding the Eurozone together so you are still left with the fundamental requirement of Germany paying indefinitely or the Greeks and Italians suddenly discovering a Protestant work ethic from somewhere or the cycle will repeat itself.

Ultimately there are political limits to the austerity which can be enforced on the periphery by Paris/Berlin/Brussels and the more the centre tries to force things, the sooner those limits will be reached. I can see what Alsacien's driving at economically but his economic rationalism and clever financial fixes require the political dimension to be suspended indefinitely - and that's not going to happen.

On the contrary. I gave two options.

Germany coughs up, via the ECB, or it's game over.

The IMF may come riding to the rescue or it may not (that's BRIC and the US and us)

Originally Posted by Brotherton Lad

On the contrary. I gave two options.

Germany coughs up, via the ECB, or it's game over.

The IMF may come riding to the rescue or it may not (that's BRIC and the US and us)

By my point is that Germany would need to keep coughing up or it'll be game over at some stage anyway - so the question for them is why strain their economy to sustain a money pit - if they're not going to stump up in perpetuity, why waste money stumping up at all?