Reports in Italy suggested that the IMF is drawing up plans for a €600 billion (£517 billion) assistance package for the country....IMF denies the news item though...NOT ENOUGH MONEY IN THE BAG !... Spain may be offered access to IMF credit, rather than a rescue package, to avoid being “picked off” by the markets in the coming weeks. An IMF rescue package involves a country being offered hundreds of billions of euros in return for agreeing to launch a major austerity programme to cut spending. A credit line is a more flexible arrangement which gives countries short term access to international finance. The reports of an IMF rescue package being prepared come as European finance ministers meet tomorrow to discuss draft plans for a bail-out scheme. Under the scheme set to be discussed, the euro area’s European Financial Stability Facility (EFSF), would have to “insure” bonds of troubled countries by covering the first 30 per cent of any unpaid debts. To offer this guarantee, the European bail-out fund would have to be able to raise €1.4 trillion – a threefold increase compared to the current size of the scheme. Last night, it was not clear if or how this money could be raised, although the EFSF may itself sell bonds to international investors....The numbers reported for potential IMF support to Italy should be put in context. The IMF's total credit outstanding to all countries at end-October was SDR 85 billion (about € 100 billion)...As for the notion that in the current circumstances any rational investor would buy EFSF bonds, well, it just beggars belief. Who exactly would guarantee those bonds? France, Germany, with debt/GDP ratios of over 80% already? Or perhaps the idea is that countries such as Italy would guarantee themselves? Who would repay the bonds? And in what currency?... WSJ -FOREX - Companies that provide the plumbing for the $4 trillion-a-day foreign-exchange market are testing systems that could handle trading of previously shelved European currencies.ICAP PLC, which operates the biggest system for enabling currency trades between banks, said Sunday that it is prepping electronic-trading systems for a possible exit by Greece from the euro zone and a return of the drachma, the country's previous currency. CLS Bank International, whose platform enables banks to settle their currency trades, is running "stress tests" to prepare for a dissolution of the euro, people familiar with the matter said.
Access Investments-Building Awareness - European Union-ROMANIA
Monday, November 28, 2011
European leaders will meet on December 9 for crunch talks
Reports in Italy suggested that the IMF is drawing up plans for a €600 billion (£517 billion) assistance package for the country....IMF denies the news item though...NOT ENOUGH MONEY IN THE BAG !... Spain may be offered access to IMF credit, rather than a rescue package, to avoid being “picked off” by the markets in the coming weeks. An IMF rescue package involves a country being offered hundreds of billions of euros in return for agreeing to launch a major austerity programme to cut spending. A credit line is a more flexible arrangement which gives countries short term access to international finance. The reports of an IMF rescue package being prepared come as European finance ministers meet tomorrow to discuss draft plans for a bail-out scheme. Under the scheme set to be discussed, the euro area’s European Financial Stability Facility (EFSF), would have to “insure” bonds of troubled countries by covering the first 30 per cent of any unpaid debts. To offer this guarantee, the European bail-out fund would have to be able to raise €1.4 trillion – a threefold increase compared to the current size of the scheme. Last night, it was not clear if or how this money could be raised, although the EFSF may itself sell bonds to international investors....The numbers reported for potential IMF support to Italy should be put in context. The IMF's total credit outstanding to all countries at end-October was SDR 85 billion (about € 100 billion)...As for the notion that in the current circumstances any rational investor would buy EFSF bonds, well, it just beggars belief. Who exactly would guarantee those bonds? France, Germany, with debt/GDP ratios of over 80% already? Or perhaps the idea is that countries such as Italy would guarantee themselves? Who would repay the bonds? And in what currency?... WSJ -FOREX - Companies that provide the plumbing for the $4 trillion-a-day foreign-exchange market are testing systems that could handle trading of previously shelved European currencies.ICAP PLC, which operates the biggest system for enabling currency trades between banks, said Sunday that it is prepping electronic-trading systems for a possible exit by Greece from the euro zone and a return of the drachma, the country's previous currency. CLS Bank International, whose platform enables banks to settle their currency trades, is running "stress tests" to prepare for a dissolution of the euro, people familiar with the matter said.
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Financial markets continue to move faster than politicians,” Mansoor Mohi-uddin, head of foreign exchange strategy for UBS, said. “Fixed income investors are betting that either Germany moves towards a fiscal union with its eurozone partners or that, without the ECB willing to buy unlimited amounts of sovereign bonds in the secondary markets, the eurozone will break apart.”
Should further integration of eurozone countries occur, then Germany’s finances will get worse, he said. “If [a closer union] involves fiscal transfers to shore up the single currency area then Germany’s fiscal position itself will deteriorate,” Mr Mohi-uddin said.
Euro socialists and all other socialists, have a wonderful knack. Its destroying economies for a living! When will those, who live the socialist dream, ever learn!..
Ireland had an excellent economic model in the 90s. Low company taxes, a business friendly environment and a well-educated workforce (often returning from working elsewhere in the world) meant is was the location of choice for companies exporting to Europe. Unfortunately, the Irish then went mad and invested wildly in property (funded by small Scottish banks pretending to be big banks).
Germany has an excellent economic model. Based on first class manufacturing and a well-educated workforce, it was and remains the choice for people wishing to buy high quality goods. Unfortunately, the Germans have gone mad and have taken on the unsustainable (and completely unreformed) public debt and public sector subsidies of southern Europe.
In fact, the Irish have acknowledged their terrible error and have slashed their public sector and are trying to revive their good economic model. However, the Germans have not, and are now, in a new re-run of Barbara Tuchman's 'The March of Folly', simply making things worse by the day.
It's hard to see how Europe can (or indeed deserves to) get out of this.
The Euro is a disaster and it will be good riddance! However, the ensuing fallout will cause a crisis of "Lehmanesque" proportions, maybe worse. Anyone who thinks stock markets will not be slaughtered by all this is living in a fantasy-land. And than, post break-up, central banks will print like mad to avoid another Great Depression. We feel it it would only be prudent to hedge oneself against this inevitable printing by the BoE and others with such hard assets as Gold, Oil and farmland investment (http://prst.co/259, http://prst.co/21U). Wolfgang Munchau'sarticle in the FT states the Euro will be toast within 10 days. The EU was wonderful as a free-trade zone, but now, but of course the Euro-socialists ended-up trying to go too far and destroyed things.
the IMF, has pointed to the fact that the EU's real debt is in babies (more than, or rather than, mere money).
Let me explain. Due to the decades long low fertility rates in Europe, and currently an apparent overall lifetime fertility rate of about 130 to 140 babies born for every 200 adults (211 would be close to just exact replacement), not just to save the Euro, but to actually save the European civilization itself, an absolutely drastic change needs to be made in the minds and hearts of all the peoples of Europe.
That change? Europeans need to believe in God again (yes, God). Why? Because just believing in one's self, evidently, is ultra-insufficient to produce the necessary commitment and sacrifice for people to form families (by marriage), and to bear children (again) in super-abundance. Numbers of probably at least 4 to 6 children on average, fairly soon, per two adults, will be essential to reversing the current trend, which is approaching to producing just 1 child for every four grandparents
A misorganisation of morons. Oh dear, how could we have allowed these incompetents to be allowed to steer the German EU ship onto the rocks? Scuttle it now, let's go back to the Drachma, Franc, Deutschmark etc. I never liked school uniform.
don't understand why,if things are so dire for the Euro,it is trading at 1.32 to the dollar. In the dark days of 2008 it hit a low of 1.24 to the dollar.The currency markets are notoriously fickle and quick to panic.
Granted the Euro has plunged 900 points in a month,but still.
One is tempted to go long and wait for the German cavalry to blow the bugle and appear just in the nick of time,a la Blucher at Waterloo
Eurozone banks cut off from funding and desperate for liquidity are bringing back cash from their subsidiaries outside the Eurozone. They are also selling some of their loans to banks outside the Eurozone that are liquid. These processes prop up the value of the euro -- for the time being...
Enough is enough. The Greeks, Itallians, Portuguese and Spaniards have all been living off other peoples money since joining the Eurozone. It's about time we let them default on their loans and declare bankruptcy. Only then will people in those countries realize that they have been living a false life style paid for by hard working northerners. It's about time they get off their collective doff and get to work and stop complaining about the price they must pay to get out of their mess.
Latest from Wall Street Journal says this report is false: http://online.wsj.com/article/...
TOKYO (Dow Jones)--A report that the International Monetary Fund could offer Italy between EUR400 billion and EUR600 billion in financial support is not credible, people familiar with ...
spate of reports suggesting that a new "hardcore euro" treaty could be in place by early 2012 will send shivers through Whitehall before tomorrow's autumn statement from George Osborne who, like David Cameron, is clamouring for close consultations with Britain over such plans. But EU officials insisted that, while Berlin and Paris might be "toying" with ideas such as drawing up a mini-accord that will not need a new treaty, they continued to talk to Brussels about "limited treaty change" involving the 17 eurozone nations or the 27 member states. Valérie Pécresse, the French budget minister, talked of a "new governance pact" for all zone members.
Companies that provide the plumbing for the $4 trillion-a-day foreign-exchange market are testing systems that could handle trading of previously shelved European currencies.
ICAP PLC, which operates the biggest system for enabling currency trades between banks, said Sunday that it is prepping electronic-trading systems for a possible exit by Greece from the euro zone and a return of the drachma, the country's previous currency.
CLS Bank International, whose platform enables banks to settle their currency trades, is running "stress tests" to prepare for a dissolution of the euro, people familiar with the matter said.
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