Tuesday, Dec 30, 2008
The Eurozone is so much better placed - strong fundamentals and diverse economies:O)
Bloomberg: ECB Pressured to Cut Rates by Weaker Sales, Lending
“The ECB will have to go further,” said Gilles Moec, an economist at Bank of America Corp. in London and a former Bank of France official. The euro region faces “a severe and protracted recession.”.......and yet the euro continues its stratospheric climb against sterling and is predicted to break 1.50 against the dollar. Time to short the euro methinks.
Posted by bystander @ 11:52 PM (502 views) Add Comment
5 Comments
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1. gardeniadotnet said...
All across Asia and Eastern Europe, export-driven economies are crumbling. Demand for their products has nearly vanished. Unemployment is skyrocketing. And hundreds of huge companies are only weeks away — and in some cases, mere days away — from defaulting on loans granted them by European banks.
As a currency trader, that tells me that the euro’s heyday is about to end and a new, massive crash in its value is only days away.
Mark my words: As hundreds of euro loans made to emerging nations go sour ... and as European banks reel from massive losses ... the world’s investors will drop the euro like a radioactive potato.
This is the fundamental shift I’ve been warning you about. Plus it’s a confirming signal that the euro may be only days away from a major collapse.
Jack Crooks
2. stillthinking said...
Interesting. What about the "last man standing" point of view though? The idea that money is going to flood into whichever economy is likely to avoid disaster longest. Hence the rise in the dollar and the yen and it seems to me, also the euro.
So basically won't the euro have support from , for example, people trying to get out of sterling?
Can the euro really crash against sterling?
3. gone-to-colombia said...
Stillthinking, I would suggest that anything might happen. There could be any number of situations where the Euro might seem over valued. Who would have thought that the dollar would have risen so much. Down here in South America the dollar was at 1500 peso 6 months ago, its now 2500 peso. The currency here had been relatively stable.
4. a saver said...
Gardeniadotnet, agree re the euro. What outlook do you see for the swiss franc versus sterling? I am wondering whether to take profits or stay long.
5. Agentimmo said...
To Jack Crooks :
Where do you see investors placing there money if they ditch out of the euro? The US, UK and Japanese economies seem to be no better placed in the current turmoil. And if euro loans made to emerging/exporting nations turn sour, will similar loans in dollars, Sterling etc be immune?