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House Price Crash Forum


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Everything posted by _w_

  1. I'm not saying it is a moral judgement, it is pragmatic one that has to be made. Do you force Germans to buy BMWs or do you force say, Greeks, to stop buying cars they can't afford? I don't see what you see WRT the Germans: where is the German government budget surplus, the trillions in foreign currency reserves as Germans accumulate savings, what's the German savings rate? The problem is that when a country plays the inflation game its economy is weakened. The latest measure of competitiveness puts Italy at 30% less competitive than Germany, they couldn't seel things to Germany if they wanted to. If I'm not mistaken, at euro entry the Lira rate was set so that the levels of German and Italian competitiveness would be on par. The difference today is based purely on Italy inflating and deficit spending. How can you blame Germany for that? Some foreigners profited from Italy's excesses but the Italians were in control of the monetary and fiscal controls. They engineered this situation. IIUC your suggestion is that Germany inflates and deficit spends like Italy. What will happen is that its economy will be gutted too, its own competitiveness will plunge and the Chinese will pick up the pieces. This is the last thing the Germans want and I don't see why they should be wrong. Monetary inflation is the destructor here, if you want to cure this mess you need to stop the inflation where it occurs. And yes, the Germans will sell fewer cars, but the overall situation will be sustainable as debts are reduced.
  2. Unfair, the call was right as I wrote it. But if you keep calling me 'Your Highness' all will be forgiven..
  3. All countries expressed an ardent wish to follow the German path when they joined. This was the European promise. I don't see anyting at all that would prevent Club Med countries from being like Germany given the right monetary policy. One of my pet peeves. I like to say they are bigger hypocrites and more readily cause harm because all will be forgiven whatever they do.
  4. The maths is faultless. But two solution can be adopted: printing and devaluation to pretend the problem never happened or default and austery. People will, I think, always hope for the easiest solution whtever the long term consequences.They are also encouraged in this view by powerful VIs who would like not to pay for their mistakes, the banks in particular. In these circumstances this is where the statesman comes in and do the unpopular thing for the long term good of the country. I realise it is also very undemocratic. That's why I didn;t mention any specific nationality, it was not my intention. But you have to admit that some countries today have it as part of their national culture not to pay taxes, to expect devaluations to avoid paying their debts, etc. This is the crux of the matter. One has to make a judgement as to which is more desirable. True. The choice is now to follow the Nordic path (a wish expressed by all Club Med countries when they joined) or the Club Med path (serial inflation / devaluation, gutting of real industry, permanent destruction of savings, etc). The Nordic approach looks to me like the most desirable if Europe is to compete in the globalised markert place. Wouldn't you say?
  5. I agree. Sark is too morally corrupt to be a statesman. That leaves Merkel who's doing an astonishing job but is very isolated.
  6. The problem with this view is that if it is followed then the whole of Europe has to constantly align with the lowest common denominator: the most fiscally incontinent, the lasiest, the most corrupted, etc. Anyone doing better than the lowest would be accused of engaging in profiteering or unfair competition. I don't know if this would work if Europe existed in isolation but right now, with Asia breathing down our necks, these kind of policies cost European jobs and capital. Europe can survive as one giant Italy or as one giant Germany. Europe is at a crossroads and IIUC what you suggest would be a disastrous outcome.
  7. Madame Tango tries to cause a panic that will force the ECB to print.
  8. The thing is, the current selling of bonds is happening thanks to Sarokzy's deal to give banks until June '12 to raise their capital ratios. So now, instead of looking for stock option diluting capital, they are deleveraging, e.g. selling assets/bonds. All to help Sarko win his coming presidential election... One thing that surprises me every time is that despite their talk of unity and all that, so many of these politicians will happily risk a Europe collapse for the sake of a small personal advantage.
  9. Interesting you should ask. Banque Rothschild sold 50% of itself to the Chinese... They didn't need to.
  10. I don't know much about Italy so can't comment. I've been wrong too many times expecting open revolt in this or that country to feel confident about this. People's passivity seems to have no bounds.
  11. Part of me agrees but there are other factors that I think point to things being solved: - All EU people have had austerity imposed on them and didn't (yet) meaningfully protest. The odds are that, like everybody else, the Italians will just take what's forced into them whether they like it or not. It all depends on their politicians and willingness to ignore people's wishes, which takes me to the next point. - GPap's unceremonious ousting and now Berlusconi's will be acting as 'lessons' to other Club Med politicans that might be tempted by populist fiscal incontinence. They'll think twice before trying that one again. I think the odds are against you but not by much. I'd expect something to blow up at some stage but can't identify anything obvious at this stage.
  12. It doesn't matter as long as they think the ECB has an excuse to monetise tomorrow. Tomorrow is all that matters, City wildebeests don't have the mental capacity to process anything beyond that.
  13. Please don't 'Sir' me, 'Your Highness' will suffice... Berlusconi out gives the ECB a chance to buy Italian bonds on a large scale. At least that is the market assumption.
  14. I tried before but with limited success. I've now completely given up on them I must say. They're not worth the aggravation.
  15. They're waiting for Berlusconi to be pushed out. Then they should buy unlimited Italian bonds to bring rates back down -> champagne all round as bankers celebrate their record breaking christmas bonuses.
  16. Thanks. I find it quite frustrating when someone posts a link to a page I can't read.
  17. http://www.zerohedge.com/news/china-takes-advantage-september-gold-price-drop-imports-record-amount-gold
  18. Since all this will do is result in more hoarding of empty properties, all this is is a poorly hidden subsidy to builders. Plus ca change...
  19. Then you'd have to bailout the UK banks who lent to the French banks so they could lend to Greece.
  20. http://traderdannorcini.blogspot.com/2011/11/important-update-cme-clarifies-changes.html
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