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A Trillion Euros...

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What odds that the markets raise that bet in due course and ask to see their hand.

A trillion here and a trillion there. Pretty soon we are going to be talking serious money.

Edited by stormymonday_2011

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What odds that the markets raise that bet in due course and ask to see their hand.

God forbid that they should do such a thing. They wouldn't would they? It's only a notional trillion, thought everyone understood.

From Reuters:

If the draft is adopted with little change, the second euro zone summit in four days will have sketched broad intentions

Try cashing that at the Post Office.

Edited by copydude

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i still dont know what they think this will achieve.

how can bankrolling yourself make you more secure.

how can europe solve its debt problems by promising to lend money to itself should it struggle to pay back debts...

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In the Mail today there was a piece about a group of 5 typists who in either 1967 or 1969 cannot remember which , started a back Britain campagine . It got a lot of air space at the time and then fizzled out . However they did say the balance of payments defict was £1 billion back then . OH HAPPY DAYS.

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i still dont know what they think this will achieve.

My best guess is that it should achieve a mechanism by which abrupt demand for large scale international capital flows can be accommodated. I think that's what the last big 'bailout' was actually to facilitate.

My hunch is that the ECB anticipate that the Euro crisis will result in significant withdrawal of support for all Euro denominated sovereign debt from foreign denominated investors. I think the upshot of this will be that these same investors (in the most part) will want to use the cash to pay-down debt on other investments.

One idea I've been thinking about recently, but don't know the answer, is how Euro denominated sovereign debt is treated on the balance sheets of European banks. I believe that Sterling denominated sovereign debt does not need to be allocated reserve capital on British banks... How does it work in the Euro zone?

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I particularly liked this part

One proposal involves creating a special purpose investment vehicle (SPIV) to tap foreign sovereign and private investors, such as Chinese and Middle Eastern wealth funds, to buy bonds of troubled euro zone countries.

I thought we already had enough spivs in the financial world.

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In the Mail today there was a piece about a group of 5 typists who in either 1967 or 1969 cannot remember which , started a back Britain campagine. It got a lot of air space at the time and then fizzled out.

Must have been pretty big for a while, it even gets referenced at the end of "Carry On Up the Khyber".

Backing%20britain.jpg

Still with "Khyber" there's also this exchange which seems apt:

Khasi: They will die the death of a thousand cuts!

Princess Jelhi: Oh! But that's horrible!

Khasi: Not at all my little desert flower, the British are used to cuts!

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a little bit of gold here, a little bit there.

i dont care if you think is gonna crash in value, you would be a total mug not to have a little bit put away would you ?

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My best guess is that it should achieve a mechanism by which abrupt demand for large scale international capital flows can be accommodated. I think that's what the last big 'bailout' was actually to facilitate.

My hunch is that the ECB anticipate that the Euro crisis will result in significant withdrawal of support for all Euro denominated sovereign debt from foreign denominated investors. I think the upshot of this will be that these same investors (in the most part) will want to use the cash to pay-down debt on other investments.

One idea I've been thinking about recently, but don't know the answer, is how Euro denominated sovereign debt is treated on the balance sheets of European banks. I believe that Sterling denominated sovereign debt does not need to be allocated reserve capital on British banks... How does it work in the Euro zone?

well, essentially its being done to inspire confidence.

but the problem at the moment isnt confidence, its debt.

its simply a mathematical problem and you cannot cheat mathematics.

thats why its pointless. no matter how much they try to fiddle around with the numbers - this bailout will essentially be loaning money to themselves, the overall debt remains the same.

theyre so worried about a short term banking crisis, i.e another credit crunch, that they are blind to see that this does nothing to solve the debt problem.

Edited by mfp123

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"Details deferred.." as they don't have a clue how to pop several trillion euros out of thin air. Millions - easy - your local building society can do that. Billions - not too much trouble for your medium-sized central bank - just ask Sir Merv. Trillions - erm, this might tip the system a tad too much... :lol::ph34r:

Edited by Chuffy Chuffnell

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"Details deferred.." as they don't have a clue how to pop several trillion euros out of thin air. Millions - easy - your local building society can do that. Billions - not too much trouble for your medium-sized central bank - just ask Sir Merv. Trillions - erm, this might tip the system a tad too much... :lol::ph34r:

as far as im aware theyre not printing this money, they are securing this money against each other i.e the tax payer is footing the bill.

all theyre saying is if a country gets into trouble were going to spread the cost across every country.

but theres the paradox, if these major european countries are in trouble, i.e spain, france, italy, how can they prop themselves up by contributing to a bailout fund, when the bailout fund is designed to help countries that cant prop themselves up.

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as far as im aware theyre not printing this money, they are securing this money against each other i.e the tax payer is footing the bill.

all theyre saying is if a country gets into trouble were going to spread the cost across every country.

but theres the paradox, if these major european countries are in trouble, i.e spain, france, italy, how can they prop themselves up by contributing to a bailout fund, when the bailout fund is designed to help countries that cant prop themselves up.

taxpayer can't and in fact won't pay, it's printing time.

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taxpayer can't and in fact won't pay, it's printing time.

Germany has been fairly staunch in saying the ECB won't be allowed to do that, too many painful memories.

Default or EZ breakup rather than that is my guess.

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http://uk.reuters.com/article/2011/10/26/uk-eurozone-idUKTRE79I0J920111026

However, the leaders earlier made progress on two other elements -- bank recapitalisation and moves to scale up the size of the euro zone's 440 billion euro (375 billion pounds) bailout fund

http://globaleconomicanalysis.blogspot.com/2011/10/grateful-for-idiocy-pack-of-lies.html

The "unpleasant truth" is Merkel lied to parliament about leverage, which is why the EFSF was approved in the first place. Having secured passage of the EFSF via bald-faced lies, the Bundestag ignored the lies and approved a blank check on the amount of leverage and the method of leverage.

The lies and deceit seem almost endless these days.

Edited by billybong

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but theres the paradox, if these major european countries are in trouble, i.e spain, france, italy, how can they prop themselves up by contributing to a bailout fund, when the bailout fund is designed to help countries that cant prop themselves up.

Well quite.

And as for the bank recapitalisation in preparation for default(s)... the banks haven't agreed to this. Perhaps they will only agree if they are nationalised. That will cost more money.

You can see where this is heading. It involves making money out of thin air. Lots of money.

Failing all this, the whole system - banks, countries, and of course the Eurozone itself, will fail. Quickly.

In November 2008 we came within hours (and this is from Darling's own mouth, albeit 2 years after and out of office) of the banks failing in the UK and ATMs switching off. What the effect of an entire currency union failing would be... f*cking hell. I believe the BoE and HM Treasury have contingency plans already in place - there was talk of them preparing for such an eventuality a few months ago. Capital controls, full nationalisation of UK banks by HM Gov, and rapid QE to prevent a deflationary death spiral.

Brace Brace!

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From the BBC: "After marathon talks in Brussels, the leaders said private banks holding Greek debt had accepted a loss of 50%.

Banks must also raise more capital to protect them against losses resulting from any future government defaults."

So where is this money going to come from?

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From the BBC: "After marathon talks in Brussels, the leaders said private banks holding Greek debt had accepted a loss of 50%.

Banks must also raise more capital to protect them against losses resulting from any future government defaults."

So where is this money going to come from?

You and any children you might have foolishly planned on.

Thanks!

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The lies and deceit seem almost endless these days.

Look these guys are tunnel vision fanatics nothing more nothing less they will never turn back and do the correct thing they are hell bent on protecting the Euro no matter how or who it gets stuffed.

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Well quite.

And as for the bank recapitalisation in preparation for default(s)... the banks haven't agreed to this. Perhaps they will only agree if they are nationalised. That will cost more money.

You can see where this is heading. It involves making money out of thin air. Lots of money.

Failing all this, the whole system - banks, countries, and of course the Eurozone itself, will fail. Quickly.

In November 2008 we came within hours (and this is from Darling's own mouth, albeit 2 years after and out of office) of the banks failing in the UK and ATMs switching off. What the effect of an entire currency union failing would be... f*cking hell. I believe the BoE and HM Treasury have contingency plans already in place - there was talk of them preparing for such an eventuality a few months ago. Capital controls, full nationalisation of UK banks by HM Gov, and rapid QE to prevent a deflationary death spiral.

They printed ration cards nearly three years ago up near leed's. Good basic long-term contingency planning.

The other steps might work in isolation, in the midst of a full European collapse I'm not so sure.

After about 10 days, when the JIT food chain proves inadequate and everyone has polished off the last jar of cloves from the back of the cupboard; I suspect it all might start turning a little Croydonesque.

Edited by Jack's Creation

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
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      • up 5%



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