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Anyones opinion on what looks like EU QE later on this week.

Will we see it boost the price of UK property and other assets and commodities?

Government just seem to refuse to spend.

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I think the euro will tank to around 1.40 to £1 gbp

depending on whats announced on thursday.

its currently at 1.31

The Swiss have cut it loose last week.

i'm hoping to see 1.40+ as i'd like to do year in the mediteranean and would like my £20k budget to stretch into 30,000 euros

Edited by workingpoor

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I think the euro will tank to around 1.40 to £1 gbp

depending on whats announced on thursday.

its currently at 1.31

The Swiss have cut it loose last week.

i'm hoping to see 1.40+ as i'd like to do year in the mediteranean and would like my £20k budget to sretch into 30,000

Hang on till next year..When Greece fall off it will be 3Euro's to the £

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Anyones opinion on what looks like EU QE later on this week.

Will we see it boost the price of UK property and other assets and commodities?

Government just seem to refuse to spend.

Personally think the QE in EU will fail. Problem will be the natural reluctance (is that the right word) of Germany, who will campaign for it to be held back. This will result in a compromise somewhere between what is actually needed and what is done.

Then you have the issues of not enough assets to actually buy. This could cause some issues, as well as how the qe is distributed.

So I am not confident that it will do the necessary at all, although there may be some short term changes. I think the deflation has started big time and its not going to stop because of the pittance the EU throws at it.

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Hang on till next year..When Greece fall off it will be 3Euro's to the £

Isnt there an election in Greece on the 25th jan?

Syriza widely expected to take power and staunch anti-austerity opposers.

I imagine Germany & the IMF will call their bluff thought and they'll continue towing the line

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Should have been E.C.B.

I think it'll fail on the basic premise the Euro isnt a one size fits all unless the Germans, Dutch etc... are going to fund the Med nations.

But its in the short term as i'm worried this is going to put more money in the hands of the banks who know nothing else other than to put it in property.

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Isnt there an election in Greece on the 25th jan?

Syriza widely expected to take power and staunch anti-austerity opposers.

I imagine Germany & the IMF will call their bluff thought and they'll continue towing the line

Unlikely to win an outright majority so a lot will depend on the make up of the coalition too.

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If the ECB prints money out of thin air, essentially to bailout the PIIGS, where will this money end up? The SNB have panicked and have already gone negative. Denmark have gone deeper into negative territory.

What will our clueless wonders have to do? 0.5% on free money is a good return, even better if the Europeans pump it in the UK housing market. Obviously this won't create a bubble as Carney can spot a bubble from a thousand miles away.....

Will the BoE be forced to go negative with it's base rate? If so will that trigger a mini housing boom?

Is the ECB about to feck over UK monetary policy with a wall of free Euro's?

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So will the Euro rise or fall against other currencies such as the USD and Sterling? What affect will Euro QE have on stockmarkets and on commodities?

I have read lots of conflicting articles today about this - some think the Euro will riise against the USD. Others think that gold will fall as a result of EU QE.

I get the impression that no one knows.

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Surely free money will go to the European rich so that they can buy more London property. Well it seems that the UK and much of the USA QE cash went to the rich so why should Europe be different.

More will flow to the US, especially if/when Yellen lifts the Fed funds rate (April or May, my guess). Since QE is ultimately disinflationary it's hard to see how this can do anything but hasten the collapse of the EZ periphery. Great for German exports but not much else. Even the plunge in energy prices is likely to be neutralised by the swooning euro.

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Rock Me ECBeus.

I watched the DAX 30 strengthen strongly at the start the PTB/MSM started pumping the story that ECB QE was deffo on and that the ECB taken command. Actually just a couple of days before that.

European stocks hit seven-year high with ECB in mind
Published: Jan 19, 2015

http://www.marketwatch.com/story/european-stocks-edge-higher-but-oil-shares-underperform-2015-01-19

What will our clueless wonders have to do? 0.5% on free money is a good return, even better if the Europeans pump it in the UK housing market. Obviously this won't create a bubble as Carney can spot a bubble from a thousand miles away.....

Will the BoE be forced to go negative with it's base rate? If so will that trigger a mini housing boom?

Is the ECB about to feck over UK monetary policy with a wall of free Euro's?

I studied and believed in capitalism, sadly. It proved to be a waste of time, double and treble bubbles, QE, FLS, QE global again and again.

With government borrowing now absorbing so much of the total credit activity, even some conventional economists have begun to wonder whether still higher deficits would not do more harm than good - but to this point there has been little retreat from the view that easy money and more spending can get the economy moving again. There is a particularly firm conviction among business economists that feeding reserves into the banking system at an artificially low price will assure a pick-up in nominal growth with a variable lag of about eighteen months.

We doubt this for several reasons. First of all, there is a structural impediment that limits the price reduction of credit. Nominal interest rates in the banking system cannot fall below zero. Banks cannot pay people to take money away. Furthermore, people who borrow money must be able to retire their debt. This limits the willingness of creditors to lend and of borrowers to use the available reserves to create loans. At interest rates above zero, investment generated by new debt must produce a rise in income higher than the interest rate, and sufficient to amortize the principal. Otherwise, any additional debt is contractionary.

The crux of the issue is whether running down the balance sheet buys recuperative time or merely postpones the inevitable. We suspect it is a policy of postponement, not prevention. It is the equivalent of encouraging a man who is afloat over his head to tread water rather than turn back to shore. Unless he is able to regain solid footing, he will eventually become exhausted and drown. So it is with an economy floundering in red ink. The multi-trillion-dollar losses are real. They can only be disguised until the good credit of governments is exhausted.

Party time for the VI, whilst younger people / no Bomad gifting professional workers, continue to tread water, whilst malinvestment doesn't get broken up, and asset values supported. Unless markets exert themselves, or some market pulls away, or even self-interest between the VI breaks things up.

Edited by Venger

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The French President has riled European Central Bank officials by first claiming he knew the bank will launch quantitative easing this week and then backtracking on his statement in a matter of hours.

Francois Hollande told business leaders at Paris's Élysée Palace, 'On Thursday, the ECB will take the decision to buy sovereign debt, which will provide significant liquidity to the European economy and create a movement that is favorable to growth.'

But shortly after the announcement Hollande's office felt the need to step in and backtrack - stating that the President was referring to the 'hypothesis' of QE and not officially confirming its introduction.

The same article says that the Germans think that QE will devalue the Euro.

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Rock Me ECBeus.

I studied and believed in capitalism, sadly. It proved to be a waste of time, double and treble bubbles, QE, FLS, QE global again and again.

It's the wild dog that needs taming.

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http://

globaleconomicanalysis.blogspot.co.uk/2015/01/futulity-of-draghis-upcoming-qe.html

Last week was the first time first time that the benchmark borrowing costs of a developed economy's government has gone negative for a 10-year duration.

....

Yes indeed folks, you can lend money to the Swiss government for 30 years at 0.381%, knowing full well the inflation target is 2.0%.

Japan is in second place. It's well behind in this dubious race to zero with a 30-year yield of 1.075%.

Germany is in a very close third place race with a 30-year yield of 1.120%. In contrast, the US offers an "exceptional" 2.446% for 30 years.

Such is the absolute madness of central bank policy. Yet, ECB president Mario Draghi actually believes he can fix things by driving yields still lower!

http://

globaleconomicanalysis.blogspot.co.uk/2015/01/endgame-for-central-bankers-says-saxo.html

Via email, Saxo bank CIO and chief economist Steen Jakobsen declares "Endgame for Central Bankers". He also asks "Why is it that Most People Trust or Bother to Listen to Central Banks?"

Edited by billybong

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This will not end well.

Without inflation the banks have to earn money the old fashioned way, you know by providing services and taking a margin, rather than simply making money (in the literal sense).

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But they hope that point will be the distant future.

The can seems to be getting heavier every time it gets kicked.

Still i think they can draw this out a while longer yet, being as all central banks of the world are colluding together.

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So will the Euro rise or fall against other currencies such as the USD and Sterling? What affect will Euro QE have on stockmarkets and on commodities?

I have read lots of conflicting articles today about this - some think the Euro will riise against the USD. Others think that gold will fall as a result of EU QE.

I get the impression that no one knows.

They seem to be front running it already, but when they seal the deal on Thursday I guess there are more legs on this yet. Grexit could spoil the party.

http://www.google.co.uk/finance?cid=12590587

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Actually Markets don't want to get too exuberant or they will have done the job without the need for any QE. It's all about bigging up asset prices in the stupid hope that it will pull Eurozone out of deflation, whilst doing the opposite.

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