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"panic Grips Market" In E U Bond Frenzy

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http://www.telegraph.co.uk/money/main.jhtm.../cnbonds105.xml

Euro bond spreads hit record as panic grips markets

By Ambrose Evans-Pritchard
Last Updated: 1:30am GMT 05/03/2008
Investors sold Italian and Greek debt yesterday in signs of near panic liquidation, driving bond spreads to the highest level since creation of the single currency.
The yields on Italian 10-year government bonds reached 52 basis points above German Bunds, approaching levels that risk setting off a self-reinforcing spiral of investor flight.
Spreads on Greek bonds also jumped to 52.
The wild moves on the euro-zone bond markets came as gold plummeted by $29 an ounce to $957 on automatic stop losses and forced selling by funds. Crude oil futures tumbled almost $3 a barrel in New York..../
"There are forced sellers out there having to liquidate assets," said Dominic Konstan at Credit Suisse. "There are also people out there who always felt
EMU wouldn't work
and this is bringing them out of the woodwork.

Euros anyone?

IR up up up as risk aversion tightens credit markets even further? Perhaps no safe haven in gold.*

________________________

* How does anyone know that the "gold" that has been purchased in record quantities of late actually exists in the physical sense? Could fraudulent trading be possible? Can the world produce as much gold that has been bought or is it just like the mortgage market where money was ficticious and created in the minds of fraudulent traders? What might happen if, for example, everyone who bought gold recently demanded that their bars/coins be handed over?

Edited by Realistbear

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http://www.telegraph.co.uk/money/main.jhtm.../cnbonds105.xml

Euro bond spreads hit record as panic grips markets

By Ambrose Evans-Pritchard
Last Updated: 1:30am GMT 05/03/2008
Investors sold Italian and Greek debt yesterday in signs of near panic liquidation, driving bond spreads to the highest level since creation of the single currency.
The yields on Italian 10-year government bonds reached 52 basis points above German Bunds, approaching levels that risk setting off a self-reinforcing spiral of investor flight.
Spreads on Greek bonds also jumped to 52.
The wild moves on the euro-zone bond markets came as gold plummeted by $29 an ounce to $957 on automatic stop losses and forced selling by funds. Crude oil futures tumbled almost $3 a barrel in New York.

IR up up up as risk aversion tightens credit markets even further? Perhaps no safe haven in gold.*

________________________

* How does anyone know that the "gold" that has been purchased in record quantities of late actually exists in the physical sense? Could fraudulent trading be possible? Can the world produce as much gold that has been bought or is it just like the mortgage market where money was ficticious and created in the minds of fraudulent traders? What might happen if, for example, everyone who bought gold recently demanded that their bars/coins be handed over?

Could this blow apart the eurozone? It's always been on the cards that Italy could disrupt the whole euro enterprise because of its inability to get to grips with its budget deficit due to the instability of its governments.

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Could this blow apart the eurozone? It's always been on the cards that Italy could disrupt the whole euro enterprise because of its inability to get to grips with its budget deficit due to the instability of its governments.

Its a funny thing but I have often wondered if the Euro would make it past their 10 year anniversary. Imbalances will probably be its undoing. ONe IR does not fit all.

Bin sayin it for quite awhile now.

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* How does anyone know that the "gold" that has been purchased in record quantities of late actually exists in the physical sense? Could fraudulent trading be possible? Can the world produce as much gold that has been bought or is it just like the mortgage market where money was ficticious and created in the minds of fraudulent traders? What might happen if, for example, everyone who bought gold recently demanded that their bars/coins be handed over?

I've heard the same about shares with uncovered shorts..

Just another sign that that the financial services sector is wildly out of control..

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How does anyone know that the "gold" that has been purchased in record quantities of late actually exists in the physical sense? Could fraudulent trading be possible? Can the world produce as much gold that has been bought or is it just like the mortgage market where money was ficticious and created in the minds of fraudulent traders? What might happen if, for example, everyone who bought gold recently demanded that their bars/coins be handed over?

Apparently nobody's listening to you RB, you'll have to shout a little louder. See below :lol:

Dollar unsellable as banks refuse to buy

12:50' 04/03/2008 (GMT+7)

http://english.vietnamnet.vn/biz/2008/03....

VietNamNet Bridge – The dollar price keeps sliding, VND is short, banks refuse to buy dollar, these are the main features of the monetary market at the current moment.

On the afternoon of March 3, we came to Thanh Cong Branch of Vietcombank in Hanoi and said we wanted to sell dollars, but the officers here refused to buy. Many other people there, who also brought in dollars to sell, had to bring dollars back home. Some of them said that they had come to several other banks before going there, but still could not sell dollars.

Linh, one of the people, related that she was trying to sell a big volume of dollars to get VND for other investment deals, but all the banks said they did not have any demand for dollars. “I’m losing tens of millions of VND a day due to the dollar price slide,” Linh said.

A reader in HCM City wrote to VietNamNet that on February 28, he came to Phuong Nam Bank to take back the matured deposit worth $10,000. The client suggested sell the $10,000 to the bank to get VND, but the bank’s officer said that the bank did not need more dollars, and that if the client really wanted to sell dollars, the bank could help make transactions with the brokerage fee of 2%.

The problem with selling the dollar began several days ago, when the dollar price was sliding on the black market, while the gold price was skyrocketing. A lot of people, who have been frightened by the dollar value decrease, have decided to sell dollars to buy gold for hoarding. :ph34r:

Nguyen Thanh Truc, Director of Agribank’s Gold and Silver Company, said that sometimes the company’s transaction offices have to refuse to buy dollars from individual clients.

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this is an interesting development.All of a sudden people realsie there's risk out there nad look what happens.Given the fudges made to get some countries into the euro,this was/is entirely predictable.I do not think it will survive,but it's no bad thing.Then we can all go back to trading real currencies like Dmarks and Guilden

Like you, my immediate thought was that the euro will not survive. But I've been having second thoughts......

The only way the euro could survive member-state economic imbalances is if the EU were to become the United States of Europe with totally centralised government, and especially bond markets. I see a case being made for the Lisbon Treaty (which is a constitution by another name) to be rushed through as an emergency measure to bail out the euro. Fear will push any recalcitrant nations into complete surrender of national sovereignty in a way that greed never could.

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Telegraph in EZ bashing shocker!! I can't recall an A.E.P article that didn't knock the Euro. No news here

Its a funny thing but I have often wondered if the Euro would make it past their 10 year anniversary. Imbalances will probably be its undoing. ONe IR does not fit all.

Bin sayin it for quite awhile now.

Would you offer Odds on that? I am looking for a hedge against EZ instability?

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If weaker economies such as Greece and Italy were forced out, are you saying RB that would cause an immediate spike and strengthening of the Euro. Are you recommending we buy them on this basis?

No--I think the imbalances will be bad for the Euro. The EU is not the USA but a collection of potentially volatile nationalistic states that will look after their own before they consider what is best for Germany.

History is a better teacher than economics IMO. Economics without history is stumbling down a very dark pothole without as much as a candle for a light.

I wouldn't recommend getting into currency trading, its too dangerous. I said months ago that the best bet in the medium to long term was Swissies, Yen and the US$. Why US$? Cable.

The panic going on in the bond markets may be the beginning of the end of the Euro as a single tier currency. What they may have to do is create a Euro 2 for the Meditteranean economies unable to match growth in Germany and, possibly, France.

Edited by Realistbear

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Ambrose's latest trademark apocalyptic piece on the euro doesn't seem to have done it any harm on FOREX today :rolleyes:

And if Italy, Ireland, and Greece did drop out (which they won't) it would only strengthen the currency, as an earlier poster points out.

It's sterling that's fo0ked not the euro.

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* How does anyone know that the "gold" that has been purchased in record quantities of late actually exists in the physical sense? Could fraudulent trading be possible? Can the world produce as much gold that has been bought or is it just like the mortgage market where money was ficticious and created in the minds of fraudulent traders? What might happen if, for example, everyone who bought gold recently demanded that their bars/coins be handed over?

RB, most commodities are probably purchased on the futures market which is massive. Although theres two sides to every futures contract, I'm pretty sure. Commercials are mostly short gold, whilst all the traders/hedge funds (ie always the loosers at big tops or bottoms) are long. Could cause a lot of margin calls.

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http://www.bloomberg.com/apps/news?pid=206...&refer=home

European Bond Investors to Ignore ECB on Inflation, Says ING

By Lukanyo Mnyanda
March 5 (Bloomberg) -- Bond investors will ignore any signal from the European Central Bank tomorrow that it plans to stay vigilant on inflation, pushing two-year note yields ``closer to 3.1 percent'' by the end of the week, ING Groep NV said...../
Trichet's Views
ECB President Jean-Claude Trichet is likely to use a press conference following tomorrow's rate decision to highlight that ``inflation expectations remain elevated,'' said Chin. Still investors will continue to buy European notes, betting signs of a slowing economy will eventually prompt policy makers to trim the main refinancing rate, he said.

The markets are ignoring the CBs from this point on. You can't beat them. Never could.

Not lomng before Trichet is forced to begin cutting. The EUs first financial "challenge" is about to hit.

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I thought I'd put this in here rather than start another thread on bonds...

Auction-Rate Bond Failures Approach 70%, Show No Sign of Easing

By Michael McDonald

March 5 (Bloomberg) -- Auction-rate bond failures show no sign of abating after investors abandoned the market for variable-rate municipal securities.

Almost 70 percent of the periodic auctions in the $330 billion market failed this week as investment banks stopped buying the securities investors didn't want. Yields on the debt averaged 6.52 percent as of Feb. 28, up from 3.63 percent before demand evaporated in January.

States from New York to California and lawmakers including House Financial Services Committee Chairman Barney Frank are attempting to revive the market. Rising yields are pinching state and local governments just as a slowing economy and falling property values slash tax revenue by more than $6.6 billion, according to a report by the U.S. Conference of Mayors.

``Even if the auction-rate market survives, we're not going to see the kind of rates we're used to,'' said Roger Roux, chief financial officer at Rady Children's Hospital in San Diego, which spent an additional $940,000 on its auction bonds since rates reset as high as 15 percent last month.

There were 521 failed auctions in the market for the floating-rate securities yesterday, amounting to a rate of 66 percent, according to data compiled by Bloomberg from brokers at Wilmington Trust Corp., Bank of New York Mellon Corp., Deutsche Bank AG and Wells Fargo & Co. The rate of failures reached 87 percent on Feb. 14 and has since ranged from 61 percent to 69 percent, according to Bank of America Corp.

Bankers Retreat

Goldman Sachs Group Inc., Citigroup Inc. and other brokers began permitting the failures last month after investors, concerned that insurers backing the bonds might be downgraded, stopped bidding in the auctions conducted every seven, 28 and 35 days. From 1984 through 2006, only 13 auctions failed as brokers stepped in to buy the bonds when demand was weak.

States and local governments account for about $166 billion of the outstanding auction-rate debt, according to estimates by Bank of America Corp. Closed-end mutual funds also use the market to raise capital, as do student-loan corporations and some issuers of taxable debt.

This is definably unarguably deflation, no bailouts happening here.

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I've always said reality is what counts. This is the real big news for goldbugs.

Yeah, but they aren't allowed to mention anything shiney and yellow in the main forum for fear of the thread being closed :angry:

crude.

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I've always said reality is what counts. This is the real big news for goldbugs.

News, and a big fat warning, all wrapped into one.

Don't get caught in speculative positions on the wrong end of a liquidity squeeze.

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Oh I agree - it's panic either way. The hard thing is whatever position you take, you are taking a position.

... unless you're taking a position in a consumption good.

These guys got burned bad because they were holding something that clearly wasn't consumable (foreign currency) and got shook down, bad, by the banking sector who decided they'd enough of it. And likely as not, they'll get shaken down again on the reverse side too - caught holding gold, when what everyone really wants these days, is their đồng.

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Financial panic.

Why do we live like this? I just just want to lie down in a cool, green place and snooze.

I suppose you should be pleased that you have some "finance" in the bank to worry about. :P

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... unless you're taking a position in a consumption good.

These guys got burned bad because they were holding something that clearly wasn't consumable (foreign currency) and got shook down, bad, by the banking sector who decided they'd enough of it. And likely as not, they'll get shaken down again on the reverse side too - caught holding gold, when what everyone really wants these days, is their đồng.

.....so Charlie's at the wire and he's holding onto his đồng!

Not for the fist time has this worried the Americans :P

Edited by Captain Cavey

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True.

Just recently (not a Christian) but I have begun to get what that religious stuff is all about. It's so relaxing:

"Give us our daily bread" (like children, just accepting we are being looked after and will be fed - our basic needs met).

And even more clearly:

"No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.

Therefore I say unto you, Take no thought for your life, what ye shall eat, or what ye shall drink; nor yet for your body, what ye shall put on. Is not the life more than meat, and the body than raiment?

Behold the fowls of the air: for they sow not, neither do they reap, nor gather into barns; yet your heavenly Father feedeth them. Are ye not much better than they?

Which of you by taking thought can add one cubit unto his stature?

And why take ye thought for raiment? Consider the lilies of the field, how they grow; they toil not, neither do they spin:

And yet I say unto you, That even Solomon in all his glory was not arrayed like one of these.

Wherefore, if God so clothe the grass of the field, which to day is, and to morrow is cast into the oven, shall he not much more clothe you, O ye of little faith?

Therefore take no thought, saying, What shall we eat? or, What shall we drink? or, Wherewithal shall we be clothed?

For your heavenly Father knoweth that ye have need of all these things.

But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.

Take therefore no thought for the morrow: for the morrow shall take thought for the things of itself. Sufficient unto the day is the evil thereof."

It's just all so lovely and comforting.

It also rings true.

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True.

Just recently (not a Christian) but I have begun to get what that religious stuff is all about. It's so relaxing:

"Give us our daily bread" (like children, just accepting we are being looked after and will be fed - our basic needs met).

And even more clearly:

"No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.

Therefore I say unto you, Take no thought for your life, what ye shall eat, or what ye shall drink; nor yet for your body, what ye shall put on. Is not the life more than meat, and the body than raiment?

Behold the fowls of the air: for they sow not, neither do they reap, nor gather into barns; yet your heavenly Father feedeth them. Are ye not much better than they?

Which of you by taking thought can add one cubit unto his stature?

And why take ye thought for raiment? Consider the lilies of the field, how they grow; they toil not, neither do they spin:

And yet I say unto you, That even Solomon in all his glory was not arrayed like one of these.

Wherefore, if God so clothe the grass of the field, which to day is, and to morrow is cast into the oven, shall he not much more clothe you, O ye of little faith?

Therefore take no thought, saying, What shall we eat? or, What shall we drink? or, Wherewithal shall we be clothed?

For your heavenly Father knoweth that ye have need of all these things.

But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.

Take therefore no thought for the morrow: for the morrow shall take thought for the things of itself. Sufficient unto the day is the evil thereof."

It's just all so lovely and comforting.

I heard some Welsh nutter going on about this in a Civic Centre sometime ago. He said most people are sick with anxiety and worry about their posessions. How materialism was destroying famuiles because of debt etc etc. The key, in his Bible Bashing opinion, was to follow Jesus' advice as you have quoted. Bible bashing, fundie, religious freak blah blah.... ;)

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True.

Just recently (not a Christian) but I have begun to get what that religious stuff is all about. It's so relaxing:

"Give us our daily bread" (like children, just accepting we are being looked after and will be fed - our basic needs met).

And even more clearly:

"No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.

....

It's just all so lovely and comforting.

But, is it supposed to be comforting? Isn't it supposed to be more of a challenge to show that you can't control things, including your own worry (after which, you might indeed become relaxed...and perhaps that's where you are, Durch)? You can't purposely not worry about such things, because to not worry means that you are worried, but are trying to stop it; which means that you're now, not only worried about those things, but you're also worried about worrying about those things, ....

Peter.

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True.

Just recently (not a Christian) but I have begun to get what that religious stuff is all about. It's so relaxing:

"Give us our daily bread" (like children, just accepting we are being looked after and will be fed - our basic needs met).

And even more clearly:

"No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.

Therefore I say unto you, Take no thought for your life, what ye shall eat, or what ye shall drink; nor yet for your body, what ye shall put on. Is not the life more than meat, and the body than raiment?

Behold the fowls of the air: for they sow not, neither do they reap, nor gather into barns; yet your heavenly Father feedeth them. Are ye not much better than they?

Which of you by taking thought can add one cubit unto his stature?

And why take ye thought for raiment? Consider the lilies of the field, how they grow; they toil not, neither do they spin:

And yet I say unto you, That even Solomon in all his glory was not arrayed like one of these.

Wherefore, if God so clothe the grass of the field, which to day is, and to morrow is cast into the oven, shall he not much more clothe you, O ye of little faith?

Therefore take no thought, saying, What shall we eat? or, What shall we drink? or, Wherewithal shall we be clothed?

For your heavenly Father knoweth that ye have need of all these things.

But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.

Take therefore no thought for the morrow: for the morrow shall take thought for the things of itself. Sufficient unto the day is the evil thereof."

It's just all so lovely and comforting.

You forgot don't do as I do, do as I say.

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But, is it supposed to be comforting? Isn't it supposed to be more of a challenge to show that you can't control things, including your own worry (after which, you might indeed become relaxed...and perhaps that's where you are, Durch)? You can't purposely not worry about such things, because to not worry means that you are worried, but are trying to stop it; which means that you're now, not only worried about those things, but you're also worried about worrying about those things, ....

Peter.

I never worry. Sometimes I am concerned, sometimes alarmed, mostly I just don't care.

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  • 297 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% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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