Friday, June 29, 2012

UK no longer a “safe haven”?

Germany caves in over bond buying, bank aid after Italy and Spain threaten to block 'everything'

"Germany has today caved into demands made by Italy and Spain for immediate eurozone aid to bring down their soaring borrowing costs".

Posted by alan @ 08:50 AM (7644 views)
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14 thoughts on “UK no longer a “safe haven”?

  • mark wadsworth says:

    Oo-er, the ‘Euro zone crisis’ has now been successfully deepened, widened, prolonged, deferred, made worse and generally exacerbated.

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  • Ireland isw also looking to renegotiate it’s debt based on the terms offered to Spain.

    I have long thought that once the Eurozone has been patched up the markets will turn on the UK because it will be fundamental weaker that the Eurozone countries.
    I expect a new appointment in the BOE which will distract the markets and buy the UK another 12 months or so.

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  • What next…?
    “Markets go up, the bears get burned, investors once again get scared to bet against the collective might of policymakers, and you’ve got a bit of breathing space until the next crisis”. says MoneyWeek.

    Gold steady at $1570….. What now GC?

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  • Terryturbojr says:

    The markets will not turn on us, or any other sovereign issuer who issue in their own currency. You cannot compare us to the eurozone, who all willingly turned themselves into foreign currency issuers, so opening themselves up to the so called bond vigilantes. The markets do not have the same hold over local ccy issuers like the UK (US, Japan, Switzerland. ..).

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  • I expect by Monday the analysts will have pulled apart this supposed solution (as they have done with all the others), bond yields will go back up and a new summit will have to be set for the end of July.

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  • “a new summit will have to be set for the end of July”.

    Please be practical – Summit season will be over and they will all be on holiday at the end of July 🙂

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  • As Mr Wadsworth says, this will only make things worse. A disorderly crah and reversion to national currencies would have at least resolved the matter. With this latest twist we see that the powers that be will drag it out as long as possible, for many many years yet. Meanwhile the real economy in Europe will be under more pressure than ever. That’s bad for jobs in Euroland, and bullish for UK house prices as more of their disillusioned workers flee to London.

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  • general congreve says:

    @3 – What now? Well I think that’s it, problem solved. Might as well sell the gold, pack up and go home.

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  • were doomed allllll doomed i tell ya. Buy freeze dried food while you still can !

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  • True @Alan, I will rephrase that “a new summit will be scheduled for late September, in the meantime we are off to Southern Europe on a tax payer funded fully-inclusive fact finding mission”.

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  • @ 7 – No – this is great news for gold. More money – more printy printy.

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  • general congreve says:

    @7 – Only kidding, gold is loving more debt ponzi action today! Up, up and away!!! 🙂

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  • paranoia blue says:

    General
    The bullion price follows the markets – which would have been bizarre, in times gone by – but the response is there as a hedge, because we all know that any rise is “total fluffy stuff,” and will ultimately require – guess what? – even more QE etc to sustain!
    So, anyone with ‘an ounce of brain-cell’ knows where the ultimate true value resides!! ATB, mate.

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  • paranoia blue says:

    PS Investing in resource producing companies – especially hydrocarbon – in the likes of West African countries which are projected to have annual GDP increases of 5% pa and above going forward – may be another sensible area to park some cash – China and Russia certainly have been doing so, for quite a while.
    My tip: Victoria Oil and Gas [VOG] which has great interests in Cameroon [just about to produce] and in Siberia [sitting on massive reserves]
    Definitely worth checking out. ATB

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