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More EU Schizophrenia: Almunia About To Admit It's "Plan B" Time
Headlines only so far:
09:11 02/09 EU ALMUNIA: SERIOUS RISK OF GREEK SPILLOVER ELSEWHERE IN EMU
09:10 02/09 EU ALMUNIA: SITUATION IN GREECE MATTER OF COMMON CONCERN
09:13 02/09 EU ALMUNIA: GREECE MAY NEED TO TAKE MORE MEASURES
09:12 02/09 EU ALMUNIA: SOME SIGNS MARKETS BELIEVE GREECE CAN SOLVE PROBS
09:11 02/09 EU ALMUNIA: COMMISSION FULLY SUPPORTS GREECE
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"Inflate or die."
Ever if they decide inflation is the way to go, they still have to decide how to inflate.
Question: inflate by economic size or inflate by population size
A new issuance of money could be handed to each country in proportion to how much that country produce each year. There is also a measurement by the asset. A new issuance of money could be handed to each country in proportion to their number of citizen. There is also a measurement of residence.
Its getting interesting.
The ECB is losing control of this.
A proper Central Bank you agree a position with the Finance Minister.
In this case there are numerous Finance Ministers and numerous national interests on the Board of the Central Bank.
All very well in good times.
Not so clever in a crisis.
Back Greece or loose the Euro.
Yes, but they aren't elected from those areas. They are appointed by the big wigs. Meaning they don't represent their areas, they represent their big wigs. *for whatever it's worth*
Deflate and kill the rent seekers.
...and anyone with a mortgage. Or large credit card bills. Or college loans.
Deflation won't kill "anyone" with a mortgage, just those that borrowed too much and didn't have a meaningful down payment.
Large credit card bills are irresponsible for the most part, so ditto.
College loans, I feel sorry for the holders of these, but college in the USA is far too expensive and needs to come down in price, otherwise nobody will be learning their "three R's" anytime soon.
Deflation is abosutely necessary to clean up this mess.
I fear nothing short of total collapse will save humanity considering the ever-tightening chokehold the current plutocracy has around our collective throat. There is no "tap out" - winner keeps all.
The russian collapse kept the KGB scrambled for years. I wonder how long it would take the CIA to get back to giving the president his daily marching orders (I mean briefings).
Heh heh. Often when the lights go out in 3rd world countries the first thing that happens is the settling of old scores. Imagine getting marooned in Balochistan.
"Guys? Guys? Hey, we agreed no more practical jokes...guys? I'll say your real name over the radio... ...fuck."
Quintus if the commercial banks took their hits I would agree with you - we should inflate what is left if we needed to but it is too late for that now as it is clear that they have control of all areas of government and are unwilling to compromise.
I guess I was sort of playing devil's advocate, as my personal view is that inflation only benefits the irresponsible and punishes those (like myself) who have been sensible and not run up vast debts, but rather have savings that would increase in value in a deflationary environment.
One cannot deny though, that excessive borrowing is so endemic across the public and private sectors that even moderate deflation would collapse the whole system. People paying off even sensible mortgage amounts would struggle as the value of their mortgage capital increases. As for the US paying of trillions of debt which is becoming more valuable each year - not likely. Guaranteed default in that scenario.
This is why deflation cannot and will not be allowed to happen, no matter what the cost.
Well if they wiped out bankbond holders who took risk and should have lost I would then accept any inflation that would be left to insure bank depositors and the payments system - but that ain't happening - the system is rotten from top to bottom and such systems nearly always collapse
The money-men seem to accept the risk of complete breakdown in order to get 100 cent on the dollar + interest
They are evil ,crazy ,stupid or possibly all three - how can you hope to spend your money in a chaotic society
DoC, the system is, as you say Rotten beyond belief.
This was posted on another thread here, but it is apposite to this discussion. Have a look and ask yourself whether NAMA will be any different.
http://www.thinkbigworksmall.com/mypage/player/tbws/23088/1111064
These "smart" guys think they are brilliant when in fact they are psychotic.
and don't get me started about NAMA as I am gone beyond the disbelief thing and am becoming acquainted with feelings of rage
1.4 quadrillion in derivatives. Hard to inflate from that PLUS all the damage caused by it.
Oh yes it can happen, but they might do everything in their power to not let it happen. Maybe they succeed after a deflationary crash. But one can happen sure enough.
It's possible to remove the rent seekers without deflation.
Government can raise reserve-ratio as they print interest-free money to pay off debt. An overwhelm portion of the money supply is credit. It's possible to change the composition of the money supply without changing the size of the money supply.
Mr. Jim Sinclair sums it up quite simply and correctly:
Unprecedented Challenges In Financial HistoryMy Dear Extended Family,
I doubt there has ever been a time in financial history when there has been challenges of this magnitude.
This is not business as usual in any form.
When have financial meetings been so top secret?
When has the military cordon off financial meetings?
When have F-18s, F-22s and French Rafales provided air support (as the Swiss did for the Davos seminar) for two central bank meetings in the last few weeks as the USA and Australia did?
Don’t accept terrorism as an excuse for everything that remains unexplained. There are so many lies and so much misinformation out there that the task of figuring out what is real is a daunting task.
I implore you to go for safety in everything you do. How can you go wrong hunkering down?
Do not speculate.
You cannot out trade these people nor can you read their intentions by charts. Both are impossibilities.
Do not deal on borrowed money. Secure you and yours. Take delivery of your precious metals and share certificates.
We are in unchartered seas of international financial turmoil. The mega rich have no loyalty to anyone or anything.
I know some of them, made one of them from scratch, and I assure you would put their mothers in a microwave for the right price. This is a financial world war taking place behind top secret meetings that are deciding our fate while not even knowing they are out of control.
I can’t change this but I can do my best to protect you.
Respectfully,
Jim
Holy ****! Holy ****!
Risk? What risk? As long as they can bump the overnight futures up 1% with ease, then there is nooooo problem and go long.
But... if the real sellers use it to get out, then they have a problem!
The ECB can't bail out Greece and the EU can't kick them out without a huge political shitstorm. The least bad route out of this crisis is for Greece to ask to leave the € to implement the reforms and join again later (if ever).
When Greece is out of the €, the EU and the FMI can cooperate and spread the risk and the cost.
The STUPIDero?
On RGE's Europe EconoMonitor, Michael G. Arghyrou and John Tsoukalas propose a last-resort plan for devaluation that would prevent moral hazard. The plan involves "the temporary implementation of a two-currency EMU, with both currencies run by the Frankfurt-based ECB. The core-EMU countries will continue to use the present currency, the strong euro. The periphery countries, on the other hand, will adopt, for a certain period of time, another currency, the weak euro. Crucially, the bonds and external debt of the periphery countries will stay in strong-euro terms. Transition from the weak to the strong euro should be made conditional upon meeting a suitably defined criterion referring to the current account balance [rather than the fiscal position], a more accurate indicator of long-term competitiveness developments."
Greek spillover.
Any explanation for the one minute jump in Eur/Dxy from 1.369 to 1.374 which corresponded to an equivalent jump in the s&p?
Any explanation for the one minute jump in Eur/Dxy from 1.369 to 1.374 which corresponded to an equivalent jump in the s&p?
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