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Nic Lenoir On Why The Euro Is About To Crash And Burn, And Why His Concern For The "New Normal" Is Not Slow Growth But Civil War
From Nic Lenoir of ICAP
Today 6 countries in Europe were the theater of riots. I highlighted in the past that voting turn-out has been on the rise in the past 8 years after a steady decline the 3 previous decades. During the credit boom fat and happy citizens had no time to vote, too busy producing or even more so consuming. Now with unemployment through the ceiling and poor economic perspectives people have started voting again. The next step is that they realize that no one in the political spectrum currently has any guts or brain and therefore no one offers a real credible fair solution, at least for now. When they do they burn things up. Because things are a little worse in Europe economically, and because the people there actually do realize the people in power are monkeys, they have now reached that stage of realization where burning things up is the logical response. Don't think the US will remain immune to this symptom of the new normal (unlike El Erian I have not revised up my forecast, and my concern is not slow growth but civil war). For proof there was a viral video going around yesterday with a man threatening a school board with a gun after his wife lost her job, and it sadly ended in a shooting. Sadly I have very much expected these incidents to become common place and it is certainly going to get a lot worse. I almost wonder if the most fair, clairvoyant, charismatic, and pro-active politician could help us prevent true chaos. I suppose the real question is will someone come along directing the blame abroad to deflect the anger of civil unrest towards an international war. Do not shoot the messenger, I am simply outlining what I consider the most likely scenario. I pointed out in 2008 that the two biggest market crashes of the 20th century were 1907 and 1929... it does not take a genius to do the math.
Looking into what chaos will look like for the financial markets, the elephant in the room is the Euro. The only way it survives in any form is if countries start defaulting. Until then the problem will not go to rest. I strongly believe that defaults are much like treating generalized infection by cutting the worst looking limb. The problem is at the core, in the way it is designed: you cannot manage drastically different economies of countries with dramatically different cultures and laws using the same currency and interest rate curve. Defaulting takes care of the current debt accumulation by poorer countries trying to keep up with the Euro (not benefiting from the tailwind of currency debasement to boost prices in nominal terms they accumulate debt). However the fact is they will find themselves in the same predicament in 30 or 40 years at the latest for the same reasons. But by the same token I do think defaults are necessary, whether it is via outright haircut on debt repayment or by breaking up the Euro with the debt being re-nominated in original currencies using the Euro conversion, in which case a subsequent and immediate currency bloodbath for the PIIGS would be the defacto default.
The problems in the Eurozone will not go away, all the temporary fixes European politicians are trying to throw at the problem are less and less effective, because the market sees that the Euro itself is broken, and so the placebo effect has a shorter and shorter life cycle. For that reason I pointed out last Friday and Monday that because sovereign CDSs in Europe were close to their widest levels still and US swap spreads had tightened back to their lowest levels since the Greek episode in the European saga, it was time to buy 2Y swap spreads. We have seen quite a bit of widening since I first brought it up already, but nothing compared to what I ultimately expect. Of course FRA/OIS spreads are blowing out in tandem. Interestingly it's no the case for the EUR curve. While counter intuitive in theory, this comes from the market structure of the debt markets. European banks have loan portfolios (unsecuritized) they need to fund in USD, and those can't be pledged against EUR deposits or to a central bank. The ECB has also quite a few schemes allowing almost any toxic junk to be pledged to them for cash. Zerohedge had a very interesting observation the other day that the leverage of the ECB is about 6 times that off the Fed. That's about the only thing that makes the Fed looks good. Also the shadow banking system is a lot more developed in the US than in Europe, so when things freeze it picks up momentum and dimension a lot faster in USD than EUR. For all those reasons, USD Libor settings were a lot more sensitive to market conditions during the Greek crisis than Euribor settings. Expect the same this time around. The attached chart of the 2nd IMM FRA/OIS in USD and EUR shows it more clearly than words could.
However it does not mean there are no traces of the damage in European Fixed Income. I have added to this email a spreadsheet where I calculate the "average" eurozone government yield curve using debt-by-maturity compounding. That gives us a quick way to see who are the countries borrowing cheaper than average, and who are those borrowing at a higher cost. Using that logic if we assumed the market premia for the overall debt-load of Europe remained constant if debt was socialized at the Eurozone level, it would cost 17Bn Euros a year to Germany and almost the same to France to keep the PIIGS in the union. If you don't think it sounds so bad, try to think what people in the US would say if Congress voted a $100Bn a year aid to Mexico. I am not sure what the current duration on a perpetual bond is, but it is equivalent to well over a trillion aid package. Not something people should take lightly.
Using these results I also looked at the spread between 2Y OIS (or EONIA fo Europe) and the 2Y government yield (or the 2Y average "Eurozone" sovereign yield). There you see the full damage much more clearly. While 2Y OIS and 2Y US Treasury yields are within 10bps of each other (mispriced? selling US treasuries against OIS is surely a great low carry fat tail insurance!), 2Y average sovereign yields trade over 120bps above EONIA. So if you are not seeing those Euribors getting crushed i tandem with the frnt Eurodollars on this move, you can see that dynamic is the same in terms of fundamental, but market structure and balance sheets mean the mole pops out of another hole. It is a legitimate question to ask whether Euribor settings should set higher. I am working on a combined average CDS for European banks contribution to Euribor weighted by market cap as I intend to show that the Euribor setting in its current form is useless and it should be modified as ultimately it is never good when your benchmarks are completely detached of the reality. But that last bit is for another day.
Good night and good luck trading,
Nic
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The BIS and the ECB are in charge apparently.
I agree, the thing about FOFOA is that it really does make sense.
You have no idea how badly the US is fucked. We are one failed treasury auction away from the abyss. Sure, sure, the PD will buy up the Treas with Fed money, so it will never happen. Right? Right?
Think of a scenario where the PD don't. Its not that hard.
It's very strange; and seems funny alright. I agree with you; I mean the EU is a net creditor; what ? they loaned somebody a bunch of paper zeros? whoopee.
No
what I meant by that is they trade real stuff(export) for real stuff in return(import), not like the US who just imports real stuff and exports paper.
Germany has trade surpluses with China.
Instead of the EU is a net creditor with trade surpluses would it not be more accurately stated that Germany has trade surpluses. These trade surpluses being greatly enhanced by the flawed design of the currency and the interest rate arbitrage within the EU.
!
I just wish I had spent more time in Europe so I could better judge. I have been there only as a tourist but several times. From what some Europeans have told (ie, unscientific anecdotal evidence) me, things are worse there than here.
I do see the USA in grave danger as well. Maybe Europe is 3 - 6 months ahead of us on the way down.
2011 will be even more interesting than 2010. Better have a lot to drink on hand.
Thats just how I see it, Europe is about 3 to 6 months, (who knows maybe its 1 month) ahead of us in events. Whats going on there will soon be here, no question in my mind.
Sheep,
Think so?, as long as UEB's keep going out the welfare state giveaways will placate the natives.
It's when those stop, the SWHTF.
Bank It.
Aw, hell no. Them thar ole Tea Party boys are gonna fix it!
America late to a party? As a girl I once knew said "sometimes you just gotta make up for lost time....
Only difference is we have the 'world reserve currency' printing press. And no one believes in that anymore. So how much time IS really left?
"just keep that music playin', boyz!" and i'm talkin' REAL music of course. "there's always time for a party." How's it go? "Show bizness kids makin' movies of themselves you know they don't...
About 6 years.
[I do see the USA in grave danger as well. Maybe Europe is 3 - 6 months ahead of us on the way down.]---DoChenRollingBearing
Agreed.
I'm tempted to add "grave danger" is an understatement, but I don't know what's worse than grave.
Does the Euro tank before the USD tanks? Does the USD tank before the Euro? Goodness sakes. We're facing an historic economic catastrophe promising to wipe out the livelihoods of millions of working families for at least a generation.
The coming meltdown will crush people financially, emotionally, and physically---affecting people you know, members of your family, business partners, you, your customers/clients/patients. Fair and honest businesses will close shop. Relationships will be strained. Otherwise honest people now fearful will lie to you. Heroes you long looked up to as mountains of virtue will disappoint. Predictable daily routines will give way to uncertainty and debilitating insecurity.
If you're an FX trader that's great. But, let's not forget what we're really talking about here.
Nice work, Nic. Thanks for explaining some of the more obscure data in a comprehensive manner.
That evening star on the EUR-USD didn't happen on an long term uptrend, but it is still daunting. Could mean ~1.29 again before the year is finished. Definitely by end of January.
When the messenger makes up the message, is it unfair to kill the messenger?
Civil war? Funny... Nothing will move in that direction.
Right, civil wars and all that cant happen anymore...
Same words spoken right before all wars. Wasnt WW1 'the war to end all wars'? Yeaaaa..
Civil wars wont happen because both Europe and the US can export the causes of a war outside.
Wait for wars to start elsewhere but not in Europe or the US.
Uh the USA is already in 2 wars and we have zero real support attacking Iran or Korea.
Zero real support attacking Iran?
War against Iran is not next imo. There will be support for it. Dont get fooled by opposite claims.
The support will be labelled as insufficient in order to mitigate this fact. But there will be support for it from countries like UK, France, Germany etc...
We're too uncivilized for a Civil War. It'll be an all out violent frenzy. Brought to you...by YOU. Keep your nose to the screen and watch them squiggles. Don't worry about the guy downstairs with a knife at your wife's throat.
Things will get ugly here in Europe, that´s for sure. And in the midst of chaos the banksters and politicans will introduce the next logical step in the history of money and citizenship, the citizen-chip. People will love it !
already got it. it's called the "device you're writing with right now." That's why I've gone "full on Neck and Neck." It's time to "do a C Atkins and Get Down and Boogie!"
http://www.amazon.com/Neck-Chet-Atkins/dp/B0000026UV
everyone is bagging on the euro. I am living in the EU. I dont see the horrible economy. I drove 6000 miles in the US this spring, there were far more homeless people there, bad roads, shitty airports, closed stores, the place looked like it was shutting down. That aint what it is like here. the malls are full of people and no spaces are unrented. Gas is twice as high as in the usa and the streets are jam packed. So someone tell me the outward signs of the failure of Europe, so I can notice them.
Yea, the US probably IS far worse than Europe! I wouldnt argue that at all, any person with a functioning brain can see we have no real economy at all, destroyed 75% Borrow to Consume economic model that was stupid to begin with.
Just that we here have this corrupt govt and media and FED, and (for a short time) can print this fiat 'world reserve currency'.
Its not about which pile of crap is better, they both stink.
Both USD and EUR are rotting carcasses.
Only difference is the EUR is soaked wet in fine french parfums, that's why some people are easily deceived into thinking it will be the reserve currency.
Old colonialist pipe dreams.
Europe is toast. Once the US goes bankrupt, the caliphs will ride west all the way to the Tagus river delta and northwards to the baltic sea. A thousand Maginot lines won't be enough.
Global conversion is the end game.
Got burkhas?
it's called "the formerly homeless people now known as the 8th Army Group soon to be based in Stuttgart." Even more worrying "they have an eye for fine art AND fine...
What do you look at? Christmas shopping? People filling up gas in their cars to go to work?
You won't see an utter barren collapse cause that isn't happening. But don't tell me you don't see the problems in EU, youre just not looking. Id be interested as to what country youre located in as well...
Have to agree, Danielius. But I think you're supposed to be thinking about that falling wedge on the chart, not what you see with your own eyes.
LOL so the hundreds of thousands of people striking and rioting don't count?
Let's see, Europe's roads are great because they don't have many of them to maintain.
Their stores are jam packed because they don't have many of them, and they aren't open at all hours.
Their real estate is jam packed because they've had artificial limits on building since, forever.
There are tons of people out and about despite horrendously expensive fuel because mass transit was shoved down their throats by central planners, everyone is jammed up next to each other in dense blocks of small homes at best or stacks of small apartments for most, and therefore driving distances are lower, and of course some driving still gets done because their cars are a lot smaller....because their families are smaller and they have less crap than we do to put in cars, and those cars are fuel efficient because fuel prices and taxes on cars and driving are very high.
The real killer is the family size. For some reason they think their entitlement states will survive birth rates that have been well below replacement for decades? Not possible. As to why birth rates are low, return to the top of my post and read this again. Statism has jammed them together in tiny spaces, tiny cars, narrow hours shops are open in, and ever shrinking disposable income after taxes. Oh, and they are essentially atheists and so don't believe in much of anything...
When you do not retain enough pride in your culture and people to reproduce, the game is over. Demographics is key to Europes future, they are dying check Italys and Spains birth rate. Mark Steyn has it right.
You are not in Greece I take it? where are you? Europe is diverse as is the USA. Take a drive through Westchester County an all is great, go to Detroit and it is not. The point is that there is enough pain (turning to unrest) in Europe that even the still tranquil and productive areas are likely going to become `infected`. Nationalism is the knee jerk response, that is Nick`s point and I think a valid one.
As a bit on anecdotal evidence that he is not alone in his unease - I was talking to a Swiss friend last week. Their National Guard is rather busy just now, their system of National Service is reliably efficient but they are making sure everything and everybody is well up to speed. They do not fear invasion by Iran or North Korea, it is their neighbours who they want to keep out.
Like other European "powers" the fifth column is already encamped within their ghettoes.
At least the IMF will raid Irelands pension's before they crash and burn! Silly, Silly Irish Politico.
Nic says one way defaults could happen is "breaking up the Euro with the debt being re-nominated in original currencies using the Euro conversion."
It's unclear whether he means at the conversion rates used at entry into the Euro, or at some new rate.
I've long wondered whether anyone -- ECB, etc. -- maintains a kind of "shadow exchange rate" for each country of the Euro that reflects a theoretical, changing exchange value of, say, the old DM or FF or whatever, against the Euro, based on a basket of metrics (GDP, country-specific inflation, balance of trade, etc.).
Anybody know? The idea might sound strange, but it's the kind of exercise bureaucrats and politicians might be inclined to do when entering into a brand-new currency regime.
Thanks in advance for any replies.
"it is never good when your benchmarks are completely detached of the reality"
You mean like when your inflation calculation does not include energy and food?
Robo-
Does gold go into a freefall/ aka get blowtorched for real''' ......if it breaks $1,320???? I think this is the "line of fear" for most .....
No Spalding.
This is a real bull market. If you dont understand gold then don't go Jonny bravo and try and make calls on it.
You will end up drowning in your sorrows never to be heard from again.
I'm not making a call but if gold break below 1,320... On the charts/many use them to trade spitz'. It looks bad after that ...Don't worry spitz its $60 bucks away you will have time to bail if it crashes below 1,350 ....
This isn't chartable. The world reserve currency has never defaulted before.
We are a long time from that day my friend. Every other paper crashes hard before the dollar....
Gold throughout history was never built upon a mountain of derivatives. That mountain started being built in the 80's .... That no sure thing. That why gold gets blowtorched like every other trade when its risk off. A mountain of funny money as part of her supports, a bunch of sand that will wash out with a high tide.
Those robots will dryhump the sell key if the charts get fugly.....
But spitz will tell me when all the funny paper (gold derivatives) blows up this is better for gold because the real thing is worth more ... Really ? You show me a ponzi build upon derivatives that every bounced back better than ever. ? Enron, AIG, Long-Term Capital. Ask Meriwether about derivatives its all part of the same centralbank ponzi -
Sorry, I didn't clarify myself: physical gold
Yes but that price you see today is built upon derivatives you take out iou's,etf's,shorts,long's options.... Its a derivative gangbang.
This helps keep the bid at 1,381.50 and over the last 10 years. The central banks own that market. The miners get the funding/hedge with the CB's.
There will be no ask price for Au in dollars. Period.
Everything is a fiat, if it goes mad max oh well, if we have a reset the USA will still be a major player or the game can go on as is for another 10-15 years.
I never said the US would not be a major player. They got gold.
You're delusional
Thats right, the paper price of gold will crash but it will be IMPOSSIBLE to get any physical. That is when the Bank for International Settlements will open a new physical only gold market. That is when we will see the real price.
Some deflationists might have a 15 minutes of fame but when the dust settles, gold will be to the moon and the European Central Bank will be the only one with a balance sheet to work with. (because of the marked to market gold)
Bwwwwwhaaaaaaaaaaaaaaaaaaaaaa ... Wheeeeeeeeeeeeeeeeeeeeew, ha,ha,haaaaa whew good one. You sleep with that under your pillow. Wow, you sound like Ken Lay ...Lol'
More what ifff's spitz' ..... ( BIS ) give me another one. Lol'
Haha
You actually thought I made that up. The BIS has its hands all over this.
Who fucking owns the BIS & World bank.... Tell me the address of the WB ?. Who wrote that book/report from the big plan layed down by the BIS/Uncle Ben.... ? The BIS is the dollar. The dollar in all her glory !!! Viva' Uncle Ben , World war one ... Germany under our boot',Versailles Treaty of 1919 she owed us.
Spitz' Ben is in total control. Ride the wave. Buy the dip & start trading stocks... The music is turned up really loud and they have a wall of sub woofers pumping bass across the dance floor.
Jamie Dimon is doing the moonwalk & Pandit is doing the cabbage patch ... The party is going all night !!! Hey Ben its your birthday ...
Click on this ... Turn it up every morning at 7:20 a.m.
Buy the dip.
Apotheosis - O Fortuna ~http://www.youtube.com/watch?v=WJ76EOVpQMM
The BIS is not affiliated with the IMF or the Fed. It is only affiliated with the ECB. It exists to fill the void when the dollar/Fed is done.
I have to agree with this. We're seeing true food cost reflected now because the huge amount of brokers. Except the brokers aren't paying any attention to the paper markets, for the corn seed I sold a couple of month ago it was paid with silver and shipped in grain train cargo to China.
Its one thing when it's on paper, when you physically have the goods to sell it turns paper trading on it's ear. Especially with food security.
I can definately see this happening. The gold standard comes back, but not to back fiat. It comes back as the capital value. I'm starting to think I'm going to start asking for physical gold next year.
I agree with my fellow dog avatar, technical analysis (in my opinion) is mostly bullshit anyway but particularly so when it comes to gold. Gold is fundamental, not technical. It is the anti fiat currency. As long as Ben and his fellow ECB buffoons continue to monetize, gold continues to go up.
Im not calling a top.But the chart below 1,320 falls far and fast.....
But if the euro issues are not going away and when the news hits spain,italy, france .... Then you are going to see a dollar rally. The next year looks bullish for the dollar if we hit 3%GDP.
The better the numbers get that will also need to be priced in. The armageddon trade may be over. If I was 50 or had $100,000 in cash I would put 20% in gold and throw away the key. But most people are trying to profit off gold like any other trade.
I would argue that the rise of gold in recent years does not reflect an Armageddon trade but in fact just the opposite - that TPTB will succeed in keeping the ponzi going and slowly but surely reducing the purchasing power of the dollar through QE2-99.
Chartists have been getting gold wrong since India purchased 400 tons from the IMF.
No actually, hedge funds are closing up in droves because the managers are more worried about protecting their own wealth at this point.
+1 Spitzer, and that price was $1,040/oz if I recall correctly.
what did happen to Johnny Bravo? was he calling for gold to go lower awhile back?
He bet his life that gold would crash at $1250, just when the ride to $1420 started late August. nobody has seen him since.
I made a huge gold purchase on the last COMEX option expiration date of the summer, which I figured would be close to the low. It actually felt expensive then and even the dealer I bought it from was kinda perplexed about the size of my order. Needless to say, I won, Jonny lost.
The price for Au and GLD will diverge.
You will be able to trade paper for paper, but there will be no ask for Au in $.
People won't want paper promises anymore.
Don't invest in anything requiring you to read a prospectus.
If I am wrong, you still own coins. If I am right, you will only own paper.
I am not a gold bug, but I keep my eyes open. When you see a story like this,
you know there is much more to the gold story.
http://www.usagold.com/cpmforum/2010/12/14/inflation-fears-bring-on-chin...
You're goin' Lost Wages/You're goin' Lost Wages!
Nic is probably right about euro, The ECB and its masters are too stupid. And as the treasuries show, the USA is right behind, and it could make civil war look like a holiday.
The BIS is the masters of the ECB. The new word will be "Don't fight the BIS"
King Euro, certanly has been since inception. .30 better
It does not look that way, If you look at euro against the PM's and most of the other currencies.
Decades ago, Toffler foresaw the collapse of Europe. He correctly pointed out Europe was the weakest link.
What we are witnessing is the dawn of WWIII, courtesy of the same fascists responsible for WWI and WWII.
The people of Greece and Ireland already know that the economic burden being shoved down their throats is MUCH, MUCH worse than the Treaty of Versailles.
Greek rioters should be smarter and target the Frankfurt bank mafia.
What's so civil about war anyways?
How the united states will break up:
http://online.wsj.com/article/SB123051100709638419.html
Alaska will return to Russia. California, Arizona, Nevada, New Mexico and Texas will return to Mexico.
In Eurabia, the price to be free from debt shall be conversion to the moslem faith.
you can't be serious.
Uhhhh, are you sure about Texas?
" . . . will return to Mexico" . . . as if Mexico were a country?
SO the Euro is toast Nic-really?The forex market doesn't seem to have read your report then.If you look at todays rates for the dollar and sterling you will all be no doubt amazed to learn that the soon to be worthless Euro is actually 50% higher against the dollar and 40% higher against sterling at 2002 rates.
AS I have said on numerous occasions on ZH,the two weakest currencies of all the western countries are sterling and the dollar,they coincidentally have the weakest economies(virtually entirely dependant on the consumer(US) or the housing market(UK)and are both off the scale in terms of their personal indebtedness and government deficits as % of GDP.
So come on Nic,why not show the real charting horror stories of sterling,why not start with GBP/CHF or GBP/JPYover the last fifty or sixty years and you will show ZH'ers what a true fiat currreny looks like over the long term.
This article is just pablum--second-hand ideas with some chartist cargo cult thrown in. Show me where there's a single original idea or insight.
Have to love the way you pull meaning from context Lord Pip.
Look forward to reading your next posts.
Cheerio.
To return to a gold standard is going to piss off a whole mob of paper holders. I am finding a quiet spot.
Russia should buy Massachusetts, it would be a model state.
"Yeah, good question. Then next question. For GLD shares, if HSBC (The Custodian of GLD) goes belly up, will GLD shares turn to dust?"
So what is likely to happen to general gold miner shares in light of some of these events? If the euro falls badly and gold increases despite the dollar increasing.. pure gold miner shares will surely increase too? Or, who am I kidding, those shares will tank as the general indices crash yeah? Too many variables, my head hurts.
"Civil War" is a misnomer. It was the war against Southern secession, not a civil war. The South did not want to take over the United States, they wanted to leave it. Catalytic parallels: current attempts to leave the Euro or USD plantations. Follow the money.
Or the War of Northern Agression, depending on which side of the mason dixon line you are on. Im to the North.
Thank you Colonel....there wasn't anything "civil" about it.
I'm sorry to have to say this but Lenoir's analysis has been far too consistently dire that past 6 months. Yes, things are bad and they will get worse. Does that mean paper assets prices will crash? Eventually yes, but given they are paper assets: not yet.
Wow Nic, I used to really respect your analysis...but "one guy going postal on a school board" is proof of a coming civil war? Really dude? Maybe it's time to let your ego go and stop trying to call all these tops.
Tired of being SCREWED by the FEDERAL GOVERNMENT and LIED to by PRESIDENT OBAMA, BERNANKE, JAMIE DIMON and the other host of CRONIES??
Then Watch the YouTube Video “AMERICAN DREAM DEAD ~ DENIAL, THEN PANIC” at (http://www.youtube.com/watch?v=7PFqAoqrPOs)
Anonymous-
It’s time you STOPPED getting SCREWED by the BIG RED WHITE and BLUE !!
I heard all this crap 2 years ago. Next. Buy the fucking dip ....
YouTube - buy the dipGot "X", book it.
Allow me to pimp my book
Civil War Two: The Coming Breakup of America
http://www.amfirstbooks.com/
~
Hey, its DXY 80 Spalding Smailes! How things going dixie?
Poor gold holders.
Lots of margin calls rolling in during Asian trading.
Another soon-to-be-failed attempt by JPM.
Poor gold holders?
-1400
http://www.goldprice.org/ebay-gold-prices/
Buy the dip tard....
Everytime we are going to have a breakout rally those darn Europeans have to riot. Good thing Gold vs. the dollar april 21-june 9th was a fair trade. Man, what I wouldn't have done for dollar strength to continue. Gold loves everyone, don't people understand that? Gold traded well against a strong dollar. Dollars are fucking worthless.
We've been through mini this before. It's really up to the Chinese what happens to the Euro.
spitzer knows whats going on........he is correct
Going to be interesting seeing the E-mini trading below 1000 again.
I hope WTSHTF doesn't happen in January! I'm supposed to be in Spain for the whole month for training!
The Boyz are back in town again!
At the risk of sounding ignorant or like a troll, just who are the opposing sides in this civil war? Using the U.S civil war as an example, I'm not seeing a civil war. An insurrection/revolt/rebellion, maybe, but not a civil war.
the most popular name for boys in england is mohammed, the number of male muslim immigrants residing in western European an d scandanvian countries is larger than the number of their respective armed forces members and, now there is this http://www.youtube.com/watch?v=GGkk5RPHuZc . Europe has problems, but they are much, much bigger than worries about budget shortfalls and pension cutbacks. we are already seeing waves of european "immigrants" seeking pr status here in asia. trying to rebuild their little mini swedish or whatever country enclaves here in the tropics, and they all tell the same story, its not the taxes its that there is no future in their countries because the eu has sold them out to the OIC. the rich ones and the smart ones are already getting out because they see they have already lost their culture, not just their pensions.
Actually, Europe is the area of the world that emigrated the highest percentage of its population.
I suppose that in your book, the previous waves of emigration were due to some other people emigrating to Europe?
in my book, historical anything would have no relevence to europe's present reality. I would guess this is because the islamic immigrants of today unlike the immigrants of past seem to have no interest in or intention of assimilating. Ewald Stadler famously spoke on this recently. http://www.youtube.com/watch?v=XRmgI_WXff0
i've expected civil war in europe for a while now, within 15 years
for the reasons mentioned above - the usa cant quite comprehend how much islam is in europe so its understandable people are shocked by people grumbling about mohammed now being the choice boys name of the continent.
the fact is that the teutons wont stand for conversion and they'll kick off big-style.
and about time.
I tend to agree. We've seen that the sleeping giant that is the German nation just open one eye and start to look around. Once he gets up and starts to stretch a bit, it's game on. And besides, young European men still outnumber young Muslim men about 2.5:1 (scary that it's gotten so close though..) But war is all about organization. Who does that better, Germans or Turks? I actually think the real threat to Europe is if the US government sides with the Muslims! They did it in the Balkans ~20 years ago, and I wouldn't put it past them to do it again on a much larger scale.
i've expected civil war in europe for a while now, within 15 years
for the reasons mentioned above - the usa cant quite comprehend how much islam is in europe so its understandable people are shocked by people grumbling about mohammed now being the choice boys name of the continent.
the fact is that the teutons wont stand for conversion and they'll kick off big-style.
and about time.
You write: "The problems in the Eurozone will not go away, all the temporary fixes European politicians are trying to throw at the problem are less and less effective, because the market sees that the Euro itself is broken, and so the placebo effect has a shorter and shorter life cycle."
I agree: The world passed from the age of leveraging and asset value appreciation … and into the age of deleveraging, and debt deflation on November 4, 2010, when the bond traders seized control of both the Interest Rate on The US 30 Year Government Bond, $TYX, and the Interest rate on the 10 Year US Government Note, $TNX, that were formerly under the control of the US Federal Reserve.
Anticipation of QE2 provided moneyness to bonds; however, on the other hand announcement of QE2, destroyed the moneyness of bonds, as the 30-10 US Sovereign Debt Yield Curve flattened.
The flattening of the 30 10 US Sovereign Debt Yield Curve yield curve, $TYX:$TNX, came as investors fled the longer out bonds more than they did the shorter duration bonds, as Ben Bernanke’s QE2 monetized debt, and as President Obama’s projected deficit spending developed the risk of a failed US Treasury auction.
November 4, 2010 was a pivot point, that is an inflection point where … the world passed from the age of leveraging, characterised by credit expansion, currency expansion, and increasing consumer discretionary spending, economic growth and inflation in investment value with moneyness …. and into the age of deleveraging, characterised by credit contraction, currency contraction, decreasing consumer discretionary spending, economic contraction, and deflation in investment value with the destruction of moneyness
The world wide investment bubble, and moneyness was pricked by Mrs Merkel calling for a haircut on debt and a call for a sovereign debt default mechanism.
A catastrophe is coming out of rising sovereign debt interest rates, as well out of further global competitive currency devaluations at the hands of the currency traders, resulting in a financial market place implosion, the European Financial Institutions, EUFN, will fall quickly falling in value, taking the entire global financial system down, resulting in Götterdämmerung, an investment flame out, bringing forth a new age.
And the accompanying rise to power of a Sovereign-Chancellor, Revelation 13:5-10, such as Angela Merkel or Herman van Rompuy or John Redwood; and also a Seignior-Banker, Revelation, 13:11-17, such as Wolfgang Schäuble, or Olli Rehn, or Jean-Claude Trichet, or Gordon Brown, with fiscal sovereignty to control deficit spending, enforce internal country devaluations, provide a common EU Treasury for both taxation and transfer payments, assure mutual guarantees of the EU debt, and as Timothy Geithner called for, implement unified regulation of banking globally. All seigniorage, both credit and fiscal will come and go through the Seignior, who will make decisions on where money is spent.
I foresee national sovereignty passing away throughout the world, as Leaders’ Framework Agreements establish ten regions of global governance as called for by the Club of Rome in 1974; hence people will no longer be citizens of sovereign nation states, rather residents living in a region of global government.