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Templeton's Mark Mobius: "Let Greece Fail"
Mark Mobius, at least smi-hypocritically, joins the camp of those who still dare live in reality. Bloomberg reports that the Templeton Chairman said Greece should be allowed to go
bankrupt as that would be the best way to sort out its finances. “If we pour piles of cash into a country where corruption
extends to top government officials, we won’t see any reforms,”
Mobius told the Ljubljana based paper. “There is no other
solution than to stop financing Greece with creditors taking
responsibility and suffering damages, so countries should help
them, not Greece, limit those damages.”
Funny he should say that: the US has already poured piles of cash (and we mean piles) into a country where corruption, cronysim, and Wall Street favoritism defines the entire system. Does that mean that the US should have been allowed to go bankrupt too? Of course, one implication of this "fresh start accounting" would have been that Templeton and all other comparable firms, even those doing god's and Zeus' work, would be long insolvent. Will the Chairman care to adjust his statement.
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...and the fed trying to pur gas on the fire with its monkeys on CNBS talking about a vigorious debate on asset sales at the FOMC. Greece down, periphery spreads widening and now the Fed going for the moonshot with talk of asset sales. G$d$mn Euro. Perhaps a repost of the DV01 post is in order.
Of course any sale would essentially be the Fed selling the "assets" to the GSE who pull down on the prepositioned Treasury line funded of course by the very instituion selling the assets. Printer financing. Rinse wash repeat...
Mobius is a phony MFer like any other out there.
Brilliant:
"Funny he should say that: the US has already poured piles of cash (and we mean piles) into a country where corruption, cronysim, and Wall Street favoritism defines the entire system. Does that mean that the US should have been allowed to go bankrupt too? Of course, one implication of this "fresh start accounting" would have been that Templeton and all other comparable firms, even those doing god's and Zeus' work, would be long insolvent. Will the Chairman care to adjust his statement."
Congress is on the case...the feds are giving up 4 hours of porn surfing a day..to monitor wall street more effectively..new regs will be enforced like never before...wall st trembles.
Leaving the US and Ben's presses aside, default would arguably be the best choice for Greece. Restoring reality and making money scarce might go some way towards starving out parasites and corruption.
Living within one's means -- what a concept.
Greece has activated the EU/IMF bailout.
For those blessed with speaking Greek, you can read and watch on video the full Papandreou speech to that end:
http://www.tanea.gr/rendered.htm
It seems to be pointless bailing out Greece except for the purpose of kicking their can into next year. More and more will be needed...until....they kick the can a bit more.
By then they will have a few more cans to kick along....
“If we pour piles of cash into a country where corruption extends to top government officials, we won’t see any reforms,” Mobius told the Ljubljana based paper."
Mobius, you act as if the cash actually has value. The bailout's value is commensurate to the paper's value and both are rapidly approaching zero.
He is a leading expert on haicuts - severe haicuts.
the entire system is corrupt. hence they will always come to the rescue. not to do so ends their power base.
"Corruption extends to top officials" - like the US?
A shame no one reached this conclusion in September 2008 when we had all sorts of Greeces popping within our own economy. The clarity provided by failure.
Bankruptcy is the only sane option for institutuions whether it's a school district or a country.
1 It's the only thing that forces cost cutting on unions and file clerks.
2 It puts most of the losses on bond holders, where they belong instead of on taxpayers and the future.
3 It reminds the world that there is such a thing as failure, even in Bernankeland. Long rates will go ballistic. Long overdue.
4 It resets prices. One of the least understood problems of our lost decade is that all of the capital is tied up in over priced real estate, and government scams. Free markets are self healing, but they have to be free enough to get the pricing right.
We need comprehensive, fair, and smart debt relief for individuals so they can get on with their lives. As for intitutioins... Hang 'em high!
Inspector LeStrade Reactions:
"There is no horse in the barn."
"We do not know where the horse is."
Sherlock Holmes Reaction:
"A detailed analysis in the barn leads me to believe that the horse was a [bred/color] and had been colicy due to feed which gives a specific stool characteristic. And on and on..."
This might be how one might view this situation with the bankers / SEC / others as incompetent. This stereotype has been fostered with massive propaganda (like the above). This may not be correct as the "other" is the highly intelligent Vampire Squid.
Well done.
Just because you are paranoid doesn't mean they are not out to get you.
I love conspiracy theory. I'm an Oxfordian as opposed to a Stratfordian in the Shakespeare authorship controversy. Still, free markets always have to coexist with corruption and incompetence. Some of us would like to get through this with a few institutions and the constitution intact. Others want to drop the big one, and see what happens.
At a fundatmental level, this is about incentives and disincentives, and the rule of law. This is and will always be a fight between the producers and the parasites.
They can't allow Greece to go BK. LEH proved that you cannot allow ANYTHING to go BK or else the entire system cascades into collapse.
EVERYthing is so overleveraged and EVERYone is BK! It really is a bunch of stacked dominos.
If Greece defaults, nevermind the CDSs, there is so much nominal exposure by EU banks and US banks to their paper, that the losses on those will drive up spreads and cause insolvencies all over the place.
The banking clan has managed to put EVERYONE into infeasible debt and the entire world monetary system threatens to implode. There really is no Plan B for when credit cannot continue to grow unabated.
Debt based money in a contractionary macro climate is toxic and fatally so.
They can't allow Greece to go BK. LEH proved that you cannot allow ANYTHING to go BK or else the entire system cascades into collapse.
This experiment has been run, twice. Cascading collapse is true to a point, but it only applies to big banks, and banks are never more than corporate shells.
A bank will not lend to a productive business unless you have at least 50% equity, but a bank's stated equity is never more than 4% and the more you know about accounting, the more you understand even the 4% is bogus.
There are 8,000 banks in the US today. We can create a new one anytime four or five bright people sit around a table and want to start a bank. Banks are conduits, nebishes, less than nothing, in real world terms.
To save the biggest and worst of the banks and play make believe with real estate we have destroyed employment, small business, and nearly all household net worth. How's that working for you????
Japan has run the same con for 20 years, and it's eating them alive. The only difference is that Japan was only trying to solve its own problems. Comrad Ben wants to take on all the world's accumulated debt. LOL
"Kick the can down the road" that is the modus operandi for governments around the world today. They don't have any good answers and little choice but too.
"into a country where corruption extends to top government officials"
how he knows that?
shall we guess he was also involved as he was quite often in and out greece making quite a loaf out of greek stock market
They need "fresh start" government. And so do we.