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Euro Gold Surges To EUR 1,168 As SYRIZA Threaten TROIKA
Euro Gold Surges To EUR 1,168 As SYRIZA Threaten TROIKA
The crushing victory of the Greek opposition party Syriza in yesterday’s Greek elections has added to jitters in already jittery financial and foreign exchange markets.
Head of Syriza, Alexis Tsipras waves after winning the elections in Athens
The euro tumbled and gold in euros surged to its highest level since April 2013, at €1,167.94/oz as markets opened in Asia. The euro has since stablised but remains near a 11 year low against the dollar and is now down 16.7 per cent against gold in January alone.
Gold in Euros - 5 Days (Thomson Reuters)
U.S. stock index futures fell, as did European shares prior to slight recoveries while borrowing costs for the euro zone's most indebted states rose due to increasing concerns that the Syriza party looked set to take on Greece's international lenders after the landslide victory.
Greek markets saw worse losses. Ten-year yields rose 22 basis points to 8.99 percent, while Greece's main stock index fell 0.6 percent, with shares in banks such as Alpha Bank and Piraeus Bank hit even more.
Yields on lower-rated euro zone bonds bounced off record lows, with Italian 10-year yields up 2 basis point at 1.54 percent and Spanish and Portuguese yields 2 bps higher at 1.39 percent and 2.26 percent, respectively.
Gold in Euros - 5 Years (Thomson Reuters)
A period of uncertainty and heightened market nervousness now seems likely and this should benefit gold.
Political uncertainty has already generated bank runs. Greek banks are already facing a serious liquidity problem as depositors have withdrawn billions of euros in recent days and weeks. Four major Greek banks have already asked for Emergency Liquidity Assistance (ELA) from the European Central Bank (ECB).
Syriza leader Alexis Tsipras promised Greeks overnight that the five years of austerity imposed under bailout programs worth 240 billion euros from the European Union (EU) and the International Monetary Fund (IMF) were over.
Prime Minister-elect Alexis Tsipras, who pledged to renegotiate the nation’s international bailout, won 149 out of a possible 300 seats in Parliament. His mandate is now to confront the nation’s programme of austerity, imposed in return for pledges of 240 billion euros in aid since May 2010.
Syriza have been given the resounding backing of the Greek people to initiate reforms to the agreement the previous government negotiated with the Troika. His pledges include a writedown of Greek debt while persuading European creditors to keep aid flowing.
The left-wing group are just two seats short of a majority with means they should be able to form a government with sympathetic individuals or parties.
While Syriza have been careful to highlight their commitment to the EU and the Euro, there is no mistaking the hardline tone of Alexis Tsipras when it comes to dealing with the Troika of the IMF, the ECB and the European Commission (EC).
In Athens yesterday, Tsipras told the crowds "Your decision today has made the Troika a thing of the past," according to London's Telegraph.
"Our victory is a victory for all people in Europe who are fighting austerity. The new Greek government will be willing to collaborate and negotiate with our European counterparts for a fair solution so that Greece can emerge from the vicious circle of debt."
Syriza appear to have every intention of keeping their election promises to cut taxes, raise public spending and increase the minimum wage. They maintain that this can be done while staying within budget by drastically cutting payments to their creditors.
Syriza's likely finance minister to be, Yanus Varoufakis, told Channel 4, " We are going to destroy the Greek oligarchy system."
Exactly who Syriza define as being part of the oligarchy system is unclear as of now but it is likely that many banks and financial institutions - the beneficiaries of the current reform program - will be in Syriza's sights.
The EU will be loathe to give any concessions that may weaken Europe's already desperately fragile banking system. Brussels will be unwilling to sustain any such concessions lest other countries, like Ireland, demand a restructuring or write-down of their debts.
Irish Taoiseach, Enda Kenny, offered tacit support for renegotiation of the so called Greek bailout when in Davos, while also expressing hope that Greece remain within euro zone.
If Syriza is blocked from improving the conditions of Greece's working and middle classes, it may have no alternative but to leave the Euro - a very messy and chaotic process which would lead to the end of the single currency as we know it. It would also make more likely a return to drachmas, pesetas, liras and punts.
Skillful accommodations will need to be negotiated on both sides if Greece is to remain in the Euro and the banking system is to remain intact.
Tsipras' lack of experience and Brussels' lack of humility may not be conducive to such accommodations.
With the ECB's admission that the Eurozone is already in a very fragile state, it seems great uncertainty lies ahead for the international monetary system.
Gold remains an essential hedge for investors at this time and an insurance policy for depositors in the euro zone and internationally - exposed to the dual risk of bail-ins and euro devaluation.
The Comprehensive Guide to Bail-ins: Protecting Your Savings in the Coming Bail-in Era
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Dude seems happy. From that angle he has that Max Keiser look about him. Go for it Greece. Kick some bankster ass.
Nothing better than the smell of a 2 party 'system' burning.
Gold price breakout will telegraph the
GLOBAL COLLAPSE TIMELINE FOR 2015/2016
Yanks can never pay back all the debt they've run up.neither can the Japanese or the Europeans.Good point,it's mathematically impossible,here's why:
http://demonocracy.info/
Jobs being created at Home Dpot and McDonalds won't pay the bill,the recovery is an illusion created by printing paper.
You yanks can talk, but how are you going to repay all that Mountain of debt that your belovered Central Bank and Government has build up?
If we actually did repay our debt we would destroy our money, which is backed only by debt! If you don't understand that you know nothing about modern central banking. We do have a plan to shrink our debt via inflation and the power of compounding. Don't think that will work? Well, we've destroyed 97% of the value of the dollar since 1913 (the year the FED was created), so put that in your pipe and smoke it! We'll need log paper to plot the remaining demise. Counterfeiting works until you reach a critical point, a phase transition, a Minski moment. But gold cannot be countefeited and that's the rub for central bankers and the only salvation for those few who know you can't have a sound real economy without sound (non-fiat) money.
So, to answer your question: we've never going to pay back any of that debt nor did we ever have any intention to do so!
Sell the Miracle Mulatto.
Since when is a "lack of experience" a bad thing when the "experienced ones" are criminals, thieves, murderers, etc.
Promises are great, but math always wins.. how you gonna pay for that bacon and Eggs pal ?
That pose. You've got to love your people to make a gesture like that. Arms spread wide open embracing a new beginning for the masses, a genuine, silver-lined smile of promise, and praying to God there isn't a sniper across the street just behind that gargoyle.
I am waiting for them to inventory what gold they think they have as it was used as collateral for the last bailout.
Hidden in the fine print.
"Debts which cannot be paid, will not be paid."
"Can't get blood from a turnip."
Does Spain still have silver deposits?
The debts cannot be paid off, period. The only question is how much longer the fiction of their repayability can be maintained.
Movies ? man who needs movies. "reality" is so fucking entertaining; it has a plot, and good guys, and bad guys, and mysterious deaths, and Billioins of Dollars at stake; I'm definetely watching this movie. Moar Popcorn !
After Syriza gets Greece out of the EU and back on the drachma - Act Two will start where they Zimbabwe themselves and all those art students will be right back in the same pot.
Popcorn with butter, olive oil and garlic powder. Let's do this!
"240 billion Euros in aid"
was to grease the politicians and pay off the holders of Greek bonds. You make it sound like altruism.
And it is "loath" not "loathe"
loath is reluctant
loathe is hatred.
We need a "hated to to do it but I had to" sort of word.
Sadly, I am beginning to believe it's NEVER altruism. It may start as altruism, but altruism simply never makes it through any political system without being converted to looting from taxpayers under whatever disguise.
"Sadly, I am beginning to believe it's NEVER altruism".
better late than never ... think about all those people who still believe it is ALWAYS altruism.
on the subject, it is another part of the system of mirrors built around us. ALMOST for everything you got to dig in, cant take anything for granted at face value ... part of the way things are run and the system works
Yes, Syriza certainly talks a lot about threatening the troika. Since winning the election they've added insouciant body language and aggressive photo opportunities. With the bankers already reeling, Tsipras escalated to the nuclear option: defiant symbolic gestures. Greece is as good as free!
If the Greeks threw out their debt servitude to the EU, and switched to a sound currency with a balanced national budget -- they could have the strongest currency in Europe. But it looks like Syriza has promised the moon to Greeks so we will merely repeat the overspending and runaway debt problems that every Western country faces.
Throwing out the euro and having a sound budget policy are two different things. They are leftist in nature so they will have problems tightening their budget to a survivable level.
If the Greeks could have a balanced budget in any currency they would not have the current debt servitude.
Evidently a large number still believe in a tooth fairy.
The only way they can continue to overspend is to continue to borrow. Which recently screwed lender will extend more credit?
The National sport is going broke, they will never amount to anything, ever.