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Guest Post: Could the Euro Trigger A 2008-Like Crash? Si, Oui, Yes.

Tyler Durden's picture




 

Submitted by Charles Hugh Smith from Of Two Minds

Could the Euro Trigger A 2008-Like Crash? Si, Oui, Yes.

If we dispense with all the fancy stuff, we end up with a simple see-saw with the euro and global equities on one end and the much-hated U.S. dollar on the other.

If we scrape away the ever-hopeful headlines predicting a new figurehead lackey or another vote will magically fix Greece, Italy, the euro, Europe's crumbling banks, etc., the global stock markets can be distilled down to one chart. And here it is: a see-saw with the U.S. dollar on one end and the euro and equities on the other.

 

 

I know the mind rebels at such simplicity, and so does the entire buy-side Wall Street edifice: if it all boils down to this, then there really isn't much value added by the endless reams of fancy reports and analysis, is there?

But let's presume for a moment that it really is this simple. Where does that leave global stock markets? The answer can be had by glancing at two other charts: one of the euro and one of the dollar.

 

 

 

Now that the cargo-cult chiefs are openly talking about the euro splintering into euro 1 and euro 2 (i.e. business class and steerage), something I proposed as a possible "face-saving" step in the devolution of the euro 18 months ago ( Why the Euro Might Devolve into Euro 1 and Euro 2 March 2, 2010), then the common-sense question is: why is the euro worth 36% more than the dollar? The answer is that it isn't worth 36% more, of course, and for a bit of technical support of that we turn to a simple chart.

There's not much to support Bulls' claims of euro strength here and much to suggest the euro is in a leaky barrel floating helplessly toward Niagara Falls. Classic wedge broken decisively to the downside, check. Uptrend decisively broken, check. RSI declining but not oversold, check. MACD declining and below the neutral line, check. Price below the critical 200-week moving average (MA), check. Price below the equally critical 50-week MA, check.

The last time these conditions occurred (April 2010), the euro cliff-dived from right where it is now around 136 to 120 in a few weeks. Technically, there are numerous reasons to consider this a high-probability scenario and essentially no support for the notion that the euro is about to storm higher.

And as the euro goes, so go equities.

 

 

Meanwhile, the chart of the dollar is unsurprisingly the inverse of the euro: it's loaded with bullish bits. RSI rising, check. MACD rising and above the neutral line, check. Classic wedge broken to the upside, check. Downtrend decisively broken, check. Classic A-B-C-D pattern visible, check. Price above the critical 50-week moving average, check.

In another classic move, price kissed the 200-week MA, retraced to support, and is now rising back to break through the resistance offered by the 200-week MA.

Without getting too fancy, the obvious targets for the euro are 120 and parity with the dollar at 100. This could also be seen as reversion to the mean. The targets for the DXY (dollar index) are correspondingly 88-90 and 100-105.

As for what this means for equities, it's a free-for-all limbo dance: how low can you go? The S&P 500, currently around 1,240, could easily limbo down to the psychological 1,000 level, pause to towel off the sweat and then repeat its 2008 swan dive to 666. Or maybe not. The only thing the see-saw tells us for certain is the euro and equities are on one end and the dollar is on the other. If the euro tanks, equities tank, too.

I know, I know, the dollar is doomed, it can't possibly rise, blah blah blah. If you insist on a fundamental reason, then read this: banks are short currency, long assets (Zero Hedge).

And what's holding up the euro again? I'm getting a lot of static in the answer.

 

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Thu, 11/10/2011 - 11:49 | 1866102 SDRII
SDRII's picture

Might want to consider this little tid bit about US being approached on a coup in Pakistan...

http://www.dawn.com/2011/11/10/mullen-denies-receiving-ijazs-letter.html

 

Thu, 11/10/2011 - 11:53 | 1866125 Harlequin001
Harlequin001's picture

and where does gold sit on this see saw?

Thu, 11/10/2011 - 11:57 | 1866158 Withdrawn Sanction
Withdrawn Sanction's picture

It's the fulcrum

Thu, 11/10/2011 - 14:28 | 1866843 FreshMind
FreshMind's picture

I picture hands on both sides pushing down only to snap the board and allow the fulcrum to float away.. up, up and away!

Thu, 11/10/2011 - 12:02 | 1866184 EL INDIO
EL INDIO's picture

It's the reference.

Thu, 11/10/2011 - 18:11 | 1867909 h3m1ngw4y
h3m1ngw4y's picture

i think gold is the reference point ;-)

so aginst all ods, the gold on the ecb balance sheet is the bullish euro factor. its more or less to market (40,22 anyone)

so it could soak up all to easy the bearish bias and then some more. only from balance sheet appreciation

at least i wouldnt be surprised if eur up big time. the euro bearish is no contrarian bet.

should the fed too decide to mark gold to market, all bets are off for all cross pairs.

Thu, 11/10/2011 - 12:02 | 1866190 Dr. Richard Head
Dr. Richard Head's picture

It's the pivot of the see saw.  Basically US Dollar and Equities/Euro can go up and down all day, while the pivot can rise up with no one (aside from central banks, Austrian economists, and the ZH crowd) noticing.

Thu, 11/10/2011 - 12:16 | 1866252 falak pema
falak pema's picture

gold is archimedes's finger. thats what scares the fiat nymphomaniacs.

Thu, 11/10/2011 - 12:25 | 1866283 Dr. Richard Head
Dr. Richard Head's picture

Fiat Nymphos sounds like a great band name.

Thu, 11/10/2011 - 12:59 | 1866452 viahj
viahj's picture

Fiat Nechros

Thu, 11/10/2011 - 12:08 | 1866213 The Big Ching-aso
The Big Ching-aso's picture

Plenty of fools out there, however greater fools are getting scarcer by the minute.

Thu, 11/10/2011 - 12:54 | 1866418 CPL
CPL's picture

Like cancer, the patient is killed inch by inch and the systemic issues are too far along for treatment.

 

Right now all people are doing is attempting to keep the patient alive even though there is nothing left to save.  It is now just an effort in how far they can torture the body before it inevitably coughs it's last breath out and the body liquefies the same moment it dies.

 

Even then the TPTB will attempt to reanimate the slop that was once known as the EU.

 

 

 

Thu, 11/10/2011 - 13:11 | 1866503 flattrader
flattrader's picture

This is nothing but run of the mill chart porn.

Here's a guy who can do real charts--

http://www.ritholtz.com/blog/2011/11/our-supercycle-oscillator-updated/

 

Thu, 11/10/2011 - 14:01 | 1866692 flacon
flacon's picture

Interesting. Do his charts take into consideration exponential debt to get us where we are now? How does that affect the supercycle?

Thu, 11/10/2011 - 12:51 | 1866387 Iwanttoknow
Iwanttoknow's picture

I know Soth asia quite well.The above mentioned person is a US intelligence asett.I find it difficult to find the report credible.

Thu, 11/10/2011 - 11:49 | 1866106 DormRoom
DormRoom's picture

too much global stock (liabilities) problems.  Everyone's looking for good, safe flows.  USD is that conduit.  How USD flow is a good broad macro indicator.

Thu, 11/10/2011 - 11:50 | 1866111 qussl3
qussl3's picture

Ben will kill it before it hits the high 80s.

The elections depend on it.

Thu, 11/10/2011 - 12:00 | 1866168 J 457
J 457's picture

That's right, but S&P will hit 1,040 range before he starts to devalue again.  Oil and commodities need to cool off before any more printing begins.  Don't underestimate impact of US debt debate and potential for govt layoffs as a result. 

Thu, 11/10/2011 - 12:03 | 1866194 qussl3
qussl3's picture

Agreed.

Perhaps the DXY isnt such a good measure.

My bet is crude <80 and brent < 95, before he goes to town.

 

Thu, 11/10/2011 - 12:08 | 1866218 11b40
11b40's picture

It really feels more an more like they are losing control.

The weaker Europe gets, the stronger the $.  The only way to keep Europe from blowing up is massive printing = weaker Euro, stronger $.  So, Bernake prints like hell trying to weaken....but the public is getting more attuned to his printing press, and what it is doing to the inflation rate.  This may not go down well at all with the electorate in 2012.

One thing I do believe is that 2012 will be a water-shed year - for better or for worse.

Thu, 11/10/2011 - 11:51 | 1866117 Dick Darlington
Dick Darlington's picture

*ITALIAN 2012 DEBT SALES `NEAR IMPOSSIBLE TASK,' SCHRODERS SAYS

*SCHRODERS FORECASTS RECESSIONS IN WIDER EUROPE, INCLUDING U.K.

*SCHRODERS FORECASTS `SERIOUS RECESSION' FOR EURO REGION IN 2012

*SCHRODERS SAYS ITALIAN DEBT WILL BE DOWNDRAGED IN COMING MONTHS

What will the EU-dictatorship do next? Prohibit free speech? In the name of democracy and zee stabeeletee, of course.

Thu, 11/10/2011 - 11:52 | 1866123 Irish66
Irish66's picture

Q-Bath tub..he is leaking

Thu, 11/10/2011 - 11:54 | 1866131 Henry Chinaski
Henry Chinaski's picture

The euro crash will be the signal that the dollar is next.  Then it's on like donkey kong, deer in the headlights, rule 48, ZH website crash, you name it.  Bitchez.     

Thu, 11/10/2011 - 12:21 | 1866271 Tramp Stamper
Tramp Stamper's picture

ZH website crash.........I knew it was going to be bad,  but not that bad.  Now I am scared.

Thu, 11/10/2011 - 13:56 | 1866660 jiggerjuice
jiggerjuice's picture

ZH crashed in August already. Don't you remember? All it takes is the DJIA going up and down 500 points a day for ZH servers to get overloaded and facefail.

Thu, 11/10/2011 - 12:24 | 1866279 fourchan
fourchan's picture

404 ECONOMY NOT FOUND

Thu, 11/10/2011 - 13:21 | 1866532 Toolshed
Toolshed's picture

Too funny!!!! +1

Thu, 11/10/2011 - 14:33 | 1866866 graspAU
graspAU's picture

Good one, or for the Commodore crowd:

LOAD "economy",8,1

FILE NOT FOUND

Thu, 11/10/2011 - 12:40 | 1866323 tarsubil
tarsubil's picture

This all makes me think of the upside down pyramid. Cold hard cash will have its 15 min before final reality reality with gold.

Thu, 11/10/2011 - 11:54 | 1866132 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Bernanke has unlimited ammo to keep the dollar low.  In fact, Europe is counting on this.

He will keep the dollar low to keep prices "stable" because he wants (needs) stocks to stay elevated to keep pensions returning.

The scenario is what ZH used to so poigniantly call, "A Race to the Bottom"; a term which was stolen by the Economist and other MSM.  Too bad we haven't been using Race to the Bottom as much lately, it still fits.

Thu, 11/10/2011 - 12:11 | 1866231 onelight
onelight's picture

But, but..the MHFT said it was all bullish going forward...

Thu, 11/10/2011 - 12:13 | 1866238 11b40
11b40's picture

Yes, there may be an unlimited supply of Bernake Bucks for now, but there is a rising chorus of complaint regarding inflation, money-printing, debt, etc.  If Bernake is not careful, he may not last until the elections...in fact, he may be dumped in a PR effort to shore up Obummer's popularity.

Thu, 11/10/2011 - 11:54 | 1866134 lapedochild
lapedochild's picture

Thank you for your post... As per your model which seems correct recently.. Any USD weakness ramps stock... what would happen if ECB starts to print? You would get dollar strenght... but would markets tank? That defies logic... since there's more fiat chasing the same assets... thoughts?

Thu, 11/10/2011 - 11:54 | 1866138 xcehn
xcehn's picture

TPTB definitely KNOW that it can. They will do whatever is in their power to print their way out of this mess at taxpayer expense. Taxpayers are more expendable than the TBTF banks.

Thu, 11/10/2011 - 11:58 | 1866162 SheepDog-One
SheepDog-One's picture

No you miss the point the printing was to get us INTO the mess...not out of anything.

The printing is over. Next youll face world war, again.

Thu, 11/10/2011 - 12:26 | 1866284 Uchtdorf
Uchtdorf's picture

Do you know the board game called Risk? I think it will become popular again.

Poll time, ZHers! Can you pick the alliance members on each side of the next world war? My best guess is that unlike WWI and WWII, die Vereinigten Staaten von Amerika and Deutschland will be on the same side in the next one.

Thu, 11/10/2011 - 12:41 | 1866327 pods
pods's picture

Not sure who the purported combatants will be, but the real war will always be banksters vs humanity.

pods

Thu, 11/10/2011 - 13:09 | 1866488 flattrader
flattrader's picture

Excellent analysis pods...with the bankers as proxies (bitches) for the uber wealthy.

Everything else is just political/nationalistic noise.

Thu, 11/10/2011 - 13:24 | 1866540 Zedge Hero
Zedge Hero's picture

IMF,ECB,WB,FED,BOE vs Human Species

Battle Ground = World

I think a world civil war could happen, every country revolts from within, oh yeah, thats right, it's already happening.  Instead of fighting each other this time we might turn on TPTB and take the fight to the Banksters!! Give em a taste of their own medicine this time.

"This just in George, all the Central banks have been occupied and destroyed by citizens around the world. And Now back to Real Jersey Whores and your regularly scheduled program."

This revolution will not be televised.

It's a Bank run Bitches!

 

Thu, 11/10/2011 - 21:01 | 1868425 DarkestPhoenix
DarkestPhoenix's picture

I've said for a long time....US takes Iran....three countries in a row....extra men at the start of the turn, FTW.

Thu, 11/10/2011 - 11:57 | 1866139 EL INDIO
EL INDIO's picture

All FIAT currencies are equally worthless and there is no reason for the USD to be the weak one all the time. That is why it is going up for a while. That's the game, currencies are trading in a range and they will depreciate and die together.

Thu, 11/10/2011 - 12:06 | 1866206 Dr. Richard Head
Dr. Richard Head's picture

Agreed.  Debt to GDP levels (of the disclosed debts at this point anyway) are similiar in Portugal, Greece, Spain, US, etc.  When one's value holder currency is a debt-based one and banks can create capital through fractional reserve lending (ledger created capital), the recipe for purchasing power loss is guanranteed.  Unless of course you have close friends in the Central Banks/Governments.

Thu, 11/10/2011 - 12:12 | 1866236 s2man
s2man's picture

yep, they just take turns ratcheting the currencies value down, yet keep the exchange rates in a range which makes them appear to maintain their values.

Thu, 11/10/2011 - 11:55 | 1866142 Captain Benny
Captain Benny's picture

Beyond the charts, it seems like the Euro has a long way to come down relative to the dollar.  The political structure of the Eurozone is in shambles and they are urgently looking for a way for the ECB to monetize the sovereign debts.

Of course the US equities market is going to tank from this.  Simple margin calls aren't enough to handle the deleveraging needed in the equities and commodities market.

Thu, 11/10/2011 - 11:57 | 1866155 SheepDog-One
SheepDog-One's picture

I cant understand why Europe is not totaly engulfed in riots and flames...same with the US actually, I dont get it.....unless theyre dumping Lithium and Xanax and Flouride into drinking water supplies like mad.

Thu, 11/10/2011 - 12:00 | 1866171 EL INDIO
EL INDIO's picture

Sex, alcohol, drugs, entertainment … that’s why.

Thu, 11/10/2011 - 12:02 | 1866191 SheepDog-One
SheepDog-One's picture

No one can afford hardly any of that anymore.

Thu, 11/10/2011 - 12:08 | 1866215 Dr. Richard Head
Dr. Richard Head's picture

Oh yeah they are rioting. Just over the wrong fucking thing.  GOD DAMN THE RETARDS - http://www.twirlit.com/2011/11/10/penn-state-riot-2011-video-rallies-getting-voilent-after-joe-paterno-fired/

Thu, 11/10/2011 - 12:24 | 1866280 john39
john39's picture

what an incredible event.   these kids are so deluded that they riot to protect a washed up old football coach who covered up for child rape.   Until Americans wake up, they will continue to get raped.

Thu, 11/10/2011 - 12:27 | 1866289 Dr. Richard Head
Dr. Richard Head's picture

Those same students also fight for continued government funded debt to become part of the system.  College is only good for getting threesome with drunks whores and access to home-grown.

Thu, 11/10/2011 - 12:27 | 1866285 Piranhanoia
Piranhanoia's picture

We need Mr. Banzai to revise the logo for Perv State.

Thu, 11/10/2011 - 12:47 | 1866350 The Big Ching-aso
The Big Ching-aso's picture

Should change that institution of lower learning name to Pennus State.

Thu, 11/10/2011 - 12:13 | 1866240 EL INDIO
EL INDIO's picture

Sex is free, between friends !

Thu, 11/10/2011 - 12:23 | 1866277 Harlequin001
Harlequin001's picture

It cost me a house and a car, not to mention a second wardrobe...

Thu, 11/10/2011 - 12:48 | 1866249 The Big Ching-aso
The Big Ching-aso's picture

Rioting is expensive.     Need jobs for really good riots.  Hospital bills, police and firemen overtime, and such.

Thu, 11/10/2011 - 11:55 | 1866143 SheepDog-One
SheepDog-One's picture

Good article! Yes nothing more to it all than a plank on a fulcrum with a lot of fingers lifting and pressing down on each side.

Thu, 11/10/2011 - 11:55 | 1866146 Burnsy
Burnsy's picture

Sounds plausible enough to me. Worth a trade.

Thu, 11/10/2011 - 11:56 | 1866152 ShankyS
ShankyS's picture

: /dx - inverted head and shoulders target 82 -twitgoo.com/4ua2ib

Thu, 11/10/2011 - 11:58 | 1866163 maxw3st
maxw3st's picture

This correlation between the Euro and equities is certainly undeniable. It plays out every day with near 1.0 accuracy. It seems however; to be entirely dependent on the fact that algo. traders have their machines mindlessly slaved to the EUR futures and EURUSD prices. Should that grammatical relationship change, there seems to be no reason why the equities market can't return to trading on its own fundamentals whilst the Euro pursues its rightful price (PPP 1.10 and falling with -GDP).

Thu, 11/10/2011 - 12:01 | 1866180 SheepDog-One
SheepDog-One's picture

Why should a Euro be 'worth' 1.40 or 1.10 to a US Lollar? 

Pesos and Canadian dollar have wildly swing from worth nothing to a dollar to far exceeding a dollar...yet a Euro is still worth more why? No reason whatsover at all that I can see.

Thu, 11/10/2011 - 12:22 | 1866274 Harlequin001
Harlequin001's picture

Why is a dollar worth a dollar?

Thu, 11/10/2011 - 12:40 | 1866303 Dr. Richard Head
Dr. Richard Head's picture

In the Coinage Act of 1792 - A dollar is defined by law as 371.25 grains of fine silver.  I can't seem to find where this Act was repealed.

I wonder how much a dollar bought someone in 1792?

Thu, 11/10/2011 - 12:51 | 1866386 I did it by Occident
I did it by Occident's picture

i think nowadays we don't have "dollars" as defined in the coinage act.  We now have new Federal Reserve Notes. 

Thu, 11/10/2011 - 13:05 | 1866478 Harlequin001
Harlequin001's picture

Yet we still have the pound Sterling, which incidentally won't buy you a pound of sterling anymore either...

Thu, 11/10/2011 - 13:14 | 1866492 Falcon15
Falcon15's picture

The Federal Reserve Act of 1913 gave power over printing our money to the Federal Reserve Bank, that was step one. The United States Gold Reserve Act of January 31, 1934 required that all gold and gold certificates held by the Federal Reserve be surrendered and vested in the sole title of the United States Department of the Treasury. We went back on the gold standard in 1946, at the close of WWII, under the "Bretton Woods System". After that President Richard "I am not a crook" Milhouse Nixon removed the United States from the gold standard (and thethen "Bretton Woods system") once and for all on August 15, 1971. In 1971 more and more dollars were being printed in Washington, then being pumped overseas, to pay for the nation's military expenditures and private investments (read Vietnam War and defense contractors). In the first six months of 1971, assets for $22 billion fled the United States.

 

The Coinage Act has never been formally repealed. It has been modified, repeatedly. In 1834, 1849, 1857, 1864, 1873, and finally in 1965 - which eliminated silver from our coinage completely.

Thu, 11/10/2011 - 14:46 | 1866927 graspAU
graspAU's picture

Actually there was a way you could exchange notes, FRN, USTN, and get a constitutional dollar from the Treasury up until around June of 1968.

Great book on the subject is, Pieces of Eight: The Monetary Powers and Disabilities of the United States Constitution.

 

Thu, 11/10/2011 - 13:36 | 1866593 web bot
web bot's picture

Look up the legal term "desuetude".

Thu, 11/10/2011 - 12:03 | 1866192 Jason T
Jason T's picture

I was actually scared last night thinking that there is a great possibility banks shut down .. the leverage is stupid high.  Only the paranoid survive .. growing monster garden next spring and raising chickens for both eggs and meat.  

Thu, 11/10/2011 - 14:06 | 1866728 TheMerryPrankster
TheMerryPrankster's picture

Try to favor junk silver over junk bonds, one will remain valuable.

Gardening is harder than it looks. If you haven't grown a garden on your property I suggest you start small and figure out what works and what doesn't  and why. Better to face -plant on a small scale, than have an epic failure and lose all that work and effort.

I was going to go big, but hadn't grown veggies since I was a kid. Found out I had problems with soil and bugs and sun exposure, now correcting those for a bigger garden next year.

dreaming of a greenhouse

Thu, 11/10/2011 - 12:05 | 1866200 s2man
s2man's picture

Go stong dollar!  Morons, sell your gold along with your falling equities!  Please give me one more dip on gold before it skyrockets again.

Thu, 11/10/2011 - 12:25 | 1866281 Monedas
Monedas's picture

Dream on, Sand Man ! Monedas 2011 Hoard now ! That's an order !

Thu, 11/10/2011 - 12:06 | 1866205 orca
orca's picture

Those graphs give me a severe case of bonerization. I am long USD, not fundamentally of technically, but because nothing trumps EUR for sheer shittiness. 2 flies at one stroke: ECB will keel over, and the FED swaplines will cause muchos painos when they have to start unwinding. Same same with regard to SNB with their idiotic EUR/CHF (but not USD/CHF) peg.
Unleash the fury

Thu, 11/10/2011 - 12:06 | 1866208 catch edge ghost
catch edge ghost's picture

...what a long strange dip it's been.

 

Thu, 11/10/2011 - 12:16 | 1866254 s2man
s2man's picture

Its bubbles deflating, putting pressure on other bubbles.  Stress sloshing back and forth between bubbles.  Not the old, familiar business/economic cycles.  Hedge accordingly.

Thu, 11/10/2011 - 12:08 | 1866219 common_sense
common_sense's picture

may be yes, may be not... derivatives world is not so easy, we need to think like the worst banker thief... do the opposite until the money says BASTA !!!

UNESCO STOPPED WORLD HUMAN PROGRAM BECAUSE NO MORE FINANCEMENT FROM USA, so BRAVO BERNANKE, YOU HAVE SPENT ALL THE MONEY IN YOUR FRIENDS, THE BANKS, AND NOW YOU DON'T HAVE NOTHING TO OFFER. BRAVO BRAVO BRAVO !!!

GOOD FOR CAPITALISM, THE MOST CORRUPT SYSTEM IN THE WORLD....

Thu, 11/10/2011 - 12:51 | 1866388 trav7777
trav7777's picture

fuck UNESCO; all these programs do is create more starving 3rd worlders

Thu, 11/10/2011 - 14:09 | 1866742 TheMerryPrankster
TheMerryPrankster's picture

I think you are confusing the U.N. with sexual intercourse which is, to my understanding a primary source of population increase.

Thu, 11/10/2011 - 12:22 | 1866243 NuYawkFrankie
NuYawkFrankie's picture

 

 

For Old World malaise, the Eur-o

Was once thought to be the cure - o

But it's now transpiring

The Euro's expiring

Leaving them all much more poor-o

Thu, 11/10/2011 - 12:41 | 1866326 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

I think Bureau was the rhyming word you were looking for, but I don't have time right now to "solve for it."  ;)

Thu, 11/10/2011 - 12:16 | 1866251 JawsMusic
JawsMusic's picture

Since the USDX index is heavily weighted by the Euro (60% if I rember correctly) then your really just showing two charts of the same thing,

with the vertical axis inverted.  When the euro goes down the USDX goes up etc...

A much more interesting thing would be both the USD and EUR charted against something like the CCI or gold.

I'm really supprized no one else called BS on this whole comparative article.

 

Thu, 11/10/2011 - 12:17 | 1866258 mn2
mn2's picture

you wish it will...get ready for a squeeze to 1.39...good luck with those negative articles, keep them coming

Thu, 11/10/2011 - 12:20 | 1866268 Logans_Run
Logans_Run's picture

"Could the Euro Trigger A 2008-Like Crash? Si, Oui, Yes."

You forgot "Fuck yeah!"

Thu, 11/10/2011 - 12:31 | 1866294 Monedas
Monedas's picture

Jimmy Rodgers just said on CNN that Gold is not in a "Bubble" ! He's buying Gold and "rural farmland".....well, I guess that's the only kind ? Monedas 2011 Grow them vegies....my little bitches !

Thu, 11/10/2011 - 12:43 | 1866338 EL INDIO
EL INDIO's picture

Jim is a rare honest billionaire.

Big respect to him.

Thu, 11/10/2011 - 13:32 | 1866547 web bot
web bot's picture

Full agreement here.

There is great wisdom in his comments.

If you read between the lines, he's projecting out... once the collapse happens, you're going to see trade patterns disrupted (globalization level) and see the necessity of producing local food. This is the reason for buying high grade land. I'm not taking about hippie commune stuff, but good land that can grow produce locally. Gold... we'll that's the currency of this century (sorry Ben - I disagree).

 

Thu, 11/10/2011 - 12:55 | 1866427 Falcon15
Falcon15's picture

Not really. Smack dab in the middle of downtown Montgomery, Alabama is a farm and cattle ranch. There is also semi-rural farmland - ie. farmland encroached upon by suburbs, but not sold to developers. Rural farmland is well away from tract developments, suburbs, cities, etc. Like reasonable far from the Suburbanites and their SUVs.

Thu, 11/10/2011 - 13:23 | 1866544 Shizzmoney
Shizzmoney's picture

Only when Americans start to get smart and take the red, white, and blue dildo being jammed up their ass everyday (also called inflation), will we start to improve our lives as a whole and root the evil people out.

But that's not gonna happen between now and 2013.  May the Timewave begin!

Thu, 11/10/2011 - 13:26 | 1866552 jack stephan
jack stephan's picture

Abraz: Bullshit. Who sent you here, boy? Did that chickenshit asshole Raphael send you, boy?

Chance the Gardener: No. Mr. Thomas Franklin told me I must leave the old man's house. He's dead, you know.

Abraz: Dead, my ass. You tell that asshole, if he got somethin' to tell me, to get his ass down here himself! You got that, boy?

 

Thu, 11/10/2011 - 13:46 | 1866620 The trend is yo...
The trend is your friend's picture

For those who have watched the movie Titanic(think global economy)....when the ship splits the first half goes right to the bottom(euro) and the second part floats high for a while(US Dollar)...but ultimately the pressure and gravity take over te the second part of the ship also sinks.

Thu, 11/10/2011 - 14:14 | 1866765 TheMerryPrankster
TheMerryPrankster's picture

But everybody gets off the ship and they have a swell party every year to celebrate their good fortune in the face of adversity right? I think its called the G20 or something. Haven't seen the movie, heard it makes your manparts drop off.

Thu, 11/10/2011 - 16:39 | 1867464 shortus cynicus
shortus cynicus's picture

What are the rescue boats?

Thu, 11/10/2011 - 15:22 | 1867114 Mario55
Mario55's picture

The big risk about betting on the usd up against the euro lies with the possibility that the weak countries exit the euro. The euro would then become in essence the new DM and would explode agaisnt the USD.

Fri, 11/11/2011 - 05:11 | 1869235 css1971
css1971's picture

Already happened on Oct 4th.40% decline from May.

 

The equity markets in the west were protected. Check out the eastern markets, commodities, debt.

 

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