IMF Managing Director Lagarde: ''Less than three months to save the euro''

[ShcShc11 0]

http://amanpour.blogs.cnn.com/2012/06/08/lagarde-on-the-looming-crisis-in-spain/#comments

http://amanpour.blogs.cnn.com/2012/06/11/lagarde-less-than-three-months-to-save-the-euro/

An interesting interview.
The EU can imo procrastinate for probably another year or two through bank bailouts (like the one given recently to Spain 100B Euros and bank infusion back in December 2011).

Greece doesn't really matter. However, if the whole EU currency collapses, then definitely watch for major banks like Citigroup and BAC to be in serious trouble (or to fail completely).


Soon, Europe would have to choose one of two options:

-A political union with monetary transfers and Eurobonds (in the same way the U.S Federal Gov transfers money to States that are in need).

-A Euro collapses. The Maastricht dream project fails and Europe falls into complete irrelevancy. Major U.S banks subsequently fail and the world economy is in a much worse Depression.


Cheers!
Shc

[kelpdiver 2]

on the plus side, we no longer have to listen to assholes gleefully tell us how the dollar will be replaced by the Euro as the benchmark currency.

[Zep 0]

I vote for a Euro collapse,
It was a bloody stupid idea when it was first conceived
and has caused nothing but hardship and misery
to the normal working European families.

Gone fishing

[winsor 236]

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on the plus side, we no longer have to listen to assholes gleefully tell us how the dollar will be replaced by the Euro as the benchmark currency.

On the down side, the dollar is fated to revert to its inherent value (zero) in the forseeable future, at which point the US will be on a "pay as you go" basis.

The good news is that our accumulated national debt will not allow foreign entities to purchsase an American hot-dog stand.

The bad news is no more oil.

If we wish to pay for imports with, say, agricultural exports, I would love to see how the harvest goes if there is no fuel for the tractors and combines.

The best analogy that comes to mind for the rest of the world refusing to accept the Green Stamps we print (or electronically generate) with such wild abandon is flaming out something like an F-4 Phantom II or F-104 Starfighter. I have heard rumors that an F-4 has been successfully landed dead-stick exactly once, the F-104 never.

We are on vapors, and our economy has not received the attention of the Martin-Baker people.

The best we could hope is to be the economic equivalent of aircraft left in Vietnam after we achieved Peace with Honor (tm) - they were all over the country as lawn ornaments. However, considering the stick skills of those in charge, one can only find consolation in the fact that, when out of fuel, you crash but don't burn.

Any way you cut it, the outcome is inevitable and it will not be pretty.

It was fun while it lasted.


BSBD,

Winsor

[JackC1 0]

The Euro was never going to work It's dead. Bury it already.

[Skyrad 0]

Whichever way you cut it the Euro is screwed. Germany is either going to take a lot of pain with a bond or the whole thing is down the plughole and everyone is in deep crap. I suspect the latter.

When an author is too meticulous about his style, you may presume that his mind is frivolous and his content flimsy.
Lucius Annaeus Seneca

[jgoose71 0]

Agreed that the Euro was a bad Idea. Now countries like Greece and Spain have the rest of Europe by the short and curlies.....

What you have now is financial black mail. Either you bail me out or we'll crash your economy. Do you think Greece or Spain are going to fix anything anytime soon? Any attempt to fix it causes riots in the street, so the rest of the Union has to fork out another huge sum of cash.

Right now, if I was in the EU, I would vote to kick them out until they fix their problem. Time to bring back the Drachma and the Peseta.

"There is an art, it says, or, rather, a knack to flying. The knack lies in learning how to throw yourself at the ground and miss."
Life, the Universe, and Everything

[Marinus 0]

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on the plus side, we no longer have to listen to assholes gleefully tell us how the dollar will be replaced by the Euro as the benchmark currency.

two things.

Europeans that are/were gleeful about the Euro? You must have imagined them because those never existed.

We know we're fucked, America still seem to have faith in it's economy. Unfortunately faith won't be enough to save it, nothing is I'm afraid.

[kallend 2,146]

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What you have now is financial black mail. Either you bail me out or we'll crash your economy.

Rather like AIG, Chrysler, GM and the Wall Street bankers in 2008.

...

The only sure way to survive a canopy collision is not to have one.

[ShcShc11 0]

Quote

Agreed that the Euro was a bad Idea. Now countries like Greece and Spain have the rest of Europe by the short and curlies.....

What you have now is financial black mail. Either you bail me out or we'll crash your economy. Do you think Greece or Spain are going to fix anything anytime soon? Any attempt to fix it causes riots in the street, so the rest of the Union has to fork out another huge sum of cash.

Right now, if I was in the EU, I would vote to kick them out until they fix their problem. Time to bring back the Drachma and the Peseta.

Greece honestly doesn`t have much power. Greece going bust is kind of like cutting off your pinky- it hurts and it sucks but you`l still live on.



Spain, on the other hand:
http://www.bloomberg.com/quote/GSPG10YR:IND

Interest rate hits 6.91%, a new high and this is only a few days after the 100B Euro bailout.

I feel that people in general sometimes forgot how serious 2009 was for the U.S. If Spain or Italy goes, then we'l probably find out.

The Great Depression started with failing stock markets in the U.S 1930. The second part of the Great Depression started in 1932 when Austria bailed out its banks (Austria being insolvent themselves).


Cheers!
Shc

[Skyrad 0]

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Agreed that the Euro was a bad Idea. Now countries like Greece and Spain have the rest of Europe by the short and curlies.....

What you have now is financial black mail. Either you bail me out or we'll crash your economy. Do you think Greece or Spain are going to fix anything anytime soon? .......

Right now, if I was in the EU, I would vote to kick them out until they fix their problem. Time to bring back the Drachma and the Peseta.

1) Even if there was the political will to fix the problems in the afore mentioned countries I believe its beyond their ability to do so.

2) Easy to say bring back the Drachma and Peseta (Not to mention the Lire and the Punt) but who would want to hold such currency?

3) All commercial contracts with such countries have been established in Euro, corporates will lose billions if they move to national currency and contracts will be a total nightmare as everything is in Euro with no mention of what exchange rates and so on will be used in the event of the removal of a nation from the Euro.

4) If contracts are written between suppliers and customers in Euro zone countries and those countries leave the Euro zone suppliers will not want national currency and by the contracts signed the customer will be obliged to pay in Euro but that will lead to customers paying way over what they intended to as the national currency will be somewhere on a par with that of Zimbabwe against the Euro. This could lead to many international companies withdrawing from such countries, and national companies going bust.

Like I said earlier, screwed either way.

When an author is too meticulous about his style, you may presume that his mind is frivolous and his content flimsy.
Lucius Annaeus Seneca

[Andrewwhyte 1]

The real question becomes which countries can feed their own people? That also includes the guest worker ex-pats who will be expelled back to their basket case home countries.
I highly doubt Greece can. When the real rioting starts I fully expect the new non-democratic government to be the one that Germany approves of.

[Skyrad 0]

Already there

http://news.sky.com/home/world-news/article/16232020

When an author is too meticulous about his style, you may presume that his mind is frivolous and his content flimsy.
Lucius Annaeus Seneca

[Marinus 0]

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Soon, Europe would have to choose one of two options:

-A political union with monetary transfers and Eurobonds (in the same way the U.S Federal Gov transfers money to States that are in need).

-A Euro collapses. The Maastricht dream project fails and Europe falls into complete irrelevancy. Major U.S banks subsequently fail and the world economy is in a much worse Depression.

There's a third possibility, the Eurozone partly collapses, and the remainder forms a economic/political union. I would prefer this over a complete failure of the Euro, and a situation in which we have to pay for the Mediterranean for an indefinite time.

And there's probably even more possible outcomes btw, it's a very complex situation that could have many different outcomes.

[lawrocket 3]

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The real question becomes which countries can feed their own people?

That leads to the question: When did each of these countries lose the ability to feed its own people? There is the distinct reality that many lost this ability well before the lack of food actually hit but due to governmental spending and borrowing, etc., this inability was not known or disclosed.

I think that this is an important question. "If government spending is cut will people starve?" If that is the case, then what does it say about government power?

My wife is hotter than your wife.

[billvon 3,111]

Good article on this in this month's Economist, concentrating on what Germany can do to prevent the collapse.

[kelpdiver 2]

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Quote

on the plus side, we no longer have to listen to assholes gleefully tell us how the dollar will be replaced by the Euro as the benchmark currency.

two things.

Europeans that are/were gleeful about the Euro? You must have imagined them because those never existed.

I said assholes, not Europeans, though a chunk of the posters here were from the continent. Others were the self hating Americans.

And I said they were gleeful at the notion that the dollar would be displaced by the Euro (even made it into the last 007 movie).

[dontlikemustard 0]

well, looks like shit is going to hit the fan. better go skydiving this weekend before its $50 per jumpticket

[ShcShc11 0]

http://www.bloomberg.com/quote/GSPG10YR:IND

6.91% 10 years Spanish bonds.
Dangerous...

[Marinus 0]

I'm an European living in the Euro-zone and I've yet to meet the first European whose stance to any aspect of the Euro, including it's relation to the Dollar might be described as "gleeful". So I find it very hard to believe that a chunk of the small community of people from the Eurozone on here, expressed such sentiment. But maybe skydivers are notorious Europhiles, who knows.

As for the Dollar being out-competed by another currency: that's only a matter of time AFAICS. If you as a county keep on heading to your own iceberg on full speed, the down-fall of the American economy won't be anything less than spectacular. FYI I'm not gleefull about that because that'll be our problem too.

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(even made it into the last 007 movie).

I won't even kick in that open door.

[Marinus 0]

According to a German source Greek army uberbobo Frangoulis Frangos has said the following:

"Ich wünsche mir, dass die Demokratie funktioniert. Ich werde mein Mandat direkt an den dann gewählten neuen Verteidigungsminister übergeben. Aber ich möchte Euch auch noch etwas sagen: Zweifelt nicht an den Kapazitäten der griechischen Armee. Ich wiederhole: Die Armee hält sich zurück. Aber es ist eine starke, stille Macht, die einen ohrenbetäubenden Lärm machen wird, sollte dies notwendig sein.“.“

translation (German confirmation please!)

http://deutsche-wirtschafts-nachrichten.de/2012/06/13/griechischer-verteidigungsminister-droht-mit-%E2%80%9Ebetaeubendem-laerm-des-militaers/

I myself wish the democracy functions. I would hand over my mandate to the newly chosen Defence Minister immediately. But I want to say you something else: Do not doubt the capacities if the Greek Army. I repeat:The Army holds back. But it's a strong, silent power that will make a ear-deafening noise if that would be necessary.

I know enough.....

*gets cola & popcorn*

http://www.youtube.com/watch?v=0uc01ASDJT8

I wish I could to say that it was fun while it lasted, but it wasn't.

[christelsabine 1]

Quote

According to a German source Greek army uberbobo Frangoulis Frangos has said the following:

"Ich wünsche mir, dass die Demokratie funktioniert. Ich werde mein Mandat direkt an den dann gewählten neuen Verteidigungsminister übergeben. Aber ich möchte Euch auch noch etwas sagen: Zweifelt nicht an den Kapazitäten der griechischen Armee. Ich wiederhole: Die Armee hält sich zurück. Aber es ist eine starke, stille Macht, die einen ohrenbetäubenden Lärm machen wird, sollte dies notwendig sein.“.“

translation (German confirmation please!)

http://deutsche-wirtschafts-nachrichten.de/2012/06/13/griechischer-verteidigungsminister-droht-mit-%E2%80%9Ebetaeubendem-laerm-des-militaers/

I myself wish the democracy functions. I would hand over my mandate to the newly chosen Defence Minister immediately. But I want to say you something else: Do not doubt the capacities if the Greek Army. I repeat:The Army holds back. But it's a strong, silent power that will make a ear-deafening noise if that would be necessary.

I know enough.....

*gets cola & popcorn*

http://www.youtube.com/watch?v=0uc01ASDJT8

I wish I could to say that it was fun while it lasted, but it wasn't.

Not that quick, Marinus. 1:2 is not the end of the world ....

It's sabre-rattling, actually. The entire article is quite "soft". We have to wait few days more and watch closely what the Greeks are going to decide - Mr. Bigmouth from the left is promising a lot, at first what most Greeks want to hear: We shall remain in the EURO zone!

Until then, better to open a Heineken (and not a coke, that*s just sugar sh*t )



PS: Your translation was correct, of course.

dudeist skydiver # 3105

[ShcShc11 0]

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As for the Dollar being out-competed by another currency: that's only a matter of time AFAICS. If you as a county keep on heading to your own iceberg on full speed, the down-fall of the American economy won't be anything less than spectacular. FYI I'm not gleefull about that because that'll be our problem too.

The U.S be surpassed by a currency? Seriously?
Maybe in 40-50 years.

There is currently no currency that can do a fraction of what the U.S dollars does and the furthest we are is SPEs (which is only at the drawing boards).

Check the 10 years U.S and tell me that again with a straight face.


Cheers!
Shc

[kelpdiver 2]

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Until then, better to open a Heineken (and not a coke, that*s just sugar sh*t )

whereas a Heineken is just shit. Surely you have better choices available than the Budweiser of Europe (Becks is the Miller's).

[Marinus 0]

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Not that quick, Marinus. 1:2 is not the end of the world ....

But it sounds like the end of the RMS Euro. If it's all the same to you I'm still heading for the same lifeboat as "Unsinkable Merkel" is in.

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Mr. Bigmouth from the left is promising a lot, at first what most Greeks want to hear: We shall remain in the EURO zone!

That's true, a majority seems to want to stay in the Eurozone. Preferably if we pay for it of course. And why not, it's not like they can pay it themselves.

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Heineken

This is becoming suspicious.....