Eurozone debt crisis

[CaerMyrddin]

I don't know if you guys have noticed, but this is the Eurozone debt crisis thread?

i.e. you may not get any significant growth for years and you can't print/devalue indefinitely or we, and the markets, will call your bluff.

I couldn't agree more. Just out of curiosity, how's inflation in the UK?

[superfrank]

sorry, the QE thread doesn't get much action!

CPI 4.8%, RPI 5.2%.

so on average just 150% above target!

[Iron]

Antonio

I thought you might find this interesting (From http://www.guardian.co.uk/world/2011/de ... CMP=twt_gu):

'Portugal's foreign ministry reports that at least 10,000 people have left for oil-rich Angola. On 31 October, there were 97,616 Portuguese people registered in the consulates in Luanda and Benguela, almost double the number in 2005.

The Portuguese are also heading to other former colonies, such as Mozambique and Brazil. According to Brazilian government figures, the number of foreigners legally living in Brazil rose to 1.47 million in June, up more than 50% from 961,877 last December. Not all are Europeans, but the number of Portuguese alone has jumped from 276,000 in 2010 to nearly 330,000.'

Jeff

Don't take this the wrong way, but you are probably overevaluating the chances of people wanting to go to the UK.

[CaerMyrddin]

Thanks Jeff.

It corroborates my view, although I wasn't expecting those figures. The elite here has always done a good job ruling their interests and making others go away...

[Iron]

Flowchart showing the history of the Eurozone debt crisis: http://www.scribd.com/doc/76319799

Jeff

[mister man]

v popliar fred considering we arent in the euro...

i wonder why !!

thanks gordon, you werent a well like PM and you do get a bad press, but lets face it, you saved us trillions after all.

something your detractors will never acknowledge..

[Euler]

Cost of borrowing halve for Italy: -

http://www.telegraph.co.uk/finance/fina ... ction.html

[Iron]

Friday Humor: Unspinning The "€100 Bill" Or How The European Bailout REALLY 'Works' - http://www.zerohedge.com/news/friday-hu ... ally-works

[superfrank]

Cost of borrowing halve for Italy: -

http://www.telegraph.co.uk/finance/fina ... ction.html

there seem to be conflicting reports on the Italian bond auction... http://www.bbc.co.uk/news/business-16352028

[Iron]

There were auctions on Wednesday & Thursday.

Italian bonds did better on Wednesday than on Thursday, when 10 year bonds reached unsustainable levels.

See http://www.telegraph.co.uk/finance/fina ... -fund.html

Jeff

[superfrank]

the backdoor QE from the ECB hasn't 'worked' yet.

[Iron]

Quite.

And it's hard to see what will happen to make bondholders suddenly think:

'You know what? Italian debt isn't as risky as we thought! Super Mario has obviouly got a handle on the situation. We don't need to be paid anything like 7% interest!'.

BTW, Sunday is the 10th anniversary of the launch of euro banknotes and coins in 12 European countries. I look forward to the BBC's sober and objective analysis of the benefits the euro has brought those countries...

Jeff

the backdoor QE from the ECB hasn't 'worked' yet.

[superfrank]

the ECB has bowed to market pressure - they've seen the US and UK print like crazy and their bond yields plummet... the only reason is that the respective central banks are buying, no one else in their right mind would buy these bonds to hold to maturity (only to sell on for profit ultimately to the backstop that is the central banks). tis harsh on countries like Italy who are being thrown to the wolves while the guilty get off scot-free (for now).

[Iron]

Correct me if I'm wrong, but the ECB hasn't done any QE yet (although only because the Germans are against it, after what happened last time they tried it!).

The problem the eurozone faces IMHO is that they need more money for bailouts than they can realistically raise. And even if they do raise the money, they're probably only kicking the can down the road.

And they need to be careful, or what they're doing could lead even to wars! If the eurozone borrow 100 billion euros from China and then tell them in a couple of years' time that they'll need to take a 50% haircut, I doubt the news will go down well!

Jeff

[superfrank]

the ECB are doing QE by the backdoor by lending unlimited amounts to euro banks at 1% which is what is behind the recent euro plunge/devaluation. it's QE in all but name - lending at 1% and hoping/obliging the banks to buy eurozone debt with it (free money for the bankers yet again).

http://www.zerohedge.com/news/fed-vs-ec ... means-gold