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Archive for the ‘EU monetary union’ Category

New reserve currency

This is big trouble for the USA
WASHINGTON (AP) — Regulators on Friday shut down a Nevada bank, raising to 83 the number of U.S. bank failures this year.
The 83 closures so far this year is more than double the pace set in all of 2009, which was itself a brisk year for shutdowns. By this time last year, regulators had closed 40 banks. The pace has accelerated as banks’ losses mount on loans made for commercial property and development.

The Federal Deposit Insurance Corp. took over Nevada Security Bank, based in Reno, with $480.3 million in assets and $479.8 million in deposits. Umpqua Bank, based in Roseburg, Ore., agreed to assume the assets and deposits of the failed bank.
New reserve currency
We in Ireland are still bailing out bankrupt banks at the cost billions we don’t have causing economic depression for this and the next generation!
With 52 thousand students coming out of our universities and no jobs to go to
alone along with 100,000 people all ready left the country ,and another 53 thousand students leaving secondary education this year
How many of them are going into apprenticeships, jobs or is it emigration for the majority for them
The Unelected Cowen and his band of economic terrorists are helping the top bankers of the state live it up while the rest of us struggle to pay our monthly bills
I say let the bankrupt banks pay their own bills and allow them to fail, just like the Americans are doing in the land of Free markets
Allowing the crooks in the Dail to plunder our natural resources and the wealth of future generations is a crime I personally do not want to be responsible for, when our children ask what you did to prevent it I can show I was active in my opposition and I made a stand
What can you say you did??
It is the responsibility of each and every one of us to oppose this band of thieves we must stand up and take action
Do not just stand by and allow our country to be destroyed by the current government who have sold out to the faceless bondholders in Germany , France and England
Stand up and Fight back now!
Put yourself up for election do not give you vote to any of the current TD’s
We need new blood in the Dail and not Family dynasties
We want a general election now and we need a new community party made up of new local people from ordinary backgrounds that will work for an average wage and not clock up huge self given perks, ending up as millionaires while the rest of us struggle to pay for these perks & pensions
We need real servants of the people and not leach’s sucking the rest of us dry like some of the current shower of TD’s are doing
The next general election must end Gombeenisem for good.
Promise yourself this and we just might save Ireland!

David Mc Williams in his latest posting Memo to ECB: print money

David Mc Williams in his latest posting Memo to ECB: print money

Highlights the conundrum the Germans now find themselves in!


As the paymasters of Europe, they are not happy in this unforeseen roll and the opposition in Germany is growing as we see with the loss of North Rhine-Westphalia see article here

In last week’s elections in Germany, by the ruling party of Angela Merkel.

Where this leaves the Euro is another question, I think too much has been invested in the Euro enterprise, so much so that I don’t expect to see the Germans just ditch it anytime soon!

The latest support package for the beleaguered Euro is testimony to the fight the Germanys are still prepared to put up, to save their investment in the single currency.

But what have the Europeans really agreed to?

From here it looks like a giant NAMA solution! Yes we have arrived at the unthinkable, a NAMA for Europe .this of course is just as bad if not even worse that our own Irish NAMA ,but with much worse consequences. All over the air waves to-day we hear that the Euro has been saved and the markets initial reaction is positive but the markets are prone to swing at a moment’s notice and I would not put faith in any initial reaction.

Where are all these billions going to come from and what is the Irish government’s contribution going to be now ,from my estimates we could be asked to stump up 5,000.000.000 billion. (Under the loan package, euro-area governments pledged 440 billion euros in loans or guarantees, with 60 billion euros more in loans from the EU’s budget and as much as 250 billion euros from the International Monetary Fund.)

Where are we going to get this kind of money? Am I the only party pooper?

Surely spending this sort of money replicates the reckless actions that got us here in the first place!

Someone somewhere is going to ask the question what are we going to have to do the get this money? Give up more sovereignty, in the form of a new Lisbon 3 referendum.

Either way this is not good news and this will dawn on the people of Europe in the coming months!

Just think if NAMA is bad for Ireland ,then Euro NAMA cannot be good for Europe !

Unless the Germans start to experience real pain, and their economy starts to go into depression ,and they then come on to the streets, I expect that things will die down and we will see perhaps new attention been brought on to the dollar again! Why? Because the Americans are much further down the road with their printing presses, and the American Jumbo Debt comes to focus on the world stage again!

The thing about debt is that it has to be faced up to at some stage !


 

 

Alert that Euro on verge of real crisis

Something big is up, and it’s possible the Euro is going into a real crisis within two months…Is this the next big market surprise ala Lehman? Not exactly like Lehman, but of the scale of that crisis that shook the entire world and almost caused worldwide bank shutdowns in Fall 2008? I am beginning to think so, and have been discussing this looming new worry for subscribers, IE we are right at the cusp of something big for the Euro and the European Union, not only financially but very much so politically. Imagine what a real Euro crisis would do to – everything!

Alert that Euro on verge of real crisis

We are so concerned by recent developments with Greece as a canary in the coal mine for the Euro that we just issued an alert to subscribers that we foresee a big blow up for the Euro in about roughly one month’s time. That is USD bullish and gold bullish, and bearish for about everything else out there. And this has many other implications for US Treasury bonds, the China Yuan revaluation issue and many others. This Euro situation is a huge potential bombshell, possibly outgunning all previous huge crises we faced over the last 2.5 years. That’s right, the Euro situation can outgun all the worst financial chaos we have seen so far, and lead to massive currency instability worldwide. This is a big deal if it happens as we foresee.

If you noticed in the last week or so of trading days, the USD and gold often went up together. Gold and the USD are fundamentally inverse, the USD pricing most commodities, even gold if you will – especially gold. That particular gold / USD inverse is tied to the fact that the USD is still the world’s paper reserve currency still and is not losing that status yet – and gold is the world’s precious metal reserve currency.

When the USD and gold rise together, trouble is near

Now, when both rise together, you can be assured that flight to safety and liquidity/cash is in effect…

The biggest reason for the USD rising at this time is flight to safety due to concerns about the Euro. And money coming out of emerging markets that are peaked out and falling. The Euro makes up over half of the US Dollar index currency basket. So, when the Euro has trouble, the USD is the biggest beneficiary along with gold.

‘This Ain’t happening.’

It became clear last week that the EU bailout with the IMF for Greece was basically hot air. Greek bond spreads rose last week to their highest level versus Germany last week; the bond markets saying the proposed Greek bailout deal was just smoke and mirrors. Since this Greece story has been out for months, it became clear that all the Club med states and the so called PIIGS (I don’t like that term but everyone is using it to refer to those states, Portugal, Ireland, Italy, Greece and Spain) are even larger versions of the looming Greek tragedy, with even larger debt problems. And their time is running out this year too.

Must have $20 billion within two months

Why is Greece causing such a stir, its economy is small compared to say Spain, who is next in line in this crisis…? Because Greece has to refinance about $50 billion worth of bonds over the next number of months, a big $20 billion chunk due to roll over in two months. Greece is now at the door of insolvency.

The fact that the EU cannot come to terms with a relatively small bailout of $50 billion for Greece shows the internal dissention in the EU over the bailouts of the Club Med guys (PIIGS), with Germany finding it politically impossible to sign a deal. Greece is being left to its own devices. That ain’t good. Not good at all.

IMF solves nothing

Getting the IMF involved is viewed by markets as a last ditch effort, and reflects terribly on the EU monetary union and political union. It is said that using the IMF here merely confirms the political paralysis in the EU over this situation, and reflects terribly on the EU and the Euro. Major political paralysis is not something a major potential reserve currency can tolerate. Calls in Germany and elsewhere to kick out repeat EMU (European monetary union) offenders with huge financial deficits, Greece running something like a 13 pct of GDP deficit yearly. It’s going bankrupt.

Money is fleeing the country. A big surge of money flight to international banks in Switzerland, UK, Cyprus in the last week or so. In short, Greece is rapidly developing a sovereign bond crisis. That is nothing new, but the timing is, in light of the fact they need about $20 billion over the next two months. And money fleeing the country…is particularly worrisome.

There are many facets to this EU situation and they are bleak as hell for the Euro. This appears to be the next looming ‘big one’ crisis. We have kept subscribers well informed of potential outcomes for the Euro, and we also called the USD rally at end of Nov 2009, and a gold bottom in Dec 2008. We have made a lot of great currency calls way ahead (by months) of anyone I know of. We also called the 2008 summer commodity peak in April 08 warning the USD would rally, again months ahead of anyone I know of.

We have some basic defensive strategies to cover these potential events – a market crash and a possible Yuan revaluation. In any case, we have made some incredible calls for the last two years on the overall markets, calling huge swings in the USD, currencies, gold and commodity markets at key times, predicting trends that lasted 6 or more months out from our calls. There is a chart showing several of the major ones we called in the last 2 years on our site. Our newsletter is 44 issues a year with mid week email alerts.

Even though our newsletter is named PrudentSquirrel, it is probably one of the best currency newsletters for big currency calls you will find out there. The name reflects our ultra conservatism.

Copyright © 2010 Christopher Laird
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