Europe - The Official Thread

[Dennisch]

It's not the banks that are affected. It's the governments who are spending all the money on Greece. The private sector seems to be hardly affected by this. According to the Dutch Financial news channel.

If Greece refuses to pay anything back the Dutch government will be down 18 billion. And that's about average for the rest of the money lending governments.

 

[Liquid]

Are the assets that worthless?

Not necessarily. Greek state assets include utilities and pretty much all public transport. Those are most certainly privatisable and it's certainly not unheard of to have these assets owned and run by foreign companies as "British" railways and a few power companies are; Arriva are German; MerseyRail, Northern Rail, Abellio Greater Anglia and the newest ScotRail franchise are Dutch. EDF Energy are French and E.ON Power are German.

Funnily enough those German (Deutsche Bahn) and Dutch (Abellio-Nederlandse Spoorwegen) railway companies are state owned enterprises running privatised railways in other countries.

So that's one 'option' for Greece.

 

[Tired Tyres]

Solution. Exit the Euro, get out the printing presses, make lots of Drachmas, give Drachmas to money lenders. laugh and drink beer. Then start advertising some really good holiday deals. Everyones a winner.

Seriously, Greece didn't fulfill the financial criteria to join the Euro in the first place, but the other member nations must have known that themselves so they are just as responsible for this mess as the Greeks are.

 

[Keef]

Not necessarily. Greek state assets include utilities and pretty much all public transport. Those are most certainly privatisable and it's certainly not unheard of to have these assets owned and run by foreign companies as "British" railways and a few power companies are; Arriva are German; MerseyRail, Northern Rail, Abellio Greater Anglia and the newest ScotRail franchise are Dutch. EDF Energy are French and E.ON Power are German.

Funnily enough those German (Deutsche Bahn) and Dutch (Abellio-Nederlandse Spoorwegen) railway companies are state owned enterprises running privatised railways in other countries.

So that's one 'option' for Greece.

So why doesn't Greece sell assets to raise revenue to pay off their debts? Because it's a government and therefore they simply don't give a crap about paying debt? That seems like a good attitude to invite hostile takeovers, and not of the corporate kind.

 

[Liquid]

So why doesn't Greece sell assets to raise revenue to pay off their debts?

That would seem like the thing to do, wouldn't it?

 

[ExigeEvan]

@Liquid - I'm not sure buying public assets in a country so unstable that it's likely to still go into financial chaos is a very appealing prospect for anyone, hence the price would be an absolute steal and would further enrage public opinion.

tl:dr No point owning the railway if no one can afford to use it.

 

[Dennisch]

Possible scenario :

Instead of going to Crete on vacation you'll be going to Kreta.

 

[Liquid]

@Liquid - I'm not sure buying public assets in a country so unstable that it's likely to still go into financial chaos is a very appealing prospect for anyone, hence the price would be an absolute steal and would further enrage public opinion.

tl:dr No point owning the railway if no one can afford to use it.

I don't disagree with you; it's hardly an ideal resolution but how else can the Greek state raise funds to pay off its debts?

 

[Touring Mars]

Unfortunately, selling off public assets is the polar opposite to what Syriza are planning to do/what they were elected to do - they are hard-left socialists... good luck persuading them to become Thatcherites before next Friday.

 

[Dennisch]

Aaah yes.

Freshly elected PM Alexis Tsipras has received the ok from Europe for a new set of helpful bags of money and now he demands again that the debt of Greece needs to be slashed.

And that wasn't the deal, Mr. Olive oil!

 

[Dennisch]

More ridiculous statements made by a Greek politician.

Minister of defense Panos Kammenos is threatening to open the border to Europe for immigrants and asylum seekers if the European Union doesn't change the way they are treating Greece now.

What's that Greece? You want to be left for dead? Ready for an invasion from who knows what? Raped by the Turks? The Albanians?

It's time for the sissies in Brussels to flex their political muscles and slap the Greeks with olive branches.

 

[Dennisch]

Two weeks have passed since Greece gave their list with alternative reform measures.

The Greeks have done nothing so far but giving interviews and talks.
And now the Troika, a word the Euro financial bobo's wouldn't use anymore, are getting annoyed due to the lack of anything Greek.
The Eurobobo's have the feeling that they are dealing with amateurs.

So, Troika isn't banned anymore and the Greeks will be out of money in 3 weeks.

 

[Liquid]

In other news, I bought $60 at €52 in January. It's now worth €55.

Everything's fine. Relaaaaax.

 

[Dennisch]

In other news, I bought $60 at €52 in January. It's now worth €55.

Everything's fine. Relaaaaax.

Yup. I noticed the drop when I ordered parts from the USA. I'm getting to little Dolla for my Euro.

 

[Touring Mars]

Greece are playing a blinder when it comes to having their cake and eating it. They keep saying that they will not agree to the bailout terms (to keep their voters happy), but then agree to the bailout terms (to keep everyone else happy), and then promptly go back to saying they won't accept the bailout terms after the next bit of the bailout has been agreed. But this strikes me as their last throw of the dice - it's like a game of Monopoly that they cannot possibly win, but the other player won't let them lose and just keeps lending them more money to keep the game going. It's all getting to be a bit of a farce, as if it wasn't already a monumental farce already.

 

[Dennisch]

I am at the point that I really hope that Greece truly runs out of money. Let's see how quickly they will change their mind about the measures imposed by Europe.

 

[DK]

If that were to happen, I wouldn't be surprised if Greece fell to Golden Dawn by the end of the year.

 

[Ibonibo]

A State bancrupcy isn't the end of the world.
It's rather a chance for a new beginning. It's a hard way, sure, but it can lead to something way better than this infernal circle we are in.
Also that Greece is in deep debt isn't really the problem. The problem is they can't serve the interest anymore. Now they want to take the money out of pension and healthcare pools.
Varoufakis should have stayed with steam and sell hats. Seriously. Also the threaths
We should have put Greece out since the problem started. And all the money we invested till now, we should have spend it as humanitarian aid.
Where do you think that money went

----

On the ECB:
If you have big savings it might be worth looking into USD or Gold. Every major bank, rating agency predicty parity for mid this year. Beginning 2016 the Euro could be as low as 0.8
Or spend it.
If the barrel oil goes up again, what it will do, we all will be bleeding.
The buys from the ECB would only work if it's banks that sell the papers. But lots of these papers are in the hands of funds. Those will take the money and invest it on the stock exchange. Also the markets of state bonds is one of the most intransparent markets,...
Banks do the same.
We've been doing this practice for years and it never affected the real economy.
Even with the negative interest rate, which is a joke, that interest rate is easily compensated with investements on the stock markets.
So why would a bank give the money to people where the risk is greater.
Take a look at the stock markets and the rallye it's on since months, years.
The funds who bought Leeman Bros shares after the crash for nearly nothing made millions out of it...

All a corrupted buddy club. You either moan about it or try to take a share from it.
Not as easy for the little man, but doable.


I see majors problems coming up for Eurozone in the coming years... bigger than 2008

 

[Keef]

Raped by the Turks?

Not is Sparta has anything to say about it!

Wait...

 

[Dotini]

You cannot squeeze blood out of a turnip. So forget about Greece.

However, the rest of the Euro states are not turnips, and our ambassador has noticed almost none of them have lived up to their NATO commitment to spend 2% of GDP on defense, including more attack helicopters. She warned: "The number of missions that require advanced militaries to contribute around the world is growing not shrinking".

http://www.bbc.com/news/uk-31813490

US Ambassador Samantha Power flew to Brussels to call on European governments to spend more

 

[Dennisch]

That will change soon, @Dotini.

For the first time in years our government is increasing the budget for the military. And with the current state of the world I'm sure our Euro buddies will follow.

 

[Liquid]

Could someone tell me, as someone who isn't keyed up on the war economy and not that big on militaries anyway, exactly why NATO membeship has a prerequisite of 2% GDP expenditure on armed forces?

Not "Well look at the situation in Ukraine" etc. etc., not why it might be a smart idea now but why it was a thing in the first place.

Thanks in advance.

 

[Dotini]

Could someone tell me, as someone who isn't keyed up on the war economy and not that big on militaries anyway, exactly why NATO membeship has a prerequisite of 2% GDP expenditure on armed forces?

Not "Well look at the situation in Ukraine" etc. etc., not why it might be a smart idea now but why it was a thing in the first place.

Thanks in advance.

Economic collapse and WW3 could occur suddenly. We must be prepared. This has always been the case, but Europe has grown lax just as new dangers stir.

 

[Vegard]

...but why it was a thing in the first place.

My guess: The MIC has some very persuasive lobbyists.

 

[Dotini]

Europe is trillions in debt and going deeper, yet where is the growth?

Once all leveraged out and needing still more money, government run businesses and physical assets can be mortgaged off to the IMF, foreign kings, dictators and oligarchs like Trump and Murdoch. That should be fun.

http://www.wsj.com/articles/europe-...t-dollar-1425977896?mod=WSJ_hp_LEFTTopStories
The fall in the euro accelerated Tuesday and bond yields in the eurozone hit fresh lows, showing how the effects of the European Central Bank’s bond-buying program continue to grip the region’s markets.

The euro fell over 1% to trade at $1.0735, before retracing marginally, one day after theECB began buying government debt in an effort to drive up inflation and boost a fragile economy.

The single currency had already fallen sharply this year as investors geared up for the ECB’s $1 trillion quantitative-easing program, which was first announced in January. But the decline resumed on Tuesday as the onset of the ECB buying pushed bond yields to new lows.

 

[Ibonibo]

^It keeps falling, hit 1.0711 mintues ago. It's not too hard to guess that it keeps falling.
If it continues at this rate, we will hit parity sooner than expected.

US Stocks are also under "attack", partly due to the Euro, partly due to next weeks US meeting next week where the interest rate in the US could go up...

 

[Keef]

in an effort to drive up inflation and boost a fragile economy.

Grrrr...just stop effing with it and it'll correct itself!

where the interest rate in the US could go up...

It needs to as it has been artificially low for a very long time.

 

[Ibonibo]

It needs to as it has been artificially low for a very long time.

Yes but with the huge gap it will create between the 2 currencies, it could be counterproductive. Not that the US is in fault, Draghi is.
Like I said in my longer post above, the state bonds the ECB buys don't necessarily come from banks, and if, those banks don't necessarily pump the money into the market.
If that happens, it will have a huge blow back.
If the EU continues like that, I seriously don't envy the people who saved all their life. They already lost a lot, now it starts to get ridiculous
Pension funds with mainly Euro investements will crumble,...

Warren Buffet already announced to borrow his money in Euros and invest it in the US.

 

[Keef]

those banks don't necessarily pump the money into the market.

The idea of pumping money into the market is a ridiculous. That doesn't solve anything. All that does is guarantee that nobody has any savings to fall back on when natural market corrections occur.

If that happens, it will have a huge blow back.
If the EU continues like that, I seriously don't envy the people who saved all their life. They already lost a lot, now it starts to get ridiculous
Pension funds with mainly Euro investements will crumble,...

It's going to happen. The correction will happen eventually. They can either stop fiddling with the market now and let it happen naturally or keep fiddling and create an even larger disaster. Government officials, being the control freaks that they are, will undoubtedly keep trying to solve a problem which is unsolvable.

 

[Ibonibo]

I'm totally with you. Subventions, pumping money into markets is skewing free markets...
Sooner or later, markets will react, because of basic economic principles.

But seeing your avatar, I wonder if Bernanke wouldn't play the money flow card to counter Draghi??

I'm now eager to see if NYSE's yesterdays down will be followed today by a massive up again?
The Dax hit a new high today after it had a blowback yesterday.
Nikkei closed on the green side...
Really curious if the US fear will continue or not. It could have been a good chance for people to get into the market at better rates. If that happened enough, he should see a up.

at least the Euro downfall continues : 1,0580