Euro Prediction Thread

[JMOT]

This thread is for the EURO CURRENCY. If you want the footy thread click here

I want to discuss the euro zone here. The impact it has for us all and our thoughts/ predictions.

My prediction is that by Xmas both Greece & Spain will exit the Euro. By Easter with portugal and italy on the verge of leaving the single currency will collapse and the whole EU will effectively have to be re-negotiated. The inconvenient truth is this crisis is now only just beginning to start as we've bullshitted and swept the bad news and reality under the carpet for long enough.

10 years of stagnation? try 20.

 

[Aiden Roberts]

This thread is for the EURO CURRENCY. If you want the footy thread click here

I want to discuss the euro zone here. The impact it has for us all and our thoughts/ predictions.

My prediction is that by Xmas both Greece & Spain will exit the Euro. By Easter with portugal and italy on the verge of leaving the single currency will collapse and the whole EU will effectively have to be re-negotiated. The inconvenient truth is this crisis is now only just beginning to start as we've bullshitted and swept the bad news and reality under the carpet for long enough.

10 years of stagnation? try 20.

I have never really got the Euro or European Union, that's not to say I agree or disagree with it although I would lean towards disagree if pushed on the issue mainly through ignorance.

I find it inconceivable that other countries have their fellow EU members best interest at heart, instead I think the richer members basically dictate to suit their own agenda. Only now when countries are teetering on the edge of leaving do they seem to care but I can't see this misplaced loyalty doing anything other than increasing the debt.

I sort of understand that we trade with Europe but we can trade with Europe anyway regardless of the Euro, I clearly do not understand the financials of the situation.

I am constantly frustrated by the European laws that seem to dictate our daily lives but then am heartened by the stance on human rights so can't have it both ways I suppose.

I suspect that my ignorance and lack of understanding is the norm in the UK or maybe we just don't care enough to try and understand it.

Sorry not very helpful but just my take on the situation.

Aiden

 

[julian]

I just hope Greece show some balls, take some hardcore austerity on the chin for a few years and leave the euro - I think its the best thing for them.

 

[websaway]

Nice for a change to be one of the richer men of Europe,

 

[Marcoose]

The UK's the same though, look at the mess the Labour government got the country into, yet it looks like people are ready to bring them back to finish off the job of bankrupting us!

I couldn't handle Miliband as PM. I'd be forced into another 4 years (minimum) of travelling. That's how much he winds me up. I really believe Cameron could be a great PM - he's just not getting a fair run because of the economic mess out there.

 

[websaway]

This thread is for the EURO CURRENCY. If you want the footy thread click here

I want to discuss the euro zone here. The impact it has for us all and our thoughts/ predictions.

My prediction is that by Xmas both Greece & Spain will exit the Euro. By Easter with portugal and italy on the verge of leaving the single currency will collapse and the whole EU will effectively have to be re-negotiated. The inconvenient truth is this crisis is now only just beginning to start as we've bullshitted and swept the bad news and reality under the carpet for long enough.

10 years of stagnation? try 20.

The problems haven't been swept under the carpet in this country, the problems are being dealt with head on, we have got a coalition that by some miracle has successfully worked towards damage limitation so that at some stage in the future, at a time which nobody can predict, will enable the country to turn to measures of growth. Nick clegg for me is the hero, he has put his country before politics and that is very rare, and for some reason
(probably because people are living off the fat and most are educated in the ways of economics) we are mostly all accepting what has to be done to move away from the precipice of economic disaster.

 

[fabpack]

I think you have 80% of the situation there.

In the 20 years of stagnation that follow, the first 5 will see the USD $ strengthen to the point that the cost of our imports (mainly from the Orient) will rocket leading to huge inflation.

Then the newly free to trade traded Chinese Yuan/Renmimbi will put downwards pressure on the USD $ and become the global currency of choice instead of the USD $.

The Chinese strength of being the only country to effectively invest and harness the power of Africa will propel them to an unassailable position of power and we all end up working for China, become the new third world and all live happily ever after.

This thread is for the EURO CURRENCY. If you want the footy thread click here

I want to discuss the euro zone here. The impact it has for us all and our thoughts/ predictions.

My prediction is that by Xmas both Greece & Spain will exit the Euro. By Easter with portugal and italy on the verge of leaving the single currency will collapse and the whole EU will effectively have to be re-negotiated. The inconvenient truth is this crisis is now only just beginning to start as we've bullshitted and swept the bad news and reality under the carpet for long enough.

10 years of stagnation? try 20.

 

[tifosi]

Will Greece leave the Euro? I don't know, but probably. The issue there is just how many elections it will it take to create a coallition that is both a representation of the populace and is one which has the courage to stand up to the EU i.e. Germany, and their own people.

How many Greeks does it take to change a lightbulb? Answer: It won't ever get changed, the lightbulb changer will have retired by then on an 80% salary at 52.

The Greeks have a systemic issue which is a polar opposite to the Germans (and French & UK). They have sold out for years for cheap money to finance a country living beyond it's means. The current generations of workers simply won't accept that their retirement & benefits system is an illusion.

As a microcosm of that is our UK public sector which has been bloated out of proportion by 15yrs os pseudo-socialism pillaging the private sector & selling off the gold reserves and remaining crown jewels - in the form of e.g. telecom licences, to finance an unsustainable feel-good boom in deprived & dissafected areas especially. The tough love we're having is the only thing from keeping up from spiralling into the abyss that Italy, Spain, Portugal and even possibly France are looking at. With France it depends on the route of their new government.

As for Germany. They're no innocents in this at all! In the race for a centralised European economy - with them at their head - they've done their own people no favours at all. The so called German success story.. their manufacturing industry and exports. Who do you think buys all their stuff? Yes, mainly smaller european countries living beyond their means and building up sovereign - and private - debt which is owed to financial companies and better still far eastern countries as long-term high interest bonds. It's Germanys self-interest alone that is fuelling their desire for the euro solidity. Their economy depends on it!

As for the US. They're living in absolute cloud cookoo land. They've so much debt that the numbers are pretty meaningless! If they don't pay it off - and they never will -by continually selling their soul to far east tiger nations in the form of US bonds then they will rapidly implode as will the USD.

And who owns most of this US debt... yep, the Chinese, who's ecomony for 30yrs has been driven by the debt fuelled consumer boom. But that's now taking a turn for the worse as imports increase, exports decrease, and their population demand higher standards of living to match yes you've guessed it - the europeans - who, yep, are living beyond their means on other peoples money!

It's utterly imbalanced. The only way is to slowly and surely wean the populace off cheap far eastern goods - an I'm not talking tellies. I'm talking every cheap bit of useless tat that litters the floors cupboard and shelves of every uk household! And to move manufacturing back here and penalise off-shore outsourcing in some taxable way.

So back to the Euro... which as I've shown isn't just a little issue of what holiday money we change each year! Scared? Should be. The situation is what wars are made from...

...and I've not even mentioned the financial institutions which are - if you use the childrens story of the fox and the scorpion - are only acting in their nature. And after the successive deregulations of the 80's & mid-late 90's especially have free-reign to make it up as they go along.

...and underneath that all is us who have happily signed the many dotted lines for cheap money which has got us in the same situation the Greeks are in. But we don't have anything to blame ourselves for so we? After all it's the banks that caused all this? Wasn't it??

Well, no it wasnt.

 

[binny]

I couldn't handle Miliband as PM. I'd be forced into another 4 years (minimum) of travelling. That's how much he winds me up. I really believe Cameron could be a great PM - he's just not getting a fair run because of the economic mess out there.

Miliband is the reason Labour won't win the next election. Doesn't fill you with enough confidence to leave him in charge of your pint let alone the country.

 

[binny]

Germany clearly see the apocalypse coming down route one. If they were committed to the EU or the Euro they'd have gone with a Eurobond but clearly they're not and possibly they even fear a situation where they will be borrowing big is imminent.

 

[Bailey]

Lots of Political understanding shown in the previous Posts - So much as i wish to I can't quote you all.

German driven fedaralisation of Europe, was always lost cause. Thankfully it was rejected by the UK. I wont go into all the underlying reasons purely because most that are European savvy both know the reasons and don't need to be taught how to "suck-eggs" (as your grandma would say)

I personally don't feel we (UK) owe 'Europe' (as an entity) any allegiance - Sure If you imagine Germany as a stand alone Entity - it will indeed be all powerful. But, to my mind that's a far better driver (and model) to change to Europe as a whole, then some godforbidden and thankfully ridden guilt-trip thats in place

 

[retired_member33]

I am a poor immigrant living in the uk, please give me money... You rich people from the uk, i am poor person from europe.

you have good currency and are smart people who not agree with euro, so smart

 

[retired_member33]

you als have jubilee with old lady sitting long time

 

[retired_member33]

Bailey your PM box is full mate!

Just wanted to say:


Get your swag on Tomorrow and get in

 

[scooter]

Greece is both corrupt and bankrupt. It has been corrupt for decades.

It should never have been allowed to join. It never made the criteria and never would in the real world. But in steps the devil incarnate itself, Goldman Sachs and shows Greece a legal way to mask its true debt.
http://www.bloomberg.com/news/2012-...oan-shows-two-sinners-as-client-unravels.html

Greece will leave the Euro. It is the only way for them to have any conceivable way to start growth. The alternative is 20yrs of draconian "austerity"

It is no longer on paper, we are now playing with peoples lives and the people have had enough. The lucky public sector workers that still have their jobs (teachers, police, etc) have seen their monthly salary slashed by on average 500 euros. This is not chuimp change, this is life changing. The problem with this is people now vote with anger and they now have both the extreme left and the very far, extreme right in their parliament. The same situation Germay faced in the 40's.

So what happens if Greece sticks 2 fingers up at its creditors and says "enough". You're not getting both your interest or your original loaned money back. Feck the lot of you. It will cause majot jitters but everyone in reality is ready for it. The biggest loser is Germany as their banks have pumped in the most but they can take the hit. The UK banks are only in for £10 billion in total. Greece will not start a domino effect.

So bye, bye Greece. Lets all enjoy some real cheap holidays for years to come and in turn help them grow. (just like Turkey)

For the UK, the real worry is Spain. They are proud and do not want to take a bail out and all the austerity plans that need to be put in place. Spain is in a terrible place. 50% of under 25's are unemployed. To accept the bail out means years of the same. They are in a spiral. Make severe cuts, put people on the dole, so the benefits rise as the tax income decreases. It is not now that we need to worry. It is when their next elections come and if you were Sapnish, what way are you going to vote? Put up with all this misery or try and find a way out? like Greece.

The Royal Bank Of Scotland (the tax payers bank) is the biggest backer of Spanish debt of all banks within europe. We, the taxpayer are in to the tune of £70billion. That will be life changing for all of us if they opt out further down the road and stick 2 fingers up and that WILL start the domino effect. You think it is hard to get a mortgage or a business loan now?

The Spanish banks have seen their biggest run in their history over the lsat 2 months as the ones that are lucky enough to have any savings are withdrawing.

No-one knows how it's going to play out. It is uncharted territory. If it was me, and I was lucky enough to have a decent amount of savings, I would be putting it into gold. When all else looks like it's going tits up, precious metals always win.






.

 

[JMOT]

spain is simply too big to fail. end of. game over. its very close to the edge now. if it goes there is nothing of the euro to save.

Whats slightly worrying is there doesnt seem to be any real action going on to stop it. methinks horse stable bolted and door springs to mind.

this could be the end of the euro in the next few weeks folks after what i've read this weekend :!:

 

[tifosi]

There's just a massive amount of Inertia here. They've tried everything and it's not working. There's just resistance to see what the reality is - that the Euro was broken years ago when they expanded too fast beyond the core 6-ish countries.

I read what Soros said. Some I agree with, some I think he's plain wrong about - considering he's looking at it from a US perspective with sweaty palms.

I don't think he really understands just how opposed to austerity the Greek population are. I don't see them being able to make a coalition in favour of the conditions needed to stay in the Euro. But he's right about Germany losing faith, especially it's own working population's desire to keep other countries - especially profilgate ones like Greece - afloat on their money. Even though they deny the strength of their economy is in these countries buying their output on borrowed/owed money.

It's just one big nasty cycle. If Greece finally see the errors of their ways then there's hope. Not much hope.

With Spain I can see the UK banks buying back what the Spanish banks e.g. Santander, bought from them on cheap money a few years ago! So long as it doesn't break the impending banking laws.

 

[Edwin]

The euro itself I believe will survive, but it may end up being used by substantially fewer countries than do so now. Furthermore, once "out" it's going to be a much longer road for countries to get back into the "euro club" and they're not going to be in a rush to admit new members.

One possible scenario is to end up with a core "nucleus" of strong Euro-using countries (Germany, Austria, Holland, France, Belgium, Luxembourg etc.) that go on to pursue ever-tighter fiscal and political union, leaving all the "failed euro" states by the wayside.

If that happens, it would be in the UK's interest to petition to join this super-group (even though in practice it's unlikely to ever do so) as together the 7-10ish countries in this hypothetical new entity would have massive financial firepower when viewed on a global scale (and freed of the constant "drag" from the weak countries) and that's what's needed to survive against a rising China, India etc.

 

[namdas]

Wow, this is a balanced discussion! Always good to hear other people's point of view tho, so on that note let me put my oar in.

The whole issue is a debate between investment and austerity, and for the last 4 years we have had nothing but austerity - yet things seem to be getting worse not better.

When was the last time we had severe austerity imposed on a country from outside, as is now happening with Greece? The weimar republic in Germany, where post WWI reparations bankcrupted the country, lead to massive inflation and created the conditions for Hitlers rise to power.

After WWII we learnt our lessons, and instead the US injected massive public spending into Germany helping it become the industrial powerhouse it is today. Investment through debt. Likewise with the UK - post war we borrowed massively from the US but in the years up to the 1980s our living standards increased dramatically and universally. Post 1980s our /economy/ grew but it largely only benefitted a small portion of society.

There is a huge difference between soverign debt and household debt and these arguments that we have 'maxed out our credit card' are facile. There is no such thing as bankcrupy for soverign debt, and at the moment we have the lowest borrowing costs in history. If we invest into infrastructure we are putting money into the economy, which will be spent time and time again and pay itself back several times over in tax revenue. Businesses frequently take on debt in order to invest and grow their businesses - why is it so wrong for a country or even a continent to do the same?

http://www.guardian.co.uk/business/2012/jun/03/paul-krugman-cassandra-economist-crisis
http://www.guardian.co.uk/commentisfree/2012/jun/02/austerity-failed-will-hutton

 

[Edwin]

Wow, this is a balanced discussion! Always good to hear other people's point of view tho, so on that note let me put my oar in.

The whole issue is a debate between investment and austerity, and for the last 4 years we have had nothing but austerity - yet things seem to be getting worse not better.

When was the last time we had severe austerity imposed on a country from outside, as is now happening with Greece? The weimar republic in Germany, where post WWI reparations bankcrupted the country, lead to massive inflation and created the conditions for Hitlers rise to power.

After WWII we learnt our lessons, and instead the US injected massive public spending into Germany helping it become the industrial powerhouse it is today. Investment through debt. Likewise with the UK - post war we borrowed massively from the US but in the years up to the 1980s our living standards increased dramatically and universally. Post 1980s our /economy/ grew but it largely only benefitted a small portion of society.

There is a huge difference between soverign debt and household debt and these arguments that we have 'maxed out our credit card' are facile. There is no such thing as bankcrupy for soverign debt, and at the moment we have the lowest borrowing costs in history. If we invest into infrastructure we are putting money into the economy, which will be spent time and time again and pay itself back several times over in tax revenue. Businesses frequently take on debt in order to invest and grow their businesses - why is it so wrong for a country or even a continent to do the same?

http://www.guardian.co.uk/business/2012/jun/03/paul-krugman-cassandra-economist-crisis
http://www.guardian.co.uk/commentisfree/2012/jun/02/austerity-failed-will-hutton

There is a MASSIVE difference between public sector and private sector jobs. It's well worth watching the following programme, as it explains the situation very well: http://www.channel4.com/programmes/britains-trillion-pound-horror-story