http://www.nytimes.com/2011/07/11/bu...euro-zone.html
http://www.businessinsider.com/how-i...-wreck-2011-7#
How much more of this can the European economy take before serious social unrest in some countries takes hold?
Printable View
http://www.nytimes.com/2011/07/11/bu...euro-zone.html
http://www.businessinsider.com/how-i...-wreck-2011-7#
How much more of this can the European economy take before serious social unrest in some countries takes hold?
This is honestly a nightmare scenario. Greece, Ireland, Portugal - they're all pretty small fry and can conceivably be contained by harsh austerity and core eurozone countries taking a haircut on publicly held 'bailout' debt. But Italy or Spain? That would be disaster, utter disaster. Especially Italy.
The encouraging news is that the spread over German bonds is really not that crazy given Italy's pretty awful debt position (120% of GDP and likely to rise absent some serious structural reforms). The discouraging news is that the ECB keeps raising rates, which repeats the mistakes of the past, where they set rates that make sense for the well-off core and are utterly awful for low-growth countries on the periphery. Hell, a little bit of euro inflation wouldn't be such a bad idea anyways.
I think the biggest risk in Italy is not whether they can conceivably pay for their debt, but rather the political risk with clowns like Berlusconi running the show. I mean, I complain as much as anybody about the political shenanigans that go on in Washington, but they're nothing compared to the utter farce of governance in Italy.
Does anyone have a sense if Italian austerity measures will be met with the same violent rejection that it has met in Greece? I don't honestly have a good feel for that, and I don't want to get stuck in a reflexive "They're European, of course they'll stage major protests against austeriy" because it frankly isn't true of several eurozone countries.
(edit: One wrinkle with Italy is that I understand much of the public debt is held by Italians and not foreigners. If Japan is any indication, sometimes people are willing to own remarkable amounts of their own government debt, especially in a low inflation/low growth environment. That might shield them from some of the contagion.)
Well there is an additional issue that makes the Italian case a bit different. There is a huge difference between the north and the south, the north is very advanced and has dependencies of secession. If Italy really went forward riots and unrest, I assume that this conflict would rise into whole new level.
Well, people who enjoy the EMU predicament can be divided in two groups; the biggest by far is the group of idiots who feel smug about the euro being 'proven a bad thing' and a much smaller group that is set to win billions if the project really stalls. George Soros will be but a footnote compared to those guys. And then we get the backlash of course, during a new Depression, courtesy (amongst other things) rating agencies making a bad situation worse.
Yes, the ones who were proven right all along and are barely ever if at all heard to be saying "I told you so" are the idiots. You've not once admitted yet that they were right, you were wrong and that the euro has been proven to be a disastrous and unmitigated failure. Your only line now is that to break it up now it exists would be worse, just gloss over everything else and call everyone else an idiot. :rolleyes:Quote:
Originally Posted by Hazir
Maybe if we had a bit of honesty from the real idiots, those who were so blindsided by political faith and adherence that they glossed over any economic concerns, then we might have a bit more confidence that this crisis could be dealt with properly.
Instead we have a situation where the worst case scenario warned about the risks of the clear flaws of a half-arsed monetary but not economic union have come about and everything is getting brushed under the carpet. The only solution you propose to bad debts is more debts.
Its time to face the music. And the truth. Or alternatively stick your head back in the sand and just continue to call others idiots.
You know, I don't give a fuck about your opinion. What I see happening is something that could lead to a financial disaster on a scale of what brought about the Great Depression. Your smuggness is not going to save you from being dragged down if this ships sinks. The only financial institutions standing will be in countries outside whar is talked of as 'the West'. Good luck with your being right then, it will help you much keeping your job or house. From all the people in this forum I am the least likely to suffer, unlike you I will not be relishing in being part of the jackassery that brought it to us.
I enjoy it because I have my income in CHF and I am seeing my buying power go up as USD and EURO come crashing down.
No you're not relishing in being part of the jackassery you're both glossing over the fact that you're part of the jackassery that brought it to us and yet still smugly condescending about it all. At least you no longer even pretend to claim that this isn't a man-made disaster that was warned about, that you said and I quote "I don't care about the economics of it" which is the attitude that created this Eurozone collapse - you just ignore it.Quote:
Originally Posted by Hazir
Don't worry I'm not holding my breath waiting for an apology from you or others of your kin who created this disaster.
Ships have already been sunk. Now we're just shooting more holes in order to try and fix it.
That's not very wise thinking, sonny. For one, the Swiss economy is deeply entangled with Europe's (and I don't doubt Swiss banks have a boatload of Italian debt - it's the 3rd largest bond market in the world behind the US and Japan). If the eurozone goes down, the Swiss won't be doing so hot. Secondly, high exchange rates are actually bad for Swiss exports. Third, the strength of a currency is not the best measure of the strength of an economy.Quote:
Originally Posted by Asmodian
Oh i know long term it will have a negative effect on Switzerland, the remark was meant mostly as humorous short term approach.
Although even long term I am quite confident that Switzerland will pretty much benefit from any turmoil as it is still seen as a safe heaven and its currency will never drop like what we are seeing with USD and EURO. So yes their will be problems but the same there will be a rush of people trying to get their money out of their home country and in to Switzerland. Working in a bank I can tell you we already have a ton of clients from Ireland that do not even fit our target market and would not really benefit from the services we offer (our bank is very specialized) and they are practically begging us to open accounts for them to just put all their money in with 0 interest payable. I can only imagine what is going on in private banking sector. It is somewhat mitigated because at the same time the banks are scourging their books to get rid of any US clients not to have to deal with US government bullshit, and I can tell you US clients are fighting tooth an nail to imagine ways not to be counted US residents and keep their accounts. So no I do not think Switzerland would face the same level of difficulties as EU or US, and if get the government to stop trying to fuck banking secrecy up we could very well benefit from a global recession.
@Asmodian, despites Loki's cynical comments, the Swiss economy is only partly based on the banking sector. Most of the economy is actually export (Machinery, Electronics, Pharmacy ect.). And as I work in this field I can tell you the current situation is catastrophic. The only reason we are still doing well - and this is remarkable that we still can compete with this value of the CHF - is that the Germans economy is rock solid, and most of our exports are going there. Our own production line is fully occupied and this to a great part because of the German orders.
But if the Euro goes down, we are in deep shit, we are simply exporting too much into Euroland to handle a breakdown.
Untill Swiss banks start feeling the crunch, which will be about the time that you'll find out that the Swiss banking industry is too big to save.Quote:
Originally Posted by Asmodian
Wow, one first step I can really appreciate was proposed today; reducing the crazy auto-pilot dealing with ratings by the rating agencies. One wonders why policy makers didn't come to that conclusion earlier; making their ratings relevant to the way the financial sector is regulated was what got us in this mess to start with, and now they all of a sudden found their vigilance making this mess even bigger. I'd gladly have them shut down alltogether tomorrow.
With al-Beeb's hard-on for Murdoch, I can't find anything about that. Any link?
Italy collapsing, stock markets collapsing but look at the BBC and the only thing going on right now is News International.
EDIT: "Also on Monday, EU Internal Markets Commissioner Michel Barnier called for limits on credit rating agencies being able to rule on a nation's debt, if the country in question is gaining EU bail-out funds.
However, analysts questioned whether such a move would be possible.
EU leaders have criticised credit rating agencies for downgrading the debts of Portugal and Greece, which they say unfairly adds to those countries' financial woes."
Seriously WTF? This is what you're talking about? I'd like to know how they think that's remotely possible, credit ratings are private organisations and can do what they want. As for adding to those nations woes, given the serious inevitability of at the least some sort of "haircut" on Greek loans eventually then the agencies are not being unfair they're simply doing their job. What Barnier means is that there won't be a default if the EU bails out the nation - well that's not guaranteed. If that was what was believed, the agencies would reflect it. The EU is not god almighty, it can not just bend the whims of the market because it deems it so. The credit agencies provide ratings on the US, so the notion they shouldn't for Greece just because the EU says so is so pathetic it should not be taken seriously by anyone.
Uhm, if I understand what you're saying correctly, there's multiple problems with this. First of all is that ratings agencies are private companies that provide a needed service for the market - they do due diligence on all sorts of debt so that individual investors don't have to. That's not to say they are foolproof - far from it, as this whole financial crisis has shown - but they clearly provide a needed service, and investors pay attention when the ratings guys speak. In some cases ratings agencies are the last people to the party - as in the case of the current sovereign debt crisis, when markets have clearly anticipated a haircut/default long before the really extreme downgrades in PIIGS debt. But rarely are they irresponsibly slashing credit ratings - they are reflective of real risks, albeit with a time delay.Quote:
Originally Posted by Hazir
If I understand your logic, then private credit scoring agencies shouldn't be allowed to lower the credit rating of deeply-indebted individuals on the verge of bankruptcy because that will raise their credit card rates and push them over the edge into bankruptcy. Why shouldn't they be allowed to rule on the creditworthiness of an individual - and even more so on nations?
I think it's also ridiculous that the rescue guys are trying to engineer a default without meeting the rating agency's definition of default - so-called 'voluntary' rolling over of debt at low interest rates, lowering bailout interest rates, etc. That might be what's needed to get Greece on its feet again (certainly I think a default is all-but-certain for Greece, at least) but to try dressing it up as anything other than creditors losing some of their money is ridiculous.
Funny, I wasn't being literal when I used "Euro" in the thread title or trying to make a particular statement on the Euro itself. But I do agree with Wiggin that this political ranting against credit agencies makes no sense. It's also reminiscent of tin-pot dictatorships that have no problem with a particular private entity/news organization/business until they do something the state doesn't like.
So what should the rating agencies do when a country can't pay its debt without outside help?
I agree with Hazir on the credit ratings agencies. They're politically infected; they're paid by the very companies they're rating, they're so slow and shallow with their ratings they might as well just rate investor confidence with polls, they were totally useless and only reactionary by the time Lehman fell, they would "rate a cow if it came across their desk". :rolleyes:
Hard to believe you guys have forgotten the events of '07-'08, when Lehman, Bear Stearns, Merrill Lynch and AIG were rated AAA one day, and the next day they were toast. Our legislators have tied "investment grade" ratings from just these three groups for publicly held pensions and municipal holdings. So, when something is downgraded below "investment level" they're required to sell. And it's not a slow transition but sometimes AAA to basically junk.
I'm sorry, but if anyone thinks the US should still be a AAA-rated sovereign wealth nation, they've had too much power punch.
It's in the very interest of American rating agencies (and there are only those), to have the focus on Greece and Portugal and not on the US.
Most countries can't pay their debts, you probably mean interests.Quote:
So what should the rating agencies do when a country can't pay its debt without outside help?
Fitch is a French company.
"Fitch rating" is US/UK based but French owned, so well it's a question of definition.
http://247wallst.com/2011/07/11/an-o...ting-agencies/
This is on front page of marketwatch/WSJ digital network.
It's always perplexed me why europe doesn't have (or hasn't developed) its own ratings agencies to compete with S & P, Moody's, and Fitch. :hmm:
I'm not saying that these rating agencies shouldn't be able to continue operating, what I am saying is that we should remove the influence they have over the way the financial sector is regulated. The rating agencies have proven that they don't do a very good job at rating risks, it is sheer madness to then still continue basing your entire regulatory system on their work. The automatism between a downgrade and a financial institution no longer meeting liquidity requirements should be removed.Quote:
Originally Posted by wiggin
What we're doing now is letting the automatic pilot decide on a flight path on the basis of what we know are faulty height meters.
BECAUSE and let's not forget this, if those rating agencies would have done a job any good we wouldn't be having this crisis in the first place, as we wouldn't have had Greek/Irish/Portugese bonds being priced as cheap as German bonds. People talk too easily about the shortcomings of the EMU, but they entirely overlook that the holy markets did not function AT ALL in setting realistic prices for sovereign debt of EMU countries. Rating agencies played a big role in that disfunctional market.
You obviously have no idea of how those ratings have achieved a status in regulations. What I am saying, and what regulators are saying; the tool used is crappy, let's not rely on it making the right decisions for us.Quote:
Originally Posted by Dreadnaught
And they somehow gained enough power and credibility that they can yell "FIRE" in a crowded theatre, causing a stampede for the exits, and undermining the very purpose of public fire safety. :sour:
For all the talk of bond vigilantes being powerful enough to move markets, there isn't enough talk about the self-fulfilling prophecy of panic selling (margin calls, defaults, etc.) the ratings agencies can cause with their downgrades....
That isn't the relevant question. The relevant question is: why should we take their word for it that if country A is in a bad state there is a solid reason to downgrade country B.Quote:
Originally Posted by Lewkowski
And why should we take tnem serious at all when it describes country C as a safe haven while country C is making actual moves that it simply will not pay?
How about instead of A, B and C you name the countries you're thinking about? A and B seems to make a lot of sense because of the fact that when A hits the rocks, B is being required to get into worse shape to "help" out.Quote:
Originally Posted by Hazir
Those are political prognostications, Rand.
Saying that when the ratings start going sour is, once again, a hallmark of a tin-pot dictatorship. I'm obviously not saying they are. But it's pretty silly that no one has a problem with the ratings when they are good, but criticizes them the ratings don't fall fast enough (US mortgages) or when they fall faster (US and European debt).Quote:
Originally Posted by Hazir
The debt rating agencies seem to be doing a good job in this case. The problem is the market's immature inability to see creditors (IE national champion banks) take a haircut on their investment like everyone else does every day.
But it's more than just Hazir and I who've expressed that the ratings were NOT accurate, even when they were giving "good" ratings. They haven't been doing a good job at all, not for rating sovereign debt or credit (because of the political considerations), nor rating individual companies as "investment grade" (because they didn't or couldn't investigate their many counter-parties at risk to "contagion").
Your are contradicting yourself (bold statements). And you are even wrong with the whole statement. People already complained about rating agencies when their perditions were too good (Or at least when they found out that ratings were too good). And actually the result in rating Greece too good in previous years was more severe than the bad rating now.Quote:
Originally Posted by Dreadnaught
The rating agencies always were crap. At the start of the EMU i never lent any credibility to the adjoining Pact. I assumed that the markets would discipline governments by pricing in fiscal (ir)responsability. I will admit that I did not follow Greek sovereign debt since 1999, but I am pretty appalled to learn that the idiots whose work is used to regulate the financial sector were doing a job that a monkey could have done better. No person with an ounce of common sense could have given Greece a rating significantly higher than junk.
So much for the deluded notion that markets can monitor or regulate themselves, huh. :rolleyes:Quote:
Originally Posted by Dreadnaught
"The Market" isn't immature at all....they know perfectly well how they can use S & P, Moody's, and Fitch ratings to attract investors, public pension funds, sovereign wealth managers (think Iceland) and eventually create a SIFI that's TBTF. All the while using math quants new innovative financial "tools" to hedge both sides of the bet. Heads--they win and some others win, too. Tails--they still win, but others lose their shorts when the scheme falls apart.
Mostly it's tax payers who lose, and have to carry water for these bailed-out bums. They turn right around and give record-breaking bonii to executives (and traders) who drove their franchise into the ground, causing millions of people to lose their retirement nest egg. Then they stop lending to the tax payers who bailed them out, even low-risk reliable borrowers. Corporate welfare, crony capitalism, private profits with public losses.
:mad:
That's ridiculous - do we really need more conspiracy theories about how various American groups - ranging from the NY DA to credit rating agencies - are trying to shift attention away from US problems? If I were an evil mastermind running the US, I'd have noted how eurozone worries have several times derailed the global recovery, materially hurting US growth... and stay away from it.Quote:
Originally Posted by earthJoker
The rating agencies have problems, but most of their ratings are relatively close to reality. And while you're welcome to think we should replace them with something else in our government shorthand (e.g. pension fund investments and the like), you're going to have to have some sort of risk measure, and I don't see a better game in town.Quote:
Originally Posted by Hazir
I think there's a broader point here worth making. I believe that you assume the problem with coupling regulations about capital/investments to credit ratings has the problem that a downgrade means government-regulated funds unload the assets and there's no one else to pick up the slack, which means a credit downgrade has very bad effects on the market for a given security. I'd challenge that: if the private market thought these agencies were wrong about something, they'd scoop up an undervalued asset like hotcakes since it would be giving outsized yields, so the effect on the security's price would be pretty small. No, the reason these rating decreases has such a big effect on prices is not government regulations tied to the ratings, but rather because most of the market believes the concerns raised by the credit agency. They might be wrong on occasion, but clearly they're right often enough that the smart money listens most of the time.
But with an implicit financial transfer in the EMU, why shouldn't the rating agencies give Greece/etc. debt a good rating? Surely the eurozone can easily pay off such debt.Quote:
BECAUSE and let's not forget this, if those rating agencies would have done a job any good we wouldn't be having this crisis in the first place, as we wouldn't have had Greek/Irish/Portugese bonds being priced as cheap as German bonds. People talk too easily about the shortcomings of the EMU, but they entirely overlook that the holy markets did not function AT ALL in setting realistic prices for sovereign debt of EMU countries. Rating agencies played a big role in that disfunctional market.
Regardless, it's not really relevant whether the rating agencies were right or not in a given case. What matters is that private markets believe them, which they wouldn't do if it didn't make them boatloads of money. If private markets believe them, then government rules about capital requirements or investment grade assets for a small slice of the market become pretty irrelevant.
Private markets don't necessarily believe them, but do know how to use them....to make boatloads of money. There's noting "irrelevant" about capital requirements (since it's related to leverage and solvency) or what's deemed "investment grade". AAA ratings get more than just a small slice of the market.
You don't need an evil mastermind if you have common interests.Quote:
Originally Posted by wiggin
So lets get another cool Google translation
"Bernd Schips: The Economist from 1993 to 2005 headed the Economic Research Centre of the ETH Zurich (KOF). Today he is Research Professor at the University of St. Gallen (FHS)."Quote:
"The crisis is an opportunity, an attack against the euro to go"
The European single currency would survive in spite of Greece and debt crisis, says economist Bernd Schips. Sharp criticism Schips at the UBS managers.
So far, the EU leaders in the crisis in Greece operate on the principle of hope: the Greeks out the prospect of new loans, although the country is broke. How long can this course still maintained?
With the relief efforts was begun about a year ago, came up as the markets doubted whether Greece would honor its debt service. The alternative was that Greece had completed a debt restructuring or debt-section. But then you had fear, the European financial system, such a shock would not stand up. With the help of Greece tried to avert a new crisis in the European financial sector.
What would have happened if we had left Greece in early fall 2010?
Assuming the financial system could bear the loss, nothing would have happened. We mistakenly confuse again the national debt of a country's € and the resulting possible default by the value of the euro. This has nothing whatsoever to do with each other. About the external value of the euro alone with the European Central Bank will decide its monetary policy.
So would it have been wiser to Greece to reschedule one year ago?
Yes. It would have been better if I had used the affected financial institutions in Europe under the arms and the previously communicated to the public to clear. . .
. . . but the Greeks would have been even dependent on foreign aid.
Of course, because if a country is insolvent, he has over the years no longer have access to capital markets. Also for the restructuring of its economy Greece would have needed help. But that would then run through the normal channels such as the EU's Structural and Cohesion Funds.
Should decide because the EU Heads of State and Government at their summit in Brussels today but another quick cut debt for Greece?
EU leaders have failed from the outset to make clear to the markets that they only want to help Greece in order to actually save the European financial system. This omission and the unspeakable cacophony of stakeholders in Brussels, Frankfurt, Berlin, Athens and elsewhere have greatly unsettled the markets. From an average debt at this point, I think, therefore, nothing. The politicians should rather make clear once again that the Greeks will only be helped if they make a contribution yourself. If they refuse, then they are broke.
How to Greece to repay its immense debt of approximately € 350 billion each?
In the short term of one to two years the country will pay a portion of its debt from privatization proceeds. It is crucial, however, to what extent it is possible to restructure the Greek economy, so clear away barriers to market entry and reduce subsidies. These structural reforms take time. If the duration of the necessary adjustment processes prove to be too long, a debt restructuring will be inevitable at some point. At least then there is the prospect that it comes at a time when the European banking system is recapitalized and can sustain the re-adjustments.
When might this time have come?
I am assuming that the Greeks used it this time with the privatization serious about getting paid the next credit tranche and the second aid package. When you consider that the structural measures do not intervene in the next three or four years, an orderly debt restructuring will be to avert any more.
Now, you believe that speculation is against the euro at a good part also staged in the background and different interests work against the euro.
Yes, absolutely. The U.S. was not so keen that the euro was on its way to become the second "global currency". The euro had begun to replace the U.S. dollar as global reserve and transaction currency. This, however, would have threatened the funding the U.S. current account deficits increases. For one must not forget: The U.S. debt is at least as dramatic as the Greek. The Americans live by the U.S. government bonds have a high rating and the rest of the world is willing to finance the purchase of American treasury bonds, the current account deficit.
They suspect an American conspiracy against the euro?
No. But it is certainly the case that we saw in the crisis in Greece a chance to drive an attack against the Euro. This has been tried again and again by the major U.S. rating agencies. Fitch, Moody's and Standard & Poor's have a market share of 95 percent. If one of these three sets anything in the world, the markets will react immediately nervous. It's striking that the highly indebted countries in Europe are thrown into a pot and they are threatening to lower the ratings, while it has left in the case of the USA in verbally and also in the UK so far nothing has happened.
The rating agencies act on behalf of the United States?
For the purposes of the United States or any case of loans to it in U.S. dollars. The problem of rating agencies has been known for years: they act not long ago in the interest of creditors, but can be paid by the borrowers. Therefore, it is for them at the moment all about, papers in U.S. dollars can appear more attractive and safer, than they actually are. And accordingly makes it bonds worm, which are denominated in euros.
To what extent does the speculation of other players such as banks and hedge funds against the euro play a role?
At the moment there is a little quieter on that front again. You have to see but clear: Foreign exchange trading is basically determined by the proprietary trading of financial institutions. He is due to only a small proportion of 5 to 6 percent on the exchange of goods and services. This means, however, that the foreign exchange departments of banks, if they have a story called, can cause price movements, where they will earn quite a bit. In this case, the story was simply that "the euro is weakening" because the European sovereign debt crisis. And this story in the beginning, only Greece was concerned, this is indeed the value of the euro area completely marginal. But the markets have followed the story against the euro, and there is enough market participants found that jumped on this train. Also, because no one has pointed out that the debt of U.S. federal states at least as dramatic as well as the overall situation of the United States is not very good. But this was not mentioned in this story.
In the foreign exchange markets but put 95 percent psychology, and only 5 percent of the real economy?
Yes, in the short term. In the longer term is translated by the realities. This is evident because the euro rate against the dollar has recovered.
They criticize So the banks and currency trading.
Criticize is the wrong word. I've just described, the role of banks and foreign exchange departments for the development of exchange rates. A currency trader has initially the task of making money, in which he focuses on the appreciation or depreciation of certain currencies. The only question is how banks should behave if the market creates uncertainty about the development of the euro and investors flee, for example in the Swiss franc. Then it is not particularly helpful when Swiss banks advise investors to remain invested in the euro, and exaggerate the story further debt.
You would have expected from the Swiss banks that they are holding back to avoid an excessive appreciation of the franc.
They could have made at least point out that the Swiss capital market is relatively limited, which means that large currency risks. You could also point out that the traditional long-term interest rate bonus and purchasing power parity rather speak again for a stronger euro. That would be the mission of the National Bank and commercial banks have been. The latter have done the opposite and recommended investors: Out of the €, purely in the Swiss franc.
From short-term profit expectations and at the expense of the real economy?
Exactly. Although they deny it. But even so, UBS boasts the world to be the second largest foreign exchange trader. Since they can not steal as easily off the hook.
You would have expected from the men's Kaspar Villiger and Oswald Grübel more responsibility?
I would certainly expect, yes.
As long as this keeps the pressure of the Swiss economy was strong franc?
There are industries such as tourism, have really struggled with the strong franc. In the industrial and commercial applications, however it looks different. Where Switzerland has had over the years in terms of producer prices, great benefits. The National Bank publishes a real exchange rate based on consumer prices. Based on producer prices, so when one considers the advances in productivity and lower import prices for primary products, the appreciation is not as great as it now appears at first glance. That is why the Swiss company in the export are still so successful.
Would you recommend nor support measures?
No, there is simply no truly clean options: They can subsidize certain sectors - tourism, for example. But here, for example, would be not to tax - at the moment it is 4 per cent - effectively passed on to customers? Do you really? When they then lowered the VAT rate for tourism in half, that's not even arrived at the customer.
They fear windfall profits?
Exactly the same time the basic problem of tourism is not addressed. This is in the high consumer price level in Switzerland.
What happens next? The Swiss franc is an end in sight?
Personally, I had earlier expected a recovery in the euro against the Swiss franc. Then came again and again but the conflicting signals from leading European politicians, who have again caused a new uncertainty.
They were hoping that the panic quickly sets?
That it tends to be in periods of uncertainty in financial markets leads to a strengthening of the franc is in itself an old story. That they failed is now against the euro and the dollar so much that is new. It can only be explained by the long duration of this uncertainty and loss of confidence, fueled by individuals knowingly and unknowingly was fueled by some.
Is this the Achilles heel of the euro, that Europe speaks with one voice for our own currency as the U.S. for the dollar?
This is crucial. This is the central problem. For a new study by the European Central Bank just shows that the economic differences between the states in the U.S. are at least as large as those between the Member States in the euro area. The argument could not work the euro because of the currency area is not optimal does not sting.
How will the crisis? Is it the Euro or in ten years?
Yeah, sure, you can assume. The euro remains.
See you as a result of the crisis increased integration into the EU?
Yes, it will be inevitable. Therefore, it was already tightened the Stability Pact. And in the longer term there will be nothing else but that fiscal policy is either more centralized or introduce much stricter rules for debt relief measures in the case. Also placed your: The European Stability Mechanism (EMS) from 2013 looks much sharper in front of sanctions - though not automatic, but that will come with time, too.
http://translate.google.ch/translate...753536&act=url
That's a problem. No one has given an explanation of why there aren't european rating agencies to compete with the basic three.Quote:
Originally Posted by wiggin
Google translator failed big time, Joker. :p
Well nobody for the private marked established one, for whatever reasons - and it seemed the EU didn't found it to be so crucial that the government has to establish one.
I turned the important part into italic and corrected the biggest mistakes in that part. I don't want to correct the whole thing.Quote:
Originally Posted by GGT