Because London doesn't have the means to save its banks.Quote:
Originally Posted by RandBlade
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Because London doesn't have the means to save its banks.Quote:
Originally Posted by RandBlade
Neither do we.
British banks are more secure (less likely to need saving) than almost any other - we've already seen that above. Plus British debt is lower than many other nations debt, so can borrow more. Plus we can (as a last resort) print more sterling.Quote:
Originally Posted by Hazir
So want to try again?
Lets get some facts in the way of Hazir's racism:
http://news.bbcimg.co.uk/media/image...e_chart624.gif
http://media.economist.com/sites/def...723_WOC203.gif
Quote:
Originally Posted by Eurostat Debt-to-GDP ratios
Greek debt Randblade, Greek debt. Only an idiot like you would think this is just about Greece.
Greece is the only one so far being seriously talked about an inevitability of default. Only an idiot like you would think therefore this is all about London. Only an idiot like you would resort to using names like idiot when presented with reasonable facts. :p
Back to reality, it appears after months (?) of me saying default is inevitable in Greece and Hazir claiming it'll be prevented at least for years, that default will be a disaster etc ... it looks like some form of technical default will be agreed today.
Actually, Greece is not the only one. Ireland is a serious candidate too under any solution that inckudes a default. Anyway, have fun living in Lala land where you can insulate yourselve from the hard reality that this is your crisis too :D
Ah yes, Ireland. Its a possibility, but nowhere near as utterly inevitable as Greece. Ireland defaulting would hit us much more, which is why we voluntarily made a bilateral agreement to support Ireland. Guess you forgot about that one? :rolleyes:
This is a global crisis as well as a eurozone crisis, but we are infinitely better off than France. The idea as you claimed that "of course it would mean a mortal blow to London" is just utter bullshit though. I suppose if France collapsed that could drag us under too, but we've survived French collapses in the past :D
if current events continue as they are it won't even be as such in the land of doubles. It'll just be: a country Wallobrux named Belgium and a northern colony that is used as lebensraum and to pay the bills. bleh.Quote:
Originally Posted by wiggin
Looks like they are going to make a deal that takes a lot of the uncertaintly out. The value of the € against the lira jumped today form TL 2.32 to TL 2.39.
The 'special assistance' sounds a lot like the Greeks are going to have to hand over a lot of their fiscal autonomy to EU appointed people.
And this is how British 'money' thinks about the deal as per the Guardian website
Quote:
In the City, Britain's banks led the risers, on relief that they may not face heavy eurozone losses. Barclays posted a 7.7% rise to 239.85p, followed by Lloyds Banking Group, up 5.9% at 47.56p.
Of course there was a risk of losses, but not "the death of London". £14bn is chump change for us.Quote:
Originally Posted by Hazir
we do though.Quote:
Originally Posted by earthJoker
Moving back to reality:
One issue rarely addressed is Italy's woeful demographics. I do not see how Italy is going to turn around its growth-rate into something positive enough to escape from its debt mountain.Quote:
Italy 'to default' but Spain may 'just' escape
Debt-laden Italy is likely to default, but Spain might just avoid it, according to the British think-tank, the Centre for Economics and Business Research.
With the countries weighed down by debt, the think tank modelled "good" and "bad" economic scenarios for both.
It found that Italy will not avoid default unless it sees an unlikely big jump in economic growth.
However, it said, "there is a real chance that Spain may avoid default".
Even though Italy has managed to run tight budgets, and has vowed to eliminate its deficit by 2014, the economy needs a significant boost in growth.
But its economy grew by just 0.1% in the first quarter of 2011 and further growth is expected to remain sluggish.
On Wednesday, Italian Prime Minister Silvio Berlusconi addressed parliament, saying the economy was "strong" and the nation's banks "solvent".
But many economists believe that the eurozone's third largest economy risks being engulfed in the debt crisis.
In a report published on Thursday, the CEBR calculated that Italy's debt would rise from 128% of annual output to 150% by 2017 if bond yields stay above the current 6% and growth remains stagnant.
"Even if the cost of borrowing goes back down to 4%, the growth rate is so anaemic that we see the debt-GDP ratio remaining at 123% in 2018," said Doug McWilliams, the CEBR's chief executive.
The conditions in Spain are better because its debt is much lower. Even under the "bad" scenario, Madrid's debt ratio would climb to no higher than 75% of national output.
"Fingers crossed but there is a real chance that Spain may avoid default and debt restructuring, unless it gets dragged down by contagion," Mr McWilliams said.
"Realistically, Italy is bound to default, but Spain may just get away without having to do so," he said.
If yields remain above 6%, that's a big if indeed. Given that they are already moving below 6 today (Spain a whisk above 6 now). And that's before the EFSF takes effect.
I also wonder if those 'demographics' for Italy take into account how many illegal immigrants there are in the country. Most of them work in the informal economy. Did you know you can get a half hour Thai massage on the beach in Italy for around €10?
Should they? The "informal economy" isn't taxed, or really taxable, so it can't exactly be used to pay off government debt, can it?Quote:
Originally Posted by Hazir
Happy ending or legitimate?Quote:
Originally Posted by Hazir
Not not, but what if you give them residency and work permits?Quote:
Originally Posted by CitizenCain
Illegitimate, but no happy endings.Quote:
Happy ending or legitimate?
Well, if that happened, they'd be too stunned at the sight of herds of flying pigs blocking out the sun to contribute anything to the economy anyway.Quote:
Originally Posted by Hazir
The EU's even worse on immigrants than the US is, and Italy's not exactly known for welcoming foreigners, even during the best of times. The worse things get, the more immigrants get scapegoated and squeezed out. Can't have them filthy foreigners stealing jobs. :|
As an adult I know who lived 10 years in Italy described it: "Italy is a beautiful place. I look forward to moving to Cambodia though, as its people realize that their nation is a developing country. Italy is too, but refuses to acknowledge it."
Seems you don't know about the Club Med habit of every now and then declaring amnesties for illegals immigrants. Which then causes howling in the parts of Europe that these people actually want to move to.Quote:
Originally Posted by CitizenCain
I think that really depends on where in Italy you are, north of Rome is barely the same country as south of Rome.Quote:
Originally Posted by Kazuha Vinland
The US does that too, every so often. I still think we'll see herds of flying pigs before Italy integrates their current illegal immigrants into the [legitimate] economy.Quote:
Originally Posted by Hazir
Given the size of tax evasion and the underground economy in Italy, I'm not sure legalizing immigrants is really the solution at all.
And there lies the problem of your solution, the emigration from Italy to other European countries.Quote:
Originally Posted by Hazir
And here we have it; Italy gets serious about deficit reduction and liberalisation of the economy and the ECB indicates it will also buy Italian bonds. A very good end to the week; Italy will even get a balanced budget stipulation in its constitution.
The ECB has just decided that it will take decisive action tomorrow in response to the markets. That doesn't say with so many words that they will buy Italian and Spanish bonds, but it can hardly mean anything else. I would be very surprised if they don't intervene tomorrow.
The Dutch parliament will debate ratification of the 'Greek deal' later this week, Belgium has rescheduled from October to September.
But wait, I thought you said it wasn't the ECB's role to do that, only to control inflation?
True, it's a stopgap measure to enable the EMU to get the EFSF in place, which will need ratification by 17 countries. You also noticed how the ECB forced the Italian government's hand over the weekend? Or the other EMU members' for that matter?
In about a month we'll have a fiscal union for all intents and purposes, it will take some time before the Germans will be accepting that name, but that doesn't change the fact that we have one.
I find it deplorable that we needed the ECB to step in, but the alternative would be no ECB, and given the choices I don't care too much about principle :)
I'm just glad that you've come around this year to what I was saying for the last decade about the euro. :)
? I was never against a full fiscal and/or political union. I merely thought - wrongly - that market forces were going to deal with prolifigacy in the absence of such a union. That also explains why I never put high hopes on the 'Pact'. What I didn't imagine was that the 'smart money' would pour into Greek sovereigns like Greece was ruled from Berlin. That effectively set us up for the path we're upon right now; we will have a fiscal union, and I presume a political union can't be far behind. No taxation without representation and all that.Quote:
Originally Posted by RandBlade
I don't understand at all why you would feel so content with me getting what I wanted anyway, putting the UK just that little bit closer to the melt-down scenario I still think is going to happen. You're on the edge of the abyss still, the last EU country in that dire position, and your political relevance will decline even further. It was pathethic how British ministers tried to present the crisis as if the UK was a 'safe haven' more than the US.
Which is one reason I was wary of the eurozone. I said all along there were inherent dangers of having a monetary union without either a fiscal union or a political union. This year has closed any argument on that point and we're now not disagreeing any more but firmly agreeing on the matter.Quote:
Originally Posted by Hazir
I also agree with you about the politics: Lets not forget we're now nearing a position of having both a monetary and fiscal union for the eurozone without any proper European demos or democracy. How you can have both types of union without any proper democracy is completely undemocratic and unsustainable.
The "last European country" - who are you trying to kid? Please present ANY independent economic analysis to suggest that the UK is closer to the abyss than France is. If contagion will spread further up than Italy to any of Europe's three large economies it won't be the UK or Germany that falls first.Quote:
I don't understand at all why you would feel so content with me getting what I wanted anyway, putting the UK just that little bit closer to the melt-down scenario I still think is going to happen. You're on the edge of the abyss still, the last EU country in that dire position, and your political relevance will decline even further. It was pathethic how British ministers tried to present the crisis as if the UK was a 'safe haven' more than the US.
As for "pathetic" - explain that to S&P. They're the ones who give the US an AA+ rating and us a AAA one.
France is behind the ECB firewall, you aren't.
What ECB firewall?Quote:
Originally Posted by Hazir
The basically unlimited amount of money the ECB can use to buy EMU sovereign debt. It's becoming near impossible to gamble against individual EMU members. It's not impossible to gamble against shaking Britain.
Really, so that's why the UK's 10-year public debt yield is "shaking" at 2.64%? SourceQuote:
Originally Posted by Hazir
Please tell me what it is for nations behind the "ECB Firewall" such as Portugal, Italy, Ireland, Greece or Spain?
But lets be fair, I referenced the big 3 nations and specifically France. So how about France? Wait, what is this, France is higher at 3.11% Source
So by that metric again France is worse than the UK. Any others?
EDIT: Just found out - missed it with the downgrade of the US and the utter disastrous collapse of one eurozone economy after another - but S&P have changed what they say about the UK now too. The UK was of course AAA but with a negative outlook, they've now lifted the negative outlook from us and reaffirmed the AAA status. Again back in reality we've taken the necessary austerity actions before being forced to.
So once more, please find a single economic reason anywhere at all to show the UK is in a worse situation than France?
Two indebted countries, one backed by extremely deep pockets and one out in the cold. Your present yield is meaningless.
Our pockets are deeper than Frances and in case you've forgotten, we're members of the IMF - which has some fairly deep pockets.Quote:
Originally Posted by Hazir
IMF will not save you, and you don't have pockets deeper than the ECB, which could buy up the entire debt of all piigs withouth breaking a sweat. The fact that it can by the way also means it won't have to. Anybody short on Spain or Italy got his fingers burned badly yesterday.
The IMF can no more buy up the entire debt of all PIIGS without breaking a sweat than the BOE can buy up the entire debt of the UK without breaking a sweat.
I can only laugh about that claim, as it would make what happened in the UK the last few days look like a candle lit party.
So to be clear then you don't have a single economic measure in which France is better off than the UK right now?