France Is Done...So Is The Euro...

[smyrna]

Amazing how socialism destroys an economy & the populace turns to more socialism to try to fix it! Greece & France, oblivious.

The socialists will throw money away like drug addicts hitting the lottery. Then they will drag down Europe & the Euro into the worst economic abyss since the 30's. The rich are already packing. Investors will leave in droves & the socialists will blame it on everyone but who actually did it, themselves. I bet there will be a lot of shorts on the stock markets & currency there in the morning.

You can't buy your way out of this. It was waste and corrupt practices that started this whole downward spiral. It will be hard work and sacrifice, that will lead us out of this doom. If you aren't a part of the solution...you're a part of the problem.

[Rurudyne]

Wait, you mean you're saying that quantitative easing was actually the Fed buying up its own bonds and not printing money?

Since the Fed is buying up a higher percentage of bond issues ... sorta.

Remember: the Fed is different than most creditors where the US is concerned.

Certainly they would share the desire held by others to find someone ELSE to take the hit if and when it comes — just as some ordinary creditors when they finally realize that they've got a load of bad debt on their hands may want to pass the buck ... why I likened it to passing a hot potato. The key is to move slowly as prudent — bail too fast and people panic and you're in for it too. But move to slow and you risk the debtor doing something out of sorts if they get desperate. The ChiComs, though not necessarily individual Chinese, seems to be playing for this balance.

But are these QE's all about just auctioning bonds? Not necessarily. The Fed apparently wants to inflate the money supply (you may recall the Chinese rumbling that the administration was trying to inflate their way out of the situation) even as they play games with inflation ... the weakness is bond sales is partly because they are keeping return on the bonds low to maintain the pretense that inflation is still "moderate".

Interestingly, earlier someone mentioned the relative value of the Euro to the Dollar as if that should speak volumes to the soundness of that currency: but that's likely the wrong lesson to learn. The Euro and the Dollar are BOTH eroding and all central banks are playing the same sort of mind games with the money.

That aside, with respect to the former I posted this not too long ago on another forum — the other guy is a Brit — about if the Euro could be saved and it specifically relates to Greece and others like it within the Eurozone:

Not to even pretend I'm saying something you haven't known all your adult life: British resistance to the Eurozone has been well entrenched so long that it was the stuff of sympathetic jokes for 1970s sitcoms (Yes, Minister comes to mind). And I will honestly profess a long standing sympathy for it just by way of a confession.

Still, I'd like to suggest that Britain could not "save the Euro" even if she had adopted it at the beginning.

The problem is that while the Euro's value is representative of the strong economies that back it it has become with respect to the weaker economies terribly overvalued compared to where their own currency would likely be had they stayed with them. That is good news (actually: great news) for those with savings in those nations with issues; however, not having control over their own currency seems to have played a real part in their woes too.

Long ago a certain infamous banker opined that he didn't care who made the laws if he controlled the money.

Now, the Euro isn't some dark foreboding conspiracy but what was said does speak in part to how these problems have risen. The idea being that countries with spending problems will, if they are able, often try to use monetary policy to get themselves out of their woes in such a way that the proverbial can will at least be kicked down the road.

This is happening right now in the US with the Fed quietly qualitative easing (we're approaching QE3 now ... there should never be anything "QE" that isn't a ocean liner), easing huge quantities of money into circulation which has helped drive down the Dollar vs other currencies and I suppose the net result that they hope for is to monetize the debt without causing inflation (I don't know if you've heard this but it has been suggested that at this time the US might be in a deflationary phase were we not printing money faster than a Christmas elf makes toys).

So, in the same spirit that people are always preparing to fight the last war (the Trident you mentioned?), it seems reasonable that politicians are likely to be using too-old playbooks too. The idea is that their domestic policies could arguably be exactly the kind that they would have had if their own central bank still controlled their currency ... but they don't. So any ideas they may think work when a nations get into these messes just won't — all because they may make the laws but they don't control the currency.

So where they might have attempted to monetize their debts in hopes that both they and their creditors won't loose everything ... they can't. Essentially the Euro has become their new gold standard and the only way they get this expensive money is to borrow it from those who have it.

On the surface that sure seems better than printing money — certainly seems saner to me — but it means, so to speak, that they've no passing game to complement running the ball.

As such, Britain would be just one more reason the Euro was strong but not a cause for why those whose domestic policies have now got them holding out their hands would be doing any better.

So I really wish you all the best and kinda hope you keep your own money. If the Euro can't be saved — and it probably can't be if what I've said above is remotely accurate — it may signal possibility for a brighter tomorrow just because your money may still be seen as sound by comparison.

[Physics Hunter]

Are these Frogs the same stupid people that cut back public worker hours to "make more jobs...?"

Yep, they're dead. They just ain't hit the floor yet.

[Physics Hunter]

I've never seen a party so set on wishing for an economic collapse that just isn't happening.

I sold into the Housing Boom in 2002, expecting the bubble to pop.

I was not wrong, just did not expect how long they could prop up the the impending disaster.

[hatman]

Are these Frogs the same stupid people that cut back public worker hours to "make more jobs...?"

Yep, they're dead. They just ain't hit the floor yet.

Good to hear.
I will look forward to hear of the total collapse of Airbus.

[Physics Hunter]

Good to hear.
I will look forward to hear of the total collapse of Airbus.

Sorry, France is not the only leg of that stool.

[hatman]

Sorry, France is not the only leg of that stool.

Correct.
Just HQ and Final Assembly.
Total collapse of that shouldn't affect future deliveries and sales.

[Physics Hunter]

Correct.
Just HQ and Final Assembly.
Total collapse of that shouldn't affect future deliveries and sales.

Such things are not crushed, they are repurposed...

[hatman]

Such things are not crushed, they are repurposed...

But with France crushed so will be Airbus HQ and Final Assembly.
Will Germany be the new HQ? Will they re-purpose FA? For what? 737 Max?
I suppose Spain could pick up the slack.

[Physics Hunter]

But with France crushed so will be Airbus HQ and Final Assembly.
Will Germany be the new HQ? Will they re-purpose FA? For what? 737 Max?
I suppose Spain could pick up the slack.

Those who are not mindful of the past are bound to repeat it.

[Dacarlo]

Good to hear.
I will look forward to hear of the total collapse of Airbus.

Why?

[mamapajamas]

We wish for reality.

It will happen.

The power head of this Country is doing nothing but delay it as they re-arrange the deck furniture and decide who gets the lifeboats.

LOL! GMTA

Ever since the French election results came in and I started reflecting upon the situation in this country, I've been going around asking people, "Can you say, 'Titanic'?"

Unless there's some major brakes-slamming soon, we're in deep doo-doo.

[hatman]

Those who are not mindful of the past are bound to repeat it.

In the spring, the garden will flourish once again.

[itsjoanne]

LOL! GMTA

Ever since the French election results came in and I started reflecting upon the situation in this country, I've been going around asking people, "Can you say, 'Titanic'?"

Unless there's some major brakes-slamming soon, we're in deep doo-doo.

Yes we are. Unsustainable debt is crippling Europe, and they vote for more of the same in France. Makes no sense.

Our debt is equally unsustainable.

[F_Rat-46]

In the spring, the garden will flourish once again.

Not if you over-fertilize it, it won't. Sometimes, you have to add a little lime to even things out.