Now here is the reality the Euro Cheerleaders don't understand. Bloomberg Now from the Handelsblatt: Handelsblatt
Naturally this is happening , and exactly as predicted when thinking people mapped out the fall of Europe and then the US some three years ago . Obviously you move assets wherever possible to areas of greatest safety balanced with greatest returns . Which is why Cash circles the globe daily but plant takes longer to relocate ! Germany is now seen as the last bastion of EU strength . However , that might change as French and Spanish banks are exposed . Regardless , the dollar will then benefit and the unthinking will rush to the lender of last resort . Unfortunately with Europe then under the water line , the US is obliged to follow as sure as night follows day .Then the dollar sinks by at least 50% These so called smart CEOs might be far smarter putting liquid assets into Chile and Brazil , as off the cuff suggestions . And Norway ( richest country in the world per capita) . But that's thinking longer term Perhaps there are good short term gains by moving into Germany and then getting out at the "right" time .
It's not about returns. It's about not losing billions of euros in value. They are hoping that exchange rate the Bundesbank sets for the euro to mark will be favorable. I.E. They'll get either a 1 DM to 1 Euro ratio or 1 DM to 1.5 Euro ratio. And this is a misguided opinion in which many clutch at so they have an excuse to save Europe. Germany is thought as the last bastion if it's out of the EU, not in it. German bunds failed at auction last week. That tells you what people think of Germany in the EU. They have been exposed for the last year. Everybody knows the big 3 in both countries are barely making it on a daily basis. That they rely on the money markets to stay open. Since Dexia failed you can't find that many French banks getting lending from the private sector. Since Dexia 40% of Bank funding in Europe has dried up. US fund managers won't invest in EU banks. It's why the ECB has been buying "toxic" assets from Banks by massive amounts. You know those "sovereign debt" buys. The dollar will not benefit if the Euro collapses. As the US would have flooded the Euro Zone with trillions of dollars and those trillions will never be paid back in the from of future currency swaps (which is suppose to make inflation neutral). So what you will have is the world market awash with trillion of dollars and no way for the US to reign those dollars in. This will lead to collapse (20%, or more) in the value of the dollar overnight. US bond rates spiking and interest rates which can't be hiked. So you do have your collapse in due course. Rather invest in commodities. Why invest in Norway? There is no little growth return there. Norway isn't the richest country per capita. It's actually Luxembourg.
If that is the case then the USA should launch a massive war of conquest and revenge as a means of survival.
Austrian Not sure you managed to add one point to my post but I respond Quote It's not about returns. It's about not losing billions of euros in value. Response . "Not losing" is one of two ways of stating a return . Which is exactly as I said . Quote: German bunds failed at auction last week. That tells you what people think of Germany in the EU. Response : That is precisely and absolutely NOT what it shows . Bond Vigilantes buy or do not buy Bonds -- along with other Governments including the country issuing them !!!!!!!They continued to be priced below every other EZ country . And by a long way . You don't judge a market professionally on one or two days results Quote: ME However , that might change as French and Spanish banks are exposed . YOU They have been exposed for the last year. Everybody knows the big 3 in both countries are barely making it on a daily basis ..... Response . Yes we know that but my point remains that the stock markets will only move dramatically against them when the " news" catches a spark , or , one or more of the Agencies down grades the banks big time -- which they were going to do until they cooked up that cover story crap of the Fed and central banks making life easier for them Quote: Originally Posted by raymondo Regardless , the dollar will then benefit and the unthinking will rush to the lender of last resort . Unfortunately with Europe then under the water line , the US is obliged to follow as sure as night follows day .Then the dollar sinks by at least 50% Your answer The dollar will not benefit if the Euro collapses. ............... So you do have your collapse in due course. Response : Again you just repeat what I posted . Quote: Originally Posted by raymondo These so called smart CEOs might be far smarter putting liquid assets into Chile and Brazil , as off the cuff suggestions . And Norway ( richest country in the world per capita) . Your Response Rather invest in commodities. Why invest in Norway? There is no little growth return there. Norway isn't the richest country per capita. It's actually Luxembourg. My reply . I am 100% in commodities . Have been for over two years . But it was not the Topic in question . As for Luxembourg -- If I had known you would descend to the trivial ,I would have found somewhere like the Cayman Islands . My answer of Norway is pragmatically correct particularly as the population of Luxembourg consists almost only of dumb arse Eurocrats . __________________
