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sasguru
18th June 2012, 13:52
Germany could lose 1.5 trillion euro immediately if the Euro collapsed: half of that amount by the Bundesbank and half by the rest of German banks.
Germany would become as indebted as Italy, proportionately to GDP.
And that's a conservative estimate.
According to the IfW, a German only Deutschmark would probably rise by 30%, leading to a 17% fall in exports and 7% decline in GDP.

This latter fact shows that Germany has artificially kept interest rates and hence the Euro down, and hence is partially responsible for the (predictable to all but politicians) condition of the PIIGS.

So do the right thing and couph up before we all go down the pan.

Ta very much for listening.

AtW
18th June 2012, 13:57
Germany could lose 1.5 trillion euro immediately if the Euro collapsed

Why would euro collapse?

Not sure what glue you sniffing today but ECB rates are currently higher than BOE.

gingerjedi
18th June 2012, 14:00
The Spanish government called their bluff, has the cent finally dropped? :laugh

russell
18th June 2012, 14:01
Next time just put the link to the article/blog with the opinion you are trying to pass as you own.

sasguru
18th June 2012, 14:01
Why would euro collapse?

Not sure what glue you sniffing today but ECB rates are currently higher than BOE.

Greece coming out of the Euro or not paying its next tranche of debts, Spanish banks failing - take your pick.
Seem you're talking the same tranqs as Master Bates.

sasguru
18th June 2012, 14:02
Next time just put the link to the article/blog with the opinion you are trying to pass as you own.

You're making the fundamental mistake of thinking everyone is as stupid and unoriginal as you are.

AtW
18th June 2012, 14:04
Greece coming out of the Euro

Who says they are leaving euro? Their newly elected Govt will want to keep it and there is no mechanism to kick country from eurozone if they don't want it to happen.

So euro will stay.

Looking at exchange rates now 1 GBP is 1.24 EUR, hardly a disaster given that GBP was much stronger in the past.

So I think you should shut the hell up and go deal with weeds in your garden.

sasguru
18th June 2012, 14:06
Who says they are leaving euro? .

Greece is bust. It has no money and no hope of growth any time soon on current policy.
So you're suggesting the same thing as I am, Germany has to pay .....
HTH, thicko.

russell
18th June 2012, 14:14
You're making the fundamental mistake of thinking everyone is as stupid and unoriginal as you are.

I didn't make it into your signature, so I assume you have a sneaking admiration of my intelligence and wit. ;)

sasguru
18th June 2012, 14:17
I didn't make it into your signature, so I assume you have a sneaking admiration of my intelligence and wit. ;)

Nah I ran out pf patience when listing the interminable no. of cretins on this forum.

AtW
18th June 2012, 14:17
Greece is bust.

Yes it's bust which means it might default on all debts, that does not mean automatically they leave eurozone - they don't want to.

It only makes sense to stay outside of such things when country is very strong and selfish: Switzerland/Norway as example, or very foolish - such as UK.

sasguru
18th June 2012, 14:24
Yes it's bust which means it might default on all debts, that does not mean automatically they leave eurozone - they don't want to.

It only makes sense to stay outside of such things when country is very strong and selfish: Switzerland/Norway as example, or very foolish - such as UK.

You really haven't a clue, have you? :laugh:laugh

A bank run would force the Greek (or Spanish or whatever) Central bank to issue its own credit notes, in effect its own currency. Unless Germany did it. Which is what we all want.
Apart from Germans obviously.

AtW
18th June 2012, 14:43
A bank run

Who exactly going to do that bank run - Greek people who have no money anyway? Foreign investors who are holding massive savings in Greek banks?

The only thing that can really happen is that Greece will default on debt in which case Govts in countries where debt holders are will have to deal with the fallout.

Greece will still remain in euro zone - they are not fooking stupid to go back to their own currency that will drop like a stone in water. That's right - the Govt of most countries would much rather fook over foreign investors than choose to deal with bankrupting their own voters.

sasguru
18th June 2012, 14:45
Who exactly going to do that bank run - Greek people who have no money anyway? Foreign investors who are holding massive savings in Greek banks?

The only thing that can really happen is that Greece will default on debt in which case Govts in countries where debt holders are will have to deal with the fallout.

You really are very thick outside the programming arena, aren't you?
And even there I'm beginning to suspect you may only be mediocre.

AtW
18th June 2012, 14:49
You really are very thick outside the programming arena, aren't you?
And even there I'm beginning to suspect you may only be mediocre.

I personally rate my understanding of economics much higher of my understanding of programming :smokin

BrilloPad
18th June 2012, 14:53
So do the right thing and couph up before we all go down the pan.


It would be the least worst way out of the mess.

sasguru
18th June 2012, 14:54
I personally rate my understanding of economics much higher of my understanding of programming :smokin

You must be the crappiest programmer in the world in that case

AtW
18th June 2012, 14:56
You must be the crappiest programmer in the world in that case

As long as customers like the product it does not matter :smokin

Mich the Tester
18th June 2012, 14:57
Whatever happens, the northern economies will have to pay. It's now time to come up with a credible plan that at least has half a chance of being accepted by enough voters to see it through. I don't think closer union will be accepted, so the option to split the euro seems to be the one on the table. Seeing as Holland doesn't have a fully functioning government and France is now run by a lefty who wants to maintain low pension ages, it's going to be up to Germany to take the lead, and that means it's Mrs Merkel's moment to step up and give some leadership.

Doggy Styles
18th June 2012, 14:59
Who exactly going to do that bank run - Greek people who have no money anyway? Foreign investors who are holding massive savings in Greek banks?Anybody with cash in a Greek bank.

Don't believe all the bollocks, not every person in Greece has zero money, and those with it are gradually moving it away. You know what happens if that carries on.

minestrone
18th June 2012, 15:00
It's a feckin disaster, something has to change.

My investments are just ticking over at the moment, I would have to say the last 4 years will probably cost me a year or so of retirement.

SupremeSpod
18th June 2012, 15:03
It's a feckin disaster, something has to change.

My investments are just ticking over at the moment, I would have to say the last 4 years will probably cost me a year or so of retirement.

Day trading on Lloyds shares could have made you sh!tloads this past month.

sasguru
18th June 2012, 15:03
It's a feckin disaster, something has to change.

My investments are just ticking over at the moment, I would have to say the last 4 years will probably cost me a year or so of retirement.

London and SE property is what you need.

AtW
18th June 2012, 15:15
Anybody with cash in a Greek bank.

Ok, so Greek bank run happens - Greece will get same assistance as Spain did, so long as they stay in eurozone - yet another reason for them not to wish to leave it.

Doggy Styles
18th June 2012, 15:16
Whatever happens, the northern economies will have to pay. It's now time to come up with a credible plan that at least has half a chance of being accepted by enough voters to see it through. I don't think closer union will be accepted, so the option to split the euro seems to be the one on the table. Seeing as Holland doesn't have a fully functioning government and France is now run by a lefty who wants to maintain low pension ages, it's going to be up to Germany to take the lead, and that means it's Mrs Merkel's moment to step up and give some leadership.What can she do?

Does anyone know what will happen if she announces the euro is to be split into a 'good euro' and a 'bad euro'?

From what I can see, the best time to leave the current eurozone is when your economy is quite close to the eurozone average, because market adjustments and movements of funds will be less dramatic. That rules out the PIIGS (too weak), possibly France (with their new government possibly soon to be too weak), and Germany (too strong).

But the likes of Finland, Netherlands, Belgium, etc. could possibly get away with it, with or without their own common currency, leaving Germany to carry on supporting the basket cases in the empire they've created.

However, Merkel can't really announce that either.

minestrone
18th June 2012, 15:17
Not checked morningstar today, might not want to.

I have the option of retirement at the moment, can't understand why I don't.

Doggy Styles
18th June 2012, 15:19
Ok, so Greek bank run happens - Greece will get same assistance as Spain did, so long as they stay in eurozone - yet another reason for them not to wish to leave it.The don't want to leave it for the same reason that passengers on the Titanic kept climbing up the decks while it was sinking. Dry feet for a little while longer.

AtW
18th June 2012, 15:23
The don't want to leave it for the same reason that passengers on the Titanic kept climbing up the decks while it was sinking.

No, they don't want to leave because unlike you they have good understanding of what weak currency like drachma can do to a country attacked by hedge funds and dirty spekulators.

http://www.hri.org/forum/econ/inflation1.gif

Greece would be back to 40-50% inflation at the very least. Their only savior in this storm is euro currency - without it they won't even get any bailouts to support their banks if that becomes necessary.

BlasterBates
18th June 2012, 15:24
Just to set the record straight. No country has paid anything yet.

The fund works as follows:

Germany or the Netherlands borrow at 1% or whatever it is they can raise on the capital markets and lends to Greece or Portugal at around 3 or 4%.

In other words the Northern countries at the moment are actually making money.

Just thought I'd point that out.

DodgyAgent
18th June 2012, 15:59
Ok, so Greek bank run happens - Greece will get same assistance as Spain did, so long as they stay in eurozone - yet another reason for them not to wish to leave it.

Greece is caught in a downward spiral of austerity. They can of course remain in the Euro where they will have no chance of stimulating their economy through lower prices (exchange rates, labour on manufacturing and general investment). Or they can leave the Euro and become a more competitive economy to invest in.

AtW
18th June 2012, 16:06
Greece is caught in a downward spiral of austerity. They can of course remain in the Euro where they will have no chance of stimulating their economy through lower prices (exchange rates, labour on manufacturing and general investment). Or they can leave the Euro and become a more competitive economy to invest in.

:rollin:

Are you stupid or what? Have you looked at stats how much they export vs import?

Exports: $26.64 billion (2011 est.)
Imports: $65.79 billion (2011 est.)

Source: https://www.cia.gov/library/publications/the-world-factbook/geos/gr.html

They depend on imports very heavily - they can only buy them if they have hard currency, which is euros.

DodgyAgent
18th June 2012, 16:08
:rollin:

Are you stupid or what? Have you looked at stats how much they export vs import?

Exports: $26.64 billion (2011 est.)
Imports: $65.79 billion (2011 est.)

Source: https://www.cia.gov/library/publications/the-world-factbook/geos/gr.html

They depend on imports very heavily - they can only buy them if they have hard currency, which is euros.

With a weak currency they will now be able to manufacture their own products far more competitively than they can now.

AtW
18th June 2012, 16:17
With a weak currency they will now be able to manufacture their own products far more competitively than they can now.

Yes like North Korea who have made their goal to be self sufficient - they are successful with one qualification: people have to eat drass and it's only Dear Leader and his cronies who can get luxuries from the west :laugh

Ok, since you did not get good edukation in Thatchers time I'll spell it out for you, based on the stats provided by link above:

Oil - imports: 496,600 bbl/day (2009 est.)
That means Greece needs $18 bln (496,600 barrels per day X 365 days X $100 per barrel).

Now they export some - 181,600 bbl/day, but the balance isn't good: $11.5 bln just to cover oil imports.

How the fook can they pay for it with drachmas? They will be like UK pensioners during winter paying big part of their income to buy fuel.

They also import gas and other things they will never be able to make - even buying them from China would require USD/EUR.

High energy costs is killing them and Western world in general - on a positive side sheiks will be buying more EPL clubs.

Doggy Styles
18th June 2012, 16:19
:laugh
:rollin:

Are you stupid or what? Have you looked at stats how much they export vs import?

Exports: $26.64 billion (2011 est.)
Imports: $65.79 billion (2011 est.)

Source: https://www.cia.gov/library/publications/the-world-factbook/geos/gr.html

They depend on imports very heavily - they can only buy them if they have hard currency, which is euros.I sometimes wonder whether you are living on the same planet. :facepalm:

The whole point is to reduce that gap, i.e. for Greece to be able to increase exports and to reduce imports. Not perpetuate it! You really don't understand that, do you! :laugh

AtW
18th June 2012, 16:24
The whole point is to reduce that gap, i.e. for Greece to be able to increase exports and to reduce imports. Not perpetuate it! You really don't understand that, do you! :laugh

How can they reduce oil/gas imports, cars and other things?

Greece's main "export" is tourism - if they get drachma they'll have cheaper price but make less money in euros: they are already popular and I doubt they'll suddenly double visitor numbers - there are plenty cheap destinations already.

sasguru
18th June 2012, 16:27
:laughI sometimes wonder whether you are living on the same planet. :facepalm:

The whole point is to reduce that gap, i.e. for Greece to be able to increase exports and to reduce imports. Not perpetuate it! You really don't understand that, do you! :laugh

He is a CRE T1N of the first order.
:rollin::rollin::rollin:

AtW
18th June 2012, 16:30
He is a CRE T1N of the first order.
:rollin::rollin::rollin:

Well, you explain then how would suddenly Greek stop importing lots of fuel for any reason other than they can't possibly afford to buy it with drackmas.

I doubt very much tourists would appreciate fuel shortages :laugh

sasguru
18th June 2012, 16:31
Well, you explain then how would suddenly Greek stop importing lots of fuel for any reason other than they can't possibly afford to buy it with drackmas.

I doubt very much tourists would appreciate fuel shortages :laugh

Were you dropped on your head as a child?

AtW
18th June 2012, 16:32
oh by the way Dodgy - I would have thought you'd appreciate the new Iron Lady of Europe :laugh

AtW
18th June 2012, 16:32
Were you dropped on your head as a child?

It seems unlikely given that I can come up with coherent argument to support my point of view. I wish I could say the same about you ...

DodgyAgent
18th June 2012, 16:39
How can they reduce oil/gas imports, cars and other things?

Greece's main "export" is tourism - if they get drachma they'll have cheaper price but make less money in euros: they are already popular and I doubt they'll suddenly double visitor numbers - there are plenty cheap destinations already.

You are a complete idiot. The whole point of a currency devaluation is that it stimulates investment and growth just as it has done for economies all over the world for thousands of years. If they have Drachma they wont be able to afford foreign g0ods which will help their balance of payments. OK raw materials will cost them but no more than they cost another country. The difference being that the "local costs" (labour in particular) will be low thus making the products they produce more competitive.
How on earth you run a business I do not know.

Doggy Styles
18th June 2012, 16:45
It seems unlikely given that I can come up with coherent argument to support my point of view. I wish I could say the same about you ...sasguru has you banged to rights. Sorry and all that. :smile

sasguru
18th June 2012, 16:45
How on earth you run a business I do not know.

He doesn't. He spends all his time in the server room tweaking his spaghetti code. The real bosses figure he does least damage there.

AtW
18th June 2012, 16:54
The whole point of a currency devaluation is that it stimulates investment and growth just as it has done for economies all over the world for thousands of years.

I gave very specific example of oil imports - just because they'll have rapidly depreciating currency (which will mean no serious direct foreign investment since only an idiot would invest into country with such high inflation using local currency) does not mean they'll magically start getting more oil.

So they can't replace easily energy import other than by reducing actual usage of it - impossible as all obvious improvements have already been made due to already high prices.

AtW
18th June 2012, 16:55
sasguru has you banged to rights.

I don't think so. :laugh

AtW
18th June 2012, 16:59
The difference being that the "local costs" (labour in particular) will be low thus making the products they produce more competitive.

Did you bother to ask those local workers how they feel about getting 2-3 times less in money they get now? Any austerity is better than this :laugh

None of your losers had the misfortune to live in a country with tulip currency, money printing and 4 digit annual inflation :eyes

Doggy Styles
18th June 2012, 20:40
I've never seen such economic ignorance on CUK, and that's saying something.

AtW
18th June 2012, 20:43
I've never seen such economic ignorance on CUK, and that's saying something.

All that says is that you don't come here often enough! :laugh

BrilloPad
19th June 2012, 12:03
is there also somewhere serious conversation about economics in here or just :ladybags: ?

Alas those who know about the subject tend to keep quiet. Its a great pity really.

Though you are not a real cuk poster until you have been called a cretin by sas. Its a rite of passage.

BrilloPad
19th June 2012, 12:05
Did you bother to ask those local workers how they feel about getting 2-3 times less in money they get now? Any austerity is better than this :laugh



Unfortunately any austerity just kicks the can further down the road. The greeks are going to default sooner or later and leave the Euro.

Its a great tragedy. But it is reality.

DodgyAgent
19th June 2012, 12:32
Did you bother to ask those local workers how they feel about getting 2-3 times less in money they get now? Any austerity is better than this :laugh

None of your losers had the misfortune to live in a country with tulip currency, money printing and 4 digit annual inflation :eyes

The cost of Oil will increase relatively to the new currency earnings of the people as will other foreign goods. However the costs of labour and property and all things Greek will reduce dramatically. take Oil for example - yes it will be expensive but refining and processing the product will cost a great deal less than doing it whilst Greece remains in the Euro. So if I was a Greek Oilman I would import a few barrels of the stuff and refine it. I can then export the finished products at more competitive prices than say the Germans can.

Your lack of logical understanding is mind blowing. Following your argument through, Why then dont the Indians "up the value of the Rupee" if they did this then the cost of buying a BMW will fall :laugh

The workers may get less money in real terms but they will be forced to grow more of their own food and products - thus stimulating production internally.

Doggy Styles
19th June 2012, 13:31
The cost of Oil will increase relatively to the new currency earnings of the people as will other foreign goods. However the costs of labour and property and all things Greek will reduce dramatically. take Oil for example - yes it will be expensive but refining and processing the product will cost a great deal less than doing it whilst Greece remains in the Euro. So if I was a Greek Oilman I would import a few barrels of the stuff and refine it. I can then export the finished products at more competitive prices than say the Germans can.

Your lack of logical understanding is mind blowing. Following your argument through, Why then dont the Indians "up the value of the Rupee" if they did this then the cost of buying a BMW will fall :laugh

The workers may get less money in real terms but they will be forced to grow more of their own food and products - thus stimulating production internally.This is basic economics, dodgy. I'm sure everyone here must already know it. :wink

DodgyAgent
19th June 2012, 13:53
This is basic economics, dodgy. I'm sure everyone here must already know it. :wink

I dont think AtW gets it. which is a worry because he is CuK's leading entrepreneur :ohwell

BrilloPad
19th June 2012, 13:58
I dont think AtW gets it. which is a worry because he is CuK's leading entrepreneur :ohwell

I thought you were? :confused:

Doggy Styles
19th June 2012, 14:03
I dont think AtW gets it. which is a worry because he is CuK's leading entrepreneur :ohwellI was being a little sarcastic at our Russian's expense.

He might be a clueless economist, but he's OUR clueless economist! :wave: :D

DodgyAgent
19th June 2012, 14:19
I thought you were? :confused:

Yesterday's man Brillo :(

Scoobos
19th June 2012, 15:44
Can someone who is a euro sceptic, as there are plenty on here banging their drums, explain what you think we stand to GAIN from a collapse of the EU and the EURO?

As far as I understand (and I'm not all that clever, but possibly the only one on this thread with an Economics degree) we are an island, and that if europe wanted to , it could financially cripple us with BoP issues, at will.

When we are out of the EU, how do these tories (mostly tories) think we are going to ship our goods; and through which countries?

My personal view is that we will go the way of Australia (in the 90's / early 00), and realise that we import 200% more than we export; and then we will have to radically change our outlook.

Wasn't that why we joined the EU in the first place? (im too young to know for sure)

DodgyAgent
19th June 2012, 15:54
Can someone who is a euro sceptic, as there are plenty on here banging their drums, explain what you think we stand to GAIN from a collapse of the EU and the EURO?

As far as I understand (and I'm not all that clever) we are an island, and that if europe wanted to , it could financially cripple us with BoP issues, at will.

Wasn't that why we joined the EU in the first place? (im too young to know for sure)

The gain will be longer term. As ever it is about lancing the boil as opposed to simply taking pain killers. If the Euro is ditched then proper balances between the economies will return that will reflect the character and status of the EU economies. Germany will have its currency set much higher thus making its products far less competitive. Ferraris will be cheaper than Porsches as Italian costs will come tumbling down.
I dont quite know where you get the idea that the EU wants to ruin the UK. You are also talking of Europe as a single entity which it is not and will be even less so if the Euro is ditched.
Those who support the Euro like to think that it is too important to be allowed to fail.
The question is does the Euro get ditched now or in the future and if it is kept how will it be managed to avoid a repeat of what is happening now.

AtW
19th June 2012, 16:13
I dont think AtW gets it. which is a worry because he is CuK's leading entrepreneur :ohwell

Oh thank you :smokin

AtW
19th June 2012, 16:14
He might be a clueless economist, but he's OUR clueless economist! :wave: :D

Oi mate, I is British now, innit? :eyes

sasguru
19th June 2012, 16:15
Oh thank you :smokin

You're not really though, are you?
Since others do the business side, marketing etc while you sit coding in the server room.
They probably panic every time you go near a potential client.:laugh:laugh:laugh

AtW
19th June 2012, 16:18
The cost of Oil will increase relatively to the new currency earnings of the people as will other foreign goods. However the costs of labour and property and all things Greek will reduce dramatically. take Oil for example - yes it will be expensive but refining and processing the product will cost a great deal less than doing it whilst Greece remains in the Euro

Labour costs in oil refining ain't that significant - the main cost is primary product, then the fact that you can only get so much different fuels from that much oil.

Funny thing about oil is that any inflation in price will cause other products being inflated also - that means loaf of bread will be going up as foreign spekulants short new Greek currency.

Basicaly the only thing worse that can happen is war.

AtW
19th June 2012, 16:19
You're not really though, are you?

How much profit should the business that I founded generate in order for you to accept it is a commercial success?