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Euros are in a muddle for the next decade
arty
post Posted: Jan 31 2013, 01:45 PM
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In Reply To: wren's post @ Jan 31 2013, 12:42 PM

Attached File  AUDEUR_n_31_01_13.gif ( 15.43K ) Number of downloads: 12

... but on the other hand, that means Europeans are now getting more Ossie Bang for their buck.
Let's tell them to come over for a long holiday wub.gif cool.gif

Attached File  EURAUD_n_31_01_13.gif ( 15.99K ) Number of downloads: 13




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I trade daily, but I am not a licensed adviser. Whether you find my ideas reasonable or not: The only person responsible for your actions is YOU.
I follow two rules: (1) There are no sacred truths. All assumptions must be critically examined. Arguments from authority are worthless. (2) Whatever is inconsistent with observed facts must be discarded or revised. We must understand the Market as it is and not confuse how it is with how we wish it to be. (inspired by Carl Sagan)
 
wren
post Posted: Jan 31 2013, 12:42 PM
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In Reply To: wren's post @ Jan 25 2013, 01:08 PM

AUD now appears to be in a muddle.Poor overnight effort by the AUD v Euro,and from a TA perspective is now below support.

 
mullokintyre
post Posted: Jan 28 2013, 03:15 AM
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In Reply To: triage's post @ Nov 18 2012, 10:04 AM


Howdy Triage,
You posted some interesting info from the Economist
QUOTE
Et tu France?

The Economist magazine has come out with a confronting (to some) cover story, highlighted by one of their killer cover designs. Those steenking english dogs have dared to question whether France is any longer the steady foundation of Euroland - silly impudent question of course as every Frenchmen knows that France is was and always will be the centre of all civilisation ....

http://www.economist.com/news/leaders/2156...time-bomb-heart


I actually bought that copy of the Economist when I was waiting for a plane in Jo'burg. It was certainly an interesting article, but I found another couple just as pertinent.

One of them told the rather mind blowing statistic that for France, 57% of GDP is Public spending and repayment of debt. The highest in Euro zone. It has not had a balanced budget since 1981, and Debt is over 90% of GDP. It seems that France is following the lead of the USA and Japan.

Another section laments how the European Union is shrinking economically; GDP in the Union is falling, especially in the PIIGS. And on the surface this is correct. However, when you look at why the Union is shrinking, its because the constituent nations have been doing the opposite of France. They have been cutting back on Public spending. Indeed the cut backs have been greater than the decrease in GDP in other constituent countries - especially in the much decried PIIGS. Barcelona will export more product than it imports for the first time in over 10 years. THE EC expects that Spain's exports will be more than 22% higher in real terms than 2009. Irish exports are expected to grow over 15% over the same period. Besides reducing current account deficits, Labour Costs are falling as workers are willing to take lower wages. Ireland where the deficit peaked at 5.7% of GDP in 2008, has been running current account surplus since 2010.
Current account deficits in Portugal have come down from a peak 12.6% to just over 2%. Even lowly Greece which peaked at 18% of GDP in 2008 ran a current account surplus for the July quarter last year ( though it may not last. And the EU expects that the deficit will still be 6.5% over the whole year, but still reducing). Italy has deficit has shrunk from 3.5% in 2010 to 1.2% last year. Spain had already returned to surplus in 2010.

Of course, the mainstream financial press will highlight how the EU has lost share of world trade as its GDP shrinks. They will never analyse the figures, just make the 30 second sound bite that suits its audience.

Mick



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wren
post Posted: Jan 25 2013, 01:08 PM
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Well Euros might be in a muddle,but the AUD doesn't look all that flash.The AUD has been weakening against the Euro for a while,or at best just holding on.We all 'know' the Europe is cactus and the US is stuffed and that Australia has the best economy in the Universe.Personally,never believed any of these Universal truths and have been buying Euros-- 0.81 average to fund future trips for next 3 years.For anyone interested there are EFTs for Euros,USD and BPD.The spreads are OK. To get the true rate with a Bank $200k is about the min. and $500k is better.OZforex is now just OK,whereas a year ago they were pretty good.
This is prob. off topic--apologies to all.

 
alonso
post Posted: Jan 12 2013, 09:08 AM
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A BBC doco worth a listen discusses the shift in the power centre of the EU to the east and the emergence of the Berlin-Warsaw axis (axis ia something of a loaded word). The eastern bloc EU members have a combined population of about 100 million and have a more free market orientation, according to this report, whereas the old western bloc centred on France-West Germany had, and still has in the case of France & its neighbours, a more leftist regulation orientation.
The power shift has big implications for the future of the EU and perhaps its trade policy.

http://downloads.bbc.co.uk/podcasts/worlds...30108-0905a.mp3



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"The optimist proclaims that we live in the best of all possible worlds. The pessimist fears this is true"

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alonso
post Posted: Jan 8 2013, 01:49 PM
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Euro crisis is over, Commission chief says DateJanuary 8, 2013 - 11:05AM

The euro has been saved and the euro crisis is a thing of the past, European Commission president Jose Manuel Barroso has declared.

But his optimistic comments and the prospect of looser rules for banks failed to lift markets, which ended a strong run of recent gains.

''I think we can say that the existential threat against the euro has essentially been overcome,'' Mr Barroso said in Lisbon. ''In 2013 the question won't be if the euro will, or will not, implode,'' he said.

Mr Barroso has maintained an optimistic stance throughout the crisis, but his comments were in sharp contrast to the new year's message from German chancellor Angela Merkel, who told TV viewers last week that the currency zone faced another rocky 12 months.

City analysts are also deeply concerned that austerity measures demanded by Brussels as the price of bailout funds would lead to prolonged recessions in periphery countries and the need for steeper spending cuts.

Cuts to essential public services in Spain, Italy, Greece and Portugal are expected to increase unemployment and lead to further social unrest. Protests on the streets of Madrid on Monday highlighted the tensions inside the euro area after banner-waving protesters blamed Brussels, Berlin and the right of centre PP government of Mariano Rajoy for privatisations and cuts in healthcare spending.

Elga Bartsch, an analyst at Morgan Stanley, said she was anxious that Mr Barroso and his colleagues in Brussels would fail to resolve long-running disputes over the EU's new institutions.

''The euro crisis seems contained for now. But we think it is not resolved for good. In addressing the fundamental flaws in the euro's institutional set-up, progress on banking union will be key. Assuming no crisis escalation, the euro area should re-emerge from recession and return to sub-par growth. Politics is the main risk,'' she said.

Political deadlock, which has also characterised the reform agenda in Washington and Tokyo, could allow social unrest to grow and wreck any coherent reform plans, she said. ''An extended recession, diverging political positions and several elections create a difficult backdrop for in-depth reforms. We therefore expect only limited progress on an effective resolution of the crisis this year. We believe that progress on banking union, where preparations are under way for a Single Supervisory Mechanism (SSM) and where discussions continue on harmonising, and possibly pooling, bank resolution and deposit guarantee schemes, will be key.''

Ms Merkel faces a general election in the autumn against a resurgent Social Democratic party (SPD) while the Italians are expected to go to the polls next month in an election that could see a revived Silvio Berlusconi with enough votes to block reform measures.

Global stock markets, which have warmed to the message that the euro crisis is abating, drifted lower as some investors sought to cash in on last week's strong gains and worries grew of more political brinkmanship in Washington.

Major indices surged last week after the US Congress passed a bill to avoid a ''fiscal cliff'' combination of government spending cuts and tax increases. The deal, however, remains incomplete. Politicians will face another deadline in two months to agree on more spending cuts while a debate over the country's $US16 trillion debt ceiling is also looming.



Read more: http://www.smh.com.au/business/world-busin...l#ixzz2HLsmWT4G
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Mr Barroso is kidding himself isn't he? Well probably not, he's got to be smarter than that. And there's nothing wrong with
being an optimist. But most of Europe knows they have big problems and even Frau Merkel, coming up to an election which
will be difficult for her to win, is open & upfront about the outlook.



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"The optimist proclaims that we live in the best of all possible worlds. The pessimist fears this is true"

"What is prudence in the conduct of every private family can scarce be folly in that of a great kingdom." Adam Smith

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triage
post Posted: Dec 29 2012, 08:49 AM
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Crisis? What crisis?

http://www.reuters.com/article/2012/12/28/...E8BR05Q20121228

At the risk of sounding defensive I have to point out that just because "it" didn't happen this year does not mean that the probability that it would happen this year was overestimated. But sometimes shit does not happen, and even when the probability of something happening is as high as 90% quite often that something will not happen.

I do think that the journo makes the mistake of assuming that it took something big, like Draghi going the full monty or Angela blinking, to avert the crisis and that it will take something big to eventually bring on the crisis. The reading I've done about complex systems suggest to me that it does not take a really big grain of sand to fall to cause a really big avalanche. The euro crisis did not happen this year because a whole bunch of decisions and events fell the right way to maintain the status quo. But surely the euro system is unstable and unsustainable in its current form and the chances are that sooner or later a single grain of sand will be dislodged that will trigger a real crisis.

But that is not to get away from the fact that anyone who placed an unhedged bet on the timing of the crisis being sometime in 2012 have been taken to the cleaners.



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"The market can stay irrational longer than you can stay solvent." John Maynard Keynes

"The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought." Rudiger Dornbush

"It is the mark of an educated mind to be able to entertain a thought without accepting it." Aristotle

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Nick1970
post Posted: Dec 26 2012, 10:35 AM
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In Reply To: triage's post @ Dec 25 2012, 04:19 PM

Thanks triage - enjoyed that doco.




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triage
post Posted: Dec 25 2012, 04:19 PM
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Some holiday viewing: this BBC documentary about the travails of Spain "feels" a bit dated but actually only came out earlier this month. It seems to arrive at one conclusion, that it is the euro that is at the core of Spain's problems, but it does not even attempt to explore any viable solution.

It identifies three things that contributed to Spain being the trainwreck it is today: fairly autonomous regional governments that were given enough space to behave irresponsibly, fairly unregulated unrestrained regional financial instututions and a freeing up of town planning rules that allowed an explosion of construction to occur. Together with the easy access to cheap credit that joining the EU gave Spanish entities these were enough to cause systemic havoc even though the national government of Spain was one of the better behaving governments in the EU. Nowadays the euro is offering the type of support to Spain that the noose offers to a hanged man in that it is preventing Spain from devaluing itself back into being competitive.

The program ends with the suggestion that if Spain continues on with the euro this may put unsustainable pressure on the unity of the country, with the possibility of the richest region, Catalonia, which has its own language (and football team), breaking away.

http://www.youtube.com/watch?v=ldu8X_UQPRA

I was not aware that modern Spain is as new as modern China (Franco only carked it a year before Mao).

h/t markco2 on hc



--------------------
"The market can stay irrational longer than you can stay solvent." John Maynard Keynes

"The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought." Rudiger Dornbush

"It is the mark of an educated mind to be able to entertain a thought without accepting it." Aristotle

Said 'Thanks' for this post: Nick1970  
 
Dave_vic_ozz
post Posted: Dec 12 2012, 07:36 AM
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In Reply To: sette's post @ Dec 12 2012, 06:49 AM

Agree and agree.

BUT - Rejection hurts. The rest of the EU would be horrified. Little gain long term, surely?

Dave



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