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  • Stability Of The European Union (22) November 9, 2013 To December 31, 2013. 174 comments
    Nov 9, 2013 8:50 AM

    This instablog is designed as an interactive News Concentrator devoted to news and discussions about the debt and associated problems in the EU and its member states.

    The top portion of the instablog contains useful background information/ charts.

    Up-to-date news content is posed in the comments area. So if you are interested in current news, read the comments.

    ____________________________________________

    A picture is often worth a thousand words. Here we have the Percent Economic Growth Rates for three countries: US, Greece, Germany. Note the distinct downturn in the US Economic Growth Rate.


    tinyurl.com/25vyea7

    Here is National debt as a percentage of GDP in 2009 for the Euro Zone. Look at Greece and Italy.


    tinyurl.com/2vvcnxv

    Here is Government deficit as a percent of GDP for 2009. Look at Greece and Ireland. Look at UK and Spain.


    tinyurl.com/2vvcnxv

    Here is the all important Jobs Picture as of March 2010. Look at Greece, Spain, Ireland and France.

    tinyurl.com/29grmpy

    =================
    EFSF

    What is the EFSF?:

    The European Financial Stability Facility (EFSF) is a special purpose vehicle financed by members of the Eurozone to combat the European sovereign debt crisis. The €110 billion bailout to Greece is not part of the EFSF guarantees, but a separate commitment.

    When you look at the Guarantee commitments by the different euro zone countries [tinyurl.com/3xde35o] you will see something interesting. Greece, Ireland, Italy, Portugal, and Spain (i.e., the PIIGS) account for over one-third (36.7%) of EFSF commitments. All by themselves, Italy and Spain have a financial commitment of almost one-third (29.8%) of the total EFSF commitment.

    ___________
    (October 23, 2011) I added this nice summary graphic of the Dominoes effect associated with the European debt crisis. You can also see the graphic and the accompanying article with the following link:

    (October 23, 2011) Guest Post: The European Financial Crisis In One Graphic: The Dominoes Of Debt. From: Zero Hedge, by: Tyler Durden.tinyurl.com/3ulxgmj

    The original copyrighted graphic is from Charles Hugh Smith (" 2011) attinyurl.com/ygsa6j

    Added February 9, 2012

    Greek General Government Debt Percent GDP
    tinyurl.com/73h5q2x

    (March 10, 2012) tinyurl.com/7moa6tg

    Unemployment for individuals less than 25 rose to 51.1 %, twice as high as three years ago as budget cuts imposed by the European Union and the International Monetary Fund as a condition for dealing with the country's debt problems have caused a wave of corporate closures and bankruptcies.

    Fantasy Greek GDP Growth Rates:

    In the fantasy report "Greece: Preliminary debt Sustainability Analysis" dated February 15, 2012 which I referred to as the "Deus ex machine" report one of the EUs key economic assumptions was that Greek GDP growth in 2012 would be -4.8% and -1% in 2013.

    The Greek economy saw growth rates of:

    -0.2% in 2008,
    -3.3% in 2009,
    -3.4% in 2010,
    -6.9% in 2011
    -7.5% in fourth quarter of 2011.
    (Data from John Mauldin report tinyurl.com/7axvcmw)

    I plotted the Greek GDP data below and projected the GDP values for 2012 and 2013 based on the current data. I also plotted the Greek GDP projections from the Deus ex machine report - blue line.

    There is no Greek stimulus, jobs are in freefall. Which projection do you believe?

    (March 29, 2012) Greek Deposit Run Update: Hopeless And Getting Worse. tinyurl.com/8425yf7

    ============

    Added April 27, 2012

    Q1 unemployment is now one quarter of the working population or 24.44%, up nearly 2% from the 22.85% as of December 31

    (click to enlarge)

    Global PMI Changes from March to April 2012

    (click to enlarge)

    From: ZeroHedge tinyurl.com/76d39dj

    FUNDING GAP

    (click to enlarge)

    From: ZeroHedge - tinyurl.com/88qfjmc

    Ten Year Bond Yield Curves as of 7/20/2012

    From: The Disciplined Investor tinyurl.com/7yg5zku

    (click to enlarge)

    Here are some interesting charts on Italy sourced from Bloomberg's BRIEF
August 7, 2012, available on "The Big Picture" site:tinyurl.com/8lty5uj.

    I verified the shadow economy figures in the following sourced article about shadow economies:

    Shadow Economies: Size, Causes, and Consequences by FRIEDRICH SCHNEIDER and DOMINIK H. ENSTE, Journal of Economic Literature
Vol. XXXVIII (March 2000) pp. 77-114 tinyurl.com/8fpz6nz.

    (click to enlarge)

    (click to enlarge)

    (click to enlarge)

    (click to enlarge)

    ----------------------------------------------------------------------------

    2013

    (click to enlarge)

    From: Labor Force Survey by the Hellenic Statistical Authority January 10, 2013 tinyurl.com/bzjlk4m

    (click to enlarge)

    From: Labor Force Survey by the Hellenic Statistical Authority January 10, 2013 tinyurl.com/bzjlk4m

    (click to enlarge)

    This chart is based on the data from the Hellenic Statistical Authorities Labour Force Survey published January 10, 2013.

    This shows the rate of change of unemployment among age groups from 2011 to 2012.

    Yet the Greek government, under the direction of the Trokia, is about to initiate an even more Draconian series of spending cuts and tax increases.

    Remember the IMFs fantasy report? GDP was supposed to start increasing again in 2012. Instead, it continued to fall, and this is one of the reasons why. They are systematically forcing people out of their jobs. No jobs, no income, no income, no spending.

    Yes, the 15-24 age group has unemployment at 56.6%, but as this chart shows, the older age groups are suffering a higher rate of increase of unemployment. So they are rapidly catching up.

    ============

    Latest youth unemployment chart as of May 31, 2013

    (click to enlarge)

    From: ZeroHedge Nov 26, 2013 tinyurl.com/lpjlh58

    Socgen in its most recent report predicts that Europe is only half way through its lost decade of 2007-2018 (see chart). We blame much of this weak performance on a slow policy response in tackling both the sovereign and banking crisis, and the still too slow pace of structural reform. The fear is now that the euro area is on the verge of deflation.

    ----------------------------

    Remember, the top portion of this insta contains some useful historical information. CURRENT NEWS is posted in the comments area.

    WARNING: This is a no Troll Zone. If you are disruptive, your comments will be deleted.

Back To FocalPoint Analytics' Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (174)
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  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Link to Old Concentrator:
    http://tinyurl.com/l4h...
    9 Nov 2013, 08:54 AM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    I don't have much to contribute, but do want you to know that I follow and very much appreciate this FPA!

     

    HardToLove
    9 Nov 2013, 09:01 AM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    I'll echo HTL's comment and add that this concentrator is my primary source of "untainted global information". Many thanks FPA.

     

    Windwood Trader
    9 Nov 2013, 09:07 AM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    Ditto, HTL and WT.

     

    But I would use the word "variegated" instead of "untainted." I like to get views from alternative perspectives, but I assume that none of them are truly unbiased or untainted. Our human nature precludes pure objectivity.

     

    Maybe someday when SkyNet takes over we can have a non-human intelligence that can simulate pure objectivity.
    9 Nov 2013, 11:44 AM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >SM-

     

    I fear the NSA already provides the non-human "intelligence" but only what we are mentally equipped to deal with- nothing more.
    10 Nov 2013, 12:22 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    If only Congress could be defined by both terms. Non-human, it fits. Intelligence, well...

     

    "Suppose you were an idiot and suppose you were a member of Congress; but I repeat myself." -Mark Twain
    10 Nov 2013, 06:00 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    What an excellent analogy: "an Escher economy."

     

    "We're Stuck In An Escher Economy Until The Existing Structure Collapses And Is Rebuilt On Stronger Principles"

     

    http://bit.ly/HNb2nN
    9 Nov 2013, 12:00 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >SM-

     

    A really on point article. I believe we're on track for the second of the possible outcomes.

     

    "Contrary to the establishment’s “sustainable recovery” narrative, the most plausible outcomes are:
    1) interest rates normalize but this triggers another bust, or
    2) interest rates remain abnormally low until we eventually experience the mother of all debt/currency crises.

     

    Conclusion 3) restated: We’re stuck in an Escher economy thanks to the impossibility of the establishment economic view, and this will remain the case until the existing structure collapses and is rebuilt on stronger policy principles."
    10 Nov 2013, 12:55 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    10 Macro economic events for this week....almost all on the EU & China.

     

    http://seekingalpha.co...

     

    It's way early, but almost every country wants higher wages. I look for this to be the theme of 2014 everywhere.
    11 Nov 2013, 03:55 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    OT....I would watch this story develop closely.

     

    EOG ceo says shale boom near peak in USA

     

    http://bit.ly/1aOi73E
    11 Nov 2013, 05:38 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    along oil lines, IMO they had a deal with Iran over the weekend but the worlds global oil companies got it blocked. Much smoke being set off on how all this is reported too....can't believe either side. But it's obvious Iran wants to deal now.

     

    IF, this deal got cut, oil prices could drop how low ? $60?
    11 Nov 2013, 05:41 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Mystery Behind Spanish Banks' Bad Debt Miracle Revealed
    From: ZeroHedge

     

    One of the mysteries surrounding insolvent, and the once bailed out Spanish banking sector has been why the proportion of bad loans [NPLs] which are sharply rising are as low as they are, considering the nation near highest position in the EU unemployment rate, and in comparison to even more insolvent European nations as Greece, Cyprus and Slovenia.

     

    Well, the cat is out of the bag...

     

    For the past several years, instead of accurately designating non-performing loans [NPLs], banks "refinanced" the bad loans making them appear viable even though the banks knew there would be zero recoveries on those loans.

     

    Banks even made additional loans whose proceeds would be used to pay interest on the existing non-performing loans.

     

    New disclosure guidelines from Spanish banking authorities are now bringing these hidden risks into the open, and as a result, delinquencies are rapidly rising. http://tinyurl.com/oxc...
    ---

     

    So a good proportion of reported “new loan” volumes, activities that are assumed to signal a recovering economy are actually cover-ups designed to hide the true percent of [NPLs]. It’s the same trick being used with Greek Sovereign loans. The ECB and the IMF issue new loans, and the majority of the new loans are used to repay the principal and interest on the old, otherwise non-performing loans.
    11 Nov 2013, 02:42 PM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    Sounds much like a Ponzi, no? New loan proceeds are used to "pay off" prior loans.

     

    HardToLove
    11 Nov 2013, 02:54 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >HTL-

     

    "Sounds much like a Ponzi, no? New loan proceeds are used to "pay off" prior loans."

     

    Isn't that how our government works? Stiff those on limited incomes with inflated dollars.

     

    WT
    11 Nov 2013, 03:36 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2335) | Send Message
     
    Good find FPA. It never ceases to amaze me -- the number of games to be played. BTW this article (and comments) are a great read: http://seekingalpha.co...
    Clearly delineated thesis and some factoids which are sure to surprise e.g. central banks now own a third of the world's bond markets and residential property represents more than 60% of the total loans of the big four Australian banks.

     

    Cash is still king in my book although I am taking short-term profits when I can get them. After the GS upgrade on (MWA) today, for example, I took some profits off the table.
    mj
    11 Nov 2013, 04:08 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    congrats MJ, I still believe water is a good one for the grand kids
    11 Nov 2013, 04:54 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    How is this different from our Social Security Trust Fund?
    11 Nov 2013, 06:33 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    With the SS Trust fund where it is now there is unlimited ability to tax- supposedly the reasoning for congress including the TF in general assets of our uncle.

     

    The primary reason- IMHO
    To get at it! Can't spend it if it's in a trust fund.

     

    WT
    11 Nov 2013, 10:07 PM Reply Like
  • Stilldazed
    , contributor
    Comments (2150) | Send Message
     
    What SS Trust Fund? The one that the govt. has been putting IOUs into since the 1960s? The money has all been spent and repurposed, just like all the gas taxes that are supposed to build/repair the roads and infrastructure.
    16 Nov 2013, 01:01 PM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    Rattie, its strikes me as a rehypothication of the old loans. I am curious how many loans are out against each bond, to include interest wonder how much percentage wise is owed against each bond value. Do the loans equate to 2-3 hundreds of percentages of the original loans at this point once all fees and interest and graft etc... is applied to each new loan.

     

    Wonder if anyone ever actually makes payments on those loans or do they simply bring them current when some banker needs to collect some more fees and his interest to secure the new loan. At this point I am beyond jaded and feel its hopeless for me to every believe in our financial system again. Someone please pull the plug soon and drain the tub. We need to start over with a fresh tub of water to bath in.
    13 Nov 2013, 04:48 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    DG, don't worry, IMO then next crash like '08 will do just that. It will be global too. No where to hide, and it will hit everyone. Corporations, individuals, rich & poor alike.

     

    there is no political will for other bailouts, and every person and gov't will be bankrupt. Debt will basically be defaulted on and then wiped off the books worldwide.

     

    IMO, that is the only reason we haven't had a 10-20% correction in markets. They (all global mots, wall st. & the feds) are afraid if it drops, then no one will buy and it crashes again.
    13 Nov 2013, 05:36 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >LT-

     

    " No where to hide, and it will hit everyone. Corporations, individuals, rich & poor alike."

     

    You pose an interesting scenario (one that I agree with) that our investing arena is to be shrunken in a cataclysmal way. Will there be somewhere that's safe to invest? Commodities? Real estate? Hard metals? Precious stones? What about income? What entity will have the capability to provide reward for risk and what form will that reward take?

     

    Trippleblack in QC#264 alluded to the loss of mutual trust between government and the individual and the result of driving them into gray and black economies. Unfortunately, I totally agree. Is that the next phase? Is that our legacy to the next generation?

     

    WT
    16 Nov 2013, 11:25 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    >WT: Although I have no way to KNOW, it seems possible that some percentage of the increasing numbers of folks who claim no job (and are not collecting unemployment insurance) are in the black market. The possibilities are huge. Everything from dog walking to yard maintenance to making display art objects. The dollar amount earned by any one person may be low, but the total income could be quite large.

     

    But the financial big boys mostly don't see any of it. The ones in the black businesses use cash and barter and mostly DO NOT have traceable bank accounts. But most will have cheap cell phones and some credit/debit cards. How the CCs? I don't know. But I can imagine another business run by someone "in the system" arranging credit for those who are not. Any company profiting from this economy will facilitate it to the extent they don't break any obvious laws. Black markets are clever markets.
    16 Nov 2013, 01:08 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    WT, there are many scenario's and I have one in my mind and it's not pretty if the cities empty out in search of food.

     

    I don't think any investment would be safe, enough land to grow food would be nice. But anything that just trades on a market is of no good. Some gold & silver, but u can't eat it.

     

    the next generation will need a different mindset. One of survival, not profits at any cost.
    16 Nov 2013, 06:24 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >SHB-

     

    "Black markets are clever markets."

     

    I remember the fabulous movie "The Third Man" about street survival in post war Germany where the black market was the only logical commerce available.

     

    Frightening to think that such may come to roost here.

     

    WT
    16 Nov 2013, 08:22 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    I came across this website (perhaps linked to ZH? I can't recall) and subscribed for free. The latest blog is called " Bad News for Keynesians:The Austerians are Right".The website is called Cyniconomics by FF Wiley and Ginger Snap.

     

    There are some interesting charts and an Appendix. The data goes beyond Europe and includes Asia, the Americas, Middle East, etc. Here is the link:
    http://bit.ly/1cBokwD
    16 Nov 2013, 11:45 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    Here: http://bit.ly/1cBoO5U

     

    I like his work too.
    16 Nov 2013, 11:49 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    And this: http://bit.ly/HZklkF

     

    Fedspeak translations that TB should appreciate, given his skill at translating Corpspeak.
    17 Nov 2013, 12:08 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    OT, but you gotta read this, there is much detail buried in each paragraph that may be of interest to you guys too.

     

    Braves Leave Atlanta -- and Fans -- Behind
    http://bloom.bg/1d8uKIC
    17 Nov 2013, 06:58 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    Thanks for the article, LT-

     

    Do you think this just may be a predecessor of Detroit happenings as well?

     

    The comments for the article say it all.
    18 Nov 2013, 10:34 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Wt, You are correct in that the comments say it all.

     

    I don't know about Detroit, but probably. I am just sick of the corporate welfare system.

     

    Everywhere from the latest Boeing fight with the union, Caterpillar, etc, etc. They get billions of $$$ in tax breaks, some that they deserve, but enough is never enough. Threaten to move from state to state, country to country globally....they better be glad I'm not a dictator.

     

    Pol's won't help the working man, they block everything. But extend the pot of gold to these guys....and they call it capitalism?
    BS

     

    I advise to watch Apple as countries are after their cash hoard overseas.
    18 Nov 2013, 11:05 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Banks....

     

    The $13 B settlement that JPM appears to have made is being welcomed by Wall st.

     

    Could be a good time to watch or enter a few that have lagged / or been flat too long.
    19 Nov 2013, 10:13 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2335) | Send Message
     
    A little humor I came across tailor made for FPA's EU Instablog:

     

    "European hell is where the Germans are the police, the Swiss the lovers, the British the chefs, the French the mechanics and the Italians the bureaucrats."
    19 Nov 2013, 10:52 AM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    Mercy: ISTM there must be a place in there for our congress and PREZ! We certainly can't be throwing a lot of stones right now.

     

    N.B.: It was over 50 years ago that us professionals learned how to budget, plan, manage and implement a large computer systems' hardware and software and those various processes reached wide-spread acceptance and use.

     

    Wonder what happened on the government front?

     

    HardToLove
    19 Nov 2013, 10:59 AM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >HTL-

     

    "Wonder what happened on the government front?"

     

    ISTM that it was a horse designed by a government committee and came a giraffe!
    19 Nov 2013, 12:06 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    >HTL: Whoever is writing the contract requirements must understand everything that needs to be done. The deliverables MUST be explicit and the penalties must be real.

     

    So the answer to your question is that those involved in the contract writing didn't know what they were doing. They would have lost points in the game if they had admitted up front that they didn't actually understand the depth or scope of the project. Civil service. They can't actually lose much if the project craters.

     

    The Head Honcho (female) is appointed and probably bulletproof. She can argue she wasn't even there when the project was defined. POTUS isn't going to fire her. " These things happen". Yep, they sure do. In a government bureaucracy.
    19 Nov 2013, 01:23 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Good one MJ lol
    19 Nov 2013, 02:06 PM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    MJ, our hell is where the corrupt govt investigates its own corruption.

     

    The latest:

     

    http://bit.ly/1aDQgjQ
    19 Nov 2013, 10:59 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    There are 2 significant points in this ....
    -Germany does NOT want it's banks to play by the same rules as the other EZ, they lose control and get exposed

     

    - They are willing to change TAX laws....APPLE, GOOGLE and others who have fled to the EZ tax havens and u can bet have a ton stashed in Germany are going to come under extreme pressures.

     

    This overseas tax thing is a big deal....corps better cut a deal with the POTUS and bring money home. Else they are going to lose a chunck of it and get nothing back in return.

     

    Document says some German banks have "particularities"
    * Some 24 domestic banks expected to come under ECB
    * ECB to assume supervisory role from Nov. 2014
    (Adds quotes, background)
    By Matthias Sobolewski
    BERLIN, Nov 21 (Reuters) - German parties negotiating the formation of a new government have signalled that they want certain domestic banks shielded from external oversight by the European Central Bank once it assumes new supervisory powers next year.
    In a draft coalition document obtained by Reuters, the parties say they will ask national financial regulator Bafin to ensure that the "particularities" of German banks are respected when they come under the watch of the ECB.
    The language reflects lingering wariness in Berlin about giving the ECB powers to supervise certain savings, development and private banks that have long operated under German rules.
    The ECB is due to take over supervisory responsibilities for 130 European banks in November of next year. Some 24 German banks will be among those, from heavyweight Deutsche Bank to regional Landesbanks and savings bank Hamburger Sparkasse.
    The 10-page document was prepared by a working group led by Finance Minister Wolfgang Schaeuble and is expected to flow into a broader coalition contract between his conservatives and the centre-left Social Democrats (SPD), forming a policy blueprint for a new government.
    It points out that because of rules specifying that all banks with assets of 30 billion euros or above must come under European supervision, some German banks that are "regionally limited" and "active in special sectors" will be subject to ECB oversight.
    "The government will ask the Bafin, in line with its responsibilities for European bank supervision, to ensure that the particularities of certain banks, for example state development banks, are respected," the document reads.
    The paper stresses the need for leverage ratio limits for banks and voices support for Europe-wide implementation of the so-called Liikanen proposals for banks, which would legally separate risky investment activities from traditional lending business.
    It also promises a crackdown on tax avoidance by multinational companies, saying Germany could press ahead with national laws to prevent the kind of profit-shifting that has allowed Apple , Google , Amazon and Starbucks to reduce their tax bills.
    The leaders of the G20 group of nations have all backed an effort by the Paris-based Organisation for Economic Cooperation and Development (OECD) to tackle corporate tax avoidance.
    But the document suggests that a new German government may not be prepared to wait another two years for the OECD to submit its recommendations for change.
    (Reporting by Matthias Sobolewski; Writing by Noah Barkin; Editing by Madeline Chambers, John Stonestreet)
    ((noah.barkin@thomsonr... 2888 5091)(Reuters Messaging: noah.barkin.reuters.co...
    Keywords: GERMANY BANKS/
    For Reuters Top News page click the following link:
    21 Nov 2013, 07:42 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2335) | Send Message
     
    Really good insight LT.

     

    On a related topic -- while Larry Summers has a few faults -- most agree he is a good thinker. And his thinking complements in part what you describe coming to Germany et al. as everyone reaches for new sources of cash flow/growth.

     

    He noted in recent remarks that " the world economy may be entering a period of “secular stagnation,” where aggregate demand fails to recover and sustain growth on anything like the pre-crisis trajectory...

     

    In this altered economic environment and accompanying political malaise, then — though Summers does not draw this conclusion in his brief remarks — we may experience ever more extreme financial storms and potential catastrophes."

     

    There is also a brief discussion in the article as to why Europe is particularly exposed to the potential calamities.
    http://on.mktw.net/1aT...
    mj
    21 Nov 2013, 09:45 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    I agree that Europe is exposed the most, because they are way behind the USA in a recovery and other political changes necessary to fix their ills. Mainly because Germany is calling the shots and hogging all the pie.

     

    I don't think we crash again like '08....or have that many catastrophes unless brought on by congress.

     

    However, I agree with Summers, growth in the USA & globally will be slow.

     

    I have long credited this to the aging population, it's global too.
    There is an article where economists are beginning to research this view that many like me who is 55-65 are retiring from jobs and have no intention to re-enter the employment field except part-time or like me as a Realtor or Volunteer RN who is "contract labor"....but still listed in the "workforce participation rate" and in some cases unemployment ....this really skews the numbers and also economic models that have worked in the past.

     

    As we get older, we spend less. It's just nature. I may have 1-2 more new cars in my lifetime, that's nothing to do with the economy...it's my life here will be gone. This scenario is 55% of the population....now that's scary.

     

    Below is a link to the unemployment numbers vs. economy that I mentioned.
    http://bit.ly/1dkPo8q
    21 Nov 2013, 11:02 AM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    About 6 months before the election in Germany a new party started that wants to return to the mark and ditch the euro. They came in with 4.7% of the vote and needed to have 5% to get in. Next election they may be a much bigger contender. One of my german friends and his fiancee are visiting and we were just talking about this last night.

     

    They said they are seeing a lot more concern in germany.

     

    edit: found link on the new party

     

    http://bit.ly/1h5UNRg
    21 Nov 2013, 06:16 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    DG, I bet they get in on the next election. In reality the Germans should be worried, but at the same time take a different path in some areas.

     

    I imagine some of this is why they want the rule changes mentioned above.
    21 Nov 2013, 06:56 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Iran, world powers reach deal but "key oil" sanctions to stay
    Iran and the P5+1 world powers have struck a six-month interim agreement in which the Persian nation will limit its nuclear program in exchange for an easing of international sanctions that will provide the country with $6-7B of foreign exchange.However, "the key oil, banking, and financial sanctions architecture, remains in place," the White House said in a fact sheet."The EU crude oil ban will remain in effect and Iran will be held to approximately 1M bpd in sales, resulting in continuing lost sales worth an additional $4B per month," the sheet said.Iran will eliminate uranium enriched to 20%, halt the installation of advanced centrifuges, refrain from commissioning its Arak heavy water reactor - from which plutonium can be made - and remove its stockpile of the fissile material, which is thought to be almost enough to make one nuclear bomb.The sides now plan to spend the next six months working on a permanent deal.The P5+1 and Iran have expressed satisfaction with the deal, but Israeli ministers have already rushed to the airwaves to denounce it.President Obama's statement.
    24 Nov 2013, 03:42 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Wonder what this does to the price of oil? Big oil can amazingly kick the can down the road .... but the mkt. should react to more oil coming on the mkt. soon.
    24 Nov 2013, 03:44 AM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    How about the Saudis? They are adamantly against this deal.
    You just watch, the Iranians will wind up with nuclear bombs when this is all over.
    24 Nov 2013, 02:39 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    There is absolutely nothing big banks haven't done in the name of capitalism for profits:

     

    U.K. accuses RBS of profiting by killing off healthy companies
    The British government is reportedly set to accuse RBS (RBS) of forcing "vibrant" small businesses into financial trouble, "squeezing them for exorbitant fees and charges, and ultimately seizing their assets to swell its own vast property empire."
    The allegations are part of a report by businessman Lawrence Tomlinson, who is a key adviser to Business Secretary Vince Cable. The report is due to be released tomorrow.
    24 Nov 2013, 06:12 AM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    US Banks have done similar disservices to small business owners for years. There is nothing new in the act, just that some governments have their hands out to force large sanctions from these robber- banks to bouy their failing economies. Apparently there is no honor among thieves, they steal from each other...
    24 Nov 2013, 02:45 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    OG, I agree with both. I am sure iran could have a bomb today, in fact probably do...question is can they deliver it ?

     

    24 Nov 2013, 02:54 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    LT, I am listening to Sunday news commentary on how the Iranians just negotiated themselves a good deal at the expense of the rest of the world!
    By the way, I don't think this agreement will in any way make the markets feel more stable on Monday! Also, there was some kind of oil well seizure in Syria the other day. *Syria's civil war has made its wells a target for months.
    At any rate, here is a link to the latest news story:
    http://bit.ly/1jyyLmZ

     

    My apologies to Rattie for hijacking his EZ blog and turning it into a Middle East blog...
    24 Nov 2013, 03:06 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    German Government Cuts Out Apple Over NSA Spying
    The German government is phasing out its use of Apple’s iPhones as part of a new secure communications initiative.
    Wall St. Cheat SheetPolitics & GovernmentNational Security Agency
    24 Nov 2013, 08:15 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Nov 26, 2013 - Portugal's latest austerity budget wins approval.
    http://tinyurl.com/kag...
    26 Nov 2013, 12:40 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » I added recent projections of GDP for the EU and many other countries from Socgen. The chart is included at the bottom of the concentrators header. These were published in ZeroHedge on Nov 26, 2013. http://tinyurl.com/lpj...

     

    Socgen predicts that Europe is only half way through its lost decade of 2007-2018 (see chart). They blame much of this weak performance on a slow policy response in tackling both the sovereign and banking crisis, and the still too slow pace of structural reform. The fear is now that the euro area is on the verge of deflation.
    26 Nov 2013, 02:20 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    deflation is creeping up in other places too....Soon as any central bank tries to tighten, or reduce stimulus, things slow down too much.
    26 Nov 2013, 03:39 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    Deflation is the horror of Japan right now. Abe is taking desperate measures to counteract its effects with limited success.

     

    One way to look at deflation is as growth in the wrong direction, where all assets diminish in value.
    30 Nov 2013, 09:40 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    I'm not certain that much of what we see happening in Japan is true deflation. The decision was made to hugely inflate the entire national real estate inventory by about 10,000 percent about 30 years ago, and when the inevitable bubble popped, they avoided paying the price by deciding to forego growth and to slowly whittle down the mammoth overvaluation.

     

    This process is about half done, but they still have a problem, and the answer is still to keep slowly deflating the still very large bubble. Single buildings in Tokyo are now worth only half as much as the state of California instead of 100 percent...

     

    We're they to normalize the insane valuations propping up their keibatsu balance sheets, I suspect it would allow growth to restart... But under new management and after bankruptcy for much of the country's major companies.

     

    American growth rates are, to a limited extent, burdened by a similar plan involving the TBTF banks and the Fed.
    1 Dec 2013, 04:38 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Look for more of this to come in a year, I have been against corps taking on huge debt to pay inflated dividends and stock buy backs just to prop earnings and have over priced stocks.

     

    $3 trillion headache on the way for corporations
    http://cnb.cx/184DGdo
    30 Nov 2013, 11:01 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    I am having a tough time understanding deflation. Could it be when productivity increases but no one wants or can afford the product? Prices of product would then be reduced to move the inventory.

     

    That makes some sense. Given that the real (wage) income of the USA population has been slowly decreasing for the last 10 years, it could also be that there isn't sufficient demand for goods at a CONSTANT level of productivity. Even real property prices could fall when the 90% hit the end of their borrowing capacity.

     

    Am I even close with this attempted explanation?
    30 Nov 2013, 07:17 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    Try this:

     

    http://bit.ly/1ceMY8h

     

    and my favorite writer about the illogicality of "inflation" and "deflation" discussions in the popular media:

     

    http://bit.ly/1ceMY8j
    30 Nov 2013, 11:38 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Great links Doc.... Thank you.
    1 Dec 2013, 12:57 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    SMaturin: Thanks for the references. Apparently I am more right then wrong in my thinking. I always wondered why ANY inflation was supposed to be good. But I suppose it is good for those with debts. Like the central governments of the world. Ahh!

     

    NOW I see why deflation is bad :-) So maybe I need to go out and borrow some money and buy some real assets. Because I anticipate increasing inflation in the coming years.
    1 Dec 2013, 01:37 AM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >Smaturin-

     

    Thanks, Doc-

     

    Both articles seem to lay a drop in prices (deflation?) primarily on the reasoning that people tend to put off buying when prices are dropping. That may be so for a new car or house but I feel spontaneity rules a lot of thinking for most other purchases. I believe supply and demand are the forces at work now.

     

    Siliconhillbilly, I believe hit upon a much more important component- that of a declining income among the middle class- ten years of decline and still dropping. People just don't have enough disposable income in the aggregate to make the kind of purchases as in the past, sticking more to the essentials and foregoing the stuff they would like but can't afford. Even if they do have the funds many are hunkering down in fear of what is coming down the road.

     

    Inflation is indeed the friend of the deficit spending bureaucrat. Paying back those debts with inflated dollars saves money on the repayment side while blasting the fixed income folks.

     

    In Japan, the aging population is a large part of their problem. That and the fact that they are savers and reluctant to spend doesn't leave much in the way of tools for stimulating their economy further. Abe has indeed taken on a serious problem. I hope it plays out.
    1 Dec 2013, 10:39 AM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    WT: "People just don't have enough disposable income in the aggregate to make the kind of purchases as in the past, sticking more to the essentials and foregoing the stuff they would like but can't afford."

     

    Our magnanimous government and its statisticians call that "hedonic adjustment."

     

    I have certainly had to adjust my hedonism in recent years.
    1 Dec 2013, 10:53 AM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >SMaturin-

     

    Boy I'm glad you said that- You're not alone.

     

    I can't even afford to be hedonistic any more, just a little narcissistic.
    1 Dec 2013, 01:51 PM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Yes, in this case we have a near pornographic exposure of the thinking wherein all money and assets should belong to government, where the rulers view any funds remaining for individuals as misappropriated.
    1 Dec 2013, 01:52 PM Reply Like
  • Stilldazed
    , contributor
    Comments (2150) | Send Message
     
    Hope all had a great holiday.
    Many of the middle class became unemployed and had to take lower paying jobs. Get ready for the next round of mortgage defaults as they now are forced to buy more expensive medical insurance. Barely scrapping bye to hopelessly buried in bills by government mandate.
    1 Dec 2013, 01:12 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >Stilldazed-

     

    An article this past week that delinquencies and defaults have increased somewhat over last month but nobody seems to worry about it- statistically insignificant they say, seasonal aberration others say,
    Hmmn.

     

    http://bit.ly/184JwxF
    1 Dec 2013, 01:46 PM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Just winding up our traditional holiday resort show. Weather was beautiful at the scenic Brasstown Valley Resort, and the crowds were down from last year about 80 percent. Black Friday was a bust from what I hear and saw...

     

    The few customers we saw looked haunted and worried. I may do a series of film noir images, though it will be hard to duplicate the surreality of colorful decorations, confused and beaten down middle class pretending to shop and enjoy the season, with a cheerful traditional Christmas music soundtrack...

     

    Horrific results. Lots of fear about what the new year will bring.
    1 Dec 2013, 02:01 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    >Stilldazed: I refuse to believe that anyone will be forced to pay a fine for refusing to buy health insurance. It is just too blatant to stand up to actual enforcement. Under the force of public exposure, the penalty will be delayed and reduced and then just disappear. No one at the Fedgov level seems to have a problem ignoring laws that annoy them. "Failure to enforce", by bureaucratic fiat, is alive and well in the "new normal" of unelected rulers.
    1 Dec 2013, 02:08 PM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    Stilldazed: Since you mentioned the ACA (Obamacare) I had to mention what I've been thinking about.

     

    The primary argument, beyond the usual - we've got to take care of everyone - was that it's unfair for taxpayers to cover the medical bills of the uninsured.

     

    But it's apparently OK for younger folks to be forced to pay for the health care of other folks by having to buy services they don't need to make the premiums cheaper for those with greater need *and* government will provide a subsidy for those that can't afford the premiums.

     

    Well, apparently younger folks must not be taxpayers, as the ACA is supposedly removing the burden from the taxpayers, and the subsidies must be coming from some ethereal "money pot" because we have removed the burden from the taxpayers.

     

    I'll forgo the discussion of constitutionality, sustainability in a demographically deteriorating society, and power grabs represented by such legislation as this.

     

    Say hello to a new, expanded and improved IRS while we're at it.

     

    HardToLove
    2 Dec 2013, 06:44 AM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    Re: Black Friday-

     

    Accurate call, Trip-

     

    CNBC reports a decline in sales-

     

    From Investing.com (National Retail Association)
    -
    http://bit.ly/1bDIABo
    2 Dec 2013, 09:46 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    There is also news that the decline in Black Friday sales is due to the Thanksgiving day opening. and "overall" weekend sales are up. Internet sales topped $1B for the first time too.

     

    Don't read much into all this crap.....I took a suit to be altered and it will be Dec. 18th before I get it.

     

    Holiday sales will be ok...with the usual "some will beat, some will miss" but sales will be up yr/yr
    2 Dec 2013, 10:54 AM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    The final verdict will come in the early parts of 2014 with the number of merchants calling it quits, restructuring, etc......

     

    We should start a poll to see who guesses the most number of correct names as to who does not make it this season. Put Pennys at the top of the list.
    2 Dec 2013, 11:31 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    The brick and mortar middle ground retailers are in trouble. Big trouble. I agree about Penny's, and add Sears to that list. Sears will have to restructure soon, and I would expect them to emerge as a much slimmer retailer (built around their appliance and tool businesses), but they will spin off KMart which will become an independent once again (and probably able to survive as a WalMart alternative.

     

    I think some blood will flow in the drug chain wars, as we saw a few years back when RiteAid got hammered. CVS is strong (but I simply cannot comprehend a marketing structure that has them building large stores only a block apart (3 within 3 blocks of my home). This sort of saturation reminds me strongly of the gas station boom days... Could Walgreens be vulnerable?

     

    Major mall retailers are due for a big round of weight reduction, too. Macy's, Dillards, Needless Markup, er, Neiman Marcus, and so on. The big malls will either cut deals to curtail the red ink for their anchors, or lose them, with nobody waiting in line to take up the slack.

     

    Anything retail with a brick and mortar base is at risk. Period.

     

    Flip side is a bonanza that just keeps on booming for shippers. Of the major shippers only the USPS has no clue how to tap into the rich profits. UPS and FEDEX are going to keep growing. FedEx's successful acquisition of Brown Trucking and their entre into what was UPS territory with ground trucking offers is likely to see them dip into that area for more acquisitions, perhaps including even larger items now considered "truck freight only". UPS is overdue to answer, and they will...
    2 Dec 2013, 04:21 PM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    When Amazon starts using drones for delivery FEDEX and UPS might get hurt. I am amazed they figure they can drone this stuff in for delivery. Has anyone seen the Taiwanese take on the drones. Hilarious.

     

    http://bit.ly/18cmHWP
    2 Dec 2013, 06:40 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >HTL-

     

    "a new, expanded and improved IRS

     

    I can feel the love already!
    2 Dec 2013, 07:20 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    TB, I agree, would not touch the REIT's with Malls as income....they have over priced rent for 40 years. Ours here had to sell Dilliards (the old Kastner Knott) the land and allow them to attach to the mall. Same with Macy's.

     

    It's sorta funny, they ran all the mom & pop stores out, but still can't turn a profit to shareholders.

     

    Sears is a mystery, they have a good CEO and he even taught some crooked short sellers a lesson about fooling with his company stock. But, why can't he see the areas he needs to get into in order to attract the young crowd? Heck, put an Apple genius bar in them or something.
    2 Dec 2013, 07:27 PM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    Funny that cartoon from one of the countries that are the biggest proponents of robotics for persona;l as well as industrial use.

     

    HardToLove
    3 Dec 2013, 12:34 PM Reply Like
  • Stilldazed
    , contributor
    Comments (2150) | Send Message
     
    siliconhillbilly,
    The "have to pass it to know what's in it" crowd doesn't care whether people can afford the insurance or the fines. The law doesn't affect them, they are exempt.

     

    Reality and their perception of reality are two very different things. It is very easy to be callous about the economic effects of laws when you don't personally have skin in the game. I see it as a "let them eat cake" attitude, with the " don't they understand how we are helping the poor" mindset (more like helping to make them poor). The poor have previously qualified for Medical and Medicaid, not the lower middle class. Now the lower middle class is going from subsistence to default to meet the legal (SC justified tax) medical mandate. JMHO

     

    Sorry gang, rant over.
    1 Dec 2013, 02:51 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Moody's upgrades Greece by two levels
    Moody's has increased Greece's debt rating by two notches to Caa3 from C and said the country's outlook is stable, citing its progress in fiscal consolidation and a "cyclical recovery in the economy."Moody's expects Greece to "achieve (and possibly outperform) its target of a primary balance in 2013, and record a surplus (of 1.5%) in 2014."The ratings agency forecasts that GDP will fall 0.5% in 2014 but grow 1% in 2015.S&P and Fitch rate Greece at B-, six levels below investment grade. Moody's ranking is nine below the threshold.Moody's move comes as Greece and the Troika try to negotiate a deal that would provide the country with another €1B in rescue money.
    1 Dec 2013, 09:20 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    >LT: re: Greece credit ratings. Do you suppose there might have been just a bit of guvmint pressure on the rating agencies over this "upgrade"? Last I looked, the southern EZ countries were in the "wishin' and hopein' " mode about fiscal stability. Of course, stability might be defined as "no change in the patient's condition" ;-).

     

    As in, " the patient is critical, but stable" Not exactly GOOD news!
    2 Dec 2013, 12:54 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Absolutely agree… the ECB wants Greece to reenter the private markets… Meanwhile, the lying continues..
    2 Dec 2013, 03:43 PM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10612) | Send Message
     
    The patient has achieved room temperature and is in stable condition. For now!
    3 Dec 2013, 02:18 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Yuan overtakes euro for trade finance
    The Chinese yuan has passed the euro to become the second-most used currency in global trade finance, the Society for Worldwide Interbank Financial Telecommunication (Swift) says.
    The renminbi took an 8.66% share of letters of credit and collections in October vs 6.64% for the euro.
    The yuan's rise has been rapid, with its share in January 2012 just 1.89%.
    The trend indicates that China's attempts to internationalize the currency, such as loosening forex controls, have been successful. The government intends to take more steps as part of a major economic reform plan.
    ETFs: FXE, EUO, ERO, CYB, CNY, DRR, FXCH, EUFX, ULE, URR
    [Global & FX, Top News] Comment!
    3 Dec 2013, 05:07 AM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10612) | Send Message
     
    If the Chinese drop their dirty peg the Renminbi would go into free fall. It's no where near reserve currency status. That peg is the reason it holds any value at all.
    3 Dec 2013, 02:26 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » All hell is breaking loose in the Ukraine and the Ukraine president is taking a trip to China... Why? Because the Ukrainians owe Russia nearly a billion dollars for natural gas, and if they don't pay, off goes the gas - in the winter. That's the lever the Russians hold over the Ukrainians, hence the recent torpedoing of the EU trade partnership deal.

     

    The Ukrainians apparently want China to provide loans so they can pay the Russians for their gas. Gas that will get a lot more expensive if that EU deal goes through... Of course the Chinese are going to want something for their help. I doubt the Ukrainians have much to offer, but China wants a free trade agreement with the EU.

     

    Meanwhile, Putin said Russia's economy would be hit if European goods - seen by Russian analysts as good-quality and relatively cheap - were allowed to transit through Ukraine tariff-free. He said Russia's agriculture, car and aviation industries would suffer as a result and there could be a jump in unemployment. "We are not ready to open our gates to European goods."

     

    So Putin sees the EU / Ukrainian deal as an EU backdoor into Russian markets. Of course, if the EU did their deal with the Ukrainians, the next move would be removal of the free-trade agreement between the Ukraine and Russia, but black markets being as they are, their would be leakage across the borders.

     

    That big energy stick that Russia carries is the reason why the EU wants a natural gas pipeline from the ME through Turkey into the EU.
    3 Dec 2013, 05:41 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Pretty good analysis,
    3 Dec 2013, 05:58 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » December 2, 2013
    FT: Grexit or Bankruptcy for Greece Within the Next 4 Years
    From: GreekReporter, by Ioanna Zikakou

     

    While analyzing the sustainability plan of the German government that derived from the coalition between Angela Merkel with the Social Democrats, the newspaper wrote that within the next four years, Greece will either return to the drachma or declare bankruptcy, or both.

     

    The Financial Times article says that the biggest threat to Germany over the next four years is the on-going EU debt crisis.

     

    The FT article points out that: The Organization for Economic Co-operation and Development forecasts that Greek sovereign debt ratio will stabilize at 160 per cent of gross domestic product in 2020. However, the EU and the IMF have been basing their bailout numbers on a target of 124 per cent.

     

    Because of this, the article suggests that in the next four years, Greece will either default or exit the euro – or both. The EU’s “pretend-and-extend” strategy of revolving loans at longer maturities and lower interest rates is approaching a natural limit.” http://tinyurl.com/m8l...
    ===
    I think extend and pretend or kicking the can will continue. I see longer maturities and lowered interest rates being offered.

     

    I was thinking last night about the emphasis that the Greeks seem to be placing on their achieving a positive primary surplus in their budget, so long as payments of the principal and interest on those EU loans was not considered.

     

    It seems like such a silly name playing game. But wait a minute. If the Greeks do achieve a positive primary surplus, that means the Greeks would no longer need further loans from the EU except to pay back principal and interest on those EU loans held by EU banks and the ECB. So when they do achieve a positive primary surplus what's to stop them from simply defaulting, leaving the EU, and switching to the Drachma?

     

    Looked at from that perspective, are Greek proclamations on achieving a positive primary surplus a hidden threat to EU powers? If you don't forgive some of our debt, we will simply default...

     

    The ECB is going to conduct another "stress test" on EU banks in the near future. Will sovereign debt bonds still be considered as "risk free". If they are, who is going to believe the results of the stress tests?
    3 Dec 2013, 10:10 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    Re: Euro zone bank stress tests. >FPA, does anyone believe the results of the previous stress tests? The only reason the EZ national banks can attract (private) investors now is the implicit guarantee of the ECB.

     

    When the curtain is parted (say, in a major market crunch) the whole charade will be over. Just more fuel for the world wide crash.
    3 Dec 2013, 01:33 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » No, the last test was total BS… this test is supposed to be improved… I believe it will also be BS.
    3 Dec 2013, 02:29 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >FPA-

     

    " I believe it will also be BS."

     

    I believe you're losing your confidence in the integrity of the banking community!
    3 Dec 2013, 03:06 PM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    FPA: A long time ago (in a concentrator far, far away) I voiced the idea that Greece would be better off (then) by defaulting and going forward from there. They would be long past the most painful portions had they done it then.

     

    Its also noteworthy that departing the euro and defaulting on debt do NOT have to be simultaneous. The Greeks could just stop paying debt payments on the more painfully priced debt, continue paying the rest, and do a selected default while remaining within the EZ. This would put the ball in the Triad's court, and I suspect they would immediately start backing away from any painful decisions.

     

    IF the EZ then kicks the Greeks out of the club (a process with no precedents and no set procedures) the Greeks could react accordingly.

     

    I see many options for them, with the status quo probably the worst choice.
    3 Dec 2013, 03:08 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    TB, I remember that and added that Greece losing control of some key infrastructure was a killer. They should have bailed then.
    3 Dec 2013, 05:59 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    >trip: Something to remember about Greece is the size of their black economy. I suspect their productivity is much higher then the statistics show. Greater employment, higher personal earnings, etc. Given that this black income is almost impossible to tax, the guvmint skim from the productive economy must be decreasing.

     

    So I like the idea that Greece will continue to limp and moan publicly (please help meeee! ) for an indefinite time while the ECB whines and then loans them more money anyway. What would be the endgame for the Greeks? Don't know. But they could greatly recover while looking pathetic on paper. Wages will fall to equilibrium levels for those working in the black. No minimum wage for them. You can't put an import tax on "midnight" importation. How much coastline is there in Greece? A lot!
    3 Dec 2013, 07:04 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Looks like the CFR is seeing things the same way I am… this was posted on the CFR site the day after my original post. It was picked up and published on ZeroHedge today Dec 9 - http://tinyurl.com/nk5...

     

    A recent study by CFR (Council on Foreign Relations) finds that countries are most at risk of defaulting the year they turn a positive primary budget - meaning they are no longer reliant on their creditors. Simply put, the Greek government has far less incentive to pay, and far more negotiating leverage with, its creditors once it no longer needs to borrow from them to keep the country running - this makes it more likely, rather than less, that Greece will default sometime next year. Beggars, once again, become choosers. http://tinyurl.com/mqy...

     

    For example: Financial Times: Greece Defies EU As It Begins Parliamentary Debate on 2014 Budget
    9 Dec 2013, 01:45 PM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    FPA: LoL! So the "fix" to prevent default and protect the creditors becomes the most likely weapon to to what waws supposed to be prevented!

     

    I love the crazy way this financial world works!

     

    HardToLove
    9 Dec 2013, 02:23 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    >FPA: That assumes the Greek guvmint isn't lying about the "positive primary budget" numbers. Still, if they just want the clout for negotiation purposes, the lie is almost as good as the real thing :-)

     

    I gotta admit I want then to screw the ECB and default. Something has to wake up the EZ.
    9 Dec 2013, 03:49 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » I don't think there is any doubt that they are lying… that is why the Troika sees a 2 to 3 Billion euro shortfall… but the Greeks say it's only 500M euros… The Greeks are bluffing and the Greeks know the EU knows they are bluffing… the question is will the EU call the bluff?
    If they call the bluff… it opens the wound again in the EU press… It's guts Vs. leverage…
    9 Dec 2013, 05:29 PM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    It looks to me that as long as the Greeks get to play with other people's money they are willing to get the last drop of milk out of that cow before it is turned to hamburger. Why do it earlier?
    3 Dec 2013, 04:12 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    More trade is now settled in yuan than in euros. But global dominance is still a ways off

     

    http://bit.ly/1c9XslY
    3 Dec 2013, 06:51 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » France's unemployment rate has increased for 9 consecutive quarters and is now at 11.03%. It has not been higher since Q3 1997.

     

    I wonder what France's real unemployment rate is?
    5 Dec 2013, 10:15 AM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    FPA: France needs to take a lesson from us on how to *really* manipulate.

     

    Like the ECB followed the FED eventually, they'll follow us eventually I guess. We follow them to socialist behavior, they follow us to manipulative behavior.

     

    HardToLove
    5 Dec 2013, 10:24 AM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    Let us have a moment of remembrance for a great hero in the struggle for freedom and self-determination.

     

    Thank you, Nelson Mandela, for inspiring the world to become a better place for all.
    5 Dec 2013, 08:01 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2335) | Send Message
     
    Well said SMaturin. The many accolades can't be overdone with this man. 25 years in prison -- and he never gave up his fight. Then when he got power -- he exited gracefully after one term. Some very rare lessons for us all.
    mj
    5 Dec 2013, 08:35 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    I caught this article in Bloomberg, about stolen electricity in Greece. Note two points:
    1.The quote that free electricity is a god given right; and
    2. The fact that these poor have been excluded from the electrical grid because the Greek government enacted an onerous tax-collecting scheme on the backs of the electric company and these poor.
    Here is the article, it is sobering.
    http://bloom.bg/1iENWzT
    5 Dec 2013, 09:45 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    http://cnb.cx/1knpCy2

     

    McKinsey: the world needs $57 trillion to keep growing

     

    (McKinsey is a very well known consulting group....and $50 Trillion was the magic number I said all along....I just wonder where it will come from? IMO, it's going to take all the Fed Reserves globally can do and combine that with the private funds.)
    7 Dec 2013, 03:14 PM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    Not sure if there is that much paper and ink to go around. Who sells the paper and ink.
    8 Dec 2013, 10:52 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    dg...I always use the $50 T figure because that's what was wiped out in '08 in the crash in just a few days. Until gov't global can create that much wealth back and a big part of it go to the consumer (working class) we can't grow any more than now. That's why we have QE.

     

    Banks and the rich have their part back now, and are growing wealth again. (bonds fully recovered to par, and stocks doubled/tripled) but mom & pop are still struggling...thus the call globally to raise wages now & a bigger push on income quality / redistribution of wealth....it's not about taking more from the rich as it is putting the balance of money creation into the consumer hands going forward.

     

    I view the economy/money supply as a game of Monopoly....there's only so much money and property in the game. When u look at Forbes list of billionaires and the % of total wealth they control, it's easy to see. I don't have the answer to how to create this, but I will say it's not 100% in higher taxes, except in closing corp loopholes and off shore accounts loopholes....it has to be new money & it has to go somewhere besides corporations balance sheets overseas. Some consumers will spend it, some will pay debt off (like me), some will save it, but it's in the system working for everyone. Don't worry, corps will get their share and more too just in increased sales.

     

    Lastly, I will take a shot at QE....it is not as dangerous as it appears on the surface. Most of QE buys mtg. backed loans. So whatever is in housing loans and real estate (except commercial & industrial loans) will be paid back much faster than 30 years. In the 1980's the average housing loan was only on the books 7 years. In 2007 that figure was only 4 years. People either sold, moved, refinanced. So the fed can take the payoffs and recover a lot of money over the next 5-10 years. Which may be way too fast, and it acts just like "reducing" the money supply. It's almost like an automatic self imposed financial discipline to control the fed balance sheet. Wall St. knows this and that's why they have panicked on tapering news.
    IMO, the tapering talk at the end of the summer was just lip service to cool the stock rally and real estate boom....and it worked. Of course banks loved it because they want loan interest rates to increase while they can still get free money to finance them with. Real estate home loans rates went up 1-2% and there was no change in fed policy, just words. So financiers have increased their profit spread by 1- 1 1/2 % in 2 weeks and for free. When rates went from 3.5 to 4.5 that's a 33% increase in profit margin....u can see why banks are salivating on this. (they are still getting free money from the fed, and paying 1% on CD's)

     

    lastly, when QE ends, there will have to be some form of stimulus. This is where gov't pols enter the picture....they just can't ever do it right or big enough. It all winds up in a few of their constituents hands. In the past, the "old guard" has gotten all of it, they fight change because the next big stimulus is NOT going 100% to them, it will go mostly new & different groups and spent in different ways to be effective. Sending $300-600 to everyone with a mailbox won't cut it, that was a joke and wasted resources. But Wal-Mart loved it.
    Building one road or one bridge to nowhere won't cut it either.

     

    History will probably prove that pols should have worked with the fed and not against them and the consumer would have been as much better as corp balance sheets are.

     

    How global govt.'s create such a huge number is going to be key going forward. I don't believe there's that much free cash in the private sector, and debt is not a good option either.....

     

    so your question is still unanswered, but I have been watching for 3 years now... to see how/when they do this.

     

    (sorry for the length, but some of this I wanted to discuss for a long time now)
    9 Dec 2013, 05:03 AM Reply Like
  • Stilldazed
    , contributor
    Comments (2150) | Send Message
     
    Hi LT,
    Once consumers start having money to spend, save or to pay off debt, we will see the beginning of inflation across the board IMO. Too much money chasing limited goods and services. If the amount of discretionary money builds slowly and industry can ramp in proportion, it can be handled, otherwise look out.
    9 Dec 2013, 02:05 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » December 9, 2013 Financial Times: Samaras is Unwilling to Obey Troika
    From: Greek Reporter, by Nikoleta Kalmouki

     

    An article in the “Financial Times,” published today reported that Samaras is no longer willing to succumb to the demands of the Troika. According to the article, the Greek government might adopt a more assertive attitude towards the Troika due to the achievement of a primary surplus....

     

    NOTE: *** FT reports that the Greek Parliament ratified the 2014 budget, on Sunday (Dec 8), IGNORING EU legislation that requires prior approval of the Greece budget by the European Commission and the International Monetary Fund. ***
    ---
    If the Troika refuses to release the one billion Euro tranche, it's the EU banks that will not get paid on a Greek default. If that happens, rates on other EU countries sovereign debt will soar...

     

    Keeping with the tradition of "kicking the can" I suspect the EU will applaud the Greeks on their austerity achievements, and will give the Greeks the next billion dollar tranche that goes right back to the ECB and the EU banks. In addition, the EU will announce some kind of delay on Greece's repayment of sovereign debt principal and interest for say five years and claim this will help them in their economic recovery. What is actually going to happen is that the Greeks will never repay the loans. Of course, we all knew that because it's impossible to repay that much debt given the Greek economy.
    9 Dec 2013, 05:52 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Whether Greece is lying or not, as their economy stabilizes....they can run a much tougher bluffing game. They could also be looking for an excuse to default and screw the Germans too.

     

    Default all depends on just how much they gave in security for the bailouts that was never published publicly. No doubt the weakest hand will fold.
    9 Dec 2013, 07:43 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    The world may be getting tired of layoffs and job cuts, If I were a board chairman, I would be working on some hiring/job retaining breaks before the govt.'s start coming down on them. Corp's have way too much cash and future profitability to play games with governments.
    http://on.mktw.net/1cy...

     

    http://on.mktw.net/1cy...
    10 Dec 2013, 08:57 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    The path is set, all but preordained...

     

    The Western democracies will quickly discard their corporate power while grasping after dreams and will o' the wisps. The process is well advanced but still accelerating. Europe set the pace for a long time, but now America is quickly overhauling them and will surpass them very soon.

     

    Our technology has turned an automation corner, and now is cannibalizing our job pyramid from the head down. It is acting as a potent multiplier. Just as "horsepower" was transformed by the industrial age, "engineerpower" is now transformed by the information age. A single engineer working with automated systems supported by the titanic power of information technology is multiplied 10,000-fold. The same thing holds true for lower level jobs, where robotic production (and robots building robots, which is already a reality) replicates (and displaces) the effort of millions of skilled laborers.

     

    Corporations have ALWAYS been just empty, soulless shells - artificial constructs imitating life. Now they are shells primarily composed of interlocking nests of smaller shells, with a paltry few humans still needed to keep the wheels turning. Every day fewer humans are needed to produce more of whatever good or service the corporation creates...

     

    As the new Order consumes more and more of the job pyramid, the odds that these empty artifacts called corporations will create more jobs than they destroy approach zero.

     

    Mankind, as a species, has some problems to address in regard to its own future.
    10 Dec 2013, 09:16 AM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    As a small business owner my biggest headache is employees. Head/neck or tail hurts so they will be late or not coming and a host of other issues keep them from being on time or at work period. Unionized employees are even worse so I understand the desire to go automated and reduce the biggest headache and cause of lost opportunity to business. With out the workers present, be they human or robot, business walks out the door.

     

    I wish it wasn't so but I fully understand. Maybe employees with the best work ethic will be running the plant while the others watch robots take their job they cant make it to or be on time for.

     

    Maybe work ethic should be part of what gets addressed.
    10 Dec 2013, 10:49 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    trip,

     

    there still remains the problem of raw materials. The rapidly increasing use of composites (carbon, glass) for structural materials will greatly reduce the need for structural metals such as iron. Aluminum will replace copper as a conductor for most uses. But the specialty metals (copper and etc.) requirements will only grow.

     

    That, and hands on repair and maintenance, are some of the next industrial limiting factors. It's going to be interesting.
    10 Dec 2013, 03:12 PM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Hence my long term investment focus in metals and energy.

     

    As human capital depreciates in value (and switches from an asset to a liability), the value of cultivated land and critical raw materials will rise to balance the scales.

     

    The New World Order (conspiracy wackiness alert) has proposed limiting the planet's human population to 500million. Thus far I have not seen what they propose as a means to that end. Short of some such scheme, our growth rate numbers are prone to hit a wall somewhere pretty soon.
    10 Dec 2013, 04:08 PM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    Please note the list of banks that might have bail-ins with in EZ.

     

    http://bit.ly/1jIWqnM
    10 Dec 2013, 11:30 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    EU agrees on plan for dealing with failing banks
    European finance ministers could be creating the conditions for a future run on banks after agreeing on a framework for winding down failing firms in the sector.Crucially, major depositors will be a first port of call if a bank needs cash to shore up its finances, as happened in such brutal fashion in the bailout of Cyprus earlier this year.Money could then be taken from a country's national resolution fund, which could request assistance from the funds of other nations. Eventually, a common European-wide fund would be created.ETF: EUFN
    | 4:36 AM|Comment!

     

    FAS
    FDIC OKs plan for taking over failing financial firms
    The board of the Federal Deposit Insurance Corp. (FDIC) has authorized a draft plan on how the agency would break up large financial firms that are about to collapse and without a taxpayer bailout.The FDIC has the authority to take over failing banks under the 2010 Dodd-Frank rule in order to limit the impact of any collapse on the financial system; the regulator would keep the operating parts of an institution open, prioritize creditor repayments - although this includes imposing losses as well - and it would recapitalize a firm.The agency is now seeking public comment on the plan.ETFs: FAS, XLF, FAZ, UYG, VFH, IYF, SEF, IYG, FXO, PFI, KBWB, RWW, FINU, RYF
    11 Dec 2013, 04:55 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    OT, questions & food for thought:

     

    1. Sprint just floated $2.8 billion of new debt, matures in 2024 at >7% yield. Probably to build out 4G service. Any takers here?

     

    2. Trulia just went public and floated debt, of which $30 million is for stock buybacks already. Not good for a new company struggling to make a profit already.

     

    3. Biggest one yet: MasterCard has 10:1 split, increases dividend 83%

     

    MasterCard announces 10:1 split, 83% dividend hike, $3.5B buyback
    With shares trading well above $700, MasterCard (MA) has decided to carry out a 10:1 split. Share distribution is set for Jan. 21; the record date is Jan. 9. (PR)The transaction processing giant is also hiking its quarterly dividend by 83% to $1.10/share ($0.11/share post-split), and announcing a new $3.5B buyback program. The new buyback will kick in once the $514M remaining on an existing $2B authorization is used up.The dividend hike leaves MasterCard sporting a 0.57% yield. MasterCard's next dividend will be paid on Feb. 10 to shareholders on record as of Jan. 9.Between its new and old buyback funds, the company is capable of repurchasing 4.3% of outstanding shares at current levels.Shares +1.9% AH.

     

    4. This one fascinates me, I think Nuance is the pioneer of Apples Siri:
    It's dropped a bunch from the summer highs in the $20's to $13 now. Icahn keeps buying.

     

    Icahn ups Nuance stake again, shares +1.2% AH
    Carl Icahn continues to bet Nuance's (http://bit.ly/YGoESK) big YTD decline represents a buying opportunity. Just six days after disclosing his firm has raised its stake in Nuance to 18.7%, the media-friendly activist investor discloses he bought another 1.38M shares from Dec. 6-10.The latest purchases leave Icahn with a 19.2% stake in the voice recognition software leader.

     

    5. Rally to end when stock buybacks end:

     

    http://seekingalpha.co...
    11 Dec 2013, 05:11 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    1. Sprint is preparing for a new round of very intense competition. I am out of telecom with no intention of re-entering any time soon.

     

    2. Avoid Trulia.

     

    3. MC is an astounding cash cow. The 83% dividend hike is just the first of many such (they will be paying much higher dividends in the future, imo). I would prefer to see an even larger dividend hike right now, and less stock buyback funding, but I suspect they are being cautious. Stock buybacks are one time events, and rarely impact a stock negatively when they are ended, whereas cutting dividends is a big deal...

     

    4. Nuance may or may not be the beeg winner in voice recognition. I have been watching this area for years, and I find it puzzling that IF Nuance was going to be dominant long term, why hasn't Apple (etc) snapped them up? I also wonder if the answer is that there are developments in the skunkworks of the major competition that make it a risky bet... Icahn has bet wrong before.

     

    5. With the news out of MC, the stock buyback craze seems to have longer legs than earlier believed...
    11 Dec 2013, 06:04 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    TB, exactly my take too on all your points. I will add that stock buybacks will probably last longer until corp profits go flat, otherwise they are just adding fuel to the fire, more profits-less shares on top of it. Maybe another couple of years until interest rates rise and sales peak out.
    11 Dec 2013, 06:22 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Did u see the late friday news that Sprint is preparing a bid for T-Mobile ?

     

    How much of that failed ATT cash is left at T-Mobile?
    14 Dec 2013, 04:38 AM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10612) | Send Message
     
    I sold the bulk of my (S) when the Soft Bank deal went through at a healthy profit. I kept a residual position that was composed of higher priced shares which had not reached profitability. They have now gone into the green and I'm watching for a good exit for those shares as well.
    2 Jan 2014, 12:00 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    An early trend that will probably expand from Asia to a global trend as corps have cut jobs and not cultivated new managers. Expect more youth to be hired and existing employees to get promotions and higher wages. Very early, but definitely a trend to watch. The good part is corps are funding this themselves.

     

    http://bloom.bg/19jtFKo
    12 Dec 2013, 04:32 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    Pension funds enjoy strong recovery
    The health of corporate pensions funds has rebounded to cover 96% of future obligations, JPMorgan estimates, boosted by surging stock markets and rising interest rates.The rate is up from 77% last year - a level funds have been stuck at since the financial crisis - and marks the strongest rebound since 1986. The trend means that companies don't have to spend as much on pension contributions.Public funds are also turning things around, with financing levels climbing to 76% from 66%.The figures could continue to improve next if year if bond yields keep rising as the Fed finally starts to taper.
    | 5:22 AM|Comment!

     

    FXE
    Eurozone industrial output surprisingly falls
    The eurozone's recovery continues to remain shaky, with industrial production dropping 1.1% in October after falling 0.2% in September and missing consensus for a rise of 0.3%.On year, output increased 0.2%, as in September, but came in well below forecasts of 1.1%. (PR)The euro is -0.1% at $1.377.ETFs: FXE, VGK, EUO, FEZ, ERO, EU, EPV, IEV, EZU, DRR, HEDJ, FEU, EUFX, UPV, ULE, FEP, ADRU, URR, FEEU, DBEU, FIEU
    12 Dec 2013, 05:50 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » December 12, 2013
    Greece Announces Primary Surplus of 2.7 Billion euros.
    From: Greek Reporter, by Nikoleta Kalmouki

     

    According to data presented by the Greek Ministry of Finance, on Thursday, the primary budget surplus now amounts to 2.67 billion euros for the first 11 months of the year (2013), remaining on track to meet annual fiscal targets.

     

    Earlier this week, the Greek Parliament approved the 2014 budget, which showed an expected primary surplus of 812 million euros for 2013. http://tinyurl.com/n8a...
    -----

     

    Interesting how the 2013 surplus number released today is more than three times the 2013 surplus stated in the budget approved only five days ago (Dec 7). One would think something as important as the Greek 2014 national budget would be based on the latest available information. Yet now we are told the actual amount of the surplus is three times larger than stated in a budget approved five days ago. Pure Humbug.
    12 Dec 2013, 02:30 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    Greece may become the hub of that emerging European art form, the politiconomic shadow dance. Watch in fascination as this new art form spreads throughout the southern EZ.
    12 Dec 2013, 02:48 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    decent read on new EZ pol's that may make life tough for Germany, at the least Germany won't be able to wield so much influence and there will be changes.

     

    http://on.mktw.net/1hS...
    14 Dec 2013, 04:36 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    It's getting time to think about 2014 investing themes, below is sorta my opinion and plan:

     

    1. Correction will happen at some point, stock gain predictions of another 20% year may be to high. I think mkt. goes up, but maybe not as much as predicted.

     

    2. Shorts....IMO, '14 will be a year the bears can gain some ground as elections loom again, and some companies disappoint, it will be a stock pickers mkt. There will be shorting opportunity again.

     

    3. Long...big industrial laggards such as GE, MSFT, APPL and others...they have to have a catalyst tho.

     

    4. Bonds...interest rates will rise. But not as high as some think. Banks are going to push this to increase spreads. So bonds are a big question mark to me. Some preferred and bonds may be oversold at 20% + under par already with hefty yields. Other bonds will drop. Big dilemma here for me personally.

     

    5. Real Estate...I think the big gains are in. Any further rise in mtg. rates will have a negative effect on sales big time. Example: in '13 our mkt built mostly $250,000 +/- homes. Only a few in the $200,000 +/- range. Now they are dropping back to $135,000 homes for '14.
    Numbers are to be taken with caution, as banks will loosen jumbo loans again to hide the skewed numbers.

     

    This is just an overview of my opinion. I will hold cash for pullbacks, occasionally lock in profits with puts/selling calls etc. For me '14 will be all about limiting risk and using caution. I have a few more ideas, but will quit here for now. I look forward to hearing other's comments and plans.
    16 Dec 2013, 06:06 AM Reply Like
  • Windwood Trader
    , contributor
    Comments (3330) | Send Message
     
    >LT-

     

    Re: 2014 investing-

     

    Thanks for your viewpoint. I share most of your thoughts.

     

    I believe anemic growth continues (if at all) and investors and savers will be hard pressed to gain a foothold just to make ends meet. Therefore consumer discretionary does not look very attractive to me. Bankruptcies are once again on the rise. Labor participation rate flounders.

     

    You mentioned industrials- Agree the catalyst requirement. Caterpillar, John Deere and PACCAR (PCAR) are the canaries in the mine for me. PACCAR even looks good at the present, IMHO.

     

    Investments on the medical end could make sense- especially the insurers that have their act together. Infrastructure growth should continue but not as fast as some think. Hospitals are continuing to expand and their development of off-site surgi centers and emergency care facilities will continue. Bio-pharms are always an opportunity as are some retails in the medical arena.

     

    Capital investment companies do make sense to me and provide a decent return, with obviously not all such companies are of quality substance. Need to do the due diligence with these characters.

     

    Energy distribution companies, pipelines and tankers- both truck and sea going as well as rail should see continued growth.

     

    Just some off the top thoughts, but without a much improved labor participation rate I for one would be a lot less sanguine about our position in the world economic scene.

     

    WT
    16 Dec 2013, 09:20 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    1. My take is that 10% market gains for 2014 would be a reasonable expectation, although there will be extreme variances in sector performance.

     

    2. Bear raids and flash sector rotation will be the new methods utilized by the ins, with the dwindling supply of retail investors their targets. I believe 2014 will be the year when we see different packs of bears attacking one another...

     

    3. I believe some blue chips will have good years, but no rocket launches. Some will have bad years. Mixed performance for the bigs, as they see how a crony socialist/capitalist system rewards ins, punishes outs, and chooses which is which.

     

    4. I see the cozy relationship between government and the 2Bigs cracking in places, but overall continuing along the gradual road we have seen them travel since 2007. The slow motion train wreck in Europe will continue, and the Fed will be involved at all levels. Interest rates influenced by the Fed will continue to be pushed toward zero, while market forces will push back. 2014 could see the Fed still ahead in the game, but that is a question. Longer term SOMETHING must give...

     

    5. Real estate is still in a state of massive flux. I believe the next shoe to drop will be new legislation meant to replicate the roots that created the last meltdown, as if that event never happened. This will ignite another bubble, though one of a shorter life span and a very different nature. Each new set of politicians believes that the idea will work, since they are much smarter than the last set... I tend to agree about the impact on jumbo loans, IF they are treated as better collateralized than the underlying majority of ideological experiments. If jumbo loans become just another subset of spoils from the political system, the corruption will etch another layer deeper into the fabric of the nation.

     

    Good talking points for discussion, LT.
    16 Dec 2013, 09:22 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    I agree with all your points TB, and they are exactly the numbers I expect.
    Let me expand on Real Estate a bit, I don't think houses will be the bubble, there was a pent up demand created in house buyers over 4 years that people sat still because of uncertainty...the smart ones started buying in mid-late 2012, followed by the pack in '13. But that ended like turning a light switch off on Labor day in Sept.

     

    Granted the rise in interest rates didn't help, the gov't shutdown was the worst but mainly the buyers were gone, it wasn't as many there as thought earlier. I am getting busier now, but nothing like a year ago. So I see housing sorta doing a self correction....

     

    The bubble is in rentals - Apartments. They have massively overbuilt. These will be a bust at some point as rents won't hold up as high as predicted & vacancies will be high. Bankruptcies here will be big and massive. IMO.
    16 Dec 2013, 09:36 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Real estate will slop along until the new legislation hits (might be after the elections, might be before). The idea used to sell it will be to "clean up the mess" at Fannie/Freddie/FHA. What it will actually do is throw the gates open for more of the same we saw culminate in 2007. This will ignite a frenzy as the large in's that have been snapping up thousands and thousands of "rental plan" houses in huge lots (and the 2Bigs sitting on enormous shadow inventory) become sellers. Look for foreign investment houses to form collections to speculate (similar to what was seen in England and elsewhere during the Spanish boom), such as is already happening in Florida.

     

    The ramp up will be steep, the bubble pop abrupt, and the ramp down even steeper. Odds are good that the eventual disaster will coincide with some geopolitical event (Eurodebt, war, middle east, China, political schism) but will also include a major financial meltdown. Might take a few years, maybe 2016?

     

    The rental situation is a "maybe" imo. Apartment construction makes sense IF society has indeed made a shift from an owner mentality/agenda to a renter/transient base. I think we WILL end up with a renter/transient economy (all along the slide back to 2nd/3rd world status), but will probably have to kill the dreams of millions more of our youth before it happens. Scenario depends on just how many participate in the bubble and how hard the crash that follows. Timing yet to be determined...
    16 Dec 2013, 10:54 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    trip, My thought on the US property/housing bubble is that when overseas (EU, Japan, China, Russia) investor groups begin buying up US real estate in bulk, the end is near. It will mean they are desperate to find SOME store of value, with the possibility of appreciation. The immediate effect will be fuel for the bubble; the follow on will be another major property crash.

     

    Is there any reliable data source on foreign buying of US property? Anyone?
    16 Dec 2013, 01:06 PM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    I'm getting reports out of Florida of widespread purchases by foreign nationals, including foreign corporations and organizations. Less so in Atlanta, though there is some occurring...
    16 Dec 2013, 01:22 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2335) | Send Message
     
    SH,

     

    the National Association of Realtors published the 2013 Profile of International Home Buying Activity which may be helpful. http://bit.ly/18Ro3Xl

     

    mj
    16 Dec 2013, 01:34 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    Thanks Mercy.
    16 Dec 2013, 03:07 PM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10612) | Send Message
     
    Wall Street is largely responsible for the rise in real estate prices. http://nyti.ms/19N5KmF They are deriving rental income from these properties and using them as collateral for leverage. The market in Canada is beginning to slump at this point. http://bit.ly/19N5KmH What happens if new legislation as described by TB actually is passed? Does the big money stop flowing precipitously? It may be stopping already as the financial sector becomes gorged on it and stops buying. My REIT holdings are down marginally at this point and the overall picture for them doesn't seem to be improving markedly.
    2 Jan 2014, 12:27 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    student debt

     

    http://abcn.ws/1bThKUf
    16 Dec 2013, 07:49 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    One more thing,

     

    Fed Tapering....will only benefit the banks and no one else Banks will push rates as high as they can. It will hurt corps too.

     

    Banks will still be getting free money from the fed 0.25%, and lending at much much higher spreads and rates.

     

    The $85 billion/month is gradually adding money to the economy, which is needed but it's not getting to where it needs to go. Increased debt on consumers, corps, & gov't is not good long term.

     

    The dilemma is (I am quoting lenders I work with) that no one has any money, earnings are poor, no one is able to save money now. Therefore the feds have to somehow replace the $50 trillion that was lost. Question is how to do it ? Huge wage increases are fought on many fronts but are desperately needed.

     

    What & how the fed does this will be huge as to the market gains/losses and also GDP.
    16 Dec 2013, 09:52 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    How will the new legislation designed to restart real estate construction be written? I am thinking it will have several phases (one for residential, one for commercial, and a big one for government built infrastructure). The residential initiative will probably come first (it has the most votes for sale), and will be couched along the lines of the GI Bill and VA loan programs seen after WWII. This will include a linkage to funding for job training and schools (just like the GI Bill), and will coincidentally paper over the huge current problem with existing Student Loan programs.
    16 Dec 2013, 10:59 AM Reply Like
  • Stilldazed
    , contributor
    Comments (2150) | Send Message
     
    Hi Guys,
    All my info is anecdotal. Myself and many people I know have lost good paying jobs and were only able to find jobs that pay like it was 1985. As you can imagine, discretionary income is nil. Now add in higher food, fuel and (mandated) insurance costs and we may be looking at another round of mortgage failures (even after HARP). Wages are still in deflation and many companies are not hiring full time because of company health insurance rules and the huge unemployed labor pool. Add in the student loans for the younger generations and we have a perfect storm situation, just not sure how this storm will materialize. I hope I'm wrong, but I keep thinking about Louie 14th and France. Many people are desperate now and this is increasing. Desperation breeds chaos and anarchy. I can define the problems, just can't define the solutions or how to invest to help provide a solution profitably.
    16 Dec 2013, 01:31 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    that "restart real estate construction" is why I am leary of rentals, if they fix it where veterans and the young can buy (student debt kids) then rentals are in trouble....and u know it will happen.

     

    Did you read on Yahoo where they are warning pol's about overlooking these millenials with student debt ? These kids gonna force change next 2 elections.
    16 Dec 2013, 03:00 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    They need to, they can't walk away from their debt now (and they are jobless living at their parents and on their parents insurance up to age 26 just drowning in debt.)
    That was a gift of Bush 2 to Sallie Mae-making it impossible to discharge education loans. Before we know it, we will see student loan debt swept away in bankruptcy proceedings, or some kind of reduction, state-sponsored, of course. HAMP for students...or some such thing.
    16 Dec 2013, 06:20 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    optionsgirl typed: "we will see student loan debt swept away in bankruptcy proceedings, or some kind of reduction, state-sponsored...."

     

    It seems inevitable to me, also. No pol worth his re-election fund will allow millennials (voters!) to be eternally squeezed by guvmint provided student loans. Bail them out, while telling them how lucky they are that THIS administration really CARES about them!

     

    It's only 1 trillion US$. The FED can just run off some more $$ tomorrow :-(
    16 Dec 2013, 10:30 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    p.s.-How ironic is it that this is the same group needed to fund the boomers under obamacare!?!
    17 Dec 2013, 02:09 PM Reply Like
  • doubleguns
    , contributor
    Comments (8613) | Send Message
     
    Sounds like everyone will be bailing out each other with borrowed money from the other guy who is borrowing from peter to pay paul. We really are looking more and more like the EZ.

     

    Wake me for the collapse.
    17 Dec 2013, 06:29 PM Reply Like
  • H. T. Love
    , contributor
    Comments (18429) | Send Message
     
    D.G.: I guess as with the importance of velocity of money for economic growth and stability, now so it is also with velocity of credit.

     

    Maybe just a different form of Ponzi - nothing new in the concept, just different instrument and application I think. The new lenders finance the old borrowers to pay the old lenders.

     

    HardToLove
    17 Dec 2013, 07:40 PM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    We have built our world
    On houses of Visa cards
    Trembling in the wind.
    17 Dec 2013, 08:15 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    Wow, economic haiku. Very nice SMaturin!
    17 Dec 2013, 11:40 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4100) | Send Message
     
    Nice one SMaturin. Gave me a chuckle with a migraine in tow, no small feat.
    18 Dec 2013, 10:50 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » December 18, 2013 Greece secures 1-bln-euro tranche

     

    The Eurozone working group of finance chiefs has ok’d release of a delayed one billion euro installment from international lenders after the Greeks agreed to downsize the Hellenic Defense Systems [EAS] and lift a ban on foreclosures with protection for the most vulnerable.

     

    The Greek government also said it would extend a cut in the Value Added Tax (VAT) on restaurants from 23 to 13 percent without permission of the Troika.

     

    Greece won concessions here because the Troika wanted the Greeks to
    sell off or shut down the EAS because it loses money, and has been used as a dumping ground for political patronage hires for decades.

     

    If the EAS is not making a profit by the end of next year, it will be downsized further. http://tinyurl.com/l8g...
    ---
    No surprise here as the tranche will be used to service loans to ECB and EU banks. Meanwhile, the payout of a further 4.9 billion euros in euro-zone aid has bogged down in disagreements over Greece's spending plans for next year.
    18 Dec 2013, 03:40 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Trimming the rather large EAS and, ultimately, the Greek Army is not a surprise (particularly since there are several scenarios for default which might be untenable if their Army presents a genuine barrier to enforcement via military intervention).

     

    This kills two or three troublesome birds with one stone.

     

    It also empowers the black economy and its mobsters, as another instrument of government power is weakened.
    18 Dec 2013, 09:14 AM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    the European Union has been downgraded to AA+ from AAA by S&P.
    20 Dec 2013, 11:02 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    About time. Now only about 5 or 6 steps over-rated...
    20 Dec 2013, 11:19 AM Reply Like
  • Jon Springer
    , contributor
    Comments (4100) | Send Message
     
    Just now?

     

    I would like to know what their definition of AAA is. Seems to me, if you can print your own money, your nation/confederation/i... is AAA in the sense that you can always pay your debts, although the currency value debts are repaid with may not be worth as much as it was when the obligation was taken out.

     

    So, either having a printing press is AAA, or currency stability plus a printing press is AAA. If it is the latter, what country has a currency pegged to anything that would hold its value certain?

     

    (None. Whether pegged to dollar, euro, bitcoin or gold, all monetary instruments are free floating in value.)

     

    So, what is AAA?
    23 Dec 2013, 01:09 PM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10612) | Send Message
     
    Sub prime mortgage backed debt instruments apparently!
    2 Jan 2014, 12:36 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    This is a good read and example of a huge shift in demographics. This focuses on jobs moving overseas, but add in demand decrease and use your imagination.

     

    1.Keep in mind that approx. 55% of the population is boomers, so many of these will be gone...or at least out of the mkt. (both stocks & as a consumer)
    2.Jobs may move overseas or may not.

     

    OT :10 American Industries That Will Be Destroyed in the Next Decade
    http://yhoo.it/JUKh1X
    22 Dec 2013, 04:54 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Demographics in America have always been about immigration. So long as the official attitude (vs laws or regulations, which of course are routinely ignored in a crony socialist/capitalist system) is to encourage immigration, a level of population growth is assured.

     

    Europe flirted with this alternative, but it was never popular or successful there, and in the rare case where large diaspora occurred in modern times (chiefly France) the outcome was riots and massive arson. The influx of utterly incompatible cultures and the prospect that the only major religious group which openly seeks political power (the muslims) comprised most of the potential immigration pool...

     

    Other nations that might have elected to immigrate some growth will probably seek another option.
    22 Dec 2013, 11:29 AM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    I knew immigration would come up, I have put a lot of thought into that over the years and personally have mixed emotions. It's more than just population growth, and I am not sure how it plays out. We do know a few things such as it takes 1-2 generations to get them educated where they can achieve the average american wage & lifestyle.
    IMO, most of them won't, they will be held to lesser paying jobs or even higher salary jobs but at a cheaper rate. The USA has about 20 years max to offset the boomer generation. So we are behind already.
    Progress is being made, but way too slow.
    22 Dec 2013, 02:22 PM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Current trends should shorten the runway for new immigrants a great deal, although it involves chopping down the existing standard of life so that the third world immigrants reach the new 2nd world standards pretty quickly. I would say in about 10 years or so.

     

    By that time our pay scales will have deteriorated (particularly when enumerated in the new lire, ie grossly devalued American dollars).

     

    The problem is political and geopolitical, whereas demographics are the effect rather than the cause. As automation continues to advance and international trade becomes a competition between various sets of robots rather than human beings - and geopolitical blocs with very similar goals rather than diametrically opposed ideologies - demographics will continue to decrease as an "important" factor.
    23 Dec 2013, 07:07 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    LT, I have my doubts about many of the industries in the US decreasing drastically. They will have to change, though.

     

    Example 1: automated laser cutting of cloth combined with new robotic sewing technology could make clothing manufacturing costs drop in the US. The (likely) higher quality would make US brand names sought after by affluent foreigners.

     

    2: 3D printer tech is drastically reducing the cost of prototype and short run "stuff" manufacturing even now. The high investment in single product manufacturing eqpt could almost vanish, along with its lead time. Time from design to production could be drastically shortened, giving the maker closest to the market a big advantage. The time it takes the Foreign Manufacturer to "understand" a product would put them behind the curve.

     

    3: Short runs of relatively high value parts would NOT be done overseas. The learning and transportation cycle is too long.

     

    4: Labor rates will keep rising in newly capitalistic countries.

     

    5: The global currency war is heating up. US import tariffs will began appearing, maybe as soon as next year, IMHO. Especially if the Fed fight to inflate the currency fails, as many now think it will.
    23 Dec 2013, 05:27 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5038) | Send Message
     
    Cliff Wachtel has a good article on SA regarding increased risk to EZ, and TBTF EZ banks. Deutsche Bank is one of them. The article is entitled
    It's Official: New EU Bank Reform Disastrous For EU, Euro, Everyone - 14 Reasons
    23 Dec 2013, 01:28 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Deutsche Bank is behind a lot of ETFs too…
    23 Dec 2013, 01:58 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    Wachtel makes some good points. Someone to * watch*, fer shur. Sorry ;-/

     

    The EZ seems to be loaded and cocked, with a set trigger. Problems in Turkey? MidEast problems migrating to Islamic enclaves in France ? Any loud sneeze could set it off.
    28 Dec 2013, 01:49 PM Reply Like
  • LT
    , contributor
    Comments (5491) | Send Message
     
    BitCoin....u guys got any thoughts on this ? I know it was banned in some countries lately & is volatile.

     

    http://on.mktw.net/1hI...
    27 Dec 2013, 06:07 AM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Its equally invalid as compared to the fiat currency manipulation/wars, imo.
    27 Dec 2013, 11:35 AM Reply Like
  • SMaturin
    , contributor
    Comments (2305) | Send Message
     
    A new ephemeral and exotic species: Tulipa cryptographia.
    27 Dec 2013, 11:11 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » December 29, 2013
    Today the French constitutional court approved a 75% tax on all those earning over €1 million. The proposal passed after the government modified it to make employers liable for the 75% tax. As BBC reports, the levy will last two years, affecting income earned this year and in 2014. There has been a chorus of protest from businesses and wealthy individuals who have condemned the tax. Polls suggest a large majority in France back the temporary tax.
    ---
    The power to tax is the power to destroy....
    29 Dec 2013, 01:39 PM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2355) | Send Message
     
    FPA: In this case, it is the power to destroy their own nation! Watch for GDP in France to drop even faster over the next 2 years.

     

    Gas up your company car on company gas and drive to your company supplied town house.
    
    If you are connected to the right people, I bet you can sidestep the tax, somehow. Cronies always make out well in government heavy economies.

     

    29 Dec 2013, 02:05 PM Reply Like
  • tripleblack
    , contributor
    Comments (13587) | Send Message
     
    Its not WHAT you earn, but WHERE you get paid.

     

    Look for high earners to suddenly discover that they need to get paid in a tax haven polity rather than back "home" in France.

     

    So, what they do for Total Oil in France is only worth 20k per year, but doing the same thing in, say, Algeria is worth 2million per year.

     

    Odd how that happens...

     

    American movie stars have been doing this since the 60's. Nothing new. Business as usual.

     

    Look for French executives to suddenly sport much more "multinational" job titles, too. Chief Financial Officer will also become "CFO Turkey Operations", "CFO Mexican Operations", etc, etc, etc.

     

    For the same reason.

     

    Don't underestimate the "...make employers liable for the 75% tax..." component, either. This means that companies can "index" key employees, essentially paying the tax load FOR them (whereas the constitutional court COULD have made it the responsibility of the individual, in which case this would be illegal).
    29 Dec 2013, 03:22 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4100) | Send Message
     
    France keeps shooting itself in the foot. It has had wealthy people willing to pay quite high taxes relative to the world for many years for the right to be French, and other quality of life benefits. Various things they've done the past few years - including to trust agreement arrangements - continue to encourage a flight of the wealthy French elsewhere in Europe or further abroad... Luxembourg, Andorra, Monaco, Switzerland, Spain, the United Kingdom, Belgium, Italy, the United States and Israel, are among the countries that should send the French government a thank you note.

     

    I understand the sentiment of the law (because I'm a sentimental kind of guy) but at this juncture it can only backfire.
    30 Dec 2013, 07:51 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » The Saga Continues - Happy New Year!

     

    Link to new Stability Of The European Union News Concentrator
    http://tinyurl.com/m9d...
    1 Jan 2014, 01:03 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6188) | Send Message
     
    Author’s reply » Link to new Stability of the European Union January 1, 2015: http://tinyurl.com/o2u...
    31 Dec 2014, 10:26 PM Reply Like
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