Europe closes sharply lower following rate cuts - both expected and unexpected - and additional...


Europe closes sharply lower following rate cuts - both expected and unexpected - and additional QE in the U.K. The ECB chose to pass its chance to wow markets with a bigger-than-expected move. Stoxx 50 -1.2%, Germany -0.5%, France -1.2%, Italy -2%, Spain -3%, U.K. +0.1%. The euro -1.2% to $1.2382.
Comments (15)
  • Archman Investor
    , contributor
    Comments (3320) | Send Message
     
    The fact that all stock markets now move up solely on the hopes of central banks easing illustrates just how sick the world's markets and economies are.

     

    I am 100% long stocks, corporate bonds, own precious metals outright and do have hedges in place.
    5 Jul 2012, 11:41 AM Reply Like
  • Tack
    , contributor
    Comments (16281) | Send Message
     
    AI:

     

    In fact, U.S. markets have advanced completely devoid of QE for the past year, but many still insist that it, or anticipation of same, is only thing driving the market. A look at the past year's retail, autos, housing, construction and employment suggests otherwise.
    5 Jul 2012, 11:50 AM Reply Like
  • Archman Investor
    , contributor
    Comments (3320) | Send Message
     
    Tack:
    I hear you. There is a school of thought out there that says:

     

    "If you are the king" (Which I am and hopefully you are too) things are really not to bad.
    However if you are of the peasant class, which is the other 70% of the population, the monthly government transfer payments just can't come soon enough.

     

    All the best.
    5 Jul 2012, 11:53 AM Reply Like
  • Tack
    , contributor
    Comments (16281) | Send Message
     
    AI:

     

    Socialistic governments (ours included) offer the opportunity to stop working and/or seeking advancement and join the peasant class. Many choose to do so completely voluntarily. Those that do so do not garner much pity from me.

     

    It's a disease in today's society that encourages one to think that somebody else -- an employer, the government, your mom, anybody -- is responsible for one's well being, rather than oneself.
    5 Jul 2012, 12:02 PM Reply Like
  • Archman Investor
    , contributor
    Comments (3320) | Send Message
     
    Tack:
    Agreed and it is heart breaking to see.
    5 Jul 2012, 12:06 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    Its an unnerving concept. Gov should be about justice. It should only be able to act when one person does harm to another, and even then a process should be in place to make sure the ability to accuse is not conflated with the ability to convict.

     

    We are now in an area where harm is being defined as a "failure to provide a benefit". In other words if you fail to be sufficiently charitable by paying as much tax as you are told to pay to support those that do not have to provide a benefit because of their political power, then you have become a criminal (ie, if you don't want to pay taxes for welfare, then we are going to put you in jail for not paying your taxes, which of course are used for welfare).

     

    Now, instead of gov being a protector against harm, it has become the agent of harm. Its an open ended grant of power. The simple fact that you fail to act has become a crime. You see this same logic in the health care mandate. The failure to act based on someone else's definition of what is good, has become a crime.

     

    It really is the logic of a thief. Thieves get angry when you resist the theft. This is why they often carry guns. So they can punish you for not complying with their demands that you provide a benefit for them.

     

    When the "failure to provide a benefit" concept is made criminal, nothing or no one is safe. Its a topsy, turvy world where good becomes evil, and evil becomes good.
    5 Jul 2012, 12:53 PM Reply Like
  • Tack
    , contributor
    Comments (16281) | Send Message
     
    hoop:

     

    You headed to Switzerland, Singapore or Chile? :-)
    5 Jul 2012, 01:10 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    That's the problem. Unlike a Quaker in Europe in the 1600s who had somewhere to escape to, there really is no where else to go. The US is still the highest deck on the sinking ship. I guess the best strategy is to shift more towards the gate keeper jobs (attorney, tax acct/attr, compliance consultant, etc), and stay away from real productivity jobs unless you can be part of the politically favored producers.

     

    How many small town bankers that have lost their banks wished they could have understood that?

     

    In every set of circumstances there are always opportunities, but you have to be honest about the environment to see them and not succumb to semantics and rhetoric about what was does exist instead of seeing what REALLY is. Its a shame we don't see this. We jab at the gloom and doomers, but what the jabbers don't see is what else might have been possible. Wouldn't you have liked your personal portfolio to be worth three times what it is worth now? That is really what has been given up here. Its not that we have avoided gloom and doom, but that we have denied ourselves far more wealth than we currently have.

     

    I've heard people talking about getting enough capital together to influence some place like Panama to reconstitute the gov under a limited republic. Its an interesting thought. Could you get enough wealth together to get some sovereign soil where the gov would only be limited to protecting capital instead of looting it. Then you move your factories and jobs there once you have secured a gov and a court system where corruption would be almost impossible. It would certainly be an attractive place for capital and capital investment. I heard of sea steaders, but you probably need land to pull this off.

     

    At any rate, you need billions to go to a foreign country and have a good lifestyle. For everyone else you just give up too much in the present to do that, it will still take the US a few decades to get there. It just won't be much fun watching people give up what they might have had, to settle for the lackluster what they do have.
    5 Jul 2012, 01:28 PM Reply Like
  • Tack
    , contributor
    Comments (16281) | Send Message
     
    hoop:

     

    All the three countries I mentioned run tight fiscal budgets, fully-funded and sequetered social-security systems and have very low rates of taxation. Tehy're not only "higher decks;" they're not even on the same boat.
    5 Jul 2012, 01:34 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    Which one are you going to?
    5 Jul 2012, 01:41 PM Reply Like
  • Tack
    , contributor
    Comments (16281) | Send Message
     
    hoop:

     

    Well, I've been to all of them multiple times, courtesy of my past life an an international exec. Let's see.... hmmmmm....

     

    Switzerland - very expensive, good food, crummy weather on north side of Alps, people on the quiet, serious side, little to no riff-raff, access to all of Europe, English gets you by, but German, or Swiss-German better in North, French in south, Italian in the real sunny parts

     

    Singapore - also expensive, rules and more rules, one of cleanest places on Earth, very hot and humid, even though in Asia, a long way to everywhere, culture shock, language issues at times

     

    Chile - easily most solvent and progressive of Latin countries, better speak Spanish (I do), great food, beautiful country, long travel distances to really go places, far away from rest of world (maybe, a plus)

     

    All things considered, I'd probably pick Switzerland to have access to rest of Europe.
    5 Jul 2012, 02:03 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    I guess that's what I meant by "highest deck". It just wasn't a financial analysis. It was also a quality of life analysis. The remnants of the free market in the US still provide some appealing alternatives to other, more expensive places. Of course Europe still has some remnants of their flirtations with free markets. I think Mises called it the "capitalist's reserves".

     

    I guess my strategy will be to find some way to loot the looters, and then leave before they find a way to loot it back.
    5 Jul 2012, 02:12 PM Reply Like
  • winningtrader
    , contributor
    Comments (2459) | Send Message
     
    The party has started with the BOE, ECB and PBC. The FED is late for the party - the cool people always arrive last but they still arrive. So, the FED is also going to join the fun and do a nice big QE3 to leave the above three players in the dust.
    5 Jul 2012, 05:34 PM Reply Like
  • Tack
    , contributor
    Comments (16281) | Send Message
     
    Not happenin'. Does no one take Bernanke seriously, even as he's been consistent in his word?
    5 Jul 2012, 05:39 PM Reply Like
  • Ben Bernankes friend
    , contributor
    Comments (475) | Send Message
     
    Hey, lets cut the rates over there because its been working so well here.....
    5 Jul 2012, 06:36 PM Reply Like
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