Ningaloo reef resort exmouth market
10 comments
Joyetech eliquid buy
Well my fellow Slope-a-Dopes, it seems the ominous warnings signs, precisely laid out in EPs And this time, it's not just the Greek Gods that are pissed off. The Eurozone volcano is not only spewing gritty ionian volcanic ash clouds, grounding all Airbus a's on the continent, but much more terrifying, the real thing, hot molten iberian lava which may well cause a complete melt down of the entire grid. Spain is deep in the red hot shit, and if you thought Greece was bad, you may want to turn away from the brilliant erupting flames before your eyes fry.
Spain's economy is the fourth-largest in Europe, and it's twice as large as Ireland, Greece, and Portugal all put together. Spain's failure would likely spell the end of the Eurozone, the 17 countries that use the euro currency, and would send shock waves through the global financial system. However, investors in the know claim the austerity measures, harsh as they are, fail to meet the government's previous deficit targets.
In addition, many analysts are skeptical that the local governments, which enjoy a degree of autonomy from the central government, will follow through on all the cuts. Can you say, burning Andalusia! Also most alarming, is the sate of the Spanish housing market, which has been often described as "the mother of all bubbles". The lasting effects of Spain's housing crash continue to weigh down banks, the construction industry, and the investment-services sector.
Investors run scared of Spain's battered banks — Reuters: The government has ruled out more state aid for a sector that comprises a motley mix of international lenders and heavily indebted local savings banks. That leaves two options: Prospects for a private sector solution are poor. Nothing on the horizon looks likely to persuade foreign fund managers to invest, such is the fear of the banks' growing bad loans, their holdings of shaky sovereign debt and the worsening economy. Already battered by a property market crash that began four years ago and continues unabated, few Spanish banks are able to borrow funds on wholesale credit markets and the majority are instead relying on the European Central Bank.
Analysts at Citigroup suggest Spanish house prices could fall a further percent before hitting a floor. This will eat further into the value of the plus billion euros' worth of property assets on banks' balance sheets — billion euros of which is already classed as "troubled" by the Bank of Spain. What are Cajas you ask? Largely unregulated regional Savings and Loans banks.
Much like the U. It started with the cajas being unable to obtain payment on their loans as construction companies fell into bankruptcy and many loans defaulted. This led to construction companies owing billions of euros to the Spanish banking system, with estimates running as high as While cajas and major banks differed to an extent, global investors saw this as the first sign that the Spanish financial sector was in serious economic trouble.
This led to investors losing confidence in the Spanish banks, which caused bank shares to quickly lose value. This led to a cycle where the banks needed more cash to pay the investors who wanted to withdraw their deposits from the banks. From January through April , investors pulled out a total of This led to more bailouts being offered by the Spanish government, which only further eroded investor confidence in the Spanish economy. It is important to note that Spanish loans are usually recourse loans.
The yield on the year government bond in Spain, which had displayed some relief in the latter half of the week, resumed a climb upward, rising 15 basis points to around 5. According to data from Markit, the cost of insuring Spanish government debt against default using credit-default swaps, rose to an all-time high.
Do you know where the U. Or put more bluntly, as Mish's Friday headline reads: If your counting on the ECB cavalry to mount yet another heroic charge up the battle hill to storm the Castilian castle, think again. The US dollar was the big winner, with the trade-weighted dollar index jumping 0.
The chivalrous Euro, after nobley clawing its way back off the ground early last week, sure looks like it may finally be ready to resume its free fall. Next stop EURO 1. Where does this European debt crisis end up? Have you ever heard the expression; "the center can not hold"? Well, that is exactly where the EU's monetary union is heading. The inherent structural flaw of the EU monetary system, was caused by the monumental error of adopting a single currency with one central bank for all sovereign states through out the eurozone, without a corresponding, and equally essential centralized fiscal authority.
It is simply impossible to sustain a monetary system without a reciprocal fiscal system. You can not print money without the ability to raise money, it's really as simple as that. This historic blunder, created an unsustainable monetary union, whereby the less productive countries on the periphery, were permitted to grossly exceed the debt loads that their internal economies could legitimately carry or service.
The defective union created the age old false promise of loose money. Much like our own sub-prime fiasco, excessive funds were offered against the inability to actually pay those funds back. What we all lived through in with the colossal crash of the U.
The disintegration of the EU monetary union will be a sight to behold. As the fiscal structural austerity reforms are demanded of the less productive indebted states by the more productive fiscally sound nations, a vicious cycle of economic contraction followed by government revenue collapse will send the afflicted states into deep protracted stagnation.
Keep in mind that European nation states have highly developed public sectors, that play significant roles in their economies as a whole, which ensures that the austerity measures will bite even harder into their GDPs.
France is already showing signs of economic stagnation, and even the mighty Germany will eventually feel the adverse effects of a crippled Eurozone. As the inevitable deteriorating economic picture of the eurozone's periphery becomes clearer and clearer for all to see, the stronger states will run for cover. They will simply walk away, and refuse to be sucked into the never ending morass.
Outright bail outs will no longer be tolerated, they will be a thing of the past. And eventually, the short sighted quick fix ECB policy of handing out free money to the famished European banking system will also be seen as the failure that it truly is.
This free funding money flow is simply trapped by the weak under-capitalized Euro mega banks, running in place exchanging the ECB hand outs for sovereign bonds so as to pocket the unearned spread, hardly a recipe for stimulating real GDP growth anywhere. The money does not make its way into the real economy on the ground, the faltering banks simply will not lend to businesses in the face of a brutal contraction.
So there you have it, without growth the Eurozone will simply choke on its own debt, be it private or public. Last week the reality of the desperate situation, that is the Eurozone, recaptured center stage with a vengeance, and it will only get worse from here on out..
The Bundesbank has become aware of the danger. It is now engaged in a campaign against the indefinite expansion of the money supply, and it has started taking measures to limit the losses that it would sustain in case of a breakup.
This is creating a self-fulfilling prophecy: Markets are beginning to reflect this. The Bundesbank is also tightening credit at home. The heavily indebted countries will either fail to implement the necessary measures, or, if they do, they will fail to meet their targets, as collapsing growth drives down budget revenues. Either way, debt ratios will rise, and the competitiveness gap with Germany will widen. Whether or not the euro endures, Europe faces a long period of economic stagnation or worse.
Other countries have gone through similar experiences. Latin American countries suffered a lost decade after , and Japan has been stagnating for a quarter-century; both have survived. But the European Union is not a country, and it is unlikely to survive. The deflationary debt trap is threatening to destroy a still-incomplete political union. Zerohedge paraphrasing George's point of view, goes one step further: Analogizing the periphery countries as third-world countries that are heavily indebted in a foreign currency that they cannot print , his initial conclusion ends with the blunt statement that " the euro has really broken down " and the ensuing discussion of just what this means from both an economic and socially devastating perspective: So you see dopes, the European Volcano is now erupting before our very eyes, China is falling off of a seismic cliff, the U.
All macro no momo……… Evil Plan