# GFC 2



## MrBurns (18 May 2012)

I think it's time to stop kiddng ourselves, it's already here.

Greece will lead to Spain and China will get the hic ups, even more than now, Retravision is the daily horror story - 
http://www.theage.com.au/business/administration-fears-for-retravision-20120518-1yugj.html

This might get nasty, worse than GFC 1


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## rumpole (18 May 2012)

MrBurns said:


> I think it's time to stop kiddng ourselves, it's already here.
> 
> Greece will lead to Spain and China will get the hic ups, even more than now, Retravision is the daily horror story -
> http://www.theage.com.au/business/administration-fears-for-retravision-20120518-1yugj.html
> ...




Sad about Retravision. They are good stores with helpful staff. As I'm in NSW I hope mine survives.


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## MrBurns (18 May 2012)

rumpole said:


> Sad about Retravision. They are good stores with helpful staff. As I'm in NSW I hope mine survives.




We'll end up with only Harvey Norman in the end if things get bad enough


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## ROE (18 May 2012)

MrBurns said:


> We'll end up with only Harvey Norman in the end if things get bad enough




That is How Gerry play, he's not a bad operator ...

he turn up the volume when things get tough and knock a few out ....

there is an article in AFR a few weeks ago analyst blame HVN for massive discount
that decimate JBH margin and other retailers....

I would do the same, if I have the muscles when things get real tough I turn up the heat
a bit more and drive a few more rivals out...


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## DB008 (18 May 2012)

MrBurns said:


> I think it's time to stop kiddng ourselves, it's already here.
> 
> Greece will lead to Spain and China will get the hic ups, even more than now, Retravision is the daily horror story -
> http://www.theage.com.au/business/administration-fears-for-retravision-20120518-1yugj.html
> ...




Who are you shorting?


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## McLovin (18 May 2012)

MrBurns said:


> We'll end up with only Harvey Norman in the end if things get bad enough




Does anyone actually shop there anymore? Even the franchisees know the ship is sinking and want out.


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## young-gun (18 May 2012)

MrBurns said:


> I think it's time to stop kiddng ourselves, it's already here.
> 
> This might get nasty, worse than GFC 1




it never left:fan


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## MrBurns (18 May 2012)

If Gerry doesnt get through it no one will, he's a clever bugger.
Watch what he does in the near future, shut stores etc, when retail is down even he won't escape. FTSE and DAX down again tonight.


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## McLovin (18 May 2012)

MrBurns said:


> If Gerry doesnt get through it no one will, he's a clever bugger.




Gerry runs a big REIT. It just so happens there is a Harvey Norman store in each of HVN's properties.

I will say with 99% confidence (and take that for what it's worth) that HVN will not exist in its current form in 10 years time. It might still be around but it won't be anything like it is now.


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## Glen48 (18 May 2012)

This will be a slow death the feds will do any thing to keep it going.
Thought the housing crash would start in 2009 but was out a few years the drip feed  tube has a hole in it so its going to be a slow death.
 Come back about 2017 with your cash for some bargains.


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## MrBurns (18 May 2012)

The last of the bigger money being spent on established housing is being spent now, from here on those buying will have sold on a lower market and will only pay those lower prices to get back in and down it goes.


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## Muschu (18 May 2012)

Surely nobody is really claiming that they know what will happen tomorrow?  I certainly don't. 

Do we not each evaluate our perceptions of the risk that exists, consider our own risk profiles, take advice or not, and make the best decisions we can according to our circumstances?

Mr B I thought a while back you were thinking you'd missed the boat on the TLS thread. Now it's GFC2? 

Maybe it is.. Or not.  

Regards

Rick


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## MrBurns (18 May 2012)

Muschu said:


> Mr B I thought a while back you were thinking you'd missed the boat on the TLS thread. Now it's GFC2?
> Rick




I did rick ...on that particular stock but the Greek problem has been hanging around for a while and has now ignited, all the signs of GFC 2 are now there, cant see how this can be reversed.


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## McLovin (18 May 2012)

MrBurns said:


> I did rick ...on that particular stock but the Greek problem has been hanging around for a while and has now ignited, all the signs of GFC 2 are now there, cant see how this can be reversed.




The difference between the GFC and now is the GFC was started by a series of largely unforeseen events. I remember at the end of 2004 reading something about the US real estate market and thinking we were in a bubble but I had no idea it would go as deep as it did or that it would cause a huge structural change in behaviour. What we know now is that the PIIGS are basically broke. Whether Greece stays or goes is much of a muchness in the grand scheme of things. It's hard to believe that it hasn't been priced in. It's the unknowns that cause GFC's not the knowns.

At least, IMHO.

ETA: I think industrials are in way better position now than they were in '08. The real risk is on the household sector who are still carrying a lot of debt.


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## StumpyPhantom (18 May 2012)

MrBurns said:


> I did rick ...on that particular stock but the Greek problem has been hanging around for a while and has now ignited, all the signs of GFC 2 are now there, cant see how this can be reversed.




Yep - no reversal.  Only question was whether the balloon would pop or deflate slowly.  Sounds like the former.

Let's just get to the bottom of the barrell ASAP and then work our way up from there...


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## young-gun (19 May 2012)

StumpyPhantom said:


> Yep - no reversal.  Only question was whether the balloon would pop or deflate slowly.  Sounds like the former.
> 
> Let's just get to the bottom of the barrell ASAP and then work our way up from there...




+1 phantom. Quite scary to think exactly where the bottom is. I've been wondering if good old isaacs 'for every action there is an equal reaction' applies to the global economy. Eg for every dollar created as debt there will inevitably have to be a dollar destroyed. For every bull run there will be an equivalent tank. Are we always going to end up back where we started? For every moment an economy is inflating or expanding will there be an equal amount of contraction/deflation?


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## wayneL (19 May 2012)

McLovin said:


> The difference between the GFC and now is the GFC was started by a series of largely unforeseen events.




Unforeseen? There were a group of us in here, and in the wider financial community banging on about what was coming for ages. 

Perhaps the exact trigger and timing was unforeseen, but not the event.


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## numbercruncher (19 May 2012)

Warming reading from some of yesterdays market commentary 




> 3.54pm: A quick dollar comment:
> 
> "The Aussie was sold-off during the session, after proving somewhat resilient overnight," said Sydney-based FOREX.com research analyst Chris Tedder.*
> 
> ...


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## Aussiejeff (19 May 2012)

numbercruncher said:


> Warming reading from some of yesterdays market commentary




Shhh!

You're sounding like one of those financial climate alarmists.....

Surely, the mighty Farcebroke IPO will save the World from GFC2 (come in Zuckers)?


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## StumpyPhantom (19 May 2012)

young-gun said:


> +1 phantom. Quite scary to think exactly where the bottom is. I've been wondering if good old isaacs 'for every action there is an equal reaction' applies to the global economy. Eg for every dollar created as debt there will inevitably have to be a dollar destroyed. For every bull run there will be an equivalent tank. Are we always going to end up back where we started? For every moment an economy is inflating or expanding will there be an equal amount of contraction/deflation?




Yep - I've been thinking about this overnight - trying to macro-predict the bottom (by comparison to GFC1 and the March 2009 low), so I would be grateful for any other views.  

I think we're probably already headed back to that low, but the question is how much lower.  That low occurred because the financial crisis tipped over into the real economy when the money freeze stopped the flow of commerce dead in its tracks.

So that's what to watch for this time around - the real economy.  Even if the global economy has one of its cyclical recessions (US after 3-4 years anaemic growth, and China due for one), that should be one where there is a normal pick up out of it.  It's taken for grant that Europe will be in a deep recession, so all that's left will be BRIC and the developing world.

What will the financial contagion coming out of Europe affect?  The worry is that it will combine will all these cyclical recessions - the synchronising effect of globalisation - and bring on a preciitous drop in the markets.

So if you thought GFC1 was a once in a lifetime opportunity, we might all be two-up on our way to the cat's 9 lives in the next 2-3 years.  Such a massive scenario you can't imagine playing out for a minimum 5 years, so plenty of time to clear debt and save pennies?


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## McLovin (19 May 2012)

wayneL said:


> Unforeseen? There were a group of us in here, and in the wider financial community banging on about what was coming for ages.
> 
> Perhaps the exact trigger and timing was unforeseen, but not the event.




People on here were predicting in 2005-06 that the real estate bubble and CDS's and securitised dodgy loans would send the financial system to the point of meltdown? Well done if you were.


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## MrBurns (19 May 2012)

How low will it go ?

FB float was massive and the DOW still slumped.

Depends, 

If Greece don't leave the Euro it still means big trouble as you really cant borrow your way out of debt indefinitely but it would give us a slight reprieve.

If they do leave that would be bad enough but if Spain then finds itself in too deep, and there's been a run on a few banks there lately, then there's REAL trouble, massive.

China depends on Europe to some extent and we rely on China so there's a real problem there.

Domestically there's insolvencies everywhere, people either have no money or are too scared to spend.

Overall I'd say the odds are stacked against this NOT being the beginning of GFC 2


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## CanOz (19 May 2012)

One thing that was worriying me more about this decline is the *pace* at which the flight to safety is occurring. Then today there was a HF manager on the Bloomy saying this too. Bond yields on safe havens such as germany, Canada, are dropping rapidly...money is coming out of Asain markets very quickly too. The Aussie dollar and other Asian currencies are dropping very fast. 

He said he 







> didn't know which way things were going to go, but this is wound up like a rubber band and I expect to see an event happen in the next 5 to 30 days




I'll check the Bloomy again later today to see if I can find an article containing the interview.

CanOz


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## MrBurns (19 May 2012)

> I expect to see an event happen in the next 5 to 30 days




An event ? That can't be good


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## Dowdy (19 May 2012)

MrBurns said:


> An event ? That can't be good




Greece pulls out of the Euro maybe?

It's going to happen, just when


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## MrBurns (19 May 2012)

Dowdy said:


> Greece pulls out of the Euro maybe?
> 
> It's going to happen, just when




If they do it will have massive consequences, their money will be worthless, the banks would have to shut down for a period etc

I dont think they will allow this to happen but it depends on the elections.

Whether they do or don't I think we're in for a tough time..... well it's with us now.


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## Julia (19 May 2012)

McLovin said:


> The difference between the GFC and now is the GFC was started by a series of largely unforeseen events. I remember at the end of 2004 reading something about the US real estate market and thinking we were in a bubble but I had no idea it would go as deep as it did or that it would cause a huge structural change in behaviour. What we know now is that the PIIGS are basically broke. Whether Greece stays or goes is much of a muchness in the grand scheme of things. It's hard to believe that it hasn't been priced in. It's the unknowns that cause GFC's not the knowns.



If it was all priced in why would the events in Europe over the last few days have resulted in such falls in markets?
You may have priced it in but imo many investors have learned nothing from the GFC and will sit like stunned fish watching their capital fall.



wayneL said:


> Unforeseen? There were a group of us in here, and in the wider financial community banging on about what was coming for ages.
> 
> Perhaps the exact trigger and timing was unforeseen, but not the event.



Agree.  Opposed to that were the self interested 'advisers' urging everyone not to panic, it would all be quite OK, their focus being the loss of commissions if they'd advised their clients to go to cash from managed funds.


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## McLovin (19 May 2012)

Julia said:


> If it was all priced in why would the events in Europe over the last few days have resulted in such falls in markets?




I think, all things considered, they're holding up pretty well. The prospect of the world's second most important currency failing, bank runs a real possibility in a number of mid-size European countries and the big overseas markets down ~5%, seems like a pretty good outcome.

Of course I have no idea what will happen on Monday but to me it seems like everything is already known and has been more or less priced in.


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## Struzball (19 May 2012)

Julia said:


> You may have priced it in but imo many investors have learned nothing from the GFC and will sit like stunned fish watching their capital fall.




Watching capital fall and "averaging down".


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## basilio (19 May 2012)

Everyone can't go to cash. Just basic logic.  All sellers no buyers for shares.

The super funds, pension funds and core holders of company shares are pretty constrained (IMO) on simply getting out of the market.  That is why smaller investors at least have the realistic option of selling out.

Where will all this go ?  God knows. I can understand the flight to cash but given the crisis in Europe there is no guarantee that banks and thus cash will survive intact.

We may end up with far more basic security. House, food, own energy, local community.


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## wayneL (19 May 2012)

basilio said:


> We may end up with far more basic security. House, food, own energy, local community.




Won't work. The leftists have destroyed the last vestiges of community with their statist oriented social engineering.


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## Joules MM1 (19 May 2012)

CanOz said:


> One thing that was worriying me more about this decline is the *pace* at which the flight to safety is occurring. Then today there was a HF manager on the Bloomy saying this too. Bond yields on safe havens such as germany, Canada, are dropping rapidly...money is coming out of Asain markets very quickly too. The Aussie dollar and other Asian currencies are dropping very fast.
> 
> He said he
> 
> ...




please hurry, Can .....  so i can email the guy and tell him i've put everything on hold for the next 5 to erm :bs: 30 days ......just in case.....

lulz


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## DB008 (19 May 2012)

Reuters - Nightmare foretold if Greece heads for euro exit



> A former finance minister, Yiannos Papantoniou, saw trouble ahead nearly a year ago: "Greece would not be able to support 11 million people so there will be huge emigration flows," he told Reuters Insider television last July. "Disruptions, social disruptions will come. I would say a regime of total anarchy."






> Most economists agree the austerity measures Greece is laboring under offer it little hope of recovery near term, and some argue that if it leaves the euro, it could export its way back to health on the back of a vastly devalued currency.
> 
> *But, barring tourism, it does not have businesses or industries that could drive such a recovery.
> *






> "The first shortages have begun to appear," said Melina Ferousi, a businesswoman who imports paper and stationery items. "French and Spanish suppliers are still selling on credit but German ones are particularly strict and are refusing to do so."
> 
> Some German suppliers have said they could not extend credit to Greece even if they wanted to because their insurers are refusing to cover the merchandise.




Well, that doesn't sound too good if you ask me.


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## CanOz (19 May 2012)

Joules MM1 said:


> please hurry, Can .....  so i can email the guy and tell him i've put everything on hold for the next 5 to erm :bs: 30 days ......just in case.....
> 
> lulz




Joules, he was talking about either a major equity market crash or bond rally, or both. His time frame was estimated by the various yields spreads they deal with. 

I do agree that the pace of the flight to safety has been quicker this time, the falls on the Kospi for example were quite severe in comparison the the US markets, even the DAX.

There has been a boat load of money leave Asia in the last week.

CanOz

CanOz


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## skating101 (19 May 2012)

Simple economics questions

If greece leaves and then defaults on its debt would this be deflationary or inflationary on the euro?

Debt monetisation - Printing money then buying the debt then cancelling it - Inflationary

Debt cancellation (default) - Existing owners of debt forgiving debt - Deflationary

Example- I (bank) receive $1000 (total amount of money in economy) from depositors. I lend $100 to my friend who spends that money on clothes. They cannot pay back the $100 debt so the options are
1. We print $100 to monetise the debt - total amount of money in economy = $1100 
2. We forgive the debt - total amount of money in economy = $1000?

The situation in southern europe is extremely deflationary due to the huge amount of debt (negative money) which is having the usual deflationary effect (high unemployment low growth). 
If the debt was cancelled would this have a heavily inflationary or deflationary effect on the rest of europe? 
If the debt was monetised have an inflationary or deflationary effect on the rest of europe?


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## Glen48 (19 May 2012)

I assume if 50%+ are unemployed they would only buy the bare essentials toilet paper, soap tin food, strip their  assets and sell at any price for money so the shops would go down as we see with WOW JB HI FI etc,larger shopping centers would tank due to overheads maybe even corner stores or corner stores would open albeit a canvas and bamboo arrangement selling the above.

No body would be selling any thing that  doesn't turn over quickly and all would be come more astute at handling money, delivery drivers would only run when they had a full load therefore it could be days before your item is available, Milk would be carton rather than cold fresh due to refrigeration costs. 
A lot would start growing their own until the crime wave hit and midnight pickers arrived.
Mean while those with gold would sit back and wait.


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## moXJO (19 May 2012)

Meanwhile in the real world no one seems to care.
I am as busy as ever, too busy if that’s possible. There are two mega shopping centres being built near me with one part completion and it is jam packed full of shoppers. Everyone I talk to seems fine. 
 And on a wider scale the Asian/Indian middle class is about to come online.

I think we are going through a transition period for business in which a lot sticking to old practices will wilt and die.
I can say I'm cautious but not bearish on the current outlook.
Asia had its gfc back in 97 and we survived that followed with a boom. Can't say I'm too worried


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## young-gun (19 May 2012)

StumpyPhantom said:


> Yep - I've been thinking about this overnight - trying to macro-predict the bottom (by comparison to GFC1 and the March 2009 low), so I would be grateful for any other views.
> 
> I think we're probably already headed back to that low, but the question is how much lower.  That low occurred because the financial crisis tipped over into the real economy when the money freeze stopped the flow of commerce dead in its tracks.
> 
> ...




I don't have access to charts anymore, but from memory the biggest rally in history occurred from 2000 onwards(with a couple of hiccups along the way). I would expect to see the market return back to whatever it was around 98-00, and then some. timeframe? it would happen in a couple of years or less. but we all know the governments are going to do what they can to prevent it, so the low may be drawn at to as long as 4-8 years away. you can see the path xjo was taking after the gfc, it was headed right back to where it wanted to be before the meddling began.

same thing with house prices, they will test prices seen pre-the new millennium. 

If you can recall the 'Pantene' commercials, this is the approach im taking to the upcoming tank of the global economy.(that is, it wont happen overnight, but it will happen)

great to see the bears coming out of the woodwork also, seems to be a large acceptance and acknowledgement of what is potentially heading our way.

perhaps greece will be the trigger, it's hard to know. whats scary i think is that, some were calling for the crash in 08/09, alot didn't see it coming. the collapse of lehmans did seem to come out of no-where. perhaps if the lehmans collapse was known to be close it could have been prevented, or softened.

Today however, everyone is well aware of everything that is wrong with the global economy, and throughout the world, governments and reserves are doing everything they can, and yet we are still unable to stop this tsunami from hitting our shores.


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## young-gun (19 May 2012)

moXJO said:


> Meanwhile in the real world no one seems to care.
> I am as busy as ever, too busy if that’s possible. There are two mega shopping centres being built near me with one part completion and it is jam packed full of shoppers. Everyone I talk to seems fine.
> And on a wider scale the Asian/Indian middle class is about to come online.
> 
> ...





the broader general public are oblivious to economics, if they want to spend they will, if they don't need to they won't. the fact that we are still spending is a sign that a) people want to spend, or more importantly have a need to spend. and b) unemployment is still quite low. australia is the last country to be on its way down(with the exception of maybe canada?)

demographics lead the way. unfortunately downturns seem to take a while to present themselves. jmo


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## StumpyPhantom (19 May 2012)

moXJO said:


> Meanwhile in the real world no one seems to care.
> I am as busy as ever, too busy if that’s possible. There are two mega shopping centres being built near me with one part completion and it is jam packed full of shoppers. Everyone I talk to seems fine.
> And on a wider scale the Asian/Indian middle class is about to come online.
> 
> ...




I wanna move to where YOU live, moXJO!!

Because I see and hear the opposite story where I live - people and businesses going broke, no-one buying anything but essentials, people saving as much as they can and cutting up their credit cards...


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## Ves (19 May 2012)

young-gun said:


> I don't have access to charts anymore, but from memory the biggest rally in history occurred from 2000 onwards(with a couple of hiccups along the way). I would expect to see the market return back to whatever it was around 98-00, and then some. timeframe? it would happen in a couple of years or less. but we all know the governments are going to do what they can to prevent it, so the low may be drawn at to as long as 4-8 years away. you can see the path xjo was taking after the gfc, it was headed right back to where it wanted to be before the meddling began.
> 
> same thing with house prices, they will test prices seen pre-the new millennium.



http://finance.yahoo.com/echarts?s=^DJI+Interactive#symbol=^dji;range=my;co mpare=;indicator=volume;charttype=line;crosshair=o n;ohlcvalues=0;logscale=on;source=undefined;

Here is a DJIA chart dating back to the crash in 1930.   I think it puts things into perspective.   Check it out using a log scale, I find it is easier to view that way.


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## young-gun (19 May 2012)

Ves said:


> http://finance.yahoo.com/echarts?s=^DJI+Interactive#symbol=^dji;range=my;co mpare=;indicator=volume;charttype=line;crosshair=o n;ohlcvalues=0;logscale=on;source=undefined;
> 
> Here is a DJIA chart dating back to the crash in 1930.   I think it puts things into perspective.   Check it out using a log scale, I find it is easier to view that way.




thanks v,

if this chart doesnt worry people then i dont know what would. i thought the run on xjo started a little later than 1995 but i could be wrong. looking at this i wouldn't be surprised to see the dow eventually bottom out between 4-6k. they've tried their best to keep that hockey stick going.


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## MrBurns (19 May 2012)

Be interesting Monday, if we stabilise not so bad, if we tank again and I mean another 80 to 100 points, I think it will be time to pack up and go home.


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## young-gun (19 May 2012)

MrBurns said:


> Be interesting Monday, if we stabilise not so bad, if we tank again and I mean another 80 to 100 points, I think it will be time to pack up and go home.




dji was down again, not as steep but down nonetheless. havent checked how europe faired, over 5% down for the week definitely not pretty, as you say monday will be very interesting.


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## Julia (19 May 2012)

StumpyPhantom said:


> I wanna move to where YOU live, moXJO!!
> 
> Because I see and hear the opposite story where I live - people and businesses going broke, no-one buying anything but essentials, people saving as much as they can and cutting up their credit cards...



Same where I live, regional Qld SE Coast.
Over the last couple of weeks I've been seeking quotes for some redecorating, new furniture, inhouse building changes etc., and have found stores empty, no customers, just staff standing around.  Hard to see how the business owners can sustain paying staff under these conditions.

A major store here "Captain Snooze" has a 70% off "End of lease Sale".  The owner told me the landlord has raised the rent to the point where they can't possibly carry on.


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## MrBurns (19 May 2012)

Julia said:


> A major store here "Captain Snooze" has a 70% off "End of lease Sale".  The owner told me the landlord has raised the rent to the point where they can't possibly carry on.




I had a bit to do with Capt'n Snooze in the early days as a real estate agent.
Landlords wil shoot themselves in the foot greed is not good.


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## Tyler Durden (19 May 2012)

MrBurns said:


> Be interesting Monday, if we stabilise not so bad, if we tank again and I mean another 80 to 100 points, I think it will be time to pack up and go home.




For me, it'll be time to join the party


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## StumpyPhantom (19 May 2012)

Tyler Durden said:


> For me, it'll be time to join the party




Alright - if you absolutely have to, but just remember to do it with just your own money.

Even your own money has two categories - money you can afford to lose, and money you can't afford to lose.  So stick with the former.

There's a third category of course, borrowed money you haven't earned yet (which you definitely cannot afford to lose).  Imagine losing that - actually that's hard to imagine, which is why it actualy happens so often.


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## Smurf1976 (19 May 2012)

McLovin said:


> People on here were predicting in 2005-06 that the real estate bubble and CDS's and securitised dodgy loans would send the financial system to the point of meltdown? Well done if you were.



I was reading in 2002 that the US mortgage institutions would inevitably end up in serious trouble as would real estate generally along with the banks and the specific company of General Motors.

The timing of the crisis was always going to be hard to predict, but if you have a boat made of rotting wood and are taking no action to address the problem then it's a fairly safe bet that at some point it will sink. When the storm will arrive is anyone's guess, but that the boat will sink at some point is fairly certain.


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## StumpyPhantom (19 May 2012)

Smurf1976 said:


> I was reading in 2002 that the US mortgage institutions would inevitably end up in serious trouble as would real estate generally along with the banks and the specific company of General Motors.
> 
> The timing of the crisis was always going to be hard to predict, but if you have a boat made of rotting wood and are taking no action to address the problem then it's a fairly safe bet that at some point it will sink. When the storm will arrive is anyone's guess, but that the boat will sink at some point is fairly certain.




That's the wisest sentiment, and one I've heard repeated most often since the onset of GFC1 when all this private debt got converted into public debt.  And it just defies belief that you could solve the problem by taking on more debt or by printing more money.

And yet, a combination of foolish optimism, self-delusion or (most probably) trying to make a buck in a temporarily rising market PLUS timing the exit when it all goes pear-shaped has kept the money in there.

So let's hope this is the final cleanout!!


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## Smurf1976 (19 May 2012)

Julia said:


> Same where I live, regional Qld SE Coast.
> Over the last couple of weeks I've been seeking quotes for some redecorating, new furniture, inhouse building changes etc., and have found stores empty, no customers, just staff standing around.  Hard to see how the business owners can sustain paying staff under these conditions.



Likewise. Apart from the optimistic words of politicians, I see nothing to suggest that overall business conditions are anything other than outright lousy. 

Everywhere I go, I hear what amounts to conversation on the subject of thrift. Common specifics are general supermarket items and electricity bills, but the overall attitude of consumers does seem to have changed to the point that controlling spending has become a priority for many.


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## numbercruncher (20 May 2012)

moXJO said:


> And on a wider scale the Asian/Indian middle class is about to come online.




Whilst everyone is pulling you up about your wildly bullish wee world moXJO thought id bring it to your attention that one of those bearish alarmist types from BHP also dissagrees with your take on the world .....



> Amidst the petty local political noise, the really big message in the speeches by BHP's chairman and CEO this week was entirely missed: implicit in the iron ore demand projections is that India isn't going to do a China, that India won't spectacularly industrialise in the East Asian manner.
> The Goldilocks scenario for the Australian economy is that growing commodities demand continues to underwrite our economic growth for decades to come thanks to India picking up the slack as the Chinese economy matures and the surge in its steel intensity comes off the boil.
> It has been assumed that India's inevitable industrialisation was running a neat 15 or 17 years behind China and then would be turbo-powered by a population that continues to grow strongly, overtaking China soon enough on its way to 1.6 billion in 2050.
> 
> ...




http://m.smh.com.au/business/bhps-big-message-india-isnt-making-it-20120518-1yv1h.html


----------



## Aussiejeff (20 May 2012)

StumpyPhantom said:


> That's the wisest sentiment, and one I've heard repeated most often since the onset of GFC1 when all this private debt got converted into public debt.  And *it just defies belief that you could solve the problem by taking on more debt or by printing more money.
> 
> And yet, a combination of foolish optimism, self-delusion *or (most probably) trying to make a buck in a temporarily rising market PLUS timing the exit when it all goes pear-shaped has kept the money in there.
> 
> So let's hope this is the final cleanout!!




Nay, StumpyP.

Our beloved Gwhizz8 have kissed, backslapped & declared JOBS, JOBS, JOBS, GROWTH, GROWTH, GROWTH (ie DEBT, DEBT, DEBT) is the waaay to go.

Ergo, Mega Debt Bomb QE3.5+ is about to go down.

Fallout = Negative interest rates anybody? 

LOL

Personally, metinks the Gwhizz8 meetings are well past their use by date. So much travelling expenses. So much expensive champagne. So much laughable empty rhetoric. An anachronism from the 70's formed after the Great Oil Crisis. It should be put to sleep.

Party on.


----------



## Logique (20 May 2012)

Ves said:


> http://finance.yahoo.com/echarts?s=^DJI+Interactive#symbol=^dji;range=my;co mpare=;indicator=volume;charttype=line;crosshair=o n;ohlcvalues=0;logscale=on;source=undefined;
> 
> Here is a DJIA chart dating back to the crash in 1930.   I think it puts things into perspective.   Check it out using a log scale, I find it is easier to view that way.



The classic pattern of a giant Head & Shoulders reversal seemed to have been avoided, so it will be very interesting from here.


----------



## young-gun (20 May 2012)

Logique said:


> The classic pattern of a giant Head & Shoulders reversal seemed to have been avoided, so it will be very interesting from here.




keeping in mind the right shoulder is on steroids...(stimulus)


----------



## moXJO (20 May 2012)

numbercruncher said:


> Whilst everyone is pulling you up about your wildly bullish wee world moXJO thought id bring it to your attention that one of those bearish alarmist types from BHP also dissagrees with your take on the world .....
> 
> 
> 
> http://m.smh.com.au/business/bhps-big-message-india-isnt-making-it-20120518-1yv1h.html




Wildly bullish you have got to be kidding me. Sorry I'm not skidding my undies in financial terror. And I did the whole bear thing before.
 I'm disagreeing with the drop bears that we will all be eating dirt and living in boxes. If the best way you can make money in this climate is sitting on a bunch of gold then good luck to ya. All I'm seeing is opportunity at the moment, not 'world is going to end' scenarios. So yes I'm not too worried.

 The govt is also not currently capitalising on our position in Asia, sooner or later they will get it and strengthen our position. 



> I wanna move to where YOU live, moXJO!!
> 
> Because I see and hear the opposite story where I live - people and businesses going broke, no-one buying anything but essentials, people saving as much as they can and cutting up their credit cards




I'm seeing a change in the way people do business. It's the same as stocks. Don't tap the trend feel the pain. My area was doing it pretty tough a while back (we did have some big industry go down) but seems to have come back well. Those that adapted have done well.
The whole city seems to be changing.


----------



## StumpyPhantom (20 May 2012)

Good luck to you moXJO - there will be success stories amongst the gloom and yours sounds like one.

Individual stories likes yours aside (and they light the path forward for all individuals and organisations who want to get ahead), the overall picture is still one which is pointing downwards


----------



## Logique (20 May 2012)

young-gun said:


> keeping in mind the right shoulder is on steroids...(stimulus)



Yes a good point that, the long term H&S pattern may in other circumstances have been more symmetrical.


----------



## numbercruncher (20 May 2012)

moXJO said:


> Wildly bullish you have got to be kidding me. Sorry I'm not skidding my undies in financial terror. And I did the whole bear thing before.
> I'm disagreeing with the drop bears that we will all be eating dirt and living in boxes. If the best way you can make money in this climate is sitting on a bunch of gold then good luck to ya. All I'm seeing is opportunity at the moment, not 'world is going to end' scenarios. So yes I'm not too worried.
> 
> The govt is also not currently capitalising on our position in Asia, sooner or later they will get it and strengthen our position.
> ...





Way to change the subject, with unrealistic extremism and all ! /applause ..... 

So you still Dissagree with the CEO of BHP (and nearly everyone else) ? India's middle class is about to save the Financial world ?

And im with Mojo - good luck to you and your township for having such a booming economy in these stormy times .....


----------



## cynic (20 May 2012)

young-gun said:


> it never left:fan




+1

I too eagerly await the demise of the original GFC. GFC1 was hastily swept under a "magical" carpet woven from financial bailouts/stimulus whilst still in its infancy. Now that the financial liquidity is drying up, the "magic" is wearing out. GFC1 is once again rearing its ugly head. It has been well nourished by financial stimulus/bailouts/quantitive easing etc. and has grown even bigger than before.

Hopefully those political/economic geniuses that thought fighting fire with kerosene was a good idea, will learn something from their previouse follies - but I won't be holding my breath!


----------



## DB008 (20 May 2012)

Worthy of a look.
BBC - The Great Euro Crash with Robert Peston
 (Gets interesting around the 25 minute mark and delves into how Greece 'cooked the books')

http://www.guardian.co.uk/tv-and-radio/2012/may/17/great-euro-crash-robert-peston?newsfeed=true


----------



## stacks (20 May 2012)

cynic said:


> +1
> 
> I too eagerly await the demise of the original GFC. GFC1 was hastily swept under a "magical" carpet woven from financial bailouts/stimulus whilst still in its infancy. Now that the financial liquidity is drying up, the "magic" is wearing out. GFC1 is once again rearing its ugly head. It has been well nourished by financial stimulus/bailouts/quantitive easing etc. and has grown even bigger than before.
> 
> Hopefully those political/economic geniuses that thought fighting fire with kerosene was a good idea, will learn something from their previouse follies - but I won't be holding my breath!




I doubt the central bankers of the world will allow the 'financial liquidity to dry up'.

As far as resolving the problems in Europe, I can see more coordinated central bank moves in the not too distant future. Their form is on the board, they have no other option now. Another GFC 1 type event would make the previous trillions spent on QE, LTRO etc. programs redundant if they stopped now. 

Interesting to see the markets response though. And by 'market' I'm including the general European public. Its one thing to provide unlimited liquidity to the big players to allow continuing function, its another thing entirely once individuals lose confidence in their banking system and start withdrawing money from their bank. Unless this response from individuals happens in Europe happens, I wouldnt discount the upcoming moves by the central monetary authorities staving off a major crisis.

The China debate while obviously related to moves in Europe is another matter entirely...


----------



## Julia (20 May 2012)

cynic said:


> +1
> 
> I too eagerly await the demise of the original GFC. GFC1 was hastily swept under a "magical" carpet woven from financial bailouts/stimulus whilst still in its infancy. Now that the financial liquidity is drying up, the "magic" is wearing out. GFC1 is once again rearing its ugly head. It has been well nourished by financial stimulus/bailouts/quantitive easing etc. and has grown even bigger than before.
> 
> Hopefully those political/economic geniuses that thought fighting fire with kerosene was a good idea, will learn something from their previouse follies - but I won't be holding my breath!




+1.


stacks said:


> I doubt the central bankers of the world will allow the 'financial liquidity to dry up'.
> 
> As far as resolving the problems in Europe, I can see more coordinated central bank moves in the not too distant future. Their form is on the board, they have no other option now. Another GFC 1 type event would make the previous trillions spent on QE, LTRO etc. programs redundant if they stopped now.



So this would continue ad infinitum?  Layer upon layer?


----------



## StumpyPhantom (20 May 2012)

stacks said:


> I doubt the central bankers of the world will allow the 'financial liquidity to dry up'.
> 
> As far as resolving the problems in Europe, I can see more coordinated central bank moves in the not too distant future. Their form is on the board, they have no other option now. Another GFC 1 type event would make the previous trillions spent on QE, LTRO etc. programs redundant if they stopped now.
> 
> ...




I thought this was just the "pouring kerosene on fire" argument by another name?  It wasn't the central bankers that had anything to do with liquidity drying up last time.

The Lehmann Brothers collapse caused the inter-bank lending to freeze up almost overnight.  What the Federal Reserve didn't do was to prop up the dead corpse (like it did a couple of weeks earlier with a bank whose name I can't remember).

For months after this, central bank liquidity sloshed around but no-one was prepared to risk it by lending to someone else.

So this is where the 'bank runs' are currently headed.  It would take a large-ish European bank (Societe Generale?) to keel over for everyone to think the same way again.  At this point, the dilemma for the central banks isn't going to be about pumping the system with liquidity.  

That's easy compared to the 'moral hazard' in propping up failed businesses, even if they could do so.  That's the other problem, how much have they got in reserve to do some of this, without then spiralling the global economy into a decades-long deflationary spiral?


----------



## Julia (20 May 2012)

StumpyPhantom said:


> The Lehmann Brothers collapse caused the inter-bank lending to freeze up almost overnight.  What the Federal Reserve didn't do was to prop up the dead corpse (like it did a couple of weeks earlier with a bank whose name I can't remember).



Bear Stearns?


----------



## StumpyPhantom (20 May 2012)

Julia said:


> Bear Stearns?




Yep - that's it.  It would have been far more appropriate to have let the bears lose with the collapse of Bear Stearns.


----------



## young-gun (20 May 2012)

cynic said:


> +1
> 
> I too eagerly await the demise of the original GFC. GFC1 was hastily swept under a "magical" carpet woven from financial bailouts/stimulus whilst still in its infancy. Now that the financial liquidity is drying up, the "magic" is wearing out. GFC1 is once again rearing its ugly head. It has been well nourished by financial stimulus/bailouts/quantitive easing etc. and has grown even bigger than before.
> 
> Hopefully those political/economic geniuses that thought fighting fire with kerosene was a good idea, will learn something from their previouse follies - but I won't be holding my breath!




agreed, no one wants to see deflation/contraction. it's not pretty, but unfortunately it comes with the territory of living beyond our means for far too long. 

lol, when it comes to learning from mistakes i think you will find the financial world is the equivalent to a bunch of goldfish(unless im mistaken and the fishies memories do actually span further than 10 seconds).

as you say, in trying to prevent catastrophe, they have indeed fed this monster into something much larger, and far worse, it is not(and never really was) containable.

the only thing that will determine when total collapse occurs is how much longer they can print and stimulate for. i personally think they are reaching their limits, but wouldnt be surprised so see a qe3, and more LTR's from europe. it's quite evident that more and more stimulus is required to achieved the desired effect, all the while lasting less and less each time.


----------



## stacks (20 May 2012)

StumpyPhantom said:


> I thought this was just the "pouring kerosene on fire" argument by another name?  It wasn't the central bankers that had anything to do with liquidity drying up last time.
> 
> The Lehmann Brothers collapse caused the inter-bank lending to freeze up almost overnight.  What the Federal Reserve didn't do was to prop up the dead corpse (like it did a couple of weeks earlier with a bank whose name I can't remember).
> 
> ...




Bear Stearns.

I wouldnt say its like putting kerosene on a fire, more like building a slow burning timber enclosure around a fire and stacking some tankers of kerosene on top. In the hope that they can find a big enough hose later.

I agree if SocGen goes the way of Lehman Bros we are all in big trouble. I wasn't arguing that. 

I think they (central banks) learnt the Lessons of Lehman, lol, and wont let a SocGen go under without a fight. The trillions they have spent so far will have been in vain. I think they will act before that happens.

And its not about how much they have in reserve, its about how much they create. 

Im sure the day of reckoning will come  but the powers of the central banks to delay it, I think, should not be  underestimated. Unless, as I said, the public trust in the banking system dies and the people says 'no mas'.

I think its interesting the contrast of the German and US (and UK) approaches: Germany still bearing the inflationary scars of the Weimar episode and continually preaching balanced budgets and austerity; the US bearing the deflationary scars of the Great Depression and all in favour of printing money to stimulate growth.

Would love to have been a fly on the wall at Camp David. Although Angelas tone seems to have moderated recently with slightly more mentions of growth and less of austerity in her speeches. Maybe Obama turned on that famous charm and promised her one of Bens printers, on the condition she only uses it profusely...


----------



## young-gun (20 May 2012)

stacks said:


> I doubt the central bankers of the world will allow the 'financial liquidity to dry up'.



it's not upto them as has been mentioned.



> As far as resolving the problems in Europe, I can see more coordinated central bank moves in the not too distant future. Their form is on the board, they have no other option now. Another GFC 1 type event would make the previous trillions spent on QE, LTRO etc. programs redundant if they stopped now.



everything they have done has been redundant anyway. what they have achieved is one gigantic can kick.



> Interesting to see the markets response though. And by 'market' I'm including the general European public. Its one thing to provide unlimited liquidity to the big players to allow continuing function, its another thing entirely once individuals lose confidence in their banking system and start withdrawing money from their bank. Unless this response from individuals happens in Europe happens, I wouldnt discount the upcoming moves by the central monetary authorities staving off a major crisis.





StumpyPhantom said:


> I thought this was just the "pouring kerosene on fire" argument by another name?  It wasn't the central bankers that had anything to do with liquidity drying up last time.
> So this is where the 'bank runs' are currently headed.  It would take a large-ish European bank (Societe Generale?) to keel over for everyone to think the same way again.  At this point, the dilemma for the central banks isn't going to be about pumping the system with liquidity.



I think the simple fact that people are acknowledging the very real possibility of banks runs being introduced in the very very near future shows just how much trouble we are in.



> The China debate while obviously related to moves in Europe is another matter entirely...



absolutely, but a very important one for good old aus



Julia said:


> +1.
> 
> So this would continue ad infinitum?  Layer upon layer?




doesn't sound like a viable option to me

i found a suitable emoticon for whats happening - :microwave

anywho, it may appear to be getting closer, but we all know that everyone is gonna step in and try to prevent it one last time, so id say we're safe for another...6-12 months??


----------



## StumpyPhantom (20 May 2012)

stacks said:


> Bear Stearns.
> 
> I wouldnt say its like putting kerosene on a fire, more like building a slow burning timber enclosure around a fire and stacking some tankers of kerosene on top. In the hope that they can find a big enough hose later.
> 
> ...




OK - now that we're seemingly singing prayers from the same hymn sheet, the task is to try and quantify the 'contagion', assuming no Central Bank intervention.

I don't want to sound too optimistic a note here, for fear of undermining my 'bear aura', but trying to compare it with GFC1, is it possible the contagion can be limited after the initial panic phase?

The reason I'm thinking this is that the inter-bank lending froze instantaneously because nobody knew who was holding the toxic debt.

This time around, besides having had the panic experience once before (a person taken out to sea in a rip the second time would have more of a clue if he/she didn't drown the first time), would everyone just take out their calculators and work out that you and me 'bank runners' are pretty small fry compared to the trillions in multiplied toxic debt and, after the initial change of undies, the banks would just settle into this new order and get on with business?

I know it's not that simple, but GFC2 is destined to be different to GFC1, and I'm trying to put a finger on what to watch out for.


----------



## stacks (20 May 2012)

young-gun said:


> it's not upto them as has been mentioned.




Was it not up them late last year? So it wasn't the ECB who released LTRO and kicked off the New Year rally? 



young-gun said:


> everything they have done has been redundant anyway. what they have achieved is one gigantic can kick




Sort of agree but I would say not redundant, just buying time. This was admitted by ECB board member Benoit Couere in the doco above. For what though? seems they are still looking for a solution that causes only bearable pain for the public. The current pain was too much. The PTB might be hoping for a slow grind of living standards in profligate countries to reduce the debt problems. But the public need to sign on and good luck with that. 



young-gun said:


> I think the simple fact that people are acknowledging the very real possibility of banks runs being introduced in the very very near future shows just how much trouble we are in.




Plenty of reports of big deposit withdrawls in European banks lately. If you are not ackowledging this, you are not looking. I know what Id be doing if I had money in a Greek bank


----------



## Glen48 (20 May 2012)

Whilethe feds world wide keep propping up the banks it tells them to do what they like or think best ( pay a large bonus)the bankesters don't have to be accountable as the taxpayer will cover any thing they do, until a few more are send broke nothing will change until the plug is pulled on the money making machine or it all grinds to a halt.


----------



## young-gun (20 May 2012)

stacks said:


> Sort of agree but I would say not redundant, just buying time. This was admitted by ECB board member Benoit Couere in the doco above. For what though? seems they are still looking for a solution that causes only bearable pain for the public. The current pain was too much. The PTB might be hoping for a slow grind of living standards in profligate countries to reduce the debt problems. But the public need to sign on and good luck with that.




you just have to look at greece, the people are more than happy to vote in parties that are ready to wipe the austerity measures that are supporting them(in way of bailouts).



> Plenty of reports of big deposit withdrawls in European banks lately. If you are not ackowledging this, you are not looking. I know what Id be doing if I had money in a Greek bank




large amounts yes, but i don't think it constitutes as a 'bank run' just yet. completely agree, i would like to think i would have been out some time ago.

by definition a bank run leaves the bank with insufficient reserves, and are unable to fund any further withdrawals. which i would imagine would leave the bank virtually unable to function?


----------



## stacks (20 May 2012)

StumpyPhantom said:


> OK - now that we're seemingly singing prayers from the same hymn sheet, the task is to try and quantify the 'contagion', assuming no Central Bank intervention.




I think there will be central bank intervention, that was my point.



StumpyPhantom said:


> This time around, besides having had the panic experience once before (a person taken out to sea in a rip the second time would have more of a clue if he/she didn't drown the first time), would everyone just take out their calculators and work out that you and me 'bank runners' are pretty small fry compared to the trillions in multiplied toxic debt and, after the initial change of undies, the banks would just settle into this new order and get on with business?




The  'bank runners' public arent small fry. The sub prime/Lehman/GFC1 was bought about by individual people not paying their loans, that was the catalyst, lots of small fry. Regardless of how much liquidity central banks provide, individual deposits are vital to banks, as is trust. Sovereign debts, Greece in particular, are obviously vital but given the time to prepare, they may less of an isssue


----------



## stacks (20 May 2012)

young-gun said:


> large amounts yes, but i don't think it constitutes as a 'bank run' just yet. completely agree, i would like to think i would have been out some time ago.
> 
> by definition a bank run leaves the bank with insufficient reserves, and are unable to fund any further withdrawals. which i would imagine would leave the bank virtually unable to function?




I didnt say it was a 'bank run'


----------



## stacks (20 May 2012)

Julia said:


> So this would continue ad infinitum?  Layer upon layer?




I didnt say ad infinitum, but I think their is more layers to come. Otherwise the layers used to date will be worthless. One major reason is I really cant see any central banker ready to admit his policies have been a failure and they have wasted trillions of dollars. 

They've played their hand and I think they will stay the course until they no longer have the power.


----------



## StumpyPhantom (20 May 2012)

stacks said:


> The  'bank runners' public arent small fry. The sub prime/Lehman/GFC1 was bought about by individual people not paying their loans, that was the catalyst, lots of small fry. Regardless of how much liquidity central banks provide, individual deposits are vital to banks, as is trust. Sovereign debts, Greece in particular, are obviously vital but given the time to prepare, they may less of an isssue




Agree they're not small fry, but FINITE fry in the sense that you can count them.

The problem with the sub-prime one was that it was multiplied many times over with the CDOs (collateral debt obligations) etc. so nobody knew who was holding what and who was next.

The run on banks here (Greece and Spain) relates to removing the Euros from the banking systems that might have to exit, so as to avoid massive devaluation.


----------



## stacks (20 May 2012)

StumpyPhantom said:


> Agree they're not small fry, but FINITE fry in the sense that you can count them.
> 
> The problem with the sub-prime one was that it was multiplied many times over with the CDOs (collateral debt obligations) etc. so nobody knew who was holding what and who was next.
> 
> The run on banks here (Greece and Spain) relates to removing the Euros from the banking systems that might have to exit, so as to avoid massive devaluation.




Multiplication of the subprime issue was caused by CDO's but the trigger was individuals not paying loans. I believe the trigger may again be individuals.

The 'banking run' that you refer to is not a banking run at all. A 'run' is a withdrawl of deposits. If (when?) Greece leaves the eurozone, the problem will be loan defaults by Greece businesses and government. 

Sovereign debt has largely been written off in the PSI program and with the LTRO program, banks may have prepared for this. Should have prepared for this really. The increased talk is that Greece leaving will be less painful than it once was because of this. BUT we'll see.. If we get there it will be messy, question is how messy...


----------



## Starcraftmazter (20 May 2012)

Yep, the world is heading into a very long and nasty depression.


----------



## Vixs (21 May 2012)

I try (obviously in vain) to try and keep abreast of things, but I just can't work out how everybody loses in this scenario.

Who is winning? Who is getting the losers money? If the solution to all of this is to keep printing more money while trying to balance that against the risk of hyperinflation or deflation...who is the printed money going to?

WHO has the bank account that's getting bigger off taxpayer funded bailouts?

When we've answered that, can someone please explain how it's not cheaper for the world to go to war with them and take it all back? Seriously. Where is it going and why can't it be recovered?

It's gotta be cheaper to kill them. Wish I was kidding.

PS: I'm not angry or personally affected detrimentally, this isn't the ranting of a loon...I just can't work out where it all goes, and I'm not a bloody idiot. No wonder the masses don't care.


----------



## stacks (21 May 2012)

Vixs said:


> I try (obviously in vain) to try and keep abreast of things, but I just can't work out how everybody loses in this scenario.



When loans dont get paid off - noone wins. If for example, Greece defaults, plenty of banks will lose money on Greek gov bonds, loans to Greek people, businesses etc. This will have knock on effects for all interrealated financial products/entities and worst case, freeze up banks lending money while they work out who is exposed and not safe to lend to.



Vixs said:


> Who is winning? Who is getting the losers money? If the solution to all of this is to keep printing more money while trying to balance that against the risk of hyperinflation or deflation...who is the printed money going to?



It will go to banks to shore up their balance sheets to help contain losses and prevent the freeze of lending by banks



Vixs said:


> WHO has the bank account that's getting bigger off taxpayer funded bailouts?
> 
> When we've answered that, can someone please explain how it's not cheaper for the world to go to war with them and take it all back? Seriously. Where is it going and why can't it be recovered?
> 
> It's gotta be cheaper to kill them. Wish I was kidding.



You cant go to war with a bank. The problem is all the large banks are so globally connected now, 1 falls, it could bring a lot more with it. Look at what happened when Lehamn Bros went down. And JP Morgan have recently shown that it has been business as usual since then.


----------



## numbercruncher (21 May 2012)

Vixs said:


> I try (obviously in vain) to try and keep abreast of things, but I just can't work out how everybody loses in this scenario.
> 
> Who is winning?
> .




Central banks and the Men who they serve in the pursuit of World Domination


----------



## Dowdy (21 May 2012)

Just watched this clips about hyperinflation in Germany.

Very interesting


----------



## MrBurns (23 May 2012)

FTSE ands DAX both down over 100pts so far..........


----------



## Glen48 (23 May 2012)

Glad I got into Face book IPO in time feel much safer now..


----------



## MrBurns (23 May 2012)

Glen48 said:


> Glad I got into Face book IPO in time feel much safer now..




You can complain on twitter


----------



## MrBurns (28 May 2012)

The market up again today, are people mad ?


----------



## young-gun (28 May 2012)

MrBurns said:


> The market up again today, are people mad ?




Another rally without legs. The volatility seems to return as stimulus wears off. Interesting to see what the US does over night. Don't worry MB I don't think you're missing much


----------



## MrBurns (28 May 2012)

young-gun said:


> Another rally without legs. The volatility seems to return as stimulus wears off. Interesting to see what the US does over night. Don't worry MB I don't think you're missing much




I dont think so either I wouldn't be in this with your money


----------



## young-gun (28 May 2012)

MrBurns said:


> I dont think so either I wouldn't be in this with your money




hey you never know, my $200 could go a long way.


----------



## DB008 (29 May 2012)

Greek Euro Exit Aftershocks Risk Reaching China



> Greece, responsible for 0.4 percent of the world economy, now poses a threat to international prosperity as investors raise bets its days using the euro are numbered.
> A Greek departure from the currency would inflict “collateral damage,” says Pacific Investment Management Co.’s Richard Clarida, a view echoed by economists from Bank of America Merrill Lynch and JPMorgan Chase & Co. At worst, it could spur sovereign defaults in Europe as well as bank runs, credit crunches and recessions that may spark more euro exits.




Bloomberg link


----------



## Glen48 (29 May 2012)

I think every one knows all is lost just waiting for some confirmation, like a teenager waiting for the results of a pregnancy test.


----------



## MrBurns (29 May 2012)

DB008 said:


> Greek Euro Exit Aftershocks Risk Reaching China
> Bloomberg link





Better send Gillard to Greece she can dole out the cheques, that should fix it


----------



## numbercruncher (29 May 2012)

The Bank note printers can fix it 



> De La Rue reported financial results this morning, but chief executive Tim Cobbold wouldn't be drawn on whether Athens had asked his firm to prepare for a new currency to be issued.
> 
> Cobbold said:
> 
> ...




http://www.guardian.co.uk/business/2012/may/29/eurozone-crisis-spanish-banks


----------



## basilio (3 June 2012)

Worth getting a picture of what is happening is Spain as the financial criss  grinds on.  

Really ugly stuff.

    News
    World news
    Spain



> *Bank bailout makes Spaniards question their future as euro agonies mount*
> 
> Spaniards having to tighten their belts find it hard to stomach bailing out banks whose recklessness has brought them to ruin
> 
> ...




http://www.guardian.co.uk/world/2012/jun/03/spain-euro-austerity-bailout


----------



## numbercruncher (3 June 2012)

basilio said:


> Worth getting a picture of what is happening is Spain as the financial criss  grinds on.
> 
> Really ugly stuff.
> 
> ...





Maybe a glimpse into our future too hey ? 


Interesting reading the comments on these articles like this one .....



> Justice won't be done until we see bankers and real estate agents hanging from lampposts for ruining economies. I don't even know how real estate agents in particular are allowed to exist as a profession. A more lying, deceitful, smug, arrogant and useless bunch of pricks you'd be hard-pressed to find.
> 
> Why do we put up with them? And when do we say enough's enough?




Fair call really - RE agents what a farce of a profession - like a two day course that "qualifies" you to walk people through what can be the biggest financial decision/screw up of their lives.


----------



## MrBurns (3 June 2012)

Looks like it's going to get very ugly, not sure how long our claim to be a great economy will last.


----------



## numbercruncher (3 June 2012)

The Herald Sun arnt mashing thier words Today!!



> Europe is headed inescapably for financial disaster and almost certainly a recession that will be worse and last longer than the one in 2008, which itself was the worst since the Great Depression of the 1930s. This euro looks like it will break up with catastrophic consequences for individual countries and the global financial system. Fear and loathing will feed on itself.






> We face the very real threat of a triple disaster. Europe in utter chaos, the US in recession and a Chinese economy that's run out of steam.




http://www.heraldsun.com.au/business/terry-mccranns-column/disaster-looms-for-global-economies/story-e6frfig6-1226381511258


----------



## MrBurns (3 June 2012)

numbercruncher said:


> The Herald Sun arnt mashing thier words Today!!
> http://www.heraldsun.com.au/business/terry-mccranns-column/disaster-looms-for-global-economies/story-e6frfig6-1226381511258




.......unfortunately sounds right.


----------



## CanOz (3 June 2012)

We are definitely getting closer to a bottom, even the media is triple doom and gloom....must be a matter of weeks now...

Edit: forgetting of course that the second leg down takes longer...



CanOz


----------



## So_Cynical (3 June 2012)

I have 2 buy orders in the market...1 ridiculously low ball, the other just 2% under Fridays close.

Doom and gloom talk genuinely excites me. 

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

Big picture...this is the Asian Century, just like the last century was the American century and the one before that the European Century....this century will be our century, the centre of the world will move closer to us and we will be Asia's farm and mine and a nice place for the workers of Asia to have a holiday.


----------



## StumpyPhantom (3 June 2012)

CanOz said:


> We are definitely getting closer to a bottom, even the media is triple doom and gloom....must be a matter of weeks now...
> 
> Edit: forgetting of course that the second leg down takes longer...
> 
> ...




Yeah - that's the big question for me.  Not so much that we have a GFC2 to contend with, but where/when the bottom will be.  Seems like we've peeled back enough layers to know that Europe's recession and contagion effect is on the horizon (though we don't really know what that will look like).

The big question might be whether China and the rest of the BRIC and emerging markets will be part of the 'domino effect'.  If they are, then this bottom could take a few years.  If we can't see that at the moment (or don't even know whether it will happen), then it's also hard to see the bottom.

A quarter of China's exports go to Europe, and if the USA is climbing down as well, then how much Chinese stimulus and domestic consumption (and how sustainable is that anyway?) will it take?


----------



## Tyler Durden (3 June 2012)

So_Cynical said:


> I have 2 buy orders in the market...1 ridiculously low ball, the other just 2% under Fridays close.
> 
> Doom and gloom talk genuinely excites me.
> 
> ...




James Packer is with you there.


----------



## numbercruncher (4 June 2012)

This mornings heart warming Bearish/realist news article is .....




> A Boston Consulting Group survey of nine developed countries plus China shows that 47 per cent of Australian respondents said they were either ''in financial trouble'' or ''not financially secure''. Italians and Spaniards are more upbeat, even though Spain, for example, has an unemployment rate of 25 per cent.
> 
> ''Australians are feeling the costs-of-living pressures,'' the head of investment research at Perpetual, Matt Sherwood, says. Electricity prices are rising and food prices are already high by international standards, Sherwood says.
> Then there is household debt. ''In the good times we borrowed more and more to have one of the *highest ratios of household debt to income in the world*,'' he says.
> ...




Fancy Italians and Spaniards being more optimistic than Australians - show the magnitude of peoples debt noose here perhaps ?


----------



## McLovin (4 June 2012)

Fiscal union one step closer.

http://online.wsj.com/article/SB10001424052702303506404577444670506067842.html?mod=googlenews_wsj




> BERLIN—Germany is sending strong signals that it would eventually be willing to back ideas such as joint European bonds or a banking union if European leaders are willing to give up more sovereignty and transfer significant powers over national budgets to Europe, a step that, if embraced, would redesign monetary union and be one of the boldest steps taken by the bloc since the euro was launched.
> 
> Europe has been blocked from taking bold steps to stem the crisis and calm financial markets because leaders can't bridge two fundamentally different approaches.
> 
> ...


----------



## notting (4 June 2012)

McLovin said:


> Fiscal union one step closer.




Is clearly the ideal, however since none of them obeyed the rules regarding spending, it's hard to see how any agreement becomes reality in implementation.


----------



## McLovin (4 June 2012)

notting said:


> Is clearly the ideal, however since none of them obeyed the rules regarding spending, it's hard to see how any agreement becomes reality in implementation.




I guess the difference is this time they're bent over a barrel and being asked to "negotiate".


----------



## numbercruncher (4 June 2012)

Dont do it Europe !

Those pesky Germans just want to be your Imperial Masters ....

Tell them thanks for the good times but now its adios  - 

The Debt is the hangover - The aspirin is dumping the Euro 

Was a fun party though huh ?


----------



## StumpyPhantom (4 June 2012)

So_Cynical said:


> I have 2 buy orders in the market...1 ridiculously low ball, the other just 2% under Fridays close.
> 
> Doom and gloom talk genuinely excites me.
> 
> ...




The ridiculous low ball offers sometimes hit the paydirt.  I did a couple of speculators in early 2009 and piacked up 2000 BHP at $20 and 2000 WBC at $14.  I must admit I don't expect hits like that again because I don't think the margin loans out there are so leveraged that they would be spilling stock onto the market at any price.


----------



## Glen48 (5 June 2012)

*VOTE*
Do you think we are headed for another GFC?






*68388*





*19344*


A few converts here




​


----------



## numbercruncher (5 June 2012)

Glen48 said:


> *VOTE*
> Do you think we are headed for another GFC?
> 
> 
> ...





 self fulfilling prophecy !


----------



## Gundini (5 June 2012)

Are we- of course yes

Can we stop it- of course we can't

So what happens next- they print more money and we start over like last time

What should I do with the tin- kick it down the road


----------



## DB008 (8 June 2012)

Greek politician punches rival on TV
http://www.irishtimes.com/newspaper/breaking/2012/0607/breaking17.html


----------



## skc (8 June 2012)

DB008 said:


> Greek politician punches rival on TV




Taiwan has the best politician fights.



Their economy is doing OK. 

May be violence do solve problems ?!


----------



## notting (8 June 2012)

All violence does is prove your own inabilities.
It's weird how people think it somehow enhances their argument or proves something to the person you beat the crap out of! 
I sometimes muse "now go show how tuff you are to a lion, tuff guy!"

It takes more spine and strength to remain in control than to lose it!

I remembering watching Kunk Fu as kid and Qy Chang, or what ever his name was, broke up this fight and said to the clowns, "Each of you seeks to be stronger in your hatred and violence upon each other, yet neither of you has the strength to love." 
Hippie.


----------



## young-gun (8 June 2012)

notting said:


> All violence does is prove your own inabilities.
> It's weird how people think it somehow enhances their argument or proves something to the person you beat the crap out of!
> I sometimes muse "now go show how tuff you are to a lion, tuff guy!"
> 
> ...




its ingrained into us through right? prob goes all the way back to the time we were monkeys fighting for mates and territory. all animals fight, and at the end of the day thats all we are, although very intelligent animals. some have the will-power to not reduce themselves to violence, some are just simply over-come by the natural urge. you can't tell me you havent wanted to punch someone right in the nose when they are pissing you off 

i saw a doco the other night on polar bears. the male polar bears beat the crap out of each other over just one female polar bear. poor guy had to endure upto 5 different bears trying to impregnate her. watching it reminded me of walking through the valley at 1am on a saturday night.

anyway back on topic.

Yes the GFC has stuck its ugly head up again. each time hungry for more and more stimulus, as the last lot doesn't quite hit the spot as well as the batch prior to that. the measures being taken to prevent total collapse are not sustainable. there is going to be a breaking point, and i personally think that it will snap over the next 12 months. potentially even by end of 2012.


----------



## notting (8 June 2012)

young-gun said:


> you can't tell me you haven’t wanted to punch someone right in the nose when they are pissing you off



No, I can't, but that doesn't make it noble.  Quite the contrary.
We can behave like a monkeys or evolve!  
The choice is there for the taking. It's good to know there is a choice and look at the consequences after the fact to see what use one way was as apposed to the other.
Prosperity and happiness follow good will, it opens the mind to creativity and opportunity tends to turn up where we least expected it to.  
Takes a kind of courage.
Im no master of it, but think it's worth trying!
:engel:


----------



## numbercruncher (15 June 2012)

Doesnt todays headline sum-up the current crazy economics.

Real economic indicators look bad so instead of US markets going down they soar on hopes of more money creation , crazyness.



> US stocks rally on hope of rescue as US data, Europe debt worsens
> BY: MATT JARZEMSKY From: Dow Jones Newswires June 15, 2012 7:02AM
> Increase Text Size
> Decrease Text Size
> ...


----------



## Struzball (15 June 2012)

numbercruncher said:


> instead of US markets going down they soar on hopes of more money creation , crazyness.




Is it bullish bearishness or bearish bullishness?


----------



## Glen48 (15 June 2012)

If the left get elected in Greece on 17th then the market will go up, the right are elected then the market will go up.
IF Spain Greece etc default then the market will go up, think they are all waiting for Big Ben to order more ink and printing plates. 
 As printing has never work maybe this one will.


----------



## Aussiejeff (15 June 2012)

Glen48 said:


> If the left get elected in Greece on 17th then the market will go up, the right are elected then the market will go up.
> IF Spain Greece etc default then the market will go up, think they are all waiting for Big Ben to order more ink and printing plates.
> As printing has never work maybe this one will.




All futures are up.

Sunshine & lollipops for all... :bananasmi:


----------



## Glen48 (15 June 2012)

http://www.activistpost.com/2012/06/obama-seeks-us-congressional.html

USA feds are pushing for arms reduction while ordering millions of non approved by Geneva rounds for DHS  as well  as selling arms to  drug dealers.
Do the FEDs know a depression is coming and it is going to be bad and therefore disarming every one is in the Feds interest.
 As you can imaging the Yank are up in arms( oops) and madly stocking with guns seller's stopped taking orders  while they catch up with orders for 1Million a month.


----------



## young-gun (15 June 2012)

Aussiejeff said:


> All futures are up.
> 
> Sunshine & lollipops for all... :bananasmi:




could there be anything more frustrating than this bullsh!t? just let it crash already. it's only a matter of time before our taxes are bailing out the big 4.


----------



## numbercruncher (18 June 2012)

HoWs this interesting tidbit from the moneymorning newsletter ...



> Look at the bond yields for other countries: the so-called safe havens of the US, German and French bonds. Recently they hit the following multi-century lows.
> 
> The US 10-year bond yield hit a 200-year low.
> 
> ...




Amazing stuff huh !?


----------



## Glen48 (18 June 2012)

Who said history doesn't repeat like 1930


----------



## Caveman (18 June 2012)

Can we have some more greece elections PLS


----------



## CanOz (19 June 2012)

In the meantime, Spanish Yields...



> European Yields: 10-yr: unch..1.571%..USD/JPY: 79.01..EUR/USD: 1.2600
> European yields are mixed this morning following the New Democracy's victory in the Greek election. The party's leader, Antonis Samaras, must now form a coalition government. Spanish yields are at euro-era highs this morning with the 10-yr up close more than 45 bps to above 7.25%. Italian yields are also spiking higher as an advance of 20 bps has the 10-yr up to 6.10%. Elsewhere, French yields are inching higher after President Francois Hollande's socialists won a majority in parliamentary elections. The French 10-yr yield is up 2 bps at 2.59%. Safe-haven buying can be found in both German Bunds and U.K. Gilts with their 10-yr yields down close to 5 bps a piece to 1.40% and 1.61% respectively.
> 
> Read more: http://www.briefing.com/GeneralCont...Briefing.aspx?CustomPageId=3734#ixzz1y9fPDatA


----------



## young-gun (19 June 2012)

CanOz said:


> In the meantime, Spanish Yields...




I understand 7% n up is considered 'ynsustainable'.. Does anyone know how long it can be sustained for? Weeks, months, years?


----------



## Glen48 (19 June 2012)

Spain has hit 7,28% word is big Ben will  kick off QE3  Wednesday


----------



## CanOz (19 June 2012)

young-gun said:


> I understand 7% n up is considered 'ynsustainable'.. Does anyone know how long it can be sustained for? Weeks, months, years?




7% is the level where other PIGS nations needed a bailout. The majority of debt is not serviced at that level yet, and it would take years to refinance that debt i would think. Its a physiological level more than anything.

McLovin could elaborate i reckon...

CanOz


----------



## McLovin (19 June 2012)

CanOz said:


> 7% is the level where other PIGS nations needed a bailout. The majority of debt is not serviced at that level yet, and it would take years to refinance that debt i would think. Its a physiological level more than anything.
> 
> McLovin could elaborate i reckon...
> 
> CanOz




I can try.

I think, iirc, they have to raise eur300b in the next three years. At 7%, they'd be paying over 10% of revenue in interest (and growing rapidly). Personally, I think the bigger issue is the sustainability of their public finances, automatic stabilisers (running counter-cyclical fiscal policy) are supposed stimulate demand during recessions, the problem is that isn't happening. There's only so long that you can run a 10% deficit. If you're running 10% deficits year after year then the interest rate you are being charged becomes secondary to the certainty that you won't be able to repay.


----------



## Glen48 (20 June 2012)

German Bailout:


So, Angela Merkel arrives at Passport Control at Athens airport.

“Nationality?” asks the immigration officer. “German,” she replies.
“Occupation?” “No, just here for a few days.”


----------



## numbercruncher (22 June 2012)

I suspected the world might be saturated with wotsits and gizmos and it seems it is .....



> NEW YORK (CNNMoney) -- Got an LCD TV? Apparently, so does the rest of the world.
> The LCD flavor of flat-screen TVs are by far the most popular, making up 84% of the market, yet demand for them is waning. Shipments of LCD units declined for the first time ever, dropping 3% to 43 million units in the first quarter, according to an NPD DisplaySearch report released Wednesday.


----------



## numbercruncher (22 June 2012)

Those pesky Italians have been partying hard too !



> The main*glaring risk threats that could propel Italy down the path to become Europe's next domino is the size of country's outstanding debt (at â‚¬1.9 trillion or 120% of GDP); the mountain of debt it has to roll over in the next 12 months (nearly â‚¬400 billion); and the market's cracking credibility around Prime Minister Mario Monti's ability to reduce the country's fiscal footprint and spur growth.






> Debt's Drag*- We begin by looking at Italy's debt profile. At 120% (as a % of GDP) –the second highest in Europe behind Greece””its debt servicing load will equate to â‚¬400 billion over the next 12 months alone.




Thats alot of Ferrari's to sell Luigi !!



> Unemployment Hooking - Another grave dynamic is the underemployment across Italian youths at 39%. While short of the 50.2% for Spanish youth, combine "a lost generation" with Italy's demographic headwinds of an aging population (near oldest in Europe) and you have a cocktail that puts great pressure on social services, and the debt and deficit loads in the years ahead.




What a mess .....

http://finance.fortune.cnn.com/2012/06/21/italy-risks/


----------



## numbercruncher (22 June 2012)

And it seems people have enough Chinese trinkets - 



> Chinese manufacturing activity hit a seven-month low in June, data from HSBC showed, putting pressure on Beijing to do more to boost the world's second largest economy.
> 
> The banking giant said preliminary figures from its closely-watched purchasing managers' index (PMI), which gauges the manufacturing sector, fell to 48.1 in June from 48.4 in May on shrinking exports and weak domestic demand.
> 
> The June figure also marked the eighth consecutive month that manufacturing has contracted. A PMI reading above 50 indicates expansion, while a reading below 50 points to contraction.


----------



## Aussiejeff (22 June 2012)

aWWWW, SHOOT!

Unca Benny's pep talk only lasted 24 hours. 

:1zhelp:..we need some Sunshine & Lollipops from Herr Schwann & his trusty sidekick Jools to restore the Faith. 

Lemme guess - Ozzies will cop a mass media reassurance rocket from the pair within the next coupla hours. Sweeeet! We'll all feel betta then, huh?

Chiz,


----------



## numbercruncher (25 June 2012)

Hows this for a scary statement !



> The global economy is misfiring on all cylinders, with the US and China leading the pack. The US may be on the brink of a recession and China is slowing. *Unless China undertakes an economic stimulus program, there's talk that Chinese will never need steel again*.




http://www.thebull.com.au/articles/a/29276-4-dirt-cheap-coking-coal-stocks.html


----------



## moXJO (25 June 2012)

numbercruncher said:


> Hows this for a scary statement !
> 
> 
> 
> http://www.thebull.com.au/articles/a/29276-4-dirt-cheap-coking-coal-stocks.html




Hmmm from that link



> Although China has the capacity to meet most of its coking coal needs internally, Chinese demand affects the price of coking coal elsewhere. Analysts at Macquarie Bank report that at the end of April 2012 crude steel output in China actually hit a new record of 743 million tonnes, annualised; and this despite dire predictions and much gnashing of teeth over China’s slowing economy. This news sent the spot price of coking coal higher and the Macquarie people expect it to go higher still in coming months, albeit at a slower pace.
> Macquarie and Woods are not the only ones sharing this point of view. US coal juggernaut Peabody Coal also anticipates rising - not falling - Chinese steel production. A Peabody analytics team highlights the point that steel consumption per capita in China, India and Brazil is currently well below other developed nations, such as Japan. Peabody estimates that approximately 1.2 billion tonnes of coking coal is needed in order for per capita steel consumption in China, India and Brazil to match the levels of Japan, Taiwan and Korea.
> The truth is that while coking coal explorers and producers have taken a severe beating, the price of coking coal has held up better than many other metals.


----------



## numbercruncher (26 June 2012)

Greece is off to a flying start 



> GREEK finance minister Vassilis Rapanos will resign after only a few days in office, the prime minister's office said on Monday.




http://www.heraldsun.com.au/news/more-news/greek-pm-released-after-eye-surgery/story-e6frf7lf-1226408486644


----------



## Aussiejeff (26 June 2012)

numbercruncher said:


> Greece is off to a flying start
> 
> 
> 
> http://www.heraldsun.com.au/news/more-news/greek-pm-released-after-eye-surgery/story-e6frf7lf-1226408486644




PIIGS might fly??


----------



## DB008 (26 June 2012)

*Der Spiegel - The Disastrous Consequences of a Euro Crash*



> *Imagining the Unthinkable*
> 
> The Disastrous Consequences of a Euro Crash
> 
> ...




Link - Der Spiegel


----------



## DB008 (26 June 2012)

Moody’s Downgrades 28 Spanish Banks On Sovereign Risk

Blooomberg link


----------



## MrBurns (26 June 2012)

Dummies guide to what went wrong in Europe.

Helga is the proprietor of a bar. She realizes that virtually all of her customers are unemployed alcoholics and, as such, can no longer   afford to patronize her bar. To solve this problem she comes up with a new marketing plan that allows her customers to drink now, but pay   later.

Helga keeps track of the drinks consumed on a ledger (thereby granting the customers' loans).

Word gets around about Helga's "drink now, pay later" marketing strategy and as a result, increasing numbers of customers flood into Helga's bar. Soon she has the largest sales volume for any bar in town.

By providing her customers freedom from immediate payment demands Helga gets no resistance when, at regular intervals, she substantially increases her prices for wine and beer - the most consumed beverages.

Consequently, Helga's gross sales volumes and paper profits increase massively. A young and dynamic vice-president at the local bank recognises that these customer debts constitute valuable future assets and increases Helga's borrowing limit. He sees no reason for any undue   concern, since he has the debts of the unemployed alcoholics as collateral.

He is rewarded with a six figure bonus.

At the bank's corporate headquarters, expert traders figure a way to make huge commissions, and transform these customer loans into DRINKBONDS. These "securities"  are then bundled and traded on international securities markets.

Naive investors don't really understand that the securities being sold to them as "AA Secured Bonds" are really debts of unemployed alcoholics. Nevertheless, the bond prices continuously climb and the securities soon become the hottest-selling items for some of the nation's leading brokerage houses.

The traders all receive a six figure bonus.

One day, even though the bond prices are still climbing, a risk manager at the original local bank decides that the time has come to demand   payment on the debts incurred by the drinkers at Helga's bar. He so informs Helga. Helga then demands payment from her alcoholic patrons but, being unemployed alcoholics, they cannot pay back their drinking debts. Since Helga cannot fulfill her loan obligations she is forced   into bankruptcy. The bar closes and Helga's 11 employees lose their jobs.

Overnight, DRINKBOND prices drop by 90%. The collapsed bond asset value destroys the bank's liquidity and prevents it from issuing new loans, thus freezing credit and economic activity in the community.

The suppliers of Helga's bar had granted her generous payment extensions and had invested their firms' pension funds in the BOND securities.  They find they are now faced with having to write off her bad debt and with losing over 90% of the presumed value of the bonds. Her wine supplier also claims bankruptcy, closing the doors on a family business that had endured for three generations; her beer supplier is taken over by a competitor, who immediately closes the local plant and lays off 150 workers.

Fortunately though, the bank, the brokerage houses and their respective executives are saved and bailed out by a multibillion dollar no-strings attached cash infusion from the government.

They all receive a six figure bonus.

The funds required for this bailout are obtained by new taxes levied on employed, middle-class, non-drinkers who've never been in Helga's bar.


----------



## prawn_86 (26 June 2012)

MrBurns said:


> Fortunately though, the bank, the brokerage houses and their respective executives are saved and bailed out by a multibillion dollar no-strings attached cash infusion from the government.
> 
> They all receive a six figure bonus.
> 
> The funds required for this bailout are obtained by new taxes levied on employed, middle-class, non-drinkers who've never been in Helga's bar.




Yep, thats where the problem is. Those who caused the issue are being bailed out instead of let to go broke like other capitalistic businesses.

If you look at some South American countries, they worked bottom up, giving the money directly to SMEs to keep people employed and expand, as opposed to bank execs bonuses, and that bottom up investment worked quite well, even in 2nd World countries


----------



## CanOz (26 June 2012)

I'm reading a book about the same thing, only it happened in the US (the innovators)...Its called "Predator Nation" by Charles Ferguson...

Great analogy, i think i can use this to explain to my wife what the GFC was, is, or will continue to be.

Thanks for sharing that Mr.B.

CanOz


----------



## MrBurns (26 June 2012)

CanOz said:


> Thanks for sharing that Mr.B.
> CanOz



Stolen from another forum but I agree it's good


----------



## StumpyPhantom (26 June 2012)

CanOz said:


> I'm reading a book about the same thing, only it happened in the US (the innovators)...Its called "Predator Nation" by Charles Ferguson...
> 
> Great analogy, i think i can use this to explain to my wife what the GFC was, is, or will continue to be.
> 
> ...




Interest in your views, CanOz (posted elsewhere) as to why you think we might be weeks/months from the bottom of GFC2

That implies that some meltdown event - Grexit, Spanic, Quitaly etc. - will occur.  That also implies that we don't have to wait the decades it will take for all this debt to get paid back and some fiscal union and growth stimulation will do the job and turn it all around?


----------



## CanOz (26 June 2012)

StumpyPhantom said:


> Interest in your views, CanOz (posted elsewhere) as to why you think we might be weeks/months from the bottom of GFC2
> 
> That implies that some meltdown event - Grexit, Spanic, Quitaly etc. - will occur.  That also implies that we don't have to wait the decades it will take for all this debt to get paid back and some fiscal union and growth stimulation will do the job and turn it all around?




No, i mean the bottom of this decline in the equity markets...they tend to lead the economy.

I said days or weeks..but not more than 3 months, i reckon...only my opinion. My reasoning pretty simple, but it worked last time...most of the indexes have formed bearish wedges. Last time i expected these patterns to be resolved down, back to thier lows and beyond...in most cases they only tested the lows again. That fits with the seasonality, and what could be the bottom in China's business cycle, according to most on the Bloomy and oil is at the first target low already. Plus everyone is getting really bearish, that's a sure sign!!

Those are my indicators! On record!

CanOz


----------



## young-gun (27 June 2012)

CanOz said:


> No, i mean the bottom of this decline in the equity markets...they tend to lead the economy.
> 
> I said days or weeks..but not more than 3 months, i reckon...only my opinion. My reasoning pretty simple, but it worked last time...most of the indexes have formed bearish wedges. Last time i expected these patterns to be resolved down, back to thier lows and beyond...in most cases they only tested the lows again. That fits with the seasonality, and what could be the bottom in China's business cycle, according to most on the Bloomy and oil is at the first target low already. Plus everyone is getting really bearish, that's a sure sign!!
> 
> ...




I admire your optimism


----------



## CanOz (27 June 2012)

young-gun said:


> I admire your optimism




Hehe, i don't have much money on the upside yet! 

CanOz


----------



## Glen48 (27 June 2012)

thanks Mr. B now I know what _over the counter Drinks or OCD's_ means


----------



## young-gun (28 June 2012)

CanOz said:


> 7% is the level where other PIGS nations needed a bailout. The majority of debt is not serviced at that level yet, and it would take years to refinance that debt i would think. Its a physiological level more than anything.
> 
> McLovin could elaborate i reckon...
> 
> CanOz






McLovin said:


> I can try.
> 
> I think, iirc, they have to raise eur300b in the next three years. At 7%, they'd be paying over 10% of revenue in interest (and growing rapidly). Personally, I think the bigger issue is the sustainability of their public finances, automatic stabilisers (running counter-cyclical fiscal policy) are supposed stimulate demand during recessions, the problem is that isn't happening. There's only so long that you can run a 10% deficit. If you're running 10% deficits year after year then the interest rate you are being charged becomes secondary to the certainty that you won't be able to repay.




It appears it isn't sustainable for very long at all...

http://www.news.com.au/business/spa...-ahead-of-summit/story-e6frfm1i-1226410637120

:bananasmi


----------



## Tyler Durden (28 June 2012)

And so it continues...

_*STOCKTON, Calif. (AP) ”” When Stockton becomes the largest U.S. city ever to file for bankruptcy, it will strike a hard blow to residents, especially city employees and retirees whose health benefits and pensions helped drive the city toward insolvency.

City Manager Bob Deis said late Tuesday that officials were left with little choice but to recommend bankruptcy after failing to hammer out deals with creditors to ease the city's $26 million budget shortfall.

Deis expects the city to file for Chapter 9 protection by Friday.

Stockton will join a number of other cities and counties across the nation that have plunged into financial crisis as the recession made it tough to cover rising costs involving current and former employees, bondholders and vendors.

"What's going on in Stockton is endemic to what's going on all over the state and the country," said Michael Sweet, a San Francisco bankruptcy attorney at Fox Rothschild LLP. "Local governments are hurting and strained under the current pension and compensation systems. These systems are not appropriate for the type of economy this country has evolved into."

At a standing room-only Stockton City Council meeting Tuesday, numerous former city employees talked about their life-threatening medical conditions and said cuts to their health benefits prompted by the city's financial straits meant they would, in effect, lose their insurance.

"Some people will be devastated. There are those who have such severe medical problems that they will not be taken up by any medical company," said Gary Gillis, a retired fire chief on the board of directors of the city retiree association. "This plan appears to be a sledgehammer or a machete."

Several retirees broke down in tears after the city approved changes to their medical benefits as part of a bankruptcy budget adopted by the City Council.

"For me, bankruptcy might as well be a life sentence," said Gary Jones, a retired police officer, who was diagnosed with a brain tumor 10 years ago. Jones said his medical insurance enabled him to undergo chemotherapy and other treatments, which he said will be unaffordable at the lower level of coverage.

During the past three years, the city has dealt with $90 million in deficits in part through drastic cuts in police and fire personnel, even as residents said they have to deal with recurring break-ins and robberies, a climbing murder rate, homelessness and plummeting property values.

Once a beneficiary of the housing boom, the city now has the second-highest foreclosure rate in the nation. Its unemployment rate has doubled in the past decade and now hovers around 16 percent while a fifth of residents live below the poverty line.

"The average citizen will not put up with this," said Gregory Pitsch, a 22-year-old unemployed resident who made an unsuccessful run for mayor. "Their home prices have plummeted, they have no jobs, a lot of people are getting fed up so that they have to resort to crime."

Betty Garcia, who co-owns a downtown jewelry store with her husband, said her community is starting a neighborhood watch group to respond to a rise in crime and lack of police response, which they expect will only get worse.

"We already hear gunshots every night," Garcia said. "It's becoming like listening to the train go by. People don't even call the cops anymore."

Experts say municipalities such as Stockton must find a way to lower their contractual obligations to current and former employees as the cost of health care skyrockets and people are living longer.

"When times were good, it was easier to expand benefits and pensions and not pay as much attention to the unfunded liabilities that were growing," said David Dubrow, a bankruptcy lawyer at Arent Fox LLP in New York City. "Now that times are not good and not good for prolonged periods, those costs are becoming severe."

Some states have passed legislation related to changing pensions and retirement benefits for new employees, Dubrow said. But it's difficult to change the rules for existing employees and even more complicated for retirees, because state constitutions and other legal issues may prevent such restructuring.

In Stockton, pensions will not be affected by a bankruptcy filing, but health benefits for employees and retirees will.*_

http://www.businessweek.com/ap/2012-06-27/stockton-official-mediation-with-creditors-fails


----------



## Glen48 (28 June 2012)

During the cold war the Yanks could not find enough Russian Subs so the experts decide  Russia had developed a secret way to disguise their subs from being tracked, so the hunt was on to find out how the Russians did it so the Yanks spent a few bucks trying to work out how the Russian did it.
After awhile the penny dropped and the yanks decided the subs never existed in the first place this is just one example of wasting money and now we find out USA is going broke at $2.5 M a second ..and still spending ....DUH


----------



## CanOz (28 June 2012)

> "Some people will be devastated. There are those who have such severe medical problems that they will not be taken up by any medical company," said Gary Gillis, a retired fire chief on the board of directors of the city retiree association. "This plan appears to be a sledgehammer or a machete."
> 
> Several retirees broke down in tears after the city approved changes to their medical benefits as part of a bankruptcy budget adopted by the City Council.
> 
> "For me, bankruptcy might as well be a life sentence," said Gary Jones, a retired police officer, who was diagnosed with a brain tumor 10 years ago. Jones said his medical insurance enabled him to undergo chemotherapy and other treatments, which he said will be unaffordable at the lower level of coverage.




That's a hell of a way for freedom loving, capitalist country with filthy rich congressman to treat its people....

I reckon they'd be better off in China!

CanOz


----------



## Glen48 (28 June 2012)

No worries the USA has is on the case:

http://www.pakalertpress.com/2012/06/28/military-in-miami-indiana-st-louis-maine-minnesota-colorado/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed:+pakalert+%28Pak+Alert+Press%29


----------



## Glen48 (29 June 2012)

*Maybe not Canoz:

3. Metals Manufacturers Turn from Pig Iron ... to Pigs!* China’s steel production fell 2.5% in May compared to April. Iron ore spot import prices fell 8% through most of May. And output of copper fell 1.4% month-on-month, its second-consecutive month of decline.
How anemic is steel demand in China? It’s _SO BAD_ ... Wuhan Iron & Steel is apparently venturing into pig farming, as the steel business is no longer profitable.
Hey, people always need to eat. They need pigs more than pig iron, Wuhan figures.
And it’s not the only one.
Shanxi Coking Coal Group, a leading coking coal producer, is venturing into the pig-slaughtering business with China’s biggest hog processor, Shuanghui Group. According to the report, the two companies will build a pig slaughterhouse with an annual output of 2 million pigs.
But will the slaughterhouse require as much energy as a steel plant? Probably not even close, which leads to our next sign that China’s economy is on the decline.

Recently, mainstream media sources including _The New York Times_ called out China for massaging its economic data to make it look better than it really is:
“Officials in some cities and provinces are also overstating economic output, corporate revenue, corporate profits and tax receipts, the corporate executives and economists said. The officials do so by urging businesses to keep separate sets of books, showing improving business results and tax payments that do not exist.
“The executives and economists roughly estimated that the effect of the inaccurate statistics was to falsely inflate a variety of economic indicators by 1 or 2 percentage points. That may be enough to make very bad economic news look merely bad.”​So is China headed for a hard landing? The last time China faced real economic troubles was in 2009, when economic growth fell to just 6.6% in the first quarter.
Growth hasn’t dipped to that level yet. But anecdotal evidence suggests China’s job market is just as bad as, or worse than, it was in the last crisis. That’s because smaller and mid-sized private firms are increasingly struggling with slackening orders, rapid wage increases and higher raw material costs.
This time around, the vast majority of market analysts expect Chinese economic growth to bottom this quarter ”” in other words, right now ”” or early next quarter. If that doesn’t happen, the bottom could fall out of Chinese stocks.


----------



## Gringotts Bank (29 June 2012)

I think a panicky market is a very good contrarian indicator.

But there's no panic; instead, low volumes and a depressed, sick looking market.  That's medium to long term bearish, IMO.


----------



## DB008 (30 June 2012)

Building Industry in trouble.



> THE building sector has warned it is in danger of sliding into "recession'' with no signs of an imminent recovery.
> A survey of 500 builders shows that sentiment is approaching GFC levels as the work dries up with activity 20 per cent below its long-term average level.
> Master Builders Australia chief economist Peter Jones said the outlook is "bleak'', with the recent Reserve Bank rate cuts having failed to stimulate new home buyers.
> "Builders and contractors are in survival mode,'' he said.
> ...


----------



## Aussiejeff (30 June 2012)

Stocks soar.

Bullrush begins.

GFC2 a fantasy...


----------



## Julia (30 June 2012)

Aussiejeff said:


> Stocks soar.
> 
> Bullrush begins.
> 
> GFC2 a fantasy...



Are you actually serious?


----------



## CanOz (30 June 2012)

Julia said:


> Are you actually serious?





Pssssst, Julia....i think he's referring tongue in cheek, to the short term change in sentiment and the inevitable 'kicking of the can down the road'....

CanOz


----------



## Glen48 (30 June 2012)

[FONT=verdana,                      geneva]Other than this it is all ok:

Date: June 29, 2012 
[FONT=verdana,                    geneva]Reporting From:[FONT=verdana,geneva] [/FONT][/FONT][FONT=verdana, geneva]Tel Aviv, Israel 
[/FONT][FONT=verdana,                    geneva][/FONT][/FONT]
This week may very well go down as 'connect the dots' week. Things have been moving so quickly, so let's step back briefly and review the big picture from the week's events:
1) After weeks... months... even years of posturing and denial, Spain and Cyprus became the fourth and fifth countries to formally request aid from Europe's bailout funds on Monday.
In doing so, these governments have officially confessed to their own insolvency and the insolvency of their respective banking systems.
Meanwhile, Slovenia's prime minister said that his country may soon ask for a bailout. (Humorously, Slovenia's Finance Minister denied any such plans.)
Spain's 10-year bond yield jumped to over 7% again in response, and many Spanish banks were downgraded to junk status by Moodys.
2) Over in the US, the city of Stockton, California filed for bankruptcy this week... the largest so far, but certainly a mere drop in the proverbial bucket.
3) JP Morgan, considered to be among the few 'good' banks remaining in the US, conceded that the $2 billion loss they announced several weeks ago might actually be more like $9 billion.
4) The Federal Reserve reported yesterday that foreigners are reducing their holdings of US Treasuries.
5) Countries from Ukraine to Kazakstan to Turkey announced that they have purchased gold in recent months to bolster their growing reserves.
6) Chile has joined a growing list of countries that has agreed to bypass the US dollar and settle all of its trade with China in renminbi.
7) China has further announced plans to create a special zone in Shenzhen, one of its wealthiest cities, to allow full exchange and convertibility of the renminbi.
8) World banking regulators from the Bank of International Settlements to the FDIC are proposing that gold bullion be treated as a risk-free cash equivalent by commercial banks.
So... what we can see from this week's events is:
- European governments are insolvent 
- European banks are insolvent 
- US governments are heading in that direction 
- Even the best US banks are not as strong as believed 
- Foreigners are abandoning the US dollar and seeking alternatives 
- Gold is money
These events are all connected, and the trend is becoming so clear that even the most casual observers are starting to wake up.
When you connect the dots, the next steps lead to what may soon be regarded as an obvious conclusion: the system, as it exists right now, is crumbling.
No amount of self-delusion can make this go away.
Rational thinking and measured action, on the other hand, can make the consequences go away... turning people from victims into spectators of the greatest bubble burst in modern times.

[FONT=verdana,                                                    geneva]Until tomorrow, 





[/FONT]​


----------



## young-gun (30 June 2012)

CanOz said:


> Pssssst, Julia....i think he's referring tongue in cheek, to the short term change in sentiment and the inevitable 'kicking of the can down the road'....
> 
> CanOz




Is anyone able to give an in depth analysis of the latest developments in Europe?(if you anybody is feeling upto it). Or is it as simple as what is read in the papers. 

I am just trying to work out why markets are rallying. Is it just simply a massive overreaction to the news that has come out? It doesn't appear as though anything has actually been addressed. In fact from what I gather all that has happened is that it's now easier to bail out banks and crumbling economies.

Won't this lead to the bailout fund deteriorating even faster?


----------



## Julia (30 June 2012)

CanOz said:


> Pssssst, Julia....i think he's referring tongue in cheek, to the short term change in sentiment and the inevitable 'kicking of the can down the road'....
> 
> CanOz



Well, I hoped it was facetious.  But, given the sudden, disproportionate imo, rally yesterday, I thought it's possible he was serious.


----------



## Tyler Durden (30 June 2012)

young-gun said:


> Is it just simply a massive overreaction to the news that has come out? It doesn't appear as though anything has actually been addressed.




I think this is it. It's like the headline came out "EUROZONE LEADERS AGREE TO DEAL", everyone reads it and thinks "wow problems solved! Let's buy into the good news!!!"

But then no one really actually reads the contents of the article, which, if they did, would reveal that details of any 'deals' are quite vague, if they exist at all.


----------



## young-gun (1 July 2012)

Tyler Durden said:


> I think this is it. It's like the headline came out "EUROZONE LEADERS AGREE TO DEAL", everyone reads it and thinks "wow problems solved! Let's buy into the good news!!!"
> 
> But then no one really actually reads the contents of the article, which, if they did, would reveal that details of any 'deals' are quite vague, if they exist at all.




As suspected...

http://www.cnbc.com/id/48008281

Markets seem to rally off the smell of an oily rag these days. Rogers is of the opinion nothing has really been achieved also.

And this:

http://www.cnbc.com/id/48013560



> 4. One Word: Debt
> 
> At its core, the global economic crisis is about debt. The balance sheet-driven slowdown has thwarted the efforts of central bankers who have tried to resuscitate the economy by levitating equity markets.






> In short: One day's headlines will not cure years' worth of economic damage inflicted by soaring global debt.


----------



## young-gun (2 July 2012)

China still slowing....faster:

http://www.cnbc.com/id/48038077


----------



## young-gun (11 July 2012)

Is Australia on the same path as Spain? swanny doesn't think so. 

http://www.cnbc.com/id/48143819


----------



## Tyler Durden (11 July 2012)

young-gun said:


> Is Australia on the same path as Spain? swanny doesn't think so.
> 
> http://www.cnbc.com/id/48143819




Spain didn't think so either 

Btw, how can Swan say our economy is "very strong", we have "low unemployment" and "strong job creation" when the states recently announced like a total of 30,000 job cuts and job advertisements have been low as of recent times?!??!


----------



## Glen48 (11 July 2012)

OZ will be 3rd world once China goes under big cleaning process and a new way of looking at life, generating an income for workers and the country.
A USA city has just dropped wages by 70% for all or risk going under so it is starting to take shape.


----------



## Smurf1976 (11 July 2012)

Which US city are we talking about? A big one? Or some tiny place that nobody outside the region has ever heard of?


----------



## Glen48 (11 July 2012)

THIS ONE:
Public workers in the hard-up US city of Scranton, Pennsylvania have had their pay slashed to minimum wage-levels as a budget fight between the mayor and city council comes to a head.

About 400 municipal workers in the city ”” including police officers, firefighters and construction workers &mdsah; are being subjected to steep pay cuts that have sparked a string of lawsuits.The city, which is the birthplace of Vice President Joe Biden and has become synonymous with industrial decline, is facing bankruptcy and the mayor has refused to borrow more money to pay wages.For police officers with two years on the job that now means a pay cut from $26 an hour to $7.25 an hour, a drop of more than 70 percent.Construction workers who earn between $18 and $20 under union contracts will also get $7.25 per hour."All the vendors are getting 100 cents on the dollar, but the people keeping the buildings from burning down have seen their pay slashed by 75 percent," Stephen Holroyd, an attorney representing three of the city's workers' unions, told AFP.Roger Leonard, a heavy equipment operator for the city told National Public Radio last week that he typically gets a $900 check for two weeks of work. After the pay cut, it dropped to only $340."I have two children and a wife, and my wife is a stay-at-home mom," said Leonard. "If the savings gets drained, we won't be okay, but I'm hoping before that happens, that they come to a resolution," he told reporters.The city, about 190 kilometers north of Philadelphia is one of a number of so-called rust belt cities that have seen manufacturing and heavy industry flee over past several decades, leaving behind empty downtown storefronts.But the cause of the immediate problem stems from mayor Chris Doherty and the city council's inability to agree on a budget.The _Scranton Times-Tribune_ reported that the town had just $133,000 in the bank on Monday, but owed $3.4 million.Holroyd said the town has the money to pay, because it has the ability to borrow money for salaries as it has done in the past."It's not because the city's broke, it's because they are in a political squabble," Holroyd said. "They've just decided not to go to the ATM."The mayor did not return a call for comment.Unions representing the employees have also sought to hold the town's mayor in contempt of court, saying he violated a judge's order to reverse his decision to slash wages."He's just ignoring the court's order," said Holroyd.Many US municipalities have seen their finances decimated by a flight of businesses and residents to the suburbs and beyond, leading to an ever-dwindling tax base and predictions of a wave of municipal defaults.
​


----------



## Buckfont (11 July 2012)

Hi glen, have you a link to your last post? I have some folks over there that may be interested. Thanks BF


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## Glen48 (11 July 2012)

http://finance.ninemsn.com.au/newsbusiness/8497467/us-city-cuts-worker-pay-by-70-percent
 All yours.


----------



## Buckfont (11 July 2012)

Thanx


----------



## DB008 (13 July 2012)

From Bloomberg Business



> *China Econ Data Questioned, Power Usage Slows*
> 
> The figures that go into China’s gross domestic product are “man-made” and “for reference only,” Li Keqiang, then a regional Communist Party head, said in 2007.
> 
> ...




Link - http://www.businessweek.com/news/2012-07-12/china-economic-data-questioned-as-electricity-use-slows


----------



## Aussiejeff (14 July 2012)

Stocks soar again.

Bullrush continues...

GFC2 still a fantasy....?


----------



## young-gun (16 July 2012)

Author of book "the new depression" seems to have a very grim outlook. Puts into perspective where all this credit growth/creation has landed us though.

http://video.cnbc.com/gallery/?video=3000103083&play=1


----------



## DB008 (24 July 2012)

*Berlin, IMF To Refuse Fresh Aid for Greece*

Interesting...

Berlin, IMF To Refuse Fresh Aid for Greece




> *Greece has fallen behind with its budget cuts and is asking lenders for more time to meet the conditions of the 130 billion euro aid package. But that would require fresh help of up to 50 billion euros, SPIEGEL has learned. Neither Berlin nor the IMF are prepared to make that money available.
> *
> 
> Germany and other important international creditors are not prepared to extend further loans to Greece beyond what has already been agreed, German newspaper SÃ¼ddeutsche Zeitung reported on Monday. In addition, SPIEGEL has learned that the International Monetary Fund (IMF) too has signalled it won't take part in any additional financing for Greece.
> ...


----------



## young-gun (25 July 2012)

*Re: Berlin, IMF To Refuse Fresh Aid for Greece*



DB008 said:


> Interesting...
> 
> Berlin, IMF To Refuse Fresh Aid for Greece




May as well apply for 9th, 10th and 11th bailout while she's there, there's no coming back on their own. How much more time does europe have left? 12 months?


----------



## Glen48 (25 July 2012)

Think Europe its a hand grenade with the pin out and OZ has about 2 years before it all tanks.
 China is building the worlds tallest sky scraper and this is normality before any depression.


----------



## DB008 (26 July 2012)

China slowing down. Iron Ore stockpiles. Deferred shipments. Vale down 24% in last 12 months.

http://www.macrobusiness.com.au/2012/07/ores-not-well/


----------



## CanOz (26 July 2012)

DB008 said:


> China slowing down. Iron Ore stockpiles. Deferred shipments. Vale down 24% in last 12 months.
> 
> http://www.macrobusiness.com.au/2012/07/ores-not-well/




Yup, just listened to an interview with a guy that was here and has been here dozens of time over the last couple of years. He said the stockpiling of coal is particularly alarming. Its everywhere....piles of the stuff.

Construction sites have virtually gone idle from 24/7...

CanOz


----------



## Glen48 (26 July 2012)

Word is it will all be over in 2 yrs  but by the looks of things could be any day, sadly it all takes time to start and stop, like stopping a runaway train, once China stops the big worry will be the OZ economy, agree we have Swan  at the helm so in good hands and impossible to find better but I doubt if even he can the Salami as it rushes in.
Will be like every one in OZ is un employed over night.

 Mate has got a job driving a water truck for $160K PA told him to go hard while it lasts.


----------



## CanOz (26 July 2012)

Glen48 said:


> Mate has got a job driving a water truck for $160K PA told him to go hard while it lasts.




That pretty much sums up Australia's biggest labor problem.....LOL!!!


----------



## DB008 (30 July 2012)

From Bloomberg

*Used Lamborghinis Linger On H.K. Lots Amid China Lull*



> Waiting lists for ultra-luxury cars in Hong Kong are getting shorter and used-car lots are cutting prices on Lamborghinis, Ferraris and Bentleys in the latest sign of China’s slowdown.
> At first glance, the numbers are deceiving: Sales of very expensive new autos surged 47 percent in the first six months, according to industry analyst IHS Automotive. Look more deeply, however, and another picture emerges, especially in the city’s used-car lots.
> 
> Dealers of such second-hand cars say job cuts and the worsening global economic outlook are creating uncertainty among the finance-industry and expatriate professionals who make up the bulk of their buyers. Morgan Stanley (MS), Citigroup Inc. (C) and Deutsche Bank AG are among firms with Asian headquarters in Hong Kong that are cutting jobs worldwide.
> “The more expensive the car, the more dry the business,” said Tommy Siu at the Causeway Bay showroom of Vin’s Motors Co., the used-car dealership he founded two decades ago. Sales of ultra-luxury cars have halved in the past two or three months, he said. “A lot of bankers don’t want to spend too much money for a car now. At this moment, they don’t know if they’ll have a big bonus.”



http://www.bloomberg.com/news/2012-07-29/used-lamborghinis-linger-on-h-k-lots-amid-china-lull.html


----------



## young-gun (30 July 2012)

DB008 said:


> From Bloomberg
> 
> *Used Lamborghinis Linger On H.K. Lots Amid China Lull*
> 
> ...




The big crash isn't gonna happen anymore, didn't you hear? Some guy in Europe thinks his central bank has the power to prevent it.
His actions will no doubt be enough to boot the can 12 months further.


----------



## DB008 (5 August 2012)

Italy: S&P downgrades 15 banks and warns over recession



> Standard & Poor’s has downgraded 15 Italian banks, saying Italy faces a potentially deeper and more prolonged recession than the ratings agency had originally anticipated.
> 
> Banks in the eurozone’s third largest economy are under pressure amid the widening eurozone debt crisis. They are seen as vulnerable because of their vast holdings in Italian government bonds.
> 
> ...




Video on the page


----------



## Aussiejeff (6 August 2012)

DB008 said:


> Italy: S&P downgrades 15 banks and warns over recession
> 
> 
> 
> Video on the page




All the Mario Bros. have to do is continue playing soothing word games for the Mindless Media - it's sure worked till now. So, why not continue this painless strategy of "media soothing" forever? Costs nothing- raises Billions for the rich and powerful elite - the ones who really matter. That appears to be the game strategy for now - worldwide it would seem...

Que sera sera?  

Meh.


----------



## young-gun (6 August 2012)

Aussiejeff said:


> All the Mario Bros. have to do is continue playing soothing word games for the Mindless Media - it's sure worked till now. So, why not continue this painless strategy of "media soothing" forever? Costs nothing- raises Billions for the rich and powerful elite - the ones who really matter. That appears to be the game strategy for now - worldwide it would seem...
> 
> Que sera sera?
> 
> Meh.




Can't go on forever AJ


----------



## Tyler Durden (6 August 2012)

DB008 said:


> Italy: S&P downgrades 15 banks and warns over recession
> 
> 
> 
> Video on the page




Interesting that the market went up today. Wonder what caused it.


----------



## So_Cynical (6 August 2012)

Ok im going on the record..GFC 2 is over!

The bottoms in and the ASX express is leaving the station...all aboard.


----------



## CanOz (6 August 2012)

So_Cynical said:


> Ok im going on the record..GFC 2 is over!
> 
> The bottoms in and the ASX express is leaving the station...all aboard.




LOL! Nice one SoCyn...its already left. If its not back by November its not coming back for awhile...

CanOz


----------



## Tyler Durden (7 August 2012)

So_Cynical said:


> Ok im going on the record..GFC 2 is over!




And so GFC 3 begins


----------



## poverty (7 August 2012)

Tyler Durden said:


> And so GFC 3 begins




Don't worry yourselves - sequels never has as much impact as the original!


----------



## young-gun (13 August 2012)

Germany to block bailout if Greece fails to meet reforms agreed on:

http://www.news.com.au/business/german-mp-warns-of-greek-aid-veto/story-e6frfm1i-1226448955948

ECB last line of defense, print or grexit?


----------



## MrBurns (13 August 2012)

young-gun said:


> Germany to block bailout if Greece fails to meet reforms agreed on:
> 
> http://www.news.com.au/business/german-mp-warns-of-greek-aid-veto/story-e6frfm1i-1226448955948
> 
> ECB last line of defense, print or grexit?




Probably another bluff, market will go down then up then...............


----------



## young-gun (13 August 2012)

MrBurns said:


> Probably another bluff, market will go down then up then...............




I'd like to think not, but you're probably right...hasn't stopped the asx jumping this morning. As far as I'm aware greece has failed to meet the mark on almost every other occasion, I don't see how they will have reached it this time either. We'll know in a month!


----------



## DB008 (13 August 2012)

Yes, but some German political parties are also looking at the new French president and his policies...


German Opposition Calls for Wealth Tax



> he opposition center-left Social Democrats and the Green Party are proposing that Germany reintroduce a wealth tax that the country eliminated in 1997. Under the proposal, a 1 percent annual tax would be applied to Germans with assets exceeding â‚¬2 million (about $2.5 million). The tax allowance would be double that figure for married couples, Norbert Walter-Borjans of the Social Democratic Party (SPD), who is finance minister for the state of North Rhine-Westphalia, said on Wednesday.


----------



## tinhat (15 August 2012)

Just when things were seeming too quiet, the Greeks manage to pipe up again. Asking for a two year extension to their austerity targets, deferral of the repayments on the second IMF loan (they want to start repaying in 2020 not 2016). Greek MP to meet with Merkel and Hollande next week.

Perhaps there will be a correction before a northern hemisphere winter bull run? Whatever happens it will merely be warm-up to the US fiscal cliff that awaits early next year.


----------



## numbercruncher (16 August 2012)

I think this little snippet from BHP is an indication of the carnage that will sweep Australia 




> The world's biggest resources company is expected to post a fall in operating profit from an Australian record $US23.6 billion last year to about $US16.9 billion in 2011-12, but it may have to write down some shale gas assets.


----------



## DB008 (16 August 2012)

Vale, in Brazil has also posted a huge profit downgrade....


----------



## Glen48 (16 August 2012)

Ok move up a notch GFC 2.5


----------



## tinhat (17 August 2012)

And yet the market completely ignores the Greeks. I'm surprised. Then again, it's all about China if you look at the numbers.


----------



## young-gun (17 August 2012)

It ll all come to a head soon enough. I have no idea what the hell is going on at the moment


----------



## lusk (17 August 2012)

young-gun said:


> It ll all come to a head soon enough. I have no idea what the hell is going on at the moment




The gambling house doesn't think so.:boy:


----------



## numbercruncher (21 August 2012)

More players reminding Australia about her date with destiny .....




> ONE of Europe's biggest banks today warned of the growing risk of recession in Australia in 2013, as prices for its key commodities such as iron ore and coal spiral lower.
> 
> The warning by Deutsche Bank comes amid rising concern that Australia's mining investment boom, which has insulated the commodity-rich economy from a global slowdown, is waning, leading to mine expansions being scaled back and mounting job losses.


----------



## DB008 (21 August 2012)

DB008 said:


> Vale, in Brazil has also posted a huge profit downgrade....




http://www.marketwatch.com/story/vale-q2-profit-falls-59-on-lower-iron-ore-prices-2012-07-25


----------



## Steve C (21 August 2012)

numbercruncher said:


> More players reminding Australia about her date with destiny .....
> 
> ONE of Europe's biggest banks today warned of the growing risk of recession in Australia in 2013, as prices for its key commodities such as iron ore and coal spiral lower.
> 
> The warning by Deutsche Bank comes amid rising concern that Australia's mining investment boom, which has insulated the commodity-rich economy from a global slowdown, is waning, leading to mine expansions being scaled back and mounting job losses.




On the above note, I would like to take this opportunity to thank Prime Minister Gillard for introducing the carbon tax and MRRT as policies to combat any chance of a recession. With these well thought out policies now in full swing mining investment in Australia is bound to increase and gain momentum...


----------



## So_Cynical (21 August 2012)

DB008 said:


> http://www.marketwatch.com/story/vale-q2-profit-falls-59-on-lower-iron-ore-prices-2012-07-25




Wow a 59% drop in Q2 profit...from 6.5 billion to $2.66 billion, share holders must be crying into their gold plated corn flakes, what a disaster Vale mite only make 10 billion dollars profit this year...the world's gone to hell in a hand basket. 



Steve C said:


> On the above note, I would like to take this opportunity to thank Prime Minister Gillard for introducing the carbon tax and MRRT as policies to combat any chance of a recession. With these well thought out policies now in full swing mining investment in Australia is bound to increase and gain momentum...




Yep its got alot to do with the profitability of mine development in Aust  you have 15 threads to bash and vent all the right wing political clap trap you like...how about posting it where its appropriate.


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## Steve C (21 August 2012)

So_Cynical said:


> Yep its got alot to do with the profitability of mine development in Aust  you have 15 threads to bash and vent all the right wing political clap trap you like...how about posting it where its appropriate.




Have you thought about foreign investment? Diminishing margins due to increased costs (ie. taxes) Do you realise that because of these policies mining companies are looking to Africa and South America taking money out of Australia? Even local miners are looking at developing assets overseas because all the taxes and red tape has made it to expensive to do business in Australia.


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## So_Cynical (22 August 2012)

Steve C said:


> Have you heard of foreign investment? Do you realise that because of these policies mining companies are looking to Africa and South America taking money out of Australia? Even local miners are looking at developing assets overseas because all the taxes and red tape has made it to expensive to do business in Australia.




Bollocks.

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

Miners dig up stuff and sell it, now in order to do that they have to operate where the stuff is..and we got the stuff.

Cant get around that.


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## Steve C (22 August 2012)

So_Cynical said:


> Bollocks.
> 
> -----------------------
> 
> ...




I work in mining consulting - believe me it's happening, Africa and South America are also commodity rich without   blatent money grabbing Government policies.

An example - a certain mid cap iron ore miner will be forced to pay $5 million annually under the carbon pricing regime even though they are not directly liable (indirect costs such as diesel) do you realise how much that squeezes margins for a mid cap?? They wouldn't get that in chile or brazil...which is why many are looking at overseas investment.

They aren't going to dig the stuff up and sell it when it stops being profitable enough to do so.


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## So_Cynical (22 August 2012)

Steve C said:


> I work in mining consulting - believe me it's happening, Africa and South America are also commodity rich without   blatent money grabbing Government policies.
> 
> An example - a certain mid cap iron ore miner will be forced to pay $5 million annually under the carbon pricing regime even though they are not directly liable (indirect costs such as diesel) do you realise how much that squeezes margins, they wouldn't get that in chile or brazil...which is why many are looking at overseas investment




Yep its all happening in Africa, there is alot of copper in the DRC and i have heard that the rebels don't charge as much tax as the Govt...also see on the news that the police in SA are very pro active in Platinum Mine security  apparently Indonesian joint venture partners are also no risk to partner with.

Billions waiting to be invested in bougainville as well...a world of Carbon/super profits tax free opportunity awaits.


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## Steve C (22 August 2012)

So_Cynical said:


> Yep its all happening in Africa, there is alot of copper in the DRC and i have heard that the rebels don't charge as much tax as the Govt...also see on the news that the police in SA are very pro active in Platinum Mine security  apparently Indonesian joint venture partners are also no risk to partner with.
> 
> Billions waiting to be invested in bougainville as well...a world of Carbon/super profits tax free opportunity awaits.




Great you read the AFR... I notice no South American references and for the few African mines you refer to there are 200 others experiencing no such issues....sovereign risk vs costs... Once the costs mean no profits then other opportunities will be looked at elsewhere.

Of course I am not claiming the costs are all attributed to labor policy, of course lower Chinese demand, commodity prices, labour costs and Europe play a large part in this potential recession mentioned in the news article but I am giving you first hand information that I am hearing from C Level Mid tier mining execs.


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## DB008 (22 August 2012)

So_Cynical - Just putting a picture out there iron prices are cooling off. On top of that, miners are still ramping up production. BHP did the massive RGP stage project (Quantum Projects still on hold), Rio also expanded Hope Downs (production output) and FMG got Cloudbreak and Christmass Creek up and running with the Solomon Hub also getting under way. These are huge projects.

Lets also not forget that the price of Iron Ore was sub $20 for a very long time, then jumped to ten fold (at peak) in a very short space of time. Equals a boom.




As Steve C says, for a variety of reasons (China slowing down, global uncertainty, carbon tax, MRRT), there has been caution in the wind in the resources sector with major projects been put on hold. I am hearing this too from first hand sources. There is a definite cooling down happening.

BHP's multi-Billion Dollar Ravensthorpe Nickel Project also suffered some pretty big cost blow-outs and there was a significant drop in the price of Nickel, which led to the mine closing there for a while. And that was a company with very deep pockets. I wonder how smaller operators are going to take the next few years.






Source/Links
http://www.indexmundi.com/commodities/?commodity=iron-ore&months=120
http://www.blue-point-trading.com/blue-point-trading-market-view-june-06-2012
http://www.kitcometals.com/charts/nickel_historical_large.html#5years
http://en.wikipedia.org/wiki/Ravensthorpe_Nickel_Mine


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## stacks (22 August 2012)

So_Cynical said:


> Yep its all happening in Africa, there is alot of copper in the DRC and i have heard that the rebels don't charge as much tax as the Govt...also see on the news that the police in SA are very pro active in Platinum Mine security  apparently Indonesian joint venture partners are also no risk to partner with.
> 
> Billions waiting to be invested in bougainville as well...a world of Carbon/super profits tax free opportunity awaits.




Lots of sarcasm and rolling eyes but little recognition of what is unfolding on the ground


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## young-gun (23 August 2012)

Is it just me or has everything gone strangely quiet recently?? Seems as though either there is lack of news to report on out of Europe or they aren't reporting it. And yet markets, well at least the Dow and the asx seem to be furthering their little rallies. Calm before the storm perhaps??


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## tinhat (23 August 2012)

young-gun said:


> Is it just me or has everything gone strangely quiet recently?? Seems as though either there is lack of news to report on out of Europe or they aren't reporting it. And yet markets, well at least the Dow and the asx seem to be furthering their little rallies. Calm before the storm perhaps??




Europeans go on holidays during August.


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## Glen48 (23 August 2012)

Big Ben is getting a few more tons of ink so Gold shot up, next gold will nudge 1700 1800 then all will tank gold down to 1400
Stand by.


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## doctorj (28 August 2012)

For those that are interested, attached it analysis from Variant Perception on the future for Australia and the impact on the AUD, stocks, banks, interest rates and a whole lot more.  Interesting read that draws comparisons between Australia and Spain and Australia and the EU Periphery.


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## Tyler Durden (28 August 2012)

doctorj said:


> For those that are interest, attached it analysis from Variant Perception on the future for Australia and the impact on the AUD, stocks, banks, interest rates and a whole lot more.  Interesting read that draws comparisons between Australia and Spain and Australia and the EU Periphery.




Thanks for that, I had a quick flick and all the reasons given appear to be fundamentally sound. Hope someone remembers this 12 months down the track and says "I told you so!"


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## DB008 (29 August 2012)

> *China Retailers Lose Steam, Deepening Wen’s Challenges*
> 
> 
> China’s retailers from clothing to computers are reporting weaker sales growth, undermining Premier Wen Jiabao’s goal of relying more on consumer spending for expansion as the economy cools.
> ...




http://www.bloomberg.com/news/2012-08-28/china-retailers-lose-steam-deepening-wen-s-challenges.html


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## So_Cynical (29 August 2012)

doctorj said:


> For those that are interested, attached it analysis from Variant Perception on the future for Australia and the impact on the AUD, stocks, banks, interest rates and a whole lot more.  Interesting read that draws comparisons between Australia and Spain and Australia and the EU Periphery.




I remember reading some "Dutch disease" analysis about 2 years or so ago, so nothing new there..while its hard to argue against the broad strokes of the report, its really all a bit same old same old....They are bullish (6 months) the aussuie market yet suggest steering clear of Banks and Miners  so basically don't buy half the ASX100 stocks. 

This quote from there website from Jan 2009 is a statment of the incredibly obvious.



			
				http://variantperception.com/track-record said:
			
		

> JANUARY 2009
> “Governments around the world are drawn towards beggar thy neighbour currency devaluations and protectionism in times of crisis.” “The unwinding of leverage, consumption and excessive construction will take years to play out. An increase in savings rate will replace excessive consumption. A shift towards retail and finance in the US economy will be reduced.”
> 
> “Industrial production is negative almost everywhere in the world and in many places is down almost 20%. Exports from countries like Japan, Korea, and Taiwan are down almost 50% year over year! This will lead to a negative GDP for the first time in almost 50 years.”
> ...




Well no **** Sherlock.


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## doctorj (29 August 2012)

So_Cynical said:


> I remember reading some "Dutch disease" analysis about 2 years or so ago, so nothing new there..while its hard to argue against the broad strokes of the report, its really all a bit same old same old....




The more interesting thing in that report is the link to interest rates and the AUD and of course the point that the problems of Dutch disease may be beginning to bite.


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## DB008 (30 August 2012)

doctorj said:


> For those that are interested, attached it analysis from Variant Perception on the future for Australia and the impact on the AUD, stocks, banks, interest rates and a whole lot more.  Interesting read that draws comparisons between Australia and Spain and Australia and the EU Periphery.




SMH has a story featuring the article in your post doctorj.

http://www.smh.com.au/business/warning-after-the-boom-itll-be-dutch-and-go-20120829-2513n.html



> AUSTRALIA faces a run on its currency, a deeper collapse in housing prices and a bank funding crisis to rival Europe's as it attempts to come to grips with life after the mining boom, according to a widely circulating report from a boutique US advisory firm.
> 
> _Entitled Australia: The Unlucky Country, the report from Variant Perception_ argues Australia faces a classic case of Dutch Disease, the erosion of capability that flows from a resources boom and an overvalued exchange rate.
> "The mining sector has crowded out almost all other sectors of the economy and also funnelled credit and liquidity into a housing bubble in the real estate sector," the report says.
> ...


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## DB008 (30 August 2012)

Bloomy's......



> *September Offers 15 Days To Cement Crisis Solutions: Euro Credit*
> 
> European policy makers end August with 15 days to justify bondholder optimism that they can deliver lasting solutions to the debt turmoil.
> September offers a microcosm of three years of crisis- fighting. The next two weeks may feature fresh anti-contagion measures from the European Central Bank, a possible aid request from Spain and insight into whether creditors will ease Greece’s bailout terms. German judges and Dutch voters also get to proclaim on the euro’s future.
> ...


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## DB008 (3 September 2012)

Still more Bloomy's...



> *China Economy’s Deterioration Raises Risk Of Wen Missing Target*
> 
> China’s economy is showing mounting signs of deterioration from manufacturers to banks, raising the risk that outgoing Premier Wen Jiabao will miss his growth target for the first time since taking office in 2003.
> Manufacturing unexpectedly contracted for the first time in nine months in August as orders shrank, a government survey showed Sept. 1. The reading adds to evidence of weakness after a surfeit of unsold goods left near-record rubber stocks at China’s main shipment port and deepening financial strains saw a 27 percent jump in overdue loans at the five biggest banks in the first half.




Link


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## Steve C (4 September 2012)

I work at a big 4 firm with a mining and oil & gas focus and I have to admit for the first time I am starting to get slightly nervous - I get the feeling the real GFC is around the corner. 

Bad time to have a mortgage and be building a house hey  Aggressive job cuts and even further drops in house prices are just around the corner IMO.


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## DB008 (13 October 2012)

Sorry, have been slack in this thread.....

Anyways.......



> *Sweden tells Greece to quit eurozone
> *
> 
> Sweden's Finance Minister has told Greece that it would be best advised to quit the Eurozone and revert to the drachma if its economy is to stand any chance of recovery.
> ...


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## qldfrog (14 October 2012)

Steve C said:


> I work at a big 4 firm with a mining and oil & gas focus and I have to admit for the first time I am starting to get slightly nervous - I get the feeling the real GFC is around the corner.
> 
> Bad time to have a mortgage and be building a house hey  Aggressive job cuts and even further drops in house prices are just around the corner IMO.




+1
in mining..


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## Aussiejeff (14 October 2012)

DB008 said:


> Sorry, have been slack in this thread.....
> 
> Anyways.......




Nah.

It'll never happen. With a little encouragement by his peers, Sweden's Finance Minister will make a judicious retraction of that statement and/or have to resign for "family/health" reasons....

ANY politician these days that admits an administration has made an error - is a washed up pollie. 

So, no wukkers. While ever Dr Benwankee has his hand permanently glued to the World's Biggest Debt Printing Press crank handle, forget any notion of GFC2.   

Party on doods.... :bananasmi


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## DB008 (15 October 2012)

Another Bloomberg - Global Economy Distress 3.0 Looms as Emerging Markets Falter



> Three years after industrializing nations led the world out of the U.S. mortgage meltdown-induced recession, the reliability of the power source is waning as Europe’s debt crisis persists. The International Monetary Fund sees them growing an average 5.8 percent in the half-decade through 2016, almost two percentage points less than the five years before the 2009 slump.
> 
> Finance chiefs at the IMF and World Bank annual meetings left Tokyo this weekend at odds over how to address the issue, with South Korea’s central bank chief urging Asia to add stimulus as Russia and Brazil called on rich nations to fix their own challenges. At stake is a world economy Bank of Israel Governor Stanley Fischer calls “awfully close” to recession.


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## DB008 (24 November 2012)

China continuing to slow down......

http://www.bloomberg.com/news/2012-11-19/purple-palace-abandoned-shows-china-shadow-banking-risk.html


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## wayneL (2 July 2019)

For the longest time Ive been half bullish  since GFC,  central banks having punted the can way down the road. 

I'm starting to worry again. 

I usually do this far too soon, so what's y'all's thought at this point.


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## sptrawler (2 July 2019)

wayneL said:


> For the longest time Ive been half bullish  since GFC,  central banks having punted the can way down the road.
> 
> I'm starting to worry again.
> 
> I usually do this far too soon, so what's y'all's thought at this point.



My personal thoughts are, it depends on Trump, if he can keep the U.S growth going they will keep China going.
If either fall over, so do we. IMO
We have run out of ammo, the resources boom #2 is nothing like #1 and we milked the housing boom to death. So it will be a slow boring infrastructure led climb from here, or a spectacular fall into the abyss if China falls over. IMO


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## basilio (2 July 2019)

Well summed up SP.  
So is now the time to lock in $158B of tax cuts ? The government is so determined to appease its wealthy backers it can't/won't recognise the dangers inherent in the long term con sequences of the  third tier of its tax cut proposals..


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## sptrawler (2 July 2019)

basilio said:


> Well summed up SP.
> So is now the time to lock in $158B of tax cuts ? The government is so determined to appease its wealthy backers it can't/won't recognise the dangers inherent in the long term con sequences of the  third tier of its tax cut proposals..



Firstly $158b of money into the economy, is better coming from tax cuts, than pay rises. IMO
I think the tax cuts are designed to get money into people's pockets, the interest rate cuts are trying to do the same, people need to get spending to support small business who are the major employers.
The only way to get money to people is by tax cuts, or pay rises, tax cuts cost the Government, but they do get money back from indirect taxes e.g gst, fuel excise, etc.
Pay rises hit the very people you are trying to help, small business, so it is a bit counter productive. Also the minimum wage has recently been raised.

The only other thing the Government can do, is start big infrastructure projects, which take a lot of lead time, but I guess the next year or two will see some big projects take off.
The third tier of tax cuts, can always be changed, if it becomes unaffordable. At this stage, it really is probably just designed, to give a long term confidence boost. So to get out of shape about it is a bit silly by Labor, they can change it if they so wish.
By the time we get to 2025, the Australian dollar could be 40c U.S, then the tax cuts could make absolute sense, no one knows at this stage, but it does indicate a sense of confidence in the economic direction whether it is ill based is yet to be seen.lol
Just my take on it.


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## qldfrog (3 July 2019)

Sadly, thinking vs ideology battles in the labour party ..or should i say with  any politician rarely end well


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