Schlagwort-Archive: Italy

Let’s think a little bit

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Well maybe thinking is a litttle to much maybe speculate would be the better word.

As you may have read, Euro land is in as deep trouble as the US. It’s an open question who really is the worse, but well that’s another story.

Now we have read a lot of ideas about saving. One of the ideas of saving was a tighter “cooperation”, well it probably is a asked quite much to synchonise 27 different countries, but welll that’s another story again.

But now something changed the ideas slightly. At first Greece is finished. Well just remember the vote then the note vote etc. Anyway Greece just stands for around 350 billions of debt. If you look over Euroland this really is not much. Anyway with the default of Greece bonds french banks will get in knee deep trouble. So far there’s nothing new.

But here we go. The interest Italy has to offer are exploding. We are now well beyond 7%. That means a doubling of your debt in “just” 10 years. Or the other way round with 7% interest and 1.8 trillions of debt (official!!), Italy has to pay interest of 1.8 trillions in 10 years (with 7% interet). No that are as much as 180 biillions a year the budget of italy is well below that of Germany that are around 300 billions. So let’s assume 250 billions. You can see 180 billions are way too much. So saying that Italy is bankrupt also could be seen as fact.

Now as you know ESFS III should be leveareged to over 1 trillions guranteees (which seems to be illusory) just see my entry on my old mises blog at: http://mises.org/Community/blogs/fdominicus/archive/2011/11/09/extension-to.aspx

So with high likliness this all can not be expected to work. Now the “new” idea is to split up the euro zone into a core zone and a “rest” And now comes the information I found most “revealing”. This is driven by France and Germany. Now we know France and Germany have seen itself as “engines” of the eu process. but guess what the french banks have a hell of outstanding bonds from Italy of around 270 billions!. Now the budget of France surely is in that areas. So if italyy defaults France is “finished” also. They can not bear another 270 billions alons. If you see that with the work on the core europe one can come on some ideas….

Investors be aware

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If you invest in the EU or Euro zone be prepard to not just econimic hindrance, expect
the worst from politicians. Think of taxes on investments and the like and you may not be suprised.
If you feel contract have to be obeyed, then forget this as soon as you make contracts with governement
agencies. Be prepared for confiscations also. We did it in Germany in 2009, we socialiczed the HRE.
If you think we’re talking about Peanuts, well we are currently at around 100 000 000 000 Peanuts and counting, according to a few numbers it seems
another 15 000 000 000 are due for the “quality papers” of the Greek governement.

Rumours were coming up talking about another 280 000 000 000 help for the “spanish” governement.
Which have probably driven down the DAX yesterday at around 2%. If you think deledes have learnef from the Failout Plans, well think again.

There is not border in sight which may hold back the politicians to drive Europe down into misery. So are you prepared to loose your money or see it getting burned?

If yes, invest in Euro land if not, well take your money and run. You will not find a lot of alternatives,but a few may be there. Have a look at Switzerland, Australie, New Zealand, maybe Canada. I’d avoid the following countries like the plague. Greece, Italy, Spain, Portugal, Germany, France, Austria and nearly every country related to good ole Europe but also avoid the US. Those mostly have been burried. Do you want your grave there too?

They are a little bit further on their way, the fed takes all the papers issued by the governement and filed it under “asset” and because of this assets they can print money, and more money and more. Money needs trust or value, our current currencies mostly havn’t anything of it at all. Trust? Well how can you trust someone who just has collected debts the last 50 years? What value has paper? How difficult could it be to print 1 000 000 000 000 bills? Imagine some german experiences.
http://de.wikipedia.org/wiki/Deutsche_Inflation_1914_bis_1923#Banknoten_und_M.C3.BCnzen_der_Hyperinflation

I just pick up the “most impressive” number.
4.200.000.000.000,00

that was the price for one US-Dollar in 1923. The largest bank not has been 100 000 000 000 000. It was printed on a sheet of paper, that’ all and that’s all there is to probably every currency currently. As I asked. What should prevent the next Hperinflation? Our politician aka deledes?