Faber Says Germany, France May Have to Bail Out Nations February 18 (Bloomberg) -- Marc Faber, publisher of the "Gloom, Boom & Doom Report" and managing director of Marc Faber Ltd., talks with Bloomberg's Deirdre Bolton about the possibility that France and Germany may have to bail out entire nations as European government budgets buckle under the weight of recession. http://www.bloomberg.com/avp/avp.ht...//media2.bloomberg.com/cache/veP_G8kQNDjQ.asf
Hey BuyLo, you're back! Dude, don't go and leave ET like that again and make me have to start reading journals and other happy go lucky shit. I want a steady flow of the real news.
So... Everybody with any money is supposed to bail out all the f-ups.... which will perpetuate the f-ups' bad behavior and bad decisions... until the "haves" are broke too.. until EVERYBODY HAS NOTHING? How about... those who f'd up go bankrupt, restructure, and LEARN A LESSON?
France and Germany don't exactly have clean hands here. http://www.creditwritedowns.com/2010/02/weaker-eurozone-manufacturers-losing-competitiveness.html So the Germans and the Benelux nations have an enormous eurozone internal market surplus. Yes, German or Dutch workers are still more expensive than Spanish or Greek ones. However, when looking at German productivity, the cost differences vanish. The problem? The euro. For example, the Spanish and the Irish had increasing productivity competitiveness pre-euro. Post-euro, a credit bubble ensued due largely to a monetary policy built for a core Europe of France, Germany and the Benelux. In Spain and Ireland, this diverted productive resources to LESS productive parts of the economy as overheating was manifest in asset prices instead of consumer prices. Now that this misallocation of resources is plain, the result is being felt in lost competitiveness. Spain, Greece and Ireland all have had enormous credit bubbles that burst catastrophically. Pre-euro, this would have induced currency depreciation as a means of restoring competitiveness. However, this release valve is absent with the euro fixing exchange rates internally. Externally, despite recent weakness, the euro is still relatively high, making it even more difficult for those countries losing manufacturing competitiveness.
Yes. 70 years ago, Field marshal Rommel conquered Greece, and now today germany yet again does so economically. Europe cannot escape its ultimate fate.
There's hypocrisy here. The US, the UK, and Japan have similar numbers, yet Club Med can't inflate like the US or Japan can. That's a big difference. Should Greece or Portugal take the US route? Then they leave the Euro and create their own currency and inflate away like everyone else. And guess what? There are rumours that some of the big holders of Greek debt are French and German banks. That would suck for them. And don't forget - how much did Soc Gen (French Banking Conglomerate) get with the AIG bailout? What about Deutsche Bank? Almost 12 BILLION each. And that was the US gov't handing out the money. The world is full of fuck-ups.