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[Rods2]

Greece's bottle will fall by March 20th.

Bad day and Greece-Lite Portugal's bottle is beginning to teeter. 

Sarkosy is practicing catch and saying France will do nothing what ever it takes to stop their bottle from falling. 

Germany with the implication of picking up 56% of EFSF and ECB losses since the S&P downgrade are now talking about knocking the bottle off the wall themselves. 

Just another normal day in the life of the boys and girls who can't organize a P'up in the Eurozone brewery. 

[Dishevelled Den]

Setting aside the wider political/strategic ramifications of the possible disintegration of the European Super State as we presently know it, and being a bit of a mouth-breather where financial matters are concerned, can someone tell me - in relatively simple terms please - what our (UK's) financial exposure is likely to be in the event of a collapse or the radical restructuring of the single currency?

[Gaffers]

I may not be 100% accurate Den but as far as I understand it we are not massively exposed in terms of exports with the majority going outside of Europe, however we import a lot from Europe so any hyper inflation that hits the continent is going to seriously affect our international trade position in terms of pushing up our costs unless we can find alternative sources.

I think the telling point to any effect on us will be the level of exposure of those countries whose financial and manufacturing interests are aligned with ours because if their costs go up as much as ours then we wont be outpriced by our compititors.  Yet we will have the whole global economy to contend with.

[Dishevelled Den]

Thanks M.

I have little time for matters financial (although I recognise 'its' importance) so I'm forcing myself to take an interest and understand what appears to be a fundemental problem within the single currency and how this might well affect us all.

[Rods2]

The UK bank's exposure to the whole of the Eurozone is about €500bn, but what you don't know is how much is insured with Credit Default Options (CDOs). A lot of the CDOs will be with American banks and insurance companies. Now the American's bailed out AIG when Lehman Brothers failed in 2008, to save the American banking system (and with it many other banks around the world). 

Now if the US banks are exposed to CDO losses as is thought, will they bail them out to save mainly the European banking system, so some of the CDO's may in reality be useless. (It is difficult to second guess what the US government will do, but their banks would also suffer from European Government bond defaults). 

Barclays and RBS would probably need a Government bailout. Lloyds-TSB I don't know, HSBC has very little exposure to the European bond market and would be okay.

In the game of pass the parcel debt, nobody knows where globally the default IOUs would end up, so expect the unexpected. Also expect wholesale contagion in Europe and Euroland with many banks needing bailouts, including all of the major Euroland economies, the UK, French, German, Italian and Spanish banks along with many of the smaller countries.

This BBC article, shows who owes what to who:

http://www.bbc.co.uk/news/business-15748696

The situation with a disorderly breakup will be really bad, akin to the devastation to Europe at the end of the Second World War. In a mass orderly breakup, you may get mutual debt forgiveness, which would hit the banks and insurance companies capitalization and would badly affect many savings, pension funds and annuities, but would not affect their liquidity.

This is really Hobsons choice: Save the banks by mutual debt forgiveness, hitting the man in the street's savings, pension fund's and annuities, or no debt forgiveness and so massive Government bailouts of the banks required again, so the tax payers pick up the bill. I'm afraid it heads you lose and tails you lose, while its still triples all round at the EU commission and for the European politicians as they makes things worse try and sort out the mess they have created. 

[Dishevelled Den]

Perhaps my enforced ignorance of these matters is a good thing in that case.

It is frustrating however that we all seem to have been well shafted by those individuals and institutions operating in circumstances which seem to amount to being a wide-boys charter.

I would like to think that some earnest consideration has been given to the possible outcome of all this fluidity and that measures are being considered to avoid the total collapse of the monetary system - with all that it implies.

One would hope so - they must be doing something other than whistling Dixie and hoping for the best, surely?

I have always had the feeling in my pipes that this over reliance on technology would bite us on the arse at some point as it seems to me that there are too many people working these systems who haven't a oppsing clue what they are doing but, more worryingly, a very few who do know what they are doing and are doing it for their own ends.

[Rods2]

Most contries are drawing up plans to cope with a disorderly breakup of the Eurozone. The English plan starts: sh*t, sh*t, sh*t, what do we do now? the French one begins: me*de, me*de, me*de..... 

But seriously, all politicians countries will be trying extract themselves for the least economic and political damage and now crash flash Gordon has gone who knows who will be trying to take the credit for saving the world. If its before April it will be Merkel and Sarkozy and and before November Merkel. The fact France has Presidential Elections in April-May and Germany in November will be entirely co-incidental! 

The bill for the losses being incurred at the moment by the ECB buying bonds will be picked up by Eurozone taxpayers and on a Eurozone disintegration many other bills by the individual countries taxpayers where the losses are incurred. The banks will be rescued, using taxpayers money, like before, and they will make record profits over the following 12 months from all the work they have do to sort out the economic tsunami and the opportunities created from market volatility, so bonuses £1m or $1m+ can be paid as normal. 

[Rods2]

The Eurozone Family - Part 1

An everyday story of 17 small families who have come together to form an extended family called the Eurozone family.

Tonight they are off to a very expensive restaurant where everybody knows the only person with any money is Germany, Greece is broke, Portugal is almost broke, Ireland is broke but trying harder then the other broke nations to live within their means, Spain and Italy are very poor and everybody thinks they are probably broke, Even Sarkozy Napoleon Jr from that ill mannered French family is not strutting around today and telling everybody how important he is and that Germany is his best friend, but then their credit record has just been made public and is very poor, it has been downgraded, how embarrassing is that! But they are all in this together as an extended family, not the 17 individual families they used to be, so it will all be alright, on the night and forever as best friends. United in strength what could possibly go wrong?

Apart from Ireland and the smaller Eurozone families who are a bit more prudent, the families from Greece, Portugal, Spain, Italy and France all order the most expensive meal and wine on the menu, well beyond what they can afford, but what the hell, the German family at the head of the table are rich, they can pay the bill. At the end of the meal, Greece, Portugal, Spain, Italy and France have all had a wonderful meal and time and have also been the most extravagant.

When the bill turns up, it goes from family to family who all turn white and ashen faced when they see the size of it, until it ends up in front of Frau Merkel from that rich German family, all eyes look across in expectation and when she goes to her handbag there is a sigh of collective relief , she will pick up the bill after all, but it is not a credit card she gets out but a calculator as they all look on perplexed, this is embarrassing she is going the check the bill before she pays it!

With a whirl of buttons in seconds she has the answer, calls the waiter over and tells him that is my part of the bill, this card will cover it. When he returns her credit card and a receipt for her portion of the bill, all hell breaks loose and the extended family becomes immediately the 16 individual families, plus Germany they really are. The 16 all start trying to minimize what they have spent, so they pay the least for what they have had, especially for the shared expensive bottles of wine, as they all try to get somebody else to pay more than their portion of the bill.

Then Sarkozy has a brainwave, and calls back Frau Merkel as she was about to leave, telling her, this is most embarrassing, but we have a problem paying the rest of the bill, but you could put it on your Eurobond credit card, her reply is a swift and firm "nien", well what about your ECB Debit card even if it means expanding the money supply a bit and okay higher inflation, she is now getting angry, "nein" is the abrupt reply "remember the 1920's" and I'm up for re-election as head of the family in November, if I did this I will never get re-elected and off she storms.

Who is going to pay the bill, will the police be called, will they be made bankrupt, don't miss the next exciting episode of the Eurozone family.

"The Eurozone Family - Part 2 to follow...."

[SIR Philbutt]

The Euro and the eurozone has been intregueing me for the last few months. Paticularly on here as well as other info elsewhere.

One issue that concerns me is the excessabilty to spending if the euro fails and the banking system and markets go to pot for a while.

I read somewhere that for a week to maybe a month (or longer) that the supply chain, money, fuel, food ... etc, could "hiccup" and this could lead to allsorts of problems. For example what happened with the bad weather last year and when the fuel blockade was on a few years ago. 

One article I read was about a feeze dried food company who had seen a marked increase in sales due to people "stocking up" for when the euro crashes. And these where people who do know better !!

The question i suppose is should we, as in joe public (and oofers), not be concerned/planning for what happens while it's being fixed (or not) instead of being distracted by what, who, how, why, when ?

[Varche]

Hey Rods2 can we have  The Eurozone Family - Part 2  please? 

PS I am sure that restaurant also has a private room away from the riff raff just for EU commissioners.

[Nickbat]

The EU is a wonderful thing...at least that's what they want our children to believe.

Brainwashing at its best. Get to the children first.

http://www.express.co.uk/posts/view/296361

Mr Nuttall said he has written to Education Secretary Michael Gove and Schools Minister Nick Gibb claiming the programme appears to breach the law banning promotion of “partisan political views” in schools and requires a balanced presentation of issues.

Yes, it does appear so.

[albitz]

Blood boiling,p1ss fizzing. This is rather outrageous. .................still, the whole sorry edifice will hopefully collapse and disappear in the not too distant future.

[Dishevelled Den]

The EU is a wonderful thing...at least that's what they want our children to believe.

Brainwashing at its best. Get to the children first.

http://www.express.co.uk/posts/view/296361

Mr Nuttall said he has written to Education Secretary Michael Gove and Schools Minister Nick Gibb claiming the programme appears to breach the law banning promotion of “partisan political views” in schools and requires a balanced presentation of issues.

Yes, it does appear so.

Brainwashing at its best. Get to the children first.

That's the way those playing the long game tend to operate, sadly. 

How effective it will be has yet to be shown but there's something not quite right about massaging the minds of the immature to accept the chosen message, it seems to me to fall far short of objective teaching - however one looks at it.

The following, quite rightly, should be cause for concern as it illustrates very well how a particular agenda is being pursued by using these questionable means.


 
http://www.youtube.com/watch?v=vgvnqv1-_D4&feature=player_embedded

[Nickbat]

Greenpeace....blood's boiling already, Den. 

[Nickbat]

Britain faces £17bn IMF bill to pay for new bail out

http://www.telegraph.co.uk/news/uknews/9022850/Britain-faces-17bn-IMF-bill-to-pay-for-new-bail-out.html

Now even my pi** is boiling.