from a professional investor's BBS ...
(snip)"There is a conflict brewing between European countries. Now that decoupling has been debunked, the world will together, harvest the fruit of the bust, whose seeds were planted during the boom and the Euro is likely to not live up to the same standard as the old German mark, Swiss franc and French franc of the 1970s.
"While tensions can be camouflaged during economic upswings, they surface during downswings. All failed currency unions were abandoned during times of economic stress," said the bank.
We are nearing the moment when the ECB must decide whether it is a bank or the political guardian of the EU Project. It cannot be both.
The monetary crunch needed to restrain German wage deals after the rail workers won 11 [ percent pay raises - sic ] will crucify Spain.
Over 40,000 estate agents closed doors in Spain last year. Property prices are dropping in Madrid, Barcelona, and Seville.
Spanish banks are issuing mortgage bonds to use as collateral at the ECB's window, without even trying to sell them on the open market. La Gaceta said this "abuse" has reached ?40bn.
The ECB has taken the political pulse of Latin Europe and concluded that rigour is now too dangerous. It will face a hostile troika of Paris, Madrid and Rome if it persists, risking EMU schism. Trumped by politics, the Germanic hawks have climbed down."(snip)



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