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Old 03-12-2011, 04:51   #91
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pirate Re: What Will Happen to Boat Pricing when Euro Is Under Par to US$ ?

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Originally Posted by Capt Phil View Post
Yep! The Fed, under their usual secret moves, propped up the Euro based on the well founded fear that to let it drift into oblivion would materially harm the US market. They were right, but to do so without Congressional oversight, is dishonest, illegal and violates the US Constitution. The 'feel good' outcome of a nearly 500 point increase in the Dow is a mirage. There is no question that the US markets would continue their downward slide to a more equitable value without some mechanism to deal with the hughly overvalued Euro. By providing this lifeline to Europe, the world has bought a couple of weeks for the EuroBankers to dither and whither but in the final analysis, Greece, Portugal and probably Italy and Spain need to be cut loose and if the Euro is to survive, have it reconstituted backed by healthy European economies. The fundamental problem is that the dilema is unsolvable without centralized fiscal control of all participating Euro countries. This would require the member countries giving up their control over their sovereign economies, not something they are rushing to do. My guess is the near term outcome will be either a hugh global devaluation or disappearance of the Euro and the corresponding devaluation of the US $ or a complete breakdown of financial institutions, banks, credit unions, brokerage houses and commodity markets. Not a pleasant prospect but after the storm, during which trade and barter will replace currencies, there will come a period of calm and a slow rebuilding of sovereign currencies based on realistic value. Good time to own a boat free and clear, have a trade you can barter for food or own a farm, unencumbered, grow your own veggies and remain armed to protect what is yours and your family. The future ain't pretty... Capt Phil
Very true... the future aint pretty for 'The Conventional Folks'...
but for some of us the world will just keep rolling on the same...
we're there already and have been for years..
Ever since we fell off the 'Radar...'.
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Old 03-12-2011, 04:57   #92
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I think we all understood when obama showed up to the meeting in europe that he would get killed at home if he publicly committed cash so he slipped it behind our backs to the imf. Saw that one coming a mile away.
Dave i respect your opinion and you sound like you are much closer to it but i still think it is not sustanable for any period of time with all the separate national interests.
We can't wait for next year and the next election here. One term president coming up. 15 trillion and counting
I say what I say because I don't think the EU and in particular the Eurozone will allow a Lehman event, ie let something default. The Euro like lots of sovereigns and big banks IS simply too big to fail. The political process here in the Eurozone is already realising that fiscal discipline and oversight, which the germans want is a price they are willing to pay to ensure that the ECB is unleashed ( which is what the French want ) . The political softening up process has begun , ps you really need to read non-English press to appreciate this as the UK press is almost entirely Eurosceptic.

as to the IMF, in practice it's owned by the Europeans anyway. Once ECB pumps billions of euro through it it will be completely owned by us. This is merely a short term trick to avoid the ECB breaking it's charter ( though it's charter currently is being interpreted in a very loose way indeed, as it is undertaking bond buying to support countries sovereign debt )

Your comments re financing debt by printing money are correct, there is a massive structural problem m but it's a long term one and in this respect the US is THE major sinner. But it is a longer term issue

The other issue is this whole problem is globally interconnected to a degree not understood by the average layman. The recent Eurodollar liquidity push is a direct result of US sub prime issues, Eurozone banks in particular ( and in general EU banks are much bigger then US banks) are holding large securitizations of US real estate, a position US banks deleveraged from ( or where helped to ) US banks knowing the risk of such security stopped lending dollars to Eurozone banks and hence the Fed, ECB and other stepped in.

One of the problems here is that in effect with the exception of Ireland ( where unlike the other PIIGS, the problem is almost solely it's banks, rather then sovereign) EU banks have had no bailout and are still carry assets of dubious merit on their books. This is difficult for the Eurozone to do with the current strictures of the ECB rules. That is that sovereigns rather then the ECB are forced to act as lenders of last resort.

The Germans themselves, despite BILDs ranting on, know that the ECB will have to intervene and print money , there concerns about inflation are misplaced, German is in effect in deflation at the moment. Of course it's an election year next year for Dr. Merkel and she has to be careful. So the Germans will hold the Eurozone feet close to the fire to extract such fiscal concessions and in return the ECB will be let off the leash. This of course, like the US debt only buys time, but time is what's needed right now, as the political process requiring treaty change to invoke closer fiscal union will take time ( though the Germans are proposing next spring). Irrespective of your view, there is a growing awareness amongst the populations of most eurozone countries that the solution is getting closer not fracturing. ( the Germans being the possible naysayers)

The main problem to treaty change, paradoxically, will be the German public, who Right Now think they are ones that will be required to pay for it all. Of course this is a misleading position, but one that is fuelled by sections of the internal german anti-euro press. ( and some opportunistic politicians) firstly the Germans have already paid for IT, as German banks gaily lent all their hand earned pension funds to other more risky Eurozone countries, especially southern Europe. What the German government is hiding from the people is the extent it's banks are sitting on a knife edge. Euro failure followed by widespread sovereign default would in practice cause most of the German banks to fail ( Ireland basically got told to guarantee all bond holders, by the ECB to prevent German banking failure). Hence any idea that Germany could decouple itself from the mess is utter nonsense. Behind all the German sabre rattling is the clear realisation that Euros need to be printed as no one else is going to lend them to it ( as the recent Bund failure clearly pointed out).

Ultimately the fall guy is China, which is holding trillions and trillions of Euro and dollar debt. I suspect it will be forced to float the yuan sooner then later,( and become worlds reserve currency) it will appreciate massively, the dollar and euro will depreciate, china will over time suffer a massive loss of currency competitiveness. Then it will be left with practically worthless dollar and Euro debt and have to bail its banks out. Then equilibrium will have been establish and 3billion Chinese will pay for our excesses ( though I suspect only once )

Anyway I've a good couple of loaded rifles and a boat with a rocna anchor and ungrounded DC system. That should see me through any crises.

Dave
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Old 03-12-2011, 04:59   #93
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Originally Posted by DJBrookster

The Fed is doing nobody a favour here but itself. Lest you forget the US can't control or agree how to control it's spiralling debt. At least the British government is trying to address the issues. All the Fed is trying to do is print it's way out of it's own debt crises but not be seen to devalue the $.
The British economy is heading into recession, it's has printed vast quantities of sterling ( several QE sessions) it in reality is a surrogate for the Euro ( see how it's tracks euro dollar interactions). I'm afraid the Uk is simply not a player in this discussion.

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Old 03-12-2011, 05:19   #94
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Originally Posted by Capt Phil
Yep! The Fed, under their usual secret moves, propped up the Euro based on the well founded fear that to let it drift into oblivion would materially harm the US market. They were right, but to do so without Congressional oversight, is dishonest, illegal and violates the US Constitution. The 'feel good' outcome of a nearly 500 point increase in the Dow is a mirage. There is no question that the US markets would continue their downward slide to a more equitable value without some mechanism to deal with the hughly overvalued Euro. By providing this lifeline to Europe, the world has bought a couple of weeks for the EuroBankers to dither and whither but in the final analysis, Greece, Portugal and probably Italy and Spain need to be cut loose and if the Euro is to survive, have it reconstituted backed by healthy European economies. The fundamental problem is that the dilema is unsolvable without centralized fiscal control of all participating Euro countries. This would require the member countries giving up their control over their sovereign economies, not something they are rushing to do. My guess is the near term outcome will be either a hugh global devaluation or disappearance of the Euro and the corresponding devaluation of the US $ or a complete breakdown of financial institutions, banks, credit unions, brokerage houses and commodity markets. Not a pleasant prospect but after the storm, during which trade and barter will replace currencies, there will come a period of calm and a slow rebuilding of sovereign currencies based on realistic value. Good time to own a boat free and clear, have a trade you can barter for food or own a farm, unencumbered, grow your own veggies and remain armed to protect what is yours and your family. The future ain't pretty... Capt Phil
That is a fundamental mis-reading of the issues. The fed intervened in the Eurodollar market not the Euro.

Secondly, the Euro is overvalued somewhat, but not because of the view held by ordinary people that the problem is Spain Italy or anywhere else. It's overvalued because there is too little of it to go around and hence it's expensive ( and hence very profitable ) to lend euros. If you look at the economies of Spain or Italy there fundamentals are say actually better then America. So why is there in effect speculation against them, solely because the market knows that there is, currently, in effect no " Eurozone " lender of last resort. This is why the dollar, the yen, and sterling haven't suffered the same problem, ultimately they can't default as they can print their currencies. ( this was why the gold standard was dropped, to finance deficits )

No country, certainly not in any immediate timescale will be ejected from the Euro. Italy is the third biggest economy well able to service it's debt. Any such ejections or departures would cause sovereign default and hence massive banking failure ( all over the world) so that's not going to happen. Maybe in the very long term Greece might withdraw but I doubt it.

by the way what's " have it reconstituted backed by healthy European economies" there isn't any, no more then the US is one. All you would end up with is a Swiss franc problem, a massively appreciated hard currency, that would kill these economies, ( just like the problem in switzerland at the moment )

This problem has an easy short term solution. ( print euros, and dollars) but long term is going to require strict efforts to reduce deficits, in this respect the US needs to lead the chase, it has the biggest problem. Unfortunately while EU countries have shown they can implement austerity measures and raise taxes, the US has attempted to have it both ways for way to long. It must accept reductions in its standard of living , raise taxes etc, in order to address its enormous deficit and restore global confidence in paper money.

Dave

To suggest Phil that barter will replace currencies as with the whole survivalist nonsense, is pure fantasy.
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Old 03-12-2011, 11:51   #95
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Re: What Will Happen to Boat Pricing when Euro Is Under Par to US$ ?

Great observations, Dave... however, I'll refer you to the most recent economic crash of 1929-32 where barter was the mainstay of the economy and saw us through much of the 30's until WWII came along and Roosevelt used it to rally the US population and get the economy swung around.
Your suggestion that 'long term is going to require strict efforts to reduce the deficit' I agree with wholeheartedly. The problem I see is near or medium term, a population that has grown to expect wholesale entitlement as a way of life will not give it up and will vote out any political body that tries to take their government economic largesse away. This is true in the US as well as Europe. You are right on the mark that the US has tried to have it both ways for way too long. I totally agree with your premise that 'dark days are a'comin'... cheers, Capt Phil
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Old 03-12-2011, 18:23   #96
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Originally Posted by Capt Phil
Great observations, Dave... however, I'll refer you to the most recent economic crash of 1929-32 where barter was the mainstay of the economy and saw us through much of the 30's until WWII came along and Roosevelt used it to rally the US population and get the economy swung around.
Your suggestion that 'long term is going to require strict efforts to reduce the deficit' I agree with wholeheartedly. The problem I see is near or medium term, a population that has grown to expect wholesale entitlement as a way of life will not give it up and will vote out any political body that tries to take their government economic largesse away. This is true in the US as well as Europe. You are right on the mark that the US has tried to have it both ways for way too long. I totally agree with your premise that 'dark days are a'comin'... cheers, Capt Phil
We both agree, however I don't see those days as dark.

Dave.
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Old 03-12-2011, 21:31   #97
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Re: What Will Happen to Boat Pricing when Euro Is Under Par to US$ ?

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As a Frenchman, I can give up my franc but not my country, as an Italian , I can give up my lira but not my country, etc, etc. I believe this is a bridge too far fo most Europeans.
I like France - particulerly I love that the French have this wild and crazy notion that the entire purpose of France is for the benefit of it's citizens ........... Not to say that they don't b#llocks that up now and again, just like the rest of the world .
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Old 03-12-2011, 21:42   #98
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Re: What Will Happen to Boat Pricing when Euro Is Under Par to US$ ?

What's tied to the dock DOJ ? You, the goat or the armchair.

Got any pics ?
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Old 03-12-2011, 22:08   #99
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pirate Re: What Will Happen to Boat Pricing when Euro Is Under Par to US$ ?

You on Ecstacy or what...... Jeez... always some one wants summat for nowt....
Money crashes.... prices go up.... its simple...y stoopid........
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Old 03-12-2011, 22:58   #100
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Re: What Will Happen to Boat Pricing when Euro Is Under Par to USD ?

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If you're this certain about the euro's fall, go to Forex.com and short the euro massively. Collect hundreds of thousands of dollars. Get catamaran for free.
Cormorant, that is a seriously cool little boat you have (apologies for thread drift, but this is way more interesting)
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Old 04-12-2011, 05:23   #101
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I like France - particulerly I love that the French have this wild and crazy notion that the entire purpose of France is for the benefit of it's citizens ........... Not to say that they don't b#llocks that up now and again, just like the rest of the world .
Thankfully it won't be up to the UK and jersey isn't even in the Eu. Of all the Eurozone countries only Ireland has to have a referendum, and theyre not about to object !!. The rest will be done by politicians keen to save their asses. The citizens will not be asked.

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Old 04-12-2011, 05:44   #102
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Re: What Will Happen to Boat Pricing when Euro Is Under Par to US$ ?

I seriously doubt the EURO will collapse. (1) European banks get in trouble (2) Central banks from Europe, the US, and even China steps in (3) Bails them out using money sucked from the life blood of taxpayers. The US, Chinese and European economies are so intertwined now that there is a perception that if the US fails so goes Europe, and if Europe fails so goes the US. Boat prices are more likely to be influenced by supply and demand. If there is a failure of government debt in Europe, there will be economic woes suffered by the working class for sure, but rest assured, the big banks, corporations, and the EURO will be saved at any cost. If I was to start shorting the EURO, I wouldn't place my bet that it will fall below $1.20 anytime soon under even the worst case scenario.
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Old 04-12-2011, 06:40   #103
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This has turned into an interesting thread. Right now I own two boats and live in a house. I am selling the house to downsize and continue to sock away as much as possible for retirement. I grow tired of our elected officials inability to stop spending. It would make far more sense to either rent or live aboard. No property taxes that way. It is a section I will have to make near term.

Agree about austere times coming but another twist from the US is that the president for campaigning is trying to stir up class warfare. This is a dangerous strategy when so many are out of work and it is perceived that the income gaps are widening. Now I can understand why people in a prior age hid money and didn't trust banks. I could not even imagine the unemployment rates of 20 % that I have heard of in Europe.

Back to boats. Avoid all the taxes and live aboard? Tempting.
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Old 04-12-2011, 08:36   #104
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This has turned into an interesting thread. Right now I own two boats and live in a house. I am selling the house to downsize and continue to sock away as much as possible for retirement. I grow tired of our elected officials inability to stop spending. It would make far more sense to either rent or live aboard. No property taxes that way. It is a section I will have to make near term.

Agree about austere times coming but another twist from the US is that the president for campaigning is trying to stir up class warfare. This is a dangerous strategy when so many are out of work and it is perceived that the income gaps are widening. Now I can understand why people in a prior age hid money and didn't trust banks. I could not even imagine the unemployment rates of 20 % that I have heard of in Europe.

Back to boats. Avoid all the taxes and live aboard? Tempting.
Unemployment rates in Europe are running in general between 10% and 14%. Of course there is far greater social support systems with mitigate that effect. The worst place on earth to be poor is the US

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Old 04-12-2011, 16:57   #105
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Well I am not European so I can't speak to your system but we do have welfare, gov subsidized housing, unemployment money, and Medicaid for medical services. , food stamps. That's just the government. In addition we have a very abundant services systems, centers, food banks, churches. I am not saying it's easy but we do feed folks and try to get them on their feet. I just got back shopping for children I will never meet.
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