The Doomsday Scenario

[Madeline]

Mostly, I want this disproven, so please don't accuse me of fear-mongering. Listening to CNN, couldn't tell you which commentator, the most awful scenario was sketched out.....

Depression takes hold in Europe, which if taken as a whole is still the largest economic engine in the world. Governments stop using taxpayers' money to bail out banks, etc. and allow investors to take it on the chin. Germany looks at Greece, Portugal, Spain, etc. and says fuck this, and withdraws from the EU. Issues its own currency. Other European nations cozy up to Germany and either succeed or fail at becoming its economic allies....the euro (as currency) dies.

Thus endeth the US's hopes for recovery as well.

Could this actually happen?

 

[loosecannon]

it can. Odds are probably 50/50.

I don't think it will. But I may change my mind quickly.

 

[Madeline]

it can. Odds are probably 50/50.

I don't think it will. But I may change my mind quickly.

Do you think it is fair to say that if Germany withdraws from the EU, we're in for a depression?

BTW, why does Germany have such a strong economy now? Effective regulation?

 

[Againsheila]

it can. Odds are probably 50/50.

I don't think it will. But I may change my mind quickly.

Do you think it is fair to say that if Germany withdraws from the EU, we're in for a depression?

BTW, why does Germany have such a strong economy now? Effective regulation?

Good question. I do know that in Germany (my cousin is from there), when they need to lay off someone they lay off those that are single first. Then they law off those that are married with a working spouse next. Only if they are in dire circumstances do they lay off the primary bread winner of a family. They also have unemployment for 2 years, or at least they used to. I'm going to have to ask about their minimum wage, I'll bet it's a living wage too. Give the money to those who spend it and you'll have a healthier economy.

Oh, and we're already in a depression, people just haven't realized it yet.

 

[loosecannon]

it can. Odds are probably 50/50.

I don't think it will. But I may change my mind quickly.

Do you think it is fair to say that if Germany withdraws from the EU, we're in for a depression?

BTW, why does Germany have such a strong economy now? Effective regulation?

I have no idea what will happen, Madeline, esp in an "if-then" scenario. I have a good idea what could happen and depressions have spread world wide before forced by global trade contraction.

Personally I think that it is somewhat by design that the nanny states and advanced economies are faltering.

 

[william the wie]

This is what the German people, Merkel and just about all other interests in Germany are advocating. Germany went through two hyperinflations in the last century and have no interest in a repeat with the Euro so it will happen the question is when.

 

[Pepe]

Your "Doomsday Scenerio is one that I read several weeks past and its is one of many that could/will happen.

If the Irish electorate places a new Government in Office come January and said Gov't follows the lead of Iceland and makes the Banks and their Bondholders/Shareholders take the losses instead of screwing the taxpayers and their progeny then I expect Greece, Portugal and probably Spain to follow suit.

This will be the de facto end of the European Monetary Union.

The other likely scenerio(s) are one of the heavily indebted Blue States (IL/CA) "defaulting' on some or all of its Debt.

Another scenerio is that one of the major Cities declares Bankrupcy, LA, Oakland, Harrisburgh, et. al., which would lead to a domino effect on hard pressed Municipalities nationwide and this drives Muni Bond rates through the stratosphere.

Another biggie is if the Bond Bear walks into the Treasury......................

As an original Member of the Doom & Gloom Club, I will say once again that the Empire of Amerika is only 36-60 months away from Collapse and Balkanization.

We as a People have passed the "Point of No Return."

 

[Againsheila]

Your "Doomsday Scenerio is one that I read several weeks past and its is one of many that could/will happen.

If the Irish electorate places a new Government in Office come January and said Gov't follows the lead of Iceland and makes the Banks and their Bondholders/Shareholders take the losses instead of screwing the taxpayers and their progeny then I expect Greece, Portugal and probably Spain to follow suit.

This will be the de facto end of the European Monetary Union.

The other likely scenerio(s) are one of the heavily indebted Blue States (IL/CA) "defaulting' on some or all of its Debt.

Another scenerio is that one of the major Cities declares Bankrupcy, LA, Oakland, Harrisburgh, et. al., which would lead to a domino effect on hard pressed Municipalities nationwide and this drives Muni Bond rates through the stratosphere.

Another biggie is if the Bond Bear walks into the Treasury......................

As an original Member of the Doom & Gloom Club, I will say once again that the Empire of Amerika is only 36-60 months away from Collapse and Balkanization.

We as a People have passed the "Point of No Return."

Before Gregoire's latest executive order, I thought we had another 4 to 5 years, now I think you're closer to the truth of the matter. Sad though, I'm not sure my husband and I will live through it. Our health is declining rapidly and without any help from the state for our autistic son, we'll die even sooner. Then what happens to our son? Hitleresc euthanasia?

 

[Baruch Menachem]

Germany will not leave the EU. The EU is a german creation. They built it, and they pay for most of it. (English whining to the contrary)

The recession was a burst of the housing bubble compounded by stupid policies that made it last longer.

there is no bubble like that in Germany.

The big question is can Spain and Greece and Ireland get their houses in order. I have great hope for Ireland. Spain and Greece seem stuck on stupid.

 

[CrusaderFrank]

Only if Soros and Rockefeller and their groups want it to happen

 

[Trajan]

according to the journal today, Germany's minister of finance has pledged a vigorous defense of the Euro....frankly I don't believe it, but there it is.

 

[loosecannon]

I believe it.

 

[william the wie]

I believe it.

Only his proposed defense is the expulsion of some or all of the PIIGS so I believe he is sincere but with a plan B ready to hand.

 

[Toro]

Yes.

It could.

 

[william the wie]

Yes.

It could.

Given the huge range of ways this could work out I think a little debate on all of the sub-scenarios and their guesstimated probabilities might be in order. I'm not sure whether the Far East bubble bust will lead to EMU bust up or vice versa and preparation is based on probabilities and consequences not sequence of events. Should another thread be used for that or what? (personal note I will be headed to the gym shortly so I am not going to create that thread until 11 or later.)