Will the PIGS slop our economy too?

The Rabbi

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Sep 16, 2009
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With Greece probably about to default, and downgradings with Spain, Portugal, and Italy in the works, what are the chances of that economic crisis spilling over and causing a double dip recession in this country? Added to that the potential default by California, Michigan, and New York the economy is looking less than stellar.
 
Naw, we got the Republicans out of office. We will do the neccessary things to prevent a meltdown, against united Republican opposition, of course.
 
Naw, we got the Republicans out of office. We will do the neccessary things to prevent a meltdown, against united Republican opposition, of course.

You mean throwing unprecedented levels of borrowed money at failing entities and creating speculative bubbles? Yeah, that's a plan all right:cuckoo:
 
Two corrections Rabbi, the Spanish banking system is in excellent shape with a huge bond sales franchise in Latin America that somewhat insulates Spain from the international bond market and you didn't include Illinois in your list of states likely to default. Otherwise you are dead on.
 
Two corrections Rabbi, the Spanish banking system is in excellent shape with a huge bond sales franchise in Latin America that somewhat insulates Spain from the international bond market and you didn't include Illinois in your list of states likely to default. Otherwise you are dead on.

It's an issue of their sovereign debt.
Amid Rush to Aid Greece, Spain Looms as Bigger Problem - NYTimes.com
The country was just downgraded and potentially is much worse than Greece, being larger.
 
At the rate Owe Bama and his dumb ass Congress are spending money, we will most likely be next to go down the tubes.
 
Two corrections Rabbi, the Spanish banking system is in excellent shape with a huge bond sales franchise in Latin America that somewhat insulates Spain from the international bond market and you didn't include Illinois in your list of states likely to default. Otherwise you are dead on.

It's an issue of their sovereign debt.
Amid Rush to Aid Greece, Spain Looms as Bigger Problem - NYTimes.com
The country was just downgraded and potentially is much worse than Greece, being larger.
Yeah I heard that today. As an apology take a look at Spanish banking in Latin America and see what kind of thread suggests itself. Hint normal arbitrage is to short the domestic bond and go long Spanish bonds.
 
Two corrections Rabbi, the Spanish banking system is in excellent shape with a huge bond sales franchise in Latin America that somewhat insulates Spain from the international bond market and you didn't include Illinois in your list of states likely to default. Otherwise you are dead on.

It's an issue of their sovereign debt.
Amid Rush to Aid Greece, Spain Looms as Bigger Problem - NYTimes.com
The country was just downgraded and potentially is much worse than Greece, being larger.
Yeah I heard that today. As an apology take a look at Spanish banking in Latin America and see what kind of thread suggests itself. Hint normal arbitrage is to short the domestic bond and go long Spanish bonds.

Spain's deficit is lower than Greece's, its total debt is lower, more of its debt is financed internally, and there is no evidence of a massive cover-up of its liabilities, unlike Greece.

But that doesn't mean it can't succumb to contagion.
 
With Greece probably about to default, and downgradings with Spain, Portugal, and Italy in the works, what are the chances of that economic crisis spilling over and causing a double dip recession in this country? Added to that the potential default by California, Michigan, and New York the economy is looking less than stellar.


What is this double dip recession shit? We are still in a massive DEPRESSION with more and more people losing their jobs every day. 49 out of 50 states attest to the Depression. Their economies are worse off now than they were 12 months ago. Ain't nothing getting better other than a few manufacturing companies are actually improving sales. The rest of the nation is on its way to hell.
 
Greek bailout appears to be headed for disaster. This will likely spread to other countries. Copper prices declining. Dow Jones declining.
Here comes the double dip, for those who thought we were in recovery. Or part II for those who didnt.
 
There reaches a point, when things look so dismal, that nothing you say matters.
 
Greek bailout appears to be headed for disaster. This will likely spread to other countries. Copper prices declining. Dow Jones declining.
Here comes the double dip, for those who thought we were in recovery. Or part II for those who didnt.
Copper is stockpiled mostly in China. China is also raising reserve requirements on its banks while its de facto colony Australia raises taxes and interest rates. There's more than just the PIIGS in this mess.
 
I started pairing back my euro shorts today and yesterday.

However, the euro can go a lot lower. It was 85 cents several years ago. And it is probably still over-valued. The purchasing power parity of the euro is $1.15-$1.20.

It probably isn't a tenable currency in the long-run. There are simply too many structural imbalances and not enough safety valves to release those imbalances to allow all the current members to be part of the eurozone.
 

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