This 50% debt doesn't just go away
mInvestor
11/6/2011 12:06:42 PM
It's good for Greece to 50% haircut from their debt. But this 50% deosn't just go away. The lenderd still need to find this 50% money, otherwise they themslves will go to default. We know those debts are mostly deriatives and swapps, it's very difficult to figure out where they are, and who shall pay for what. But overall our whole global economic system still need to pay for this 50%, even Greece is forgiven from that.
So I can't agree more with you people there, there is no good reason that we can cheer from this deal. It's really strange that stock market rallied after this news.
A puzzled and interesting time indeed.
I think cautious is an understatement with a market that is behaving completely erratically there is no confidence in most investors. I am not selling but I am certainly not buying right now. Unfortunately, with the election year, politicians will be hesitant to make any changes for fear of a mistake before the election and we will all be left in an economic purgatory that feels more like hell.
While the rate cut is positive for the currency in the short term because the ECB is trying to help stabilize markets and boost economic growth,I wonder if it willl be perceived as advantageous in the long term. It seems like there are conflicting factors at play here in the near and far term.
The European Central Bank lowered its benchmark interest rate from 1.5% to 1.25% today-- just two days after Mario Draghi took over as president. What do you think: good move or an action that is likely to result in inflation in the name of growth and economic stability?
Re: Not a rosie scenario
driven
11/2/2011 8:47:06 AM
Ha! Funny cartoon. (Though a bit disturbing to realize chicken little has been right all along...)
Jacob, anyone who is focused on long term returns but fails to consider the impact of the short term -- and very significant -- global issues is either a masochist or a fool.
Re: Not a rosie scenario
Jacob
11/2/2011 3:08:35 AM
“Only one quarter of the investing public is now cautious over the market outlook”
You are right. Most of the investors are looking for long term returns and hence they are not that much bothered about the ups and downs in market. I think the regular traders are much bothered and concerned about the fluxuations in market.
Re: Not a rosie scenario
Value Hiker
11/1/2011 10:47:20 PM
Greeks are very unwilling to take on the stricter conditions being demanded of them to win fresh funding and avoid default. Greeks are clearly questioning whether there might not be an easier way out of their crisis. Default is much more attractive now than a year ago.
Germany can't save Greece, French can't either. Let's face the reality: Greece will default within a year. You can not save a patient who does not want to follow the doctor's perscription
Dear Tenacious: You are not alone! As I research on a daily basis I get more and more nervous. The bright side to all this though is that often during times of great upheaval, when the future looks most bleak, deep, fundamental changes often occur in society that set it up for decades of success. I believe we are in just such a time, as the decades of incorrect economic policies and ideology are coming to their natural consequence, thus fundamental beliefs are at last being questioned. I have great faith that the spirit of American entrepreneurialism (which is a state of mind to me rather than an actual nationality) will survive and be made stronger by this painful time.
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