Tag Archives: Germany

  • Blog
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    Europe is Drowning Under Too Much Government

    Its banks are being increasingly propped up by the U.S.
    by Alasdair Macleod

    Monday, March 4, 2013, 7:52 PM


    The Christmas and New Year's break, when Europe shuts down and stops thinking, is now well and truly over, and we are reawakening to the same old problems: Greece, Spain, Cyprus, Portugal, Italy, France…all with their hands out for money from Germany, Holland, Finland, and Austria.

    The holiday from the banking crisis, which was the result of the determination of the ECB to put a lid on it, is also over, with yields on the supplicant countries’ debt rising again.

    However, joining the bad news list is the United Kingdom. Ominously, the pound is sliding in the foreign exchange markets, providing a very tricky background for Chancellor Osborne’s budget on March 20th. I shall examine the UK’s position later, but first let’s update ourselves on developments in the Eurozone.

    The reality is that all the problems of the Eurozone are still with us, despite the fall in bond yields and their modest subsequent recovery. There is now the likelihood that we are about to enter the final phase of the end of the Eurozone experiment, with far wider consequences. So we need to pick up the story where we left off.

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  • Podcast

    Alasdair Macleod: Europe is in Worse Shape Than Everyone Thinks

    EU governments are getting desperate
    by Adam Taggart

    Saturday, March 2, 2013, 5:18 PM



    From his perch in the United Kingdom, Alasdair Macleod provides an update on the ongoing economic crisis in Europe, which — while largely absent from headlines in the US of late — continues to worsen.

    Due to bloated state-run programs and extreme malinvestment, EU governments find themselves in a box. Economic growth has stalled, and no amount of intervention seems able to get it going again. So in order to keep their economies moving forward, they are becoming increasingly rapacious in extorting tax revenues from wherever they can find them.

    Click the play button below to listen to Chris' interview with Eric Sprott (34m:40s): – See more at: https://www.peakprosperity.com/podcast/80989/eric-sprott#sthash.ok7RFfsH.dpuf

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  • Insider
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    Off the Cuff: “Hand-to-Mouth” Tightness Seen in Silver Inventories

    A strong bullish signal for silver investors
    by Adam Taggart

    Thursday, January 17, 2013, 6:23 AM


    In this week's Off the Cuff podcast, Chris and Ted Butler discuss:

    • Germany's Gold Grab
      • What impact with the reserve repatriation by the Bundesbank have?
    • Silver's Screaming Fundamentals
      • The size of the silver market is TINY
    • The Future Price of Silver
      • Betting on higher prices still seems the smart move here
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  • Insider
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    Off the Cuff: Will We Learn from Japan’s Missteps In Time?

    Its fate could shock other countries into action
    by Adam Taggart

    Thursday, November 22, 2012, 7:14 AM


    In this week's Off the Cuff with Mish & Chris podcast, Mish and Chris discuss:

    • Japan's Kamikaze Monetary Policy
      • The yen may be poised for destruction
    • Denial is a river in Germany, Greece, and Spain
      • Poor decisions being made in all three countries
    • Fiscal Cliff: Deal or No Deal?
      • What's most likely at this point

    In this Thanksgiving edition of Off the Cuff, Chris and Mish are grateful for Japan. Why? Because Japan will likely collapse under its unsustainable monetary and fiscal policies before the U.S. does.

    Much of the structural rot that ails the U.S. has been festering for much longer in Japan. With signs growing that the Japanese economy is nearing its predictable endgame, its implosion might be shocking enough to cause our leaders to think seriously that fate could be ours if we don't take radically different actions immediately.

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  • Blog
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    Europe Is Now Sinking Fast

    The good are being dragged down by the bad
    by Alasdair Macleod

    Tuesday, November 20, 2012, 7:09 AM


    With the Eurozone having being displaced from the financial headlines by the American presidential election, you might have briefly thought that its problems had gone away. They haven’t.

    It’s just that the public is expected to absorb one major story at a time. And now that the presidential election is done and dusted, Europe is rapidly returning to the headlines. This is not desired by the powers-that-be, who desperately need us to believe things will get better with a little patience.

    Behind the scenes, in order to prevent a systemic crisis, the authorities (through the European Central Bank) have been hard at work keeping a lid on interest rates for Spain and Italy, which act as everyone’s market bellweather. Their strategy focuses on the hope that high bond yields are just a lack of 'animal spirits' – and if only they can be reignited!

    Time is working against all countries in the Eurozone because the good are being dragged down by the bad…

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  • Insider
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    Europe’s Mexican Standoff

    All's fine until someone blinks
    by Alasdair Macleod

    Tuesday, November 20, 2012, 7:08 AM


    Executive Summary

    • Germany is unlikely to break solidarity with the rest of the Eurozone while Merkel remains in charge. But she may not last as long as she'd like.
    • France's economy is deteriorating at an alarming rate.
    • Most of France's "stability" to date is due to inflows of money fleeing Spain and Italy. That will stop soon – and then what?
    • The UK is suffering from many of the same ills as the U.S. However, its banks are too dependent on Eurozone debt for it to take drastic counter-measures, and so it is handcuffed to the future of the Continent.
    • All is well as long as no one defaults or no one leaves the Eurozone. With each player's position deteriorating, how long can the status quo last?

    If you have not yet read Europe Is Now Sinking Fast, available free to all readers, please click here to read it first.

    In previous articles, I have given Peak Prosperity's enrolled members the lowdown on the weak Eurozone governments and looked at the crisis from Germany’s point of view. With respect to Germany, all that can be added is that her political elite is still frozen in inaction and show no signs of snapping out of it. Mrs Merkel, particularly, is still pursuing the out-of-date Euroland ideal. It is as if she has decided that she has no alternative. Come what may, it will have to succeed in the end, and she is not going to be the one who calls “uncle.”

    I don’t know how these things work in Germany, but in the UK there comes a point where “the men in grey suits” metaphorically tap the leader on the shoulder and politely instruct him or her to resign. It happened to Mrs Thatcher, and unless she has a change of heart, it could happen to Mrs Merkel before next November’s German elections. And when that happens, the withdrawal of Germany from the euro can be expected to begin.

    In this article we will update the deteriorating situation in two other key players on Europe's chessboard: France and the United Kingdom. And we'll reveal why the current system is like a Mexican standoff: Everything is stable until someone makes a move. Then all hell breaks loose…

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  • Daily Digest
    Image by NASA, Flickr Creative Commons

    Daily Digest 10/31 – Sandy Damage Bill May Be $50 Billion, Greece PM Warns of Chaos

    by saxplayer00o1

    Wednesday, October 31, 2012, 4:56 PM

    • Storm's cost may hit $50B; rebuilding to ease blow
    • Greek PM Warns of Chaos if Austerity Blocked
    • Spanish banks sap profits with "desperate" price war
    • Portugal government seeks opposition support for more spending cuts
    • India Cuts Reserve Ratio to Back Growth Push; Holds Key Rate
    • Bernanke’s Cash Fuels Record Debt Rally
    • Hungary 'to offer wealthy foreigners citizenship in return for investment'
    • Fitch Puts Argentina's Junk-Level Sovereign Rating on Review For Downgrade
    • Superstorm Sandy cuts power to 8.1 million homes
    • Tenn. has 74 percent increase in homeless students
    • Storm-Surge Damage May Not Be Covered by Some Insurance
    • Why Germany Wants to See its US Gold
    • Bank of Japan Expands Stimulus as GDP Poised to Decline
    • Willow Road work will impact red light revenue (Illinois)
    • Four nuclear plants shut down in N.Y. area
    • Argentina scorns US debt ruling, vows to pay restructured bonds

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  • Insider
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    Off the Cuff: On the Knife’s Edge

    Options are running out across the board
    by Adam Taggart

    Friday, October 26, 2012, 3:11 AM


    In this week's Off the Cuff with Mish & Chris podcast, Mish and Chris discuss:

    • Phony employment
      • More workers being hired to do less work more poorly
    • Phony hopium
      • Despite QE3, over half the companies reporting Q3 earnings are under analyst expectations
    • Germany entering recession
      • The EU's only functioning economic engine is sputtering
    • Japan on the knife's edge
      • Between crushing deflation and currency destruction
    • Time for our politicians to clarify our priorities
      • What are we not going to do?

    As we enter the fall and the upcoming elections, we find the status quo is becoming less and less sustainable on many fronts.

    [Short summary tonight due to WS game 2. With all respect to Bob and Jim H — Go Giants!!]

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  • Insider
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    The Implications of a German Exit from the Eurozone

    What changes to expect
    by Alasdair Macleod

    Tuesday, September 25, 2012, 4:45 AM


    Executive Summary

    • Why the U.S. and the IMF won't act soon enough to avoid a German exit
    • Why Finland will bolt from the Eurozone the moment Germany does (and how many others may soon follow?)
    • What a German exit (and a new mark) would really mean
    • When will Germany likely announce its departure from the Eurozone?

    If you have not yet read Part I, available free to all readers, please click here to read it first.

    In Part I, we covered the background to what now appears to be inevitable: Germany has to leave the Eurozone. She, along with the Netherlands and Finland, simply cannot afford to bail out the rest of the Eurozone, so she is standing in the way of a resolution to the crisis. It is therefore only a matter of time before the political classes have to face this reality.

    Time is running out, and the longer Germany delays, the worse her position will be. The yields on Spanish and Italian debt will inevitably head towards and through the 7% "point-of-no-return" threshold and beyond, and Germany will get all the blame. Germany will be seen as a thorn in the side of the ECB, restricting its scope for monetary action and obstructing a solution, partly because of the Bundesbank’s stubborn conservatism and partly because Germany’s Constitutional Court frowns on monetising government debt. She will be unfairly condemned by everyone.

    Let’s look at some back-of-the-envelope figures…

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  • Blog
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    Why Germany Is Going to Exit the Eurozone

    Simply put, it has no choice
    by Alasdair Macleod

    Tuesday, September 25, 2012, 4:24 AM


    It's becoming clear that there is only one sensible solution ahead of us as the Eurozone’s problems evolve: Germany and the other countries suited to a strong currency should leave. If they do, the European Central Bank (ECB) will be free to pursue the easy money policies recommended by Keynesians and monetarists alike. It's increasingly clear that Germany has no option but to behave like any creditor seeking to protect its interests – and do its best to defuse the growing resentment against her from the Eurozone’s debtors.

    However, leaving the Eurozone is a political and legal, even seismic wrench, reversing decades of historical progression towards political and economic union.

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