World economy talk

[Monseratto]

Spain is too big to fail and too big to save...

The economy of Spain is the twelfth-largest economy in the world, based on nominal GDP comparisons, and the fifth-largest in Europe. It is regarded as the world's 23th most developed country. Until 2008 the economy of Spain had been regarded as one of the most dynamic within the EU, attracting significant amounts of foreign investment.

[uls]

Re the Saudi plan to flood the market with oil to bankrupt Iran and Iraq

the Saudis are overconfident. they still think they have that much control over the price of oil

if they increase production to drive down oil price below $100, other producers that breakeven at $100 will stop production

that will just cancel out Saudi Arabia's increased production

$60 per barrel? good luck Saudi

like i said in a previous post -- for many oil companies producing a barrel of oil already costs around $100

if oil price (Brent) falls below $100 and stays below $100 for an extended period oil companies will simply stop producing

which will reduce supply

which will drive up oil price

[uls]

^^^ and that's why Spain is a very big problem

[Monseratto]

If they dismantle the Euro, those indebted EU countries will suffer currency shock due to devaluation. Consumer prices will skyrocket, pensions shrink to poverty levels. Massive unemployment, many will be forced to migrate. But their goverments will be able to better balance with a devalued currency, something they can't do with the Euro...

[uls]

US 10 yr yield falls below 1.6% -- 1.593%

record low

[Monseratto]

Germany must be sick and tired of other people's problems...

Spain cries for help: is Berlin listening ? | Reuters

Spain cries for help: is Berlin listening ?

(Reuters) - Crisis is the watchword in Madrid. Take your pick - liquidity crisis, debt crisis, banking crisis, economic crisis, confidence crisis, investor crisis, jobless crisis. Spain, the ailing euro zone's latest problem child, has them all.

The latest gaffe: after weeks insisting that one of the country's biggest banks, Bankia, did not need fresh funds, ministers dropped the bombshell last Friday that there was a 23-billion-euro hole in the accounts. They have yet to explain clearly how they will find the money when they are already struggling to finance a spiralling national debt.

Analysts and foreign bankers here say the Madrid government is making a big gamble by assuming that the European Union's paymaster Germany, together with the European Central Bank, will in the end "do the right thing" and come to Spain's rescue.

It is inconceivable, they say, to imagine the eurozone without its fourth biggest economy. Spain's future is inextricably linked to Europe's future. So Germany is bound to agree reluctantly to change course and allow the ECB and the bailout fund to support Spain.

"It may go down to the wire, it may get very bad," one senior diplomat here said. "But Germany has to choose. With Greece it did not have to choose. It could allow Greece to fail. But if Spain fails, Europe fails. So in the end we have to believe that Merkel and the Taliban of the Bundesbank (German central bank) will change their minds and do what they need to do to save Europe."

[uls]

Germany 10 yr yield new record low 1.199%.

2 yr yield now NEGATIVE (-0.003%)

[uls]

as if the market needs more bad news

US jobs report -- only 69,000 jobs created. 150,000 expected

US 10 yr yield falls below 1.5%

[uls]

hey Fed time for QE3

[Monseratto]

hey Fed time for QE3

Any prediction for the DOW's opening?

[Monseratto]

Oil prices collapsing...!

Pre-market crude oil futures plunged nearly 4 percent Friday on this morning's catastrophic nonfarm payrolls figure.

July Brent contracts were down -3.81 percent to $98, while WTI declined as much as -4.55 percent to $82 — an eight-month low.

Meanwhile, gold futures spiked as much as 1.19 percent to hit $1,581.45.

Natural gas, too, is getting beaten up — down -2.79 percent to $2.36.

London - Brent oil prices sank under $100 a barrel on Friday for the first time in eight months, hit by weak Chinese data and eurozone debt tensions centred on Spain, and ahead of more key US data.

Brent North Sea crude for delivery in July tumbled to $99.60 a barrel in early London deals, which was the lowest level since October 4, 2011.

New York's main contract, West Texas Intermediate crude for July dived to $84.52 a barrel - the lowest level since October 20.

"Oil prices have dipped below the psychological $100-per-barrel with the focus turning away from the Iran situation and onto the state of the global economy after a raft of poor economic results over recent days," said Gary Hornby, an analyst at energy consultants Inenco.

"Concerns over Spain have resurfaced after the country's 10-year bond yields nudged close to 7.0%, a level seen as unsustainable and continuing uncertainty over the upcoming Greek elections in mid-June."

Adding to the sense of panic, latest figures showed a net €97bn of investor money fled Spain in the first three months of the year - the highest on record.

[uls]

market just opened

earlier dow futures was down 200

[uls]

guess i'm not the only one thinking QE3 after the jobs report

Forex: EUR/USD soars above 1.2450 on QE3 speculation
Fri, Jun 01 2012, 13:36 GMT | FXstreet.com

FXstreet.com (Córdoba) - The dollar initially strengthened on the back of disappointing nonfarm payrolls, but as participants consider the risks of the Fed launching another round of bond purchasing (QE3), the US currency lost momentum and reversed gains.

look at the euro spike

[Monseratto]

Ahhh...the sky is falling!!! Any news from the Feds?

[Monseratto]

All gains of 2012 for the DOW has been wiped out...But gold is a darling again with speculation of QE3.

[interruptedz]

nahihilo ko sa mga pinaguusapan nyo.hehe

tanong lang.bakit nagka crisis sa EURO ngayon?ano mali sa ginawa ng GREECE,SPAIN and PORTUGAL? to think na may mga PHD pa mga economic planners nyan.pero sa interview sa TV.majority of greeks gusto pa rin sa EURO.sabi sa BBC kaya daw nagkacrisis sa greece.dahil advantage daw na drachma pa rin pera nila kasi mas weaker daw ang drachma kaya ganun.medyo di ko magets

[uls]

tanong lang.bakit nagka crisis sa EURO ngayon?ano mali sa ginawa ng GREECE,SPAIN and PORTUGAL?

sa Greece at Portugal malaki utang ng gobyerno nila. since kulang ang tax collection umuutang sila pambayad sa utang. ok sana basta may nagpapautang kaya lang dumating ang panahon na ayaw na sila pautangin

yung Spain naman nagkaroon ng real estate boom. yung mga bangko nila dami mortgage loans, construction loans. nag bust yung boom. yung mga loans di nababayaran. patay mga bangko. so kailangan ng Spain govt i-bailout mga bangko. kulang naman ng pera

umabot sa point na aywa nmajority of greeks gusto pa rin sa EURO.sabi sa BBC kaya daw nagkacrisis sa greece.dahil advantage daw na drachma pa rin pera nila kasi mas weaker daw ang drachma kaya ganun.medyo di ko magets

advantage ng may sariling currency pwede ka mag print pambayad ng utang (basta denominated sa currency mo yung utang)

like pag nangutang ang gobyerno natin in peso walang problema sa pag bayad dahil may ari ng Pinas ang Bangko Sentral na taga print ng peso

pero pag nangutang ang gobyerno natin in dollar dapat may dollar pumapasok sa economy natin para may dollar na pambayad

when you run out of dollar reserves to pay dollar loans IMF ang bagsak mo

ang mga bansa sa eurozone di sila maka print ng euro

ang ECB lang makakaprint ng euro

the ECB is outside the control of individual governments

[uls]

kaya kung drachma ang currency ng Greece at ang utang ng gobyerno nila denominated in drachma walang problema ang pambayad

pag bumalik ang Greece sa drachma automatic devaluation more than 50% siguro (against the euro)

that will make everything in Greece so damn cheap to euro holders

magiging sobra mura labor nila

magiging very competitive ang Greece

[interruptedz]

sa Greece at Portugal malaki utang ng gobyerno nila. since kulang ang tax collection umuutang sila pambayad sa utang. ok sana basta may nagpapautang kaya lang dumating ang panahon na ayaw na sila pautangin

yung Spain naman nagkaroon ng real estate boom. yung mga bangko nila dami mortgage loans, construction loans. nag bust yung boom. yung mga loans di nababayaran. patay mga bangko. so kailangan ng Spain govt i-bailout mga bangko. kulang naman ng pera



advantage ng may sariling currency pwede ka mag print pambayad ng utang (basta denominated sa currency mo yung utang)

like pag nangutang ang gobyerno natin in peso walang problema sa pag bayad dahil may ari ng Pinas ang Bangko Sentral na taga print ng peso

pero pag nangutang ang gobyerno natin in dollar dapat may dollar pumapasok sa economy natin para may dollar na pambayad

when you run out of dollar reserves to pay dollar loans IMF ang bagsak mo

ang mga bansa sa eurozone di sila maka print ng euro

ang ECB lang makakaprint ng euro

the ECB is outside the control of individual governments

so umuutang ang portugal and greece para pambayad sa utang?are you refering to domestic debt? and saan sila umuutang? foreign?

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[ame="http://www.youtube.com/watch?v=Bx5Sc3vWefE"]Victoria Grant - YouTube[/ame]