Greece to Leave Euro Zone on June 18: Wealth Manager

[DumbAss Tanker]

Before everyone gets carried away with funerary rites for the Euro, remember that 'half of our kids are below average' - i.e. half the trade the thing is based on is always going tp underperform the average.  Half the economic activity there is always going to underperform the average, that's what 'average' means. 

I do think it has been seriously overvalued and the fact it's above parity with the dollar can only be accounted for by the reputation of German engineering, the popularity of French and Italian style, and the steady flow of tourism from outside the Eurozone.  The whole thing may fall apart ultimately, but I don't think it's going to be within the next three weeks by any stretch.  I give it at least a year of endless summits and crises first.

[obumazombie]

How long do the Chinese have to wait so the DUmmies get their free shit from Obama?

The Chinese are nothing, if not patient. Generationally patient. Millennially patient.

[rich_t]

I know that the uncertainty over the euro is playing havoc in the stock market....  Well, not havoc actually, but it sure is causing a bit of a roller coaster.

[Ptarmigan]

Spain and Italy are worse as they are larger than Greece. The Euro is not turning out as expected.

[thundley4]

Spain and Italy are worse as they are larger than Greece. The Euro is not turning out as expected.

I dunno. It's turning out pretty much how I expected.

[obumazombie]

I dunno. It's turning out pretty much how I expected.

Did you currency trade in the direction you expected the euro to go ?

[QuietEvening]

I don't understand why this would cause issues here in the US.  If the Greeks are retiring fresh out of High School on the dime of the rest of the EU, wouldn't it make sense to ship them off on an ice flue and cut off the support?  Let them sink or swim on their own, and the Euro will become stronger without the dead weight.

What am I missing?

[DumbAss Tanker]

QuietEvening, there is a unified EU currency, but not a unified debt or fiscal structure, so the weaker countries have paid comparatively high bond yields, and therefore the big banks in the stronger countries hold a shitload of Greek (And Spanish, Irish, etc.) bond debt on their books as assets.  Conversion back to the drachma in Greece means default (Or something just about as bad, when the debt is converted at an official exchange rate and the value of the drachma immediately plummets to parity with the Zimbabwe dollar), dragging the finances of the healthy countries down with the bad.

[NHSparky]

And when you consider just how heavily we're invested in EU banks, it also affects us.

[obumazombie]

And when you consider just how heavily we're invested in EU banks, it also affects us.

I'll bet that when the bottom falls out of the foreign bond market the banksters will walk away with their wealth intact. There should be some economic retribution to economic disasters, the heads of those entities and their boards and top officers should go down with the ship economically. Otherwise it looks like a legal or illegal scam.

[QuietEvening]

QuietEvening, there is a unified EU currency, but not a unified debt or fiscal structure, so the weaker countries have paid comparatively high bond yields, and therefore the big banks in the stronger countries hold a shitload of Greek (And Spanish, Irish, etc.) bond debt on their books as assets.  Conversion back to the drachma in Greece means default (Or something just about as bad, when the debt is converted at an official exchange rate and the value of the drachma immediately plummets to parity with the Zimbabwe dollar), dragging the finances of the healthy countries down with the bad.

Yeah, that makes sense.  I thought they had unloaded Greek exposure some time back when all the riots were going on.  Should have paid closer attention.

[USA4ME]

I don't think the others will go.  Greece will be it, the others will do what it takes to not become Greece.

.

[DefiantSix]

I don't think the others will go.  Greece will be it, the others will do what it takes to not become Greece.

.

Unfortunately for those European countries right behind Greece, they're too far along on that road to perdition to be able to save themselves by stopping in place now.  The US isn't as far along, but it'll take radical (not in the Obama sense of the word) changes in government spending to prevent us from following right along behind Europe.

[thundley4]

I don't think the others will go.  Greece will be it, the others will do what it takes to not become Greece.

.

Spain may be sooner than we think.

[DumbAss Tanker]

Spain may be sooner than we think.

They can't possibly keep up what they are paying for bond yields now over any protracted period, if they stay in a monetary system where they have no direct control of the money supply.

[NHSparky]

They can't possibly keep up what they are paying for bond yields now over any protracted period, if they stay in a monetary system where they have no direct control of the money supply.

Think "payday loans" on a national scale.

[obumazombie]

Think "payday loans" on a national scale.

All the customers are "Wimpy" characters.

[BlueStateSaint]

Here's a side effect:

The Prisons in Greece are Running out of Food

by John Galt
 May 29, 2012 07:00 ET
 
In another sign that the nation of Greece is failing to function at every level, another story appears in the Greek newspaper Protothema which gives the average person some degree of awareness as to how severe the crisis truly is:
 
Prisons are running out of food

The rest of the blog post is here: http://johngaltfla.com/wordpress/2012/05/29/the-prisons-in-greece-are-running-out-of-food/

It lists the response of the citizens of Corinth . . . I do believe St. Paul established a Church there . . .