30 Nov '11 20:02>
http://uk.news.yahoo.com/uk-banks-urged-prepare-euro-break-154737202.html
How will this affect America?
How will this affect America?
Originally posted by skipper2666I'm sure they'll make a few bucks - unpicking the financial mess.
How much exposure do JP and Goldmans etc have in respect to eurozone bonds and the like?
Originally posted by invigorateI hope that you're right on that but I'm sure I've read a few times that the Euro and it's whole set up was a safe system, very strong and would never fail or be close to failing??
I'm sure they'll make a few bucks - unpicking the financial mess.
I'm not sure the Eurozone has issued bonds per se (individual nations fund their deficits individually) - but I know what you mean.
However your original article is just contingency planning by the banks - normally what they plan for does not happen.
Originally posted by skipper2666You may very well have read that, but the person who wrote it was tragically wrong.
I hope that you're right on that but I'm sure I've read a few times that the Euro and it's whole set up was a safe system, very strong and would never fail or be close to failing??
Originally posted by skipper2666How is that even possible? You have a standardize currency among many different nations and cultures with wildly disparate economic development and purchasing power. These sorts of problems were destined to arise sooner or later. Ultimately, the success of the Euro relies on willingness of the people of Hamburg being willing to subsidize the lifestyle of the people of Athens. If people of rich Europe are not willing to eventually bail out and subsidize poor Europe then the euro is a failure waiting to happen.
I hope that you're right on that but I'm sure I've read a few times that the Euro and it's whole set up was a safe system, very strong and would never fail or be close to failing??
Originally posted by sh76It's not a matter of poor or rich. Greece has a higher GDP per capita than Slovenia, but the latter's public finances are fine.
How is that even possible? You have a standardize currency among many different nations and cultures with wildly disparate economic development and purchasing power. These sorts of problems were destined to arise sooner or later. Ultimately, the success of the Euro relies on willingness of the people of Hamburg being willing to subsidize the lifestyle of the pe ...[text shortened]... g to eventually bail out and subsidize poor Europe then the euro is a failure waiting to happen.
Originally posted by sh76It might work with Fiscal Union and goodwill - but Fiscal union needs political union and thats not going to happen!
How is that even possible? You have a standardize currency among many different nations and cultures with wildly disparate economic development and purchasing power. These sorts of problems were destined to arise sooner or later. Ultimately, the success of the Euro relies on willingness of the people of Hamburg being willing to subsidize the lifestyle of the pe ...[text shortened]... g to eventually bail out and subsidize poor Europe then the euro is a failure waiting to happen.
Originally posted by KazetNagorraI have heard various Euros try to imply that the Euro-zone concept is basically the same as the Federal System in the US, but this is simply incorrect. I recall Paul Krugman discussing the much lower labor mobility across national borders in Europe than there is between States in the US. And this article points out how dissimilar the Euro banking structure is to the American one:
It's not a matter of poor or rich. Greece has a higher GDP per capita than Slovenia, but the latter's public finances are fine.
The differences in GDP per capita between Eurozone states are comparable to the differences between US states.
The problems arose because Eurozone members (most importantly, Germany and France) were not willing to implement strict(er) fiscal rules when they still had ample opportunity to do so.
Originally posted by no1marauderOf course there are significant differences, but there are similarities as well. The key one is that central banks in general, including the Fed, endeavor to inoculate national economies against the natural punishment that markets inflict on over speculation, and over extension of credit.
I have heard various Euros try to imply that the Euro-zone concept is basically the same as the Federal System in the US, but this is simply incorrect. I recall Paul Krugman discussing the much lower labor mobility across national borders in Europe than there is between States in the US. And this article points out how dissimilar the Euro banking structu ...[text shortened]... The structures in Europe just do not meaningfully approximate the US ones.
Originally posted by skipper2666unless you have your money under a matress, even your bank may eventually run out of money and you'll have none.
Should we bale out Banks, doesn't this go against The Free Market..... isn't that a communist/ socialist ideal?
Why should my tax money, future tax money go to keeping these people in business when they can't do a simple thing like run a bank correctly?
Originally posted by uzlessAfter the Great Depression the US government guaranteed money placed in banks. I think the max amount the US government will guarantee is more than $100K these days.
unless you have your money under a matress, even your bank may eventually run out of money and you'll have none.
Banks are only required to keep between 5-9% of the cash you deposit with them. The rest they "loan" out to people. So if those people (other banks) don't pay it back, that means at best you'll get only 5-9% of your money back.
You okay with that?
Originally posted by skipper2666Because they are "too big too fail" and, well, you're just not.
Should we bale out Banks, doesn't this go against The Free Market..... isn't that a communist/ socialist ideal?
Why should my tax money, future tax money go to keeping these people in business when they can't do a simple thing like run a bank correctly?