Greece default.

IronWolf

The underlying problem is not so much writing off greek debt, it is the unregulated derivatives market which has trillions in potential liabilities completely unseen on the balance sheets.

Until the world gets to grips with the derivatives market and regulates it properly there is always a ticking timebomb waiting to go off.

There is huge amounts of regulation for selling and buying shares yet hardly anything for derivatives. You could sign up for trillions in potential losses and noone would stop you.

gagahouse

IronWolf wrote: »

The underlying problem is not so much writing off greek debt, it is the unregulated derivatives market which has trillions in potential liabilities completely unseen on the balance sheets.

Until the world gets to grips with the derivatives market and regulates it properly there is always a ticking timebomb waiting to go off.

There is huge amounts of regulation for selling and buying shares yet hardly anything for derivatives. You could sign up for trillions in potential losses and noone would stop you.

That's changing, Dodd-Frank in the US and EMIR in Europe will force most OTC derivatives to centrally clear and to trade on electronic markets. You will have to post initial and variation margin for your OTC trades unless you are an end-user like a corporate who uses them for pure hedging purposes.

Catapa

Which rate of debt to GDP is sustainable depends on many factors, Belgium for example has had a high rate for many decades.

Some total public deficit to GDP ratios:
Japan -YEN-- 198%
Greece --€-- 116% (adjusted)
Ireland ---€-- 97%
USA

---

$-- 94%
Portugal --€-- 93%
UK

---

£-- 87%
France ----€-- 85%
Germany --€-- 82%
Austria ----€-- 74%
Spain

---

€-- 68%
Netherlands €-- 64%
Finland

---

51%

The problem with the USA and the UK is their current deficits, which increase the burden rapidely, reason why the markets have been turning against the UK.

ILW

Catapa wrote: »

Which rate of debt to GDP is sustainable depends on many factors, Belgium for example has had a high rate for many decades.

Some total public deficit to GDP ratios:
Japan -YEN-- 198%
Greece --€-- 116% (adjusted)
Ireland ---€-- 97%
USA

---

$-- 94%
Portugal --€-- 93%
UK

---

£-- 87%
France ----€-- 85%
Germany --€-- 82%
Austria ----€-- 74%
Spain

---

€-- 68%
Netherlands €-- 64%
Finland

---

51%

The problem with the USA and the UK is their current deficits, which increase the burden rapidely, reason why the markets have been turning against the UK.

It also shows that comparing deficit to GDP is pretty meaningless.

A ratio of debt to tax receipts would be a lot more revealing and useful in deciding the state of an economy.

Is one published?

CLAPTON

Catapa wrote: »

Which rate of debt to GDP is sustainable depends on many factors, Belgium for example has had a high rate for many decades.

Some total public deficit to GDP ratios:
Japan -YEN-- 198%
Greece --€-- 116% (adjusted)
Ireland ---€-- 97%
USA

---

$-- 94%
Portugal --€-- 93%
UK

---

£-- 87%
France ----€-- 85%
Germany --€-- 82%
Austria ----€-- 74%
Spain

---

€-- 68%
Netherlands €-- 64%
Finland

---

51%

The problem with the USA and the UK is their current deficits, which increase the burden rapidely, reason why the markets have been turning against the UK.

I'm sure you mean DEBT to gdp ratios and NOT deficit

beaujolais-nouveau

ILW wrote: »

No point paying off debts if money is going to become worthless.

Interest rates will go up first, very quickly.

I am throwing all spare money at paying off debts and stocking up.