Stress Testing ECB-Style

Generali

15/7/2011:

"Bank of Cyprus and Marfin Popular Bank were subject to the 2011 EU-wide stress tests...Both banks passed."
Central Bank of Cyprus Press Release

18/3/2013:
"The Central Bank of Cyprus would like to announce that 19 & 20 March have been declared as bank holidays"
Central Bank of Cyprus Press Release

:TThe EU decided not to stress test for sovereign default despite the markets pricing in a 90% chance of a Greek default at the time. :T

purch

Did they stop taking their medication ?

purch

Apparently EUR finance ministers (and dimwit Osbourne) are agreeing to extend the repayment schedules for Eire & Portugal.

Borrowing on the "never never" :eek:

michaels

purch wrote: »

Apparently EUR finance ministers (and dimwit Osbourne) are agreeing to extend the repayment schedules for Eire & Portugal.

Borrowing on the "never never" :eek:

What are the options? - kick the can or admit that the borrowers can't pay back the money loaned on the agreed terms and thus having to write off some of the borrowing. The later is only possible if the lender has sufficient reserves otherwise there is no option but zombie sovereigns....

Thrugelmir

purch wrote: »

Borrowing on the "never never" :eek:

and can the UK continue to look on smugly?

Seems as people don't want to face reality............:eek:

purch

Nobody appears eager to face any kind of reality.

They continue to insist the elephant isn't present, yet the stench from it's mess that nobody is cleaning up is getting unbearable

Generali

michaels wrote: »

What are the options? - kick the can or admit that the borrowers can't pay back the money loaned on the agreed terms and thus having to write off some of the borrowing. The later is only possible if the lender has sufficient reserves otherwise there is no option but zombie sovereigns....

The option is to take the Iceland approach: screw your creditors and look after your own people.

Now the Troika have announced that Cyprus is to have most of her gold reserves confiscated in order that she can't escape the Euro. It's starting to become clear why the Germans are repatriating their gold.

This stinks. I'm not normally one for conspiracy theories but something is fundamentally rotten here.

I'm glad I'm not in Europe any more. I'd be getting worried if I was.

michaels

But what does the 'Iceland Apporach' feel like in a country like the UK that is running a trade deficit of 5% of GDP?

Rather cold and hungry I fear?!

MacMickster

Generali wrote: »

This stinks. I'm not normally one for conspiracy theories but something is fundamentally rotten here.

I'm glad I'm not in Europe any more. I'd be getting worried if I was.

Its not just about Europe. I suspect that the Chinese have also cottoned on to the fact that economic warfare may be far more effective than conventional warfare in the future. Domination by one nation over others is best achieved by beggaring other nations, leaving them beholden to a master nation, and without the resources to resort to conventional warfare.

Generali

michaels wrote: »

But what does the 'Iceland Apporach' feel like in a country like the UK that is running a trade deficit of 5% of GDP?

Rather cold and hungry I fear?!

Overall the trade deficit for 2012 was £36,058,000,000 or about £600/head. If I drank British beer instead of imported wine I'd save my £600 easily if I still lived there!

wotsthat

Generali wrote: »

Overall the trade deficit for 2012 was £36,058,000,000 or about £600/head. If I drank British beer instead of imported wine I'd save my £600 easily if I still lived there!

Do the UK need to take an Iceland approach? How much government debt is yielding a positive real return - aren't the creditors screwing themselves?