Friday, 2 December 2011

EURO going, going ....

Another day, and the Euro will become even more endangered. "In 30 years, I've never heard such talk from a bank chief" quotes the Mail, as the Bank advises us all to take cover as the imminent end of the Euro approaches. Meanwhile, in the Brussels bunker, Von Rumple calls on non-existent divisions and corps to move to his aid, but all he's got defending the Eurocapital are a few insane boys and some decimated BB rated banks. The Reich gold is in the alpine redoubt, as Generalfeldmarshall  Merkel prepares for the Fifth Reich, jealously guarding the wealth that will back the new NordReich Eurozone from the ruins of the Berlaymont.. 


It's time to let the Eurobanks fall as they will. Apart from the banks, firms are strong and cash-rich and asset-rich; these will not diminish as the banks crash, and will enjoy a bounce and a recovery in share values once the drag of the bankrupt Euro financial sector is removed from the markets. 


We're not going to move on out of recession without this major catharsis. It will be a huge hammer blow, but suddenly the chains and shackles will have been shattered and fall away, and the economy will rise. C'mon. let's get it done. 

9 comments:

Anonymous said...

"Apart from the banks, firms are strong and cash-rich and asset-rich; these will not diminish as the banks crash, "


Problem is, it has been customary for a firm to place its money with a bank. Post MFGlobal, can any firm really know that the bank that has its money, actually has its money?

Lehmans was levered 60:1 rumor has it that European banks are operating at an even greater ratio.

While we need banks, we don't need these banks. They should have been put into administration years ago. Wound down and new recapitalized banks set up.

If only ...

Greg Tingey said...

You are grossly unfair to Ms Merkel (remeber, she's an "Ossie")

The analysis is almost certainly true, though.
Greece & Spain will exit, probably Portugal.
Ireland MAY re-join Sterling?
"New" Euro to consist of "Northern countries only + France ....

rapscallion said...

Greg. Up to where you mentioned France, I agree with you. France though is a basket case, it's exposure is huge. They'd be better off with the club med countries

DP111 said...

There is no political will in the Eurozone, or even outside it, to see the Euro go out of business. As the Euro, or for that matter any currency, is a political act, it will not go out of business until the main political players - Germany and France, say it is finished. The Euro may diminish in value but will stay.

What EU politicians are now doing is the time honoured British strategy of muddling along, and hoping to get through.

Kevin said...

I remember them saying exactly these things about Britain and the ERM. Then we were eventually forced to drop out.

And never looked back...until Gordon splurged it all away

Ed P said...

How do "cash rich" firms obtain their funds from a failed bank?

DP111 said...

Kevin

Very true.

But the ERM decision was merely to get out of it. What we have here is not to get out of the Euro, though it is far more difficult, as a new currency has to be setup, but to kill the Euro completely as a currency.

Ian said...

Wonder when Belgium will go under?

Sir Hugo said...

In a Northern Euro, France would be the new Greece.