Greece At Forefront; Ireland, Spain, Italy...

[Kathianne]

No denying, we're living through interesting times. I wish I were 20-something, instead of fifty-something. Even then, i don't wish a 2nd decade of life of what is reality.

http://news.sky.com/home/world-news/article/16076510



Fears Over 'Shockwave' Of Greek Debt Crisis
Fears Over 'Shockwave' Of Greek Debt Crisis
7:48pm UK, Saturday September 24, 2011
Ed Conway, economics editor, in Washington DC
No longer a question of if, but when - that is the tone of discussions over Greece which has dominated the summit of finance ministers in Washington over the weekend.According to senior G20 sources, the assumption now is that the country will have to default on its debt by as much as 50% – on top of the 20% voluntary restructuring already agreed in July.
And so whereas efforts some months ago were aimed at preventing Greece defaulting, the Eurozone, and its G20 colleagues from the world's biggest economies, are instead making secret plans to build a firewall protecting European economies such as Spain and Italy from the prospect of a buyers' strike.


Here's what ministers are currently thinking: Greece is, in sovereign debt terms at least, a lost cause.


Portugal and Ireland may be salvageable – unlike Greece their austerity plans and bail-outs are yielding at least some results, albeit at the cost of some severe pain.
A collapse in confidence in the debt of Italy or Spain would be disastrous and unaffordable...

[LuvRPgrl]

No denying, we're living through interesting times. I wish I were 20-something, instead of fifty-something. Even then, i don't wish a 2nd decade of life of what is reality.

http://news.sky.com/home/world-news/article/16076510

To be honest, I dont understand the whole economics of countries thing. So what if Greece defaults, then what?

As for 20 something, no way. Kids today are miserable. Your and my contemporaries have left them a desolate and hopeless life. Even the people living in the great depression were happieer than todays kids. My generation was a fantastic one to grow up in, unfortunately, the final 3-4 decades of it has overlapped into the big govt control era

[Kathianne]

To be honest, I dont understand the whole economics of countries thing. So what if Greece defaults, then what?

As for 20 something, no way. Kids today are miserable. Your and my contemporaries have left them a desolate and hopeless life. Even the people living in the great depression were happieer than todays kids. My generation was a fantastic one to grow up in, unfortunately, the final 3-4 decades of it has overlapped into the big govt control era

I disagree. My kids are all 20'somethings. They aren't unhappy, not by a long shot. They go to work, they play, they are getting married. They don't see the world as we did, but they are optimistic. I don't think they are looking to buy houses within a year of getting married, though many of their friends have.

[fj1200]

To be honest, I dont understand the whole economics of countries thing. So what if Greece defaults, then what?

A lot of the Euro banks own Greek debt on the balance sheets. Those would be hit if they actually default because the value will plummet.

[Kathianne]

A lot of the Euro banks own Greek debt on the balance sheets. Those would be hit if they actually default because the value will plummet.

and the US holds a lot of Euro bank interests.

[LuvRPgrl]

A lot of the Euro banks own Greek debt on the balance sheets. Those would be hit if they actually default because the value will plummet.

and?

[fj1200]

and?

Banks' balance sheets go down threatening reserves and their market values, their abilities to lend, the abilities of their borrowers to get the funds they need, and overall what would be the response to the other questionable countries and their finances, Ireland, Portugal, Italy, Spain... At that point it depends on the Central Banks and governments as to their response.

One persons opinion:

What Will Happen If Greece Defaults (http://www.usnews.com/news/blogs/rick-newman/2011/09/15/what-will-happen-if-greece-defaults)

[LuvRPgrl]

Banks' balance sheets go down threatening reserves and their market values, their abilities to lend, the abilities of their borrowers to get the funds they need, and overall what would be the response to the other questionable countries and their finances, Ireland, Portugal, Italy, Spain... At that point it depends on the Central Banks and governments as to their response.

One persons opinion:

What Will Happen If Greece Defaults (http://www.usnews.com/news/blogs/rick-newman/2011/09/15/what-will-happen-if-greece-defaults)



ok, I understand that, but its still paperwork and numbers basically, when and where and how does the "rubber meet the road?"

Instead of peoples paperworks being affected, how and when do people become affected in their paychec, ability to work, or industries having to close?

[fj1200]

ok, I understand that, but its still paperwork and numbers basically, when and where and how does the "rubber meet the road?"

Instead of peoples paperworks being affected, how and when do people become affected in their paychec, ability to work, or industries having to close?

Think about 2008 and 2009 here and then extend it to Europe.

[Kathianne]

http://www.businessweek.com/news/2011-09-28/euro-crisis-makes-fed-lender-of-only-resort-as-funding-ebbs.html


Euro Crisis Makes Fed Lender of Only Resort as Funding Ebbs September 28, 2011, 2:49 AM EDT

<cite>By Craig Torres and Caroline Salas Gage</cite>
(Updates with dollar’s gain in ninth paragraph.)


Sept. 28 (Bloomberg) -- The Federal Reserve, chastised by Congress for lending money to foreign institutions such as the Central Bank of Libya, is once again the lender of last resort for banks around the world it knows little about.


Three years after the collapse of Lehman Brothers Holdings Inc., money-market borrowing rates for dollars are rising, leading the Fed and European Central Bank to make the currency available to Europe’s institutions for as many as three months. U.S. prime money-market funds cut their exposure to euro-zone bank deposits and commercial paper, or short-term IOUs, to $214 billion in August from $391 billion at the end of last year, according to JPMorgan Chase & Co. data.


The failure of regulators worldwide to address European banks’ fragile dependence on short-term funding is “putting the Fed in a really awkward position,” said Karen Shaw Petrou, managing partner at Federal Financial Analytics, a Washington regulatory research firm whose clients include the biggest U.S. banks. The swaps with Europe “are an extremely advantageous political football” for critics of the Fed, she said.


The extended funding comes as the U.S. central bank is already under fire for its unprecedented monetary stimulus. Republican leaders including Representative John Boehner of Ohio and Senator Mitch McConnell of Kentucky wrote Chairman Ben S. Bernanke and the Board of Governors on Sept. 19, asking them to “resist further extraordinary intervention in the U.S. economy.”...


Large Losses
Investors are fleeing because of concern that banks will take large losses if a euro-zone nation such as Greece defaults. Europe’s debt crisis has generated as much as 300 billion euros ($408 billion) in credit risk for the region’s banks, the International Monetary Fund said last week.


Against the euro, the dollar is heading for its biggest monthly advance since November last year as European policy makers fail to contain their region’s sovereign-debt crisis. It was little changed today at $1.3575 at 3:11 p.m. in Tokyo.


The London Interbank Offered Rate at which banks say they can borrow for three months in dollars rose for a 13th day on Sept. 27 to 0.36522 percent from 0.36278 percent the previous day, according to data from the British Bankers’ Association...

[LuvRPgrl]

Think about 2008 and 2009 here and then extend it to Europe.

hmmm, ok, relatively speaking 08 & 09 werent that bad, but I guess you are saying it could, probably would, or definately will be worse than that., I dont get into economics too much, so I dont understand alot about it, thanks for the info.

[fj1200]

hmmm, ok, relatively speaking 08 & 09 werent that bad, but I guess you are saying it could, probably would, or definately will be worse than that., I dont get into economics too much, so I dont understand alot about it, thanks for the info.

Unemployment went from 5% to 10% and could have been worse without Fed actions. That&#39;s the point, what actions will keep any Greek contagion from spreading too far.