European Banking Crisis

[LaoPo]

I am glad to hear you are very successful. I was lucky my family was in the steel business and I received huge amount of US Steel and with that I own a Coal Company. I was lucky others dig the coal and I deposit the profits nothing could be sweeter and easier At age of 74 just rich and stupid I guess.

Some (a few...) people are more fortunate than most I suppose and I believe you without a doubt you're rich. About being stupid...I have NO comment, as I didn't receive quite the answer I expected about your business experience, and I didn't ask for your inheritance experiences

LaoPo

Edited October 6, 2008 by LaoPo

[Naam]

I was lucky my family was in the steel business and I received huge amount of US Steel and with that I own a Coal Company. I was lucky others dig the coal and I deposit the profits nothing could be sweeter and easier At age of 74 just rich and stupid I guess.

i wouldn't dare to contradict a rich man

[LaoPo]

I was lucky my family was in the steel business and I received huge amount of US Steel and with that I own a Coal Company. I was lucky others dig the coal and I deposit the profits nothing could be sweeter and easier At age of 74 just rich and stupid I guess.

i wouldn't dare to contradict a rich man

You're having one of these days Naam especially if the whole world is in RED

LaoPo

[Naam]

You make some valid points S.A., I think that the scary part of this for Europe is that they are just at the beginging of their real estate-banking-financial crisis, while the U.S. is in the middle of it! It is hard to say at this juncture if the European situation will be worse than the U.S. or not, I guess we will just have to wait and see! The fact that the E.U. central banks did not lower interest rates at their meeting a few days ago tells me that many european countries could be in for a very tough time. I am only willing to make one prediction at this time, and that is that Germany will exit the E.U. sometime in the next 18months!

In the process of educating myself about the E.U. monetary policies. It does seem that Germany exiting E.U. would have horrific consequences. I really don't see this happening now, but the union is going to be tested. The European Central bank in theory is independent, but theory and reality can be very different. From what I've read, real estate in Germany is not nearly as over valued as most of the other members. Germany being Europe's 1000 pound gorilla, will probably push it weight around and have more a say in what happens in the near term.

right you are! in fact real estate in Germany (as opposed to most or even all other european countries) has been continously falling for more than a decade. and no such thing exists like "let's refinance, skim from ze top bekaus vee haff more of der ekvity, go on a shpending shpree und take a holiday on vone of ze greekish islands vhere zey play der bouzouki und dance der sirtaki oll day and night long ".

[Naam]

I was lucky my family was in the steel business and I received huge amount of US Steel and with that I own a Coal Company. I was lucky others dig the coal and I deposit the profits nothing could be sweeter and easier At age of 74 just rich and stupid I guess.

i wouldn't dare to contradict a rich man

You're having one of these days Naam especially if the whole world is in RED

LaoPo

vhy shoodent i LaoPo? i haff manatched to sekure neerly 80% of meye holdings. vhot iss left might go belly-oop or not, i koodent kare less.

joke aside. of course i still care a little because even 20% is still a lot of dough to lose. actually i shouldn't care at all. it's not my or my wife's 20% which is still in rather risky assets. it's the money of our heirs!

[LaoPo]

You make some valid points S.A., I think that the scary part of this for Europe is that they are just at the beginging of their real estate-banking-financial crisis, while the U.S. is in the middle of it! It is hard to say at this juncture if the European situation will be worse than the U.S. or not, I guess we will just have to wait and see! The fact that the E.U. central banks did not lower interest rates at their meeting a few days ago tells me that many european countries could be in for a very tough time. I am only willing to make one prediction at this time, and that is that Germany will exit the E.U. sometime in the next 18months!

In the process of educating myself about the E.U. monetary policies. It does seem that Germany exiting E.U. would have horrific consequences. I really don't see this happening now, but the union is going to be tested. The European Central bank in theory is independent, but theory and reality can be very different. From what I've read, real estate in Germany is not nearly as over valued as most of the other members. Germany being Europe's 1000 pound gorilla, will probably push it weight around and have more a say in what happens in the near term.

right you are! in fact real estate in Germany (as opposed to most or even all other european countries) has been continously falling for more than a decade. and no such thing exists like "let's refinance, skim from ze top bekaus vee haff more of der ekvity, go on a shpending shpree und take a holiday on vone of ze greekish islands vhere zey play der bouzouki und dance der sirtaki oll day and night long ".

I have a vague feeling (well....vague... ) that the falling in Germany has -still- to do with the housing prices in (former) Eastern and Western Germany.

If one would divide the two, a completely different picture would appear. Eastern Germany has completely empty parts with cities and villages mainly consisting of elderly retired and quite poor people. The younger generation left, long ago, to search for work in the West. (One could buy a beautiful villa/house in Eastern Germany for peanuts compared to Western Germany or even Holland. The same house would cost at least 5 to 10 times more)

That's why the average real estate prices in Germany dropped already for so many years.

That's not so in cities like Berlin, Düsseldorf, Köln, München, Stuttgart, Frankfurt and Hamburg to name a few.

LaoPo

Edited October 6, 2008 by LaoPo

[beginner]

[Now, if you would be so kind to inform me about your business experiences ? I am all ears since I'm never too old to learn something new from others.

LaoPo

This could be a whole new thread but I will answer here as it is clearly related to the European Banking Crisis.

My mum and dad were also in the Iron and Steel business. Mum ironed and dad stole.

My own first business experience at age 5 years was selling yesterdays paper from a cardboard box hung round my neck with a piece of string to innocent and good hearted passers by. I think my first days profit was five old pence.

In my teens I made my first million. (Turkish lira). But blew it all in a poorly judged investment in a cinema date including two ice creams with a totally unsuitable girl.

By my twenties, entrepreneurship was second nature to me.

My own company was listed in the Misfortune 500 four years running.

I was told that money doesn't make you happy and I was determined to test the hypothesis.

It looked like I would have to tell any grand kids that I started out with nothing and still had most of it left!

Then a stroke of entrepreneurial genius (if you will pardon my boasting).

I married into money. It worked for me.

[harrry]

Naam Is it a Europe wide thing that house prices are relatively lower than some years ago at least compared to house prices in Australia. I was worried when my daughter and her husband sold up their house here as he wanted to return to Switzerland as once houses were several times the price of those here however the house they got in Baden was only about 60% of the price in Australia.

Edited October 6, 2008 by harrry

[LaoPo]

[Now, if you would be so kind to inform me about your business experiences ? I am all ears since I'm never too old to learn something new from others.

LaoPo

This could be a whole new thread but I will answer here as it is clearly related to the European Banking Crisis.

My mum and dad were also in the Iron and Steel business. Mum ironed and dad stole.

My own first business experience at age 5 years was selling yesterdays paper from a cardboard box hung round my neck with a piece of string to innocent and good hearted passers by. I think my first days profit was five old pence.

In my teens I made my first million. (Turkish lira). But blew it all in a poorly judged investment in a cinema date including two ice creams with a totally unsuitable girl.

By my twenties, entrepreneurship was second nature to me.

My own company was listed in the Misfortune 500 four years running.

I was told that money doesn't make you happy and I was determined to test the hypothesis.

It looked like I would have to tell any grand kids that I started out with nothing and still had most of it left!

Then a stroke of entrepreneurial genius (if you will pardon my boasting).

I married into money. It worked for me.

...I like your sense of humor

LaoPo

[VegasVic]

Never better! I have a penchant for making predictions that go against the tide! If you remember I was the one here on thaivisa back in the spring of 2007 warning everyone about the terrible unregulated hedge fund industry and the exponential expansion of the derivative markets, and I was the one a year ago that battled daily with lao po and said that the SSE would lose over 50% of its value BEFORE the Olympics, and not so many months ago when oil was shooting toward $150/bbl and many thought it would hit $200/bbl and gold was over $1000/ounce and all the goldbugs were certain gold would shortly be at $1500/ounce and the Dollar was at $1.60/Euro, I was the one who shouted many times over to short oil, short gold, and go long the Dollar, so far all of those predictions are doing pretty well. I guess 18 months from now we will know if my most recent prediction here comes to pass!!!

I remember you making these predictions and it's not to difficult to verify your claims. If Germany exits things will have surely gone to hel_l in a handbasket! I hope you are very wrong on this forecast.

You should have paid closer attention siamamerican, as I do. Anyone following these recommendations, when given, would be broke today and in no position to take advantage of subsequent market moves. If you're goig to be a trader, understand, timing matters.

I guess my gains this year aren't real. You have no idea how I invest, so please don't make unfounded accusations. Wise master Lanna, please explain how getting out of China, oil, and the Euro would leave a person broke.

Sometimes I'm at a loss trying to understand some of the silly posts. Are you just angry at me and blindly made a foolish post. If so, my feeling are hurt.

I undersdtand that when people are losing money their emotions can get the better of them. I wasn't referring to you at all, so I'm not sure why you've reacted in this way. The fact is Vic made all these predictions while the investments in question were still rising. They rose considerably further after his prognostications. Anyone acting on that advice would have lost their money. No ego here, no anger, no intent to hurt. I'm just telling you what I saw.

So untrue lanna, you are beginning to sound bitter like lao po! Last Aug-Sept. I was arguing with lao nearly every day that the SSE would lose over 50% of its value well before the Olympics, this is when the SSE was at its highs As far as gold and oil goes yes I have been bearish on both for a while however I didn't call for an all out short on either until gold was near $1000/ounce and oil was in the upper $130's coming just coming off its highs in the mid $140's. As far as the dollar is concerned all I have read about on TV for over a year is that the dollar is dead and will be worthless, and all along I have told everyone not to count the dollar out, and when the dollar bottomed out against the Euro at around $1.60 I was all over this board telling everyone to go long the dollar especially the Europeans! I see the Euro is at $1.35 currently(and the pound at $1.74) just as I posted back in Febuary that Goldman Sachs had predicted it would be later this year!!! I understand your frustration that the ECB didn't even drop rates and yet the Euro is still falling, so imagine what will happen to the Euro when the ECB does start cutting rates I don't really like to throw this in your face lanna, but then again I did expect a little more objectivity from someone like you!

[Ground Engineer]

Ground engineer,

I watched that zeitgeist movie. Excellent! It is spit out clear how finance works and why it is going down. The venus project, if you ask me, is one of the best answers out there.

Its awe inspiring! Have you watched the first one that came out last year.....its just called Zeitgeist the movie...just as brilliant.

Agree with you about the Venus project......its time for radical change.

www.thezeitgeistmovement.com opens this Friday. Cant wait to get involved.

[lannarebirth]

Never better! I have a penchant for making predictions that go against the tide! If you remember I was the one here on thaivisa back in the spring of 2007 warning everyone about the terrible unregulated hedge fund industry and the exponential expansion of the derivative markets, and I was the one a year ago that battled daily with lao po and said that the SSE would lose over 50% of its value BEFORE the Olympics, and not so many months ago when oil was shooting toward $150/bbl and many thought it would hit $200/bbl and gold was over $1000/ounce and all the goldbugs were certain gold would shortly be at $1500/ounce and the Dollar was at $1.60/Euro, I was the one who shouted many times over to short oil, short gold, and go long the Dollar, so far all of those predictions are doing pretty well. I guess 18 months from now we will know if my most recent prediction here comes to pass!!!

I remember you making these predictions and it's not to difficult to verify your claims. If Germany exits things will have surely gone to hel_l in a handbasket! I hope you are very wrong on this forecast.

You should have paid closer attention siamamerican, as I do. Anyone following these recommendations, when given, would be broke today and in no position to take advantage of subsequent market moves. If you're goig to be a trader, understand, timing matters.

I guess my gains this year aren't real. You have no idea how I invest, so please don't make unfounded accusations. Wise master Lanna, please explain how getting out of China, oil, and the Euro would leave a person broke.

Sometimes I'm at a loss trying to understand some of the silly posts. Are you just angry at me and blindly made a foolish post. If so, my feeling are hurt.

I undersdtand that when people are losing money their emotions can get the better of them. I wasn't referring to you at all, so I'm not sure why you've reacted in this way. The fact is Vic made all these predictions while the investments in question were still rising. They rose considerably further after his prognostications. Anyone acting on that advice would have lost their money. No ego here, no anger, no intent to hurt. I'm just telling you what I saw.

So untrue lanna, you are beginning to sound bitter like lao po! Last Aug-Sept. I was arguing with lao nearly every day that the SSE would lose over 50% of its value well before the Olympics, this is when the SSE was at its highs As far as gold and oil goes yes I have been bearish on both for a while however I didn't call for an all out short on either until gold was near $1000/ounce and oil was in the upper $130's coming just coming off its highs in the mid $140's. As far as the dollar is concerned all I have read about on TV for over a year is that the dollar is dead and will be worthless, and all along I have told everyone not to count the dollar out, and when the dollar bottomed out against the Euro at around $1.60 I was all over this board telling everyone to go long the dollar especially the Europeans! I see the Euro is at $1.35 currently(and the pound at $1.74) just as I posted back in Febuary that Goldman Sachs had predicted it would be later this year!!! I understand your frustration that the ECB didn't even drop rates and yet the Euro is still falling, so imagine what will happen to the Euro when the ECB does start cutting rates I don't really like to throw this in your face lanna, but then again I did expect a little more objectivity from someone like you!

Vic, when I talk about markets I am always cognizant that people who may read these posts have real money at risk and if I say something forcefully and repeatedly (as some may see that as a sign of credibility) someone may be swayed by my opinon. Consequently, I only talk about what i see, what I may know that they don't, and will occasionally cite that those circumstances have been known to lead to certain outcomes on a probabilistic basis (if only to get them to think about their assumptions). In my world there are three positions when it comes to markets, long, short or no opinion. As you carry strong opinions, if someone had shorted any of your "sells" or gone long the dollar when you "rang the bell", they would have likely lost, if not all their money, then a great deal. Unless of course you're just shooting the breeze, in which case you should add that as a disclaimer.

As for the Euro, you leave me wondering if you read my posts at all.

Edited October 6, 2008 by lannarebirth

[VegasVic]

Never better! I have a penchant for making predictions that go against the tide! If you remember I was the one here on thaivisa back in the spring of 2007 warning everyone about the terrible unregulated hedge fund industry and the exponential expansion of the derivative markets, and I was the one a year ago that battled daily with lao po and said that the SSE would lose over 50% of its value BEFORE the Olympics, and not so many months ago when oil was shooting toward $150/bbl and many thought it would hit $200/bbl and gold was over $1000/ounce and all the goldbugs were certain gold would shortly be at $1500/ounce and the Dollar was at $1.60/Euro, I was the one who shouted many times over to short oil, short gold, and go long the Dollar, so far all of those predictions are doing pretty well. I guess 18 months from now we will know if my most recent prediction here comes to pass!!!

I remember you making these predictions and it's not to difficult to verify your claims. If Germany exits things will have surely gone to hel_l in a handbasket! I hope you are very wrong on this forecast.

You should have paid closer attention siamamerican, as I do. Anyone following these recommendations, when given, would be broke today and in no position to take advantage of subsequent market moves. If you're goig to be a trader, understand, timing matters.

I guess my gains this year aren't real. You have no idea how I invest, so please don't make unfounded accusations. Wise master Lanna, please explain how getting out of China, oil, and the Euro would leave a person broke.

Sometimes I'm at a loss trying to understand some of the silly posts. Are you just angry at me and blindly made a foolish post. If so, my feeling are hurt.

I undersdtand that when people are losing money their emotions can get the better of them. I wasn't referring to you at all, so I'm not sure why you've reacted in this way. The fact is Vic made all these predictions while the investments in question were still rising. They rose considerably further after his prognostications. Anyone acting on that advice would have lost their money. No ego here, no anger, no intent to hurt. I'm just telling you what I saw.

So untrue lanna, you are beginning to sound bitter like lao po! Last Aug-Sept. I was arguing with lao nearly every day that the SSE would lose over 50% of its value well before the Olympics, this is when the SSE was at its highs As far as gold and oil goes yes I have been bearish on both for a while however I didn't call for an all out short on either until gold was near $1000/ounce and oil was in the upper $130's coming just coming off its highs in the mid $140's. As far as the dollar is concerned all I have read about on TV for over a year is that the dollar is dead and will be worthless, and all along I have told everyone not to count the dollar out, and when the dollar bottomed out against the Euro at around $1.60 I was all over this board telling everyone to go long the dollar especially the Europeans! I see the Euro is at $1.35 currently(and the pound at $1.74) just as I posted back in Febuary that Goldman Sachs had predicted it would be later this year!!! I understand your frustration that the ECB didn't even drop rates and yet the Euro is still falling, so imagine what will happen to the Euro when the ECB does start cutting rates I don't really like to throw this in your face lanna, but then again I did expect a little more objectivity from someone like you!

Vic, when I talk about markets I am always cognizant that people who may read these posts have real money at risk and if I say something forcefully and repeatedly (as some may see that as a sign of credibility) someone may be swayed by my opinon. Consequently, I only talk about what i see, what I may know that they don't, and will occasionally cite that those circumstances have been known to lead to certain outcomes on a probabilistic basis (if only to get them to think about their assumptions). In my world there are three positions when it comes to markets, long, short or no opinion. As you carry strong opinions, if someone had shorted any of your "sells" or gone long the dollar when you "rang the bell", they would have likely lost, if not all their money, then a great deal. Unless of course you're just shooting the breeze, in which case you should add that as a disclaimer.

As for the Euro, you leave me wondering if you read my posts at all.

Let me see if I have this right, if someone shorted the Euro and went long the Dollar earlier this summer when the Euro in the upper $1.50's/Dollar when I suggested that they do, and now the Euro is $1.34, you are trying to tell the board that they would have lost money? That certainly is a creative take on the situation, in my world that looks like a very astute trade! Also when I told everyone a few months back to short oil in the upper $130's and now oil is $89/bbl, I guess that would not have made them any money either? I will grant you that the world seems a bit upside down right about now, but in the markets that I trade in when you short something it still means that you are betting that it goes down in price, and as any one can readily see the SSE, oil, gold and the Euro/Dollar are all down (some of these by over 60%) since I alerted the board here

[siamamerican]

I agreed the European Banks are twice as stupid as America Banks Also who would want to live in Europe another reason real estate is more overpriced

Phil,

Come on, I asked you in the other global correction thread to stop over indulging on the booze before posting. Appreciate the contrarian views, but no one is going to take you seriously.

I have your advice and stopped drinking and joking around Please remember this post of mine

The only thing more predictable than European glee at American economic trouble is how quickly it fades amid Europe's own problems. So no sooner did Der Spiegel publish its latest eulogy for American power last week ("The Price of Hubris") than European banks had to be rescued one after another. The euro's recent fall of about 5% against the dollar is further proof that the credit mania was a global phenomenon and its aftermath requires global responses.

In contrast to the U.S., Europe has no lender of last resort. The European Central Bank was created to manage the supply of euros, not to rescue failing institutions. It can provide short-term liquidity against collateral -- which it has done admirably so far. But it can't ease a solvency crisis. ECB President Jean-Claude Trichet can provide intellectual leadership, but in Europe there are 27 separate national purses and no central treasury.

The ECB's limitations aren't necessarily bad. The Federal Reserve has been stretching its powers to the limit, if not the breaking point. One goal of Treasury Secretary Hank Paulson's plan is to put the burden of injecting capital into the U.S. banking system where it belongs -- on the political authorities in the Treasury and Congress. Europe should be wary of damaging its central bank by loading it up with new, fundamentally political, powers.

That doesn't mean Europe's leaders can't step to the fore with public capital and the power to resolve failing banks before they become systemic threats. Last weekend the governments of Belgium, Netherlands and Luxembourg agreed to inject €11.2 billion into Fortis. On Tuesday, the French and Belgian governments bailed out Dexia bank.

National capitals have also acted alone. The U.K. seized Bradford & Bingley and sold the mortgage lender's retail branches and deposits to the Spanish bank Santander. In Germany, a consortium of private banks, backed by state guarantees, stepped in with a €35 billion credit to Hypo Real Estate, one of Europe's largest real estate, project finance and local government lenders. That rescue looked in doubt yesterday, amid friction between the government and other banks over who would pay.

Meanwhile, governments have been acting on their own to guarantee bank deposits, starting with Ireland which guaranteed for two years all deposits, bonds, senior debt and lower Tier-II debt of six Irish financial institutions. That drew the ire of other governments, as British and other depositors flocked to the Irish banks to take advantage. This is one of the drawbacks of separate national responses: It creates "depository arbitrage" and gives some banks a competitive advantage. Berlin gave in yesterday, and said that it too would guarantee all private bank deposits.

The rescues of Fortis and Dexia show that ad hoc cooperation in cross-border cases can work. An advantage of these spontaneous responses is that they don't require new legislation or new institutions, which the EU usually requires years to draw up. French President Nicolas Sarkozy hosted a weekend summit to discuss the crisis, but it produced little but promises "to do whatever is necessary," as British Prime Minister Gordon Brown put it.

An alternative would be to establish a temporary Continental resolution authority, with enough power and capital to put out fires across the Continent. The European Investment Bank could act as such an authority. Its board of governors is made up of the finance ministers of all EU member states. As a public agency that issues publicly guaranteed bonds, it could set up the rescue fund relatively quickly.

However Europe responds, at least we can look forward to less gloating about America's predicament. Global cooperation is essential in what has become a global panic.

Agree, the gloating will cease in the coming weeks. In the coming months, Europeans are going to be irate with their banks. I don’t understand how many don’t comprehend a bubble. It’s bursting and there were winners and losers. The winners are waiting to pounce and will make another killing when the constant wining has reached a crescendo.

[siamamerican]

5. Everybody is talking "Europe" in this thread and since the OP is American I would like to know what he means by EUROPE.....which definition is to be considered.....which demographics ?

* The Geographical Europe - around 730+ Million people in around 50 countries and 30-40 major languages ??

* The European Union - with some 500 Million people in 27 countries with 23 official languages ??

* The Eurozone Europe - with some 320 Million*** people in 15 Eurozone member-countries (10 or 11 languages) -and the largest economy in the world; based on 2007 GDP and purchasing power parity among the various currencies. ??

There are more 'Europe's' but this will do.

*** that does NOT include the few million people from states outside the Union with or without a formal agreement, using the Euro as well.

Note:

Come on LaoPo, you know it isn't fare to ask geographical questions to an American. Someone had to tell our President that N Africa isn't a nation.

I was referring to the continent on the map that has that country that looks like a boot on its southern tip. I think they call that country Italy and Romans live there.

Edited October 6, 2008 by siamamerican

[siamamerican]

You make some valid points S.A., I think that the scary part of this for Europe is that they are just at the beginging of their real estate-banking-financial crisis, while the U.S. is in the middle of it! It is hard to say at this juncture if the European situation will be worse than the U.S. or not, I guess we will just have to wait and see! The fact that the E.U. central banks did not lower interest rates at their meeting a few days ago tells me that many european countries could be in for a very tough time. I am only willing to make one prediction at this time, and that is that Germany will exit the E.U. sometime in the next 18months!

In the process of educating myself about the E.U. monetary policies. It does seem that Germany exiting E.U. would have horrific consequences. I really don't see this happening now, but the union is going to be tested. The European Central bank in theory is independent, but theory and reality can be very different. From what I've read, real estate in Germany is not nearly as over valued as most of the other members. Germany being Europe's 1000 pound gorilla, will probably push it weight around and have more a say in what happens in the near term.

right you are! in fact real estate in Germany (as opposed to most or even all other european countries) has been continously falling for more than a decade. and no such thing exists like "let's refinance, skim from ze top bekaus vee haff more of der ekvity, go on a shpending shpree und take a holiday on vone of ze greekish islands vhere zey play der bouzouki und dance der sirtaki oll day and night long ".

My globe at home doesn't have country labels, and to be honest, until recently I thought Germany was France.

I take back my commnet that you smell like a monkey's fart.

[LaoPo]

5. Everybody is talking "Europe" in this thread and since the OP is American I would like to know what he means by EUROPE.....which definition is to be considered.....which demographics ?

* The Geographical Europe - around 730+ Million people in around 50 countries and 30-40 major languages ??

* The European Union - with some 500 Million people in 27 countries with 23 official languages ??

* The Eurozone Europe - with some 320 Million*** people in 15 Eurozone member-countries (10 or 11 languages) -and the largest economy in the world; based on 2007 GDP and purchasing power parity among the various currencies. ??

There are more 'Europe's' but this will do.

*** that does NOT include the few million people from states outside the Union with or without a formal agreement, using the Euro as well.

Note:

Come on LaoPo, you know it isn't fare to ask geographical questions to an American. Someone had to tell our President that N Africa isn't a nation.

I was referring to the continent on the map that has that country that looks like a boot on its southern tip. I think they call that country Italy and Romans live there.

Well, this is Europe #4 with 815 Million people....The Council of Europe:

But, don't worry, if I would go to a market with a blind map in any city or village with a map of North America OR Europe, 75+% of the people wouldn't even know where they are...OR where the states in the US or Canada or countries in Europe are...

LaoPo

Edited October 6, 2008 by LaoPo

[Naam]

Naam Is it a Europe wide thing that house prices are relatively lower than some years ago at least compared to house prices in Australia. I was worried when my daughter and her husband sold up their house here as he wanted to return to Switzerland as once houses were several times the price of those here however the house they got in Baden was only about 60% of the price in Australia.

it is Harry but to the best of my knowledge Switzerland is an exception. your daughter and your son-in-law must have been lucky. i assume that you are talking about Baden, Switzerland and not the State Baden, Germany which borders Switzerland.

[Naam]

[Now, if you would be so kind to inform me about your business experiences ? I am all ears since I'm never too old to learn something new from others.

LaoPo

This could be a whole new thread but I will answer here as it is clearly related to the European Banking Crisis.

My mum and dad were also in the Iron and Steel business. Mum ironed and dad stole.

My own first business experience at age 5 years was selling yesterdays paper from a cardboard box hung round my neck with a piece of string to innocent and good hearted passers by. I think my first days profit was five old pence.

In my teens I made my first million. (Turkish lira). But blew it all in a poorly judged investment in a cinema date including two ice creams with a totally unsuitable girl.

By my twenties, entrepreneurship was second nature to me.

My own company was listed in the Misfortune 500 four years running.

I was told that money doesn't make you happy and I was determined to test the hypothesis.

It looked like I would have to tell any grand kids that I started out with nothing and still had most of it left!

Then a stroke of entrepreneurial genius (if you will pardon my boasting).

I married into money. It worked for me.

[Naam]

Agree, the gloating will cease in the coming weeks. In the coming months, Europeans are going to be irate with their banks. I don’t understand how many don’t comprehend a bubble. It’s bursting and there were winners and losers. The winners are waiting to pounce and will make another killing when the constant wining has reached a crescendo.

rumour has it that another €200 billion are required to keep (i don't how many) german banks afloat and that within the next few days!

[Plutarch]

Ahem.

Excuse me, but......

Money has no intrinsic value. If institutions are no longer able to transact in currency they themselves cease to have value. Socialising the obligations created by these redundant institutions by government intervention cannot succeed because the markets themselves have no pont of reference save the benchmark of fear and panic.

What commenced in the USA has spread everywhere.

The contagion that was spawned by Greenspan and incubated by all capitalist economies has to run its course.

Assets are simply expressions of hope and belief and will wither on the vine of hubris.

It's going to be a great ride everyone. Just enjoy it for what it is in the spirit that some of our ascendants took watching Krakatoa blow its top 20 miles away.......

[Ground Engineer]

Ahem.

Excuse me, but......

Money has no intrinsic value. If institutions are no longer able to transact in currency they themselves cease to have value. Socialising the obligations created by these redundant institutions by government intervention cannot succeed because the markets themselves have no pont of reference save the benchmark of fear and panic.

What commenced in the USA has spread everywhere.

The contagion that was spawned by Greenspan and incubated by all capitalist economies has to run its course.

Assets are simply expressions of hope and belief and will wither on the vine of hubris.

It's going to be a great ride everyone. Just enjoy it for what it is in the spirit that some of our ascendants took watching Krakatoa blow its top 20 miles away.......

Totally agree!!!

[Naam]

Money has no intrinsic value.

except for food, shelter and (depending on climate) clothes NOTHING has intrinsic value!

[siamamerican]

Agree, the gloating will cease in the coming weeks. In the coming months, Europeans are going to be irate with their banks. I don’t understand how many don’t comprehend a bubble. It’s bursting and there were winners and losers. The winners are waiting to pounce and will make another killing when the constant wining has reached a crescendo.

rumour has it that another €200 billion are required to keep (i don't how many) german banks afloat and that within the next few days!

Europe is going to feel a lot of pain in the short term. We already know how poorly European banks investments in the US have fared. Now, they are going to have to weather Europe's real estate bubble.

The world profited from this real estate bubble much to long and the correction is going to be severe in Europe. I don't think that the more conservative domestic loan portfolios in Europe are safe from property devaluation. Collateral is the crux of the US problem and when that collateral value plummets in Europe, regretfully, the European banks will face the same challenges.

[siamamerican]

Ahem.

Excuse me, but......

Money has no intrinsic value. If institutions are no longer able to transact in currency they themselves cease to have value. Socialising the obligations created by these redundant institutions by government intervention cannot succeed because the markets themselves have no pont of reference save the benchmark of fear and panic.

What commenced in the USA has spread everywhere.

The contagion that was spawned by Greenspan and incubated by all capitalist economies has to run its course.

Assets are simply expressions of hope and belief and will wither on the vine of hubris.

It's going to be a great ride everyone. Just enjoy it for what it is in the spirit that some of our ascendants took watching Krakatoa blow its top 20 miles away.......

Yes I agree if money isn't used to transact it doesn't have any value. Hopefully this wasn't a profound revelation!

I just had my own revelation. If humans stop eating, food will have no value.

[Naam]

Oct. 7 (Bloomberg) -- Three of the U.K.'s biggest banks,

Barclays Plc, Royal Bank of Scotland Group Plc and Lloyds TSB

Group Plc, told Chancellor of the Exchequer Alistair Darling

that they will each need as much as 15 billion pounds ($26

billion) of government money to strengthen their balance

sheets, the British Broadcasting Corp. reported.

At a meeting with the chancellor last night, the trio said

they'd like 7.5 billion pounds at once and a further 7.5

billion guaranteed by the Treasury, to be made available in

case of need, the BBC said.

The trio were disappointed that Darling didn't present

them with a fully worked-out rescue plan, the broadcaster said.

In the next two years, U.K. banks have to pay off or

redeem tens of billions of pounds of asset-backed securities,

and the banks want a government guarantee that it will lend

them what they need to do that, the BBC said.

The meeting was also attended by the heads of other banks,

by Bank of England Governor Mervyn King and by Adair Turner,

the chairman of the Financial Services Authority, the BBC said.

daahhhhhling... i'm feeling pretty lonesome............

[LaoPo]

I'm sure the Brits (Downing St. 10) will step in and help; they won't let the three biggest banks go to the toilet without toiletpaper to clean their @rses...

BUT: it becomes more interesting by the hour:

Iceland Central Bank Receives 4 Billion Euro Loan From Russia

By Tasneem Brogger

Oct. 7 (Bloomberg) -- Russia agreed to lend Iceland's central bank 4 billion euros ($5.43 billion) to inject liquidity into the financial system, the bank said.

The loan will run over three to four years and cost as much as 50 basis points, or 0.5 of a percentage point, more than Libor.

Russia's central bank declined to comment immediately.

Iceland's Financial Supervisory Authority said today that it had taken control of Landsbanki Islands hf, the country's second-largest lender. Kaupthing Bank hf, the largest bank, said the central bank had agreed to lend it 500 million euros.

--Bloomberg

Note: Wasn't there an Icelandic bank handing high deposit percentages ?

LaoPo

Edited October 7, 2008 by LaoPo

[lannarebirth]

I'm sure the Brits (Downing St. 10) will step in and help; they won't let the three biggest banks go to the toilet without toiletpaper to clean their @rses...

BUT: it becomes more interesting by the hour:

Iceland Central Bank Receives 4 Billion Euro Loan From Russia

By Tasneem Brogger

Oct. 7 (Bloomberg) -- Russia agreed to lend Iceland's central bank 4 billion euros ($5.43 billion) to inject liquidity into the financial system, the bank said.

The loan will run over three to four years and cost as much as 50 basis points, or 0.5 of a percentage point, more than Libor.

Russia's central bank declined to comment immediately.

Iceland's Financial Supervisory Authority said today that it had taken control of Landsbanki Islands hf, the country's second-largest lender. Kaupthing Bank hf, the largest bank, said the central bank had agreed to lend it 500 million euros.

--Bloomberg

Note: Wasn't there an Icelandic bank handing high deposit percentages ?

LaoPo

Hmmm, maybe the Russians will get a Navy base out of the deal.

[Plutarch]

Yes I agree if money isn't used to transact it doesn't have any value. Hopefully this wasn't a profound revelation!

I just had my own revelation. If humans stop eating, food will have no value.

The point, seemingly lost upon Naam and perhaps you, is that saving the banks is not necessarily a prerequiste to world survival, a belief of course they themselves are understandably disinclined to support.

The correct strategy would be to secure the mortgage books but let the vulnerable banks go and rot.

The potemkin economy of the past 8 years is dead. Best to bury it quickly but of course assets valued at the height of the pyramid selling scam and bought by the hubristic are obviously going to suffer.

Glad I didn't buy overpriced real estate particularly in Thailand, vicariously or otherwise.

Nothing new under the sun and one only has to look at the Japanese experience to understand the likely ramifications but who could have guessed that Russia would buy Iceland.

Another revelation: if humans couldn't count would they be so greedy?

[LaoPo]

Iceland Central Bank Receives 4 Billion Euro Loan From Russia

Hmmm, maybe the Russians will get a Navy base out of the deal.

Could be; they just have to dust off the US base in Keflavik, SW of Reykjavik, closed in 2006.

It's weird and strange that the EU didn't step in but on the other hand, Moscow is able to decide overnight; 27 EU countries would quarrel over a little bit of help....

Iceland has also an important aluminium and HydroPower (export) industry and who knows...maybe the Russians know more than we do what's around in the enormous waters, surrounding Iceland.

BTW: Iceland has a population of a mere 300,000.

LaoPo

Edited October 7, 2008 by LaoPo