Financial Crisis

[Naam]

Really? The ECB in conjunction with the government officials of these countries agree that austerity measures must be forced through...The ECB has stated many times that austerity measures must be strictly implemented..This is Trichets wish.The people are not free, not yet anyway to default...as government in collusion with all these champagne socialists within the EU said no...

distortions such as using the expression "government officials" instead of "government" are not acceptable. i therefore refuse to waste my time with any discussion and limit myself to comments, e.g.

-Trichet's wishes are the wishes of Merkel and Sarkozy,

-the ECB cannot force any government to implement austerity measures,

-the ECB cannot prevent a sovereign default if the government in power decides to default on the country's debt.

period!

[Naam]

With the big push for austerity for the Greek lower and middle class do you think the Greek government might actually also be forced to start collecting taxes due by the wealthy (even for prior years) or will the Greeks just continue to let the wealthy off and perhaps the hard working Germans, and other Northern Europeans will bail them out???

I fear the US is following the same track in letting the super wealthy pay effective tax rates similar to the middle class or less based on Bush trickle down economics but the rich actually don't even give a trickle and retain all the benefits of the country's wealth based on their position to do so. Such mismanagement will probably result in the loss of a country's wealth and that of their wealthy class.

they have started already last year to impound yachts, sequester fancy holiday homes and digging into ridiculous tax returns of past years. the Greek government also avoided an entry in the Guinness Book of Records for having the world's highest number of pensioners age 105 till age 126 these pensioners were all "killed" in a single week.

[Naam]

"I'll be giving my detailed thoughts on what is coming, and how to prepare, at Taipan's upcoming crisis and survival event in Las Vegas in September."

Hey think attendance is free? Greece may have already defaulted by then anyway.

The ECB may not be able to force austerity but they sure can provide unlimited (except by the inevitable) bailout debt to postpone the European jenga.

so what?

[RedFxTrade]

Really? The ECB in conjunction with the government officials of these countries agree that austerity measures must be forced through...The ECB has stated many times that austerity measures must be strictly implemented..This is Trichets wish.The people are not free, not yet anyway to default...as government in collusion with all these champagne socialists within the EU said no...

distortions such as using the expression "government officials" instead of "government" are not acceptable. i therefore refuse to waste my time with any discussion and limit myself to comments, e.g.

Not quite sure what you mean by distortions Naam?

-Trichet's wishes are the wishes of Merkel and Sarkozy,

Thats interesting. You see who really is pulling the strings? Its hard to know...but generally agree. It kind of throws a spanner in the works that the ECB is "strongly independent" as Trichet said last week. But I guess we all knew that...

-the ECB cannot force any government to implement austerity measures,

Again I agree...however, they can take decisions together with Merkel and Sarkozy (rather than government officials ) which amount to the same thing. The Greek Government obviously are going a long with it....and are using the heavy hand of the state to implement the plan. However, I do agree that it cannot be forced in the purest sense...but perhaps the Greek Gov will grow a set and gain a moral back bone and walk away

-the ECB cannot prevent a sovereign default if the government in power decides to default on the country's debt.

Agree...and this would be a wet dream for me, if Ireland, Greece, Portugal just decided to walk it, and give two fingers to the EU. By the way, I m not anti-European. Love Europe, dislike the EU.

Overall I agree with what your saying...the government in power holds the strongest hand at the table, but are too cozy with all the perks they receive within the EU. However, indirectly the decisions taken by Merkel, Sarkozy, ECB and the Greek Government are leading to an enforcement of austerity through violence and coercion. A dangerous precedent indeed.

period!

Edited June 15, 2011 by RedFxTrade

[churchill]

Europe .. seems to be slowly blowing up in front of our eyes - Will the US act before the same happens there ...

Greek Stocks And Bonds Are Imploding Right Now

Read more: http://www.businessinsider.com/greek-markets-are-imploding-2011-6?utm_source=twitterfeed&utm_medium=twitter&utm_campaign=Feed%3A+businessinsider+%28Business+Insider%29&utm_content=Google+Feedfetcher#ixzz1PKoI3OwY

Edited June 15, 2011 by churchill

[RedFxTrade]

Europe .. seems to be slowly blowing up in front of our eyes - Will the US act before the same happens there ...

Greek Stocks And Bonds Are Imploding Right Now

Read more: http://www.businessi...r#ixzz1PKoI3OwY

It certainly is....Steep Rise in ECB Loans to Spanish Banks

The number of European Central Bank loans taken out by Spanish banks jumped by almost a quarter in May as rising Spanish government borrowing costs continued to take their toll on the country’s businesses.

Higher borrowing costs for Madrid are reflected in the cost of financing for banks and other companies in the eurozone’s fourth-largest economy, meaning lenders chose to borrow more from the ECB directly rather than access costly funding from the capital markets.

The amount Spanish banks borrowed directly from the ECB rose from €42bn in April to €53bn ($76.5bn) in May, according to data published on Tuesday by the Bank of Spain.

International investors have demanded a higher return to lend to Spain due to a combination of concerns over the deflation of its decade-long property bubble, stagnant economic growth, and the possibility of contagion from a Greek default.

I think what is hitting the markets really hard, is well a host of things....but was reading this morning that any roll over of greek maturities would mean that the whole Greek banking system would need to raise more money on top of the bailout money. Figure is around a 70 billion Euros...how on earth can the Greek banks raise that? Of course they cannot...so other countries will have to pay even more on top of the bailout.

On top of that French banks are not looking too healthy in this picture...expect a downgrade in the coming days...which will only add to the fear. Credit Agricole and Soc gen have exposure to Greek bonds,.,,,but thats not the main problem, they also own a couple of Greek banks, Emporiki and Geniki respectively, who have large exposure to the private sector economy in Greece and Greek Bonds...Emporiki have about 21 Billion in loans. In short French banks are directly exposed to Greek Bonds and the private sector of the Greek economy.

A quick glance at the Deposits and Loans side of the Emporiki balance sheet does not make good reading...Dear knows how much more deposits have leaked now. A near 18% drop in deposits YoY just in March and very little loan exposure reduction.

I m not sure where Naam gets this idea or figures from from that there is no run on deposits on Greek banks...

[Naam]

I m not sure where Naam gets this idea or figures from from that there is no run on deposits on Greek banks...

and i'm not sure why you refer to a casual remark, made weeks ago and referring to a single day, using presence tense "gets this idea". you have to be a bit more sophisticated when presenting rubbish like this if you don't want to be ridiculed

next!

[RedFxTrade]

I m not sure where Naam gets this idea or figures from from that there is no run on deposits on Greek banks...

and i'm not sure why you refer to a casual remark, made weeks ago and referring to a single day, using presence tense "gets this idea". you have to be a bit more sophisticated when presenting rubbish like this if you don't want to be ridiculed

next!

This is not something new...it has been going on for months...the run on deposits. This was pointed out 2 weeks ago, and you said you it was bull...yet two weeks ago, and 3 months ago it was known there was a run on the Greek bank deposits. The Bank Of Greece figures show this....the action in stock prices shows this....This run has not began in the last 2 days, but weeks ago. I m just pointing out at the time you said it was bull and scare mongering with no sources despite with evidence to the contrary...All I m saying is I m not sure where you got that idea two weeks ago, not today...Perhaps it was a casual remark, but you did post about 3 or 4 "casual" remarks in posts in retort saying it was bull when the it was obviously not back then.

[churchill]

Quote from gold thread ....

'Panic Capital Flight in Greece, Depositors Yank 1.5 Billion Euros in 2 Days

Naam's reply ....

'translated from an unknown greek online news site. no greek newspaper, no international newspaper, no reports from any greek or european tv-station, no Reuters, no Bloomberg published related news.

surely another combined Bilderberg-Illuminati and most probably al-Qaeda conspiracy suppressing all information! '

My reply then as now is "Quite ! Wait for front page news to confirm what seems pretty obvious and gold will probably be a lot higher - Up to you /

Edited June 15, 2011 by churchill

[Naam]

International investors have demanded a higher return to lend to Spain due to a combination of concerns over the deflation of its decade-long property bubble, stagnant economic growth, and the possibility of contagion from a Greek default.

Wall Street Journal JUNE 14, 2011

Spain sold €5.42 billion in 12- and 18-month Treasury bills, near the maximum targeted €5.5 billion. The offer attracted a hefty total €17 billion in bids, implying a more than three-fold coverage ration, implying strong investor demand. The higher yields, however, are "a reflection of the current tensions in the peripheral universe," said UniCredit strategist Chiara Cremonesi.

Spain's 12-month average yield rose to 2.695% from 2.546% previously May 17. The 18-month average yield increased to 3.260% from 3.095%.

"The decoupling is still there for now with Spain and Italy doing well in their refinancing program so far with almost 50% of the expected needs already raised in the market," said Jean-Francois Robin, a strategist at Natixis.

Naam June 15, 2011 THE SKY IS FALLING!

[RedFxTrade]

Even if the higher level officials across the EU come to an agreement with what to do with regards Greece, what are the chances that the Greek government will be able to pass the measures taken?

In my view it seems more unlikely by the hour and day....In fact it seems that The Greek Government PASOK do not even hold a majority anymore...so how can they pass these measures?

Greek Paralysed By Strikes

A couple of top rated journalists who have done great work on the ground in Middle East, Eypt, Libya, Alan Fisher travelled to Athens last night. He seems to be indicating on his twitter feed from Athens Sq that the mood has changed to extreme anger, petrol bombs being thrown....They should let it go now before they make it worse...giving more money to this will sink money down a rat hole...

[Naam]

Naam's reply ....

'translated from an unknown greek online news site. no greek newspaper, no international newspaper, no reports from any greek or european tv-station, no Reuters, no Bloomberg published related news.

what's wrong with that reply? does it imply any "ideas" or did it refer to facts (then)?

[churchill]

International investors have demanded a higher return to lend to Spain due to a combination of concerns over the deflation of its decade-long property bubble, stagnant economic growth, and the possibility of contagion from a Greek default.

Wall Street Journal JUNE 14, 2011

Spain sold €5.42 billion in 12- and 18-month Treasury bills, near the maximum targeted €5.5 billion. The offer attracted a hefty total €17 billion in bids, implying a more than three-fold coverage ration, implying strong investor demand. The higher yields, however, are "a reflection of the current tensions in the peripheral universe," said UniCredit strategist Chiara Cremonesi.

Spain's 12-month average yield rose to 2.695% from 2.546% previously May 17. The 18-month average yield increased to 3.260% from 3.095%.

"The decoupling is still there for now with Spain and Italy doing well in their refinancing program so far with almost 50% of the expected needs already raised in the market," said Jean-Francois Robin, a strategist at Natixis.

Naam June 15, 2011 THE SKY IS FALLING!

Is that not something to do with China and other countries diversifying out of USD - as I stated some months ago -- 'China coming to the rescue of the Euro ?' --- An idea not liked by Naam ...

[Naam]

Posted 2011-05-30 16:05:09

Quite ! Wait for front page news to confirm what seems pretty obvious and gold will probably be a lot higher - Up to you

gold may 30 = $ 1,540

gold as of now = $ 1,518

where did you get the "idea" that gold will be probably a lot higher?

[churchill]

Naam's reply ....

'translated from an unknown greek online news site. no greek newspaper, no international newspaper, no reports from any greek or european tv-station, no Reuters, no Bloomberg published related news.

what's wrong with that reply? does it imply any "ideas" or did it refer to facts (then)?

It seems it did reflect facts .... and isn't the whole point of these discussions to get ahead of the curve ...if possible--- Not to look backwards but forwards ... if we can ?

[churchill]

Posted 2011-05-30 16:05:09

Quite ! Wait for front page news to confirm what seems pretty obvious and gold will probably be a lot higher - Up to you

gold may 30 = $ 1,540

gold as of now = $ 1,518

where did you get the "idea" that gold will be probably a lot higher?

that is not the point ! As I posted it over a month ago .....

I still think that Gold in the current climate will be a lot higher in the coming months ... trying to look forward of course ..

[RedFxTrade]

International investors have demanded a higher return to lend to Spain due to a combination of concerns over the deflation of its decade-long property bubble, stagnant economic growth, and the possibility of contagion from a Greek default.

Wall Street Journal JUNE 14, 2011

Spain sold €5.42 billion in 12- and 18-month Treasury bills, near the maximum targeted €5.5 billion. The offer attracted a hefty total €17 billion in bids, implying a more than three-fold coverage ration, implying strong investor demand. The higher yields, however, are "a reflection of the current tensions in the peripheral universe," said UniCredit strategist Chiara Cremonesi.

Spain's 12-month average yield rose to 2.695% from 2.546% previously May 17. The 18-month average yield increased to 3.260% from 3.095%.

"The decoupling is still there for now with Spain and Italy doing well in their refinancing program so far with almost 50% of the expected needs already raised in the market," said Jean-Francois Robin, a strategist at Natixis.

Naam June 15, 2011 THE SKY IS FALLING!

Is that why Spanish yields on 2, 5 and 10 years are up sharply...this week and today? Must be the strong demand ...yield up means people are selling....that is distribution not demand...If this was such a healthy auction why are yields moving higher? Come back with an article with a high bid to cover and Spanish yields considerably lower not higher...that would be demand.

Its not so much Spanish yields you should worry about, initially, thought I suspect the banking sector problems will be transmuted into Spanish sovereign yields in the not too distant future....However, despite that yields are higher, and on longer maturity auctions much higher...however, its the Spanish banks that are the main problem in Spain...Failed bond auctions, and a 25% rise on Spanish banks dependency on ECB loans in the last month Steep Rise in ECB Loans To Spanish Banks However, I m sure the robust GDP growth and efficiency and shrinking tax receipts in the Spanish economy along with the all the hidden non market to market property valuations will keep Spanish yields low.

LONDON (SHARECAST) - Reports of a failed bond auction by the Spanish banking giant Santander has emphasised the weakness of Spanish local governments.

The Wall Street Journal claims Banco Santander failed to find buyers for 50% of a bond offering backed with loans made to Spain’s regional governments.

[RedFxTrade]

Posted 2011-05-30 16:05:09

Quite ! Wait for front page news to confirm what seems pretty obvious and gold will probably be a lot higher - Up to you

gold may 30 = $ 1,540

gold as of now = $ 1,518

where did you get the "idea" that gold will be probably a lot higher?

that is not the point ! As I posted it over a month ago .....

I still think that Gold in the current climate will be a lot higher in the coming months ... trying to look forward of course ..

Naams looking at it in USD....the USD has been stronger, however, the price of gold in real terms, not in nominal terms against one currency is up...Sugar, oil, copper, rubber, GBP, Euro, AUD...gold is higher month on month in real terms...

[RedFxTrade]

Naam's reply ....

'translated from an unknown greek online news site. no greek newspaper, no international newspaper, no reports from any greek or european tv-station, no Reuters, no Bloomberg published related news.

what's wrong with that reply? does it imply any "ideas" or did it refer to facts (then)?

There were facts....the Greek banks own balance sheets, and the Bank of Greece figures...then as in 2 weeks ago, or 3 months ago...

[churchill]

"S&P says Greek bank outflows of domestic deposits could intensify'

i think S&P waits for front page headlines as well

[RedFxTrade]

Good Luck with those negotiations Mr Paparendou It all seems like a lovely conducive environment for a parliamentary debate...rumours of large circles being formed to not allow politicians out the parliament. Gold catching a strong bid against Euro, GBP, CHF, NOK, SEK om safe haven demand

Update from Athens Sq

Just been told one policeman also injured in the trouble in Athens #greece

19 minutes ago

AlanFisher Alan Fisher

Seen one person taken away on a stretcher #Greece

30 minutes ago

AlanFisher Alan Fisher

Sorry for the typosþ - eyes watering fromthe tear gas

30 minutes ago

AlanFisher Alan Fisher

Groups now fighting in the crowd - those trying to keep it peaceful and those causing trouble

41 minutes ago

AlanFisher Alan Fisher

More tear gas and thunder flashes fired by policer into the crowd #greece

44 minutes ago

AlanFisher Alan Fisher

Latest demo pics from Athens #Greece http://twitpic.com/5bty7m

47 minutes ago

AlanFisher Alan Fisher

Greek PM says he's trying to reach national consensus over budget - poss opening positions in cabinet to opposition? #Greece

54 minutes ago

»

YanniKouts Yannis Koutsomitis by AlanFisher

Uncorfirmed: Greek PM Papandreou to ask for the formation of a new bipartisan government. | #Greece /cc

@AlanFisher

1 hour ago Favorite Retweet Reply

AlanFisher Alan Fisher

Couple of petrol bombs have now been thrown

1 hour ago

AlanFisher Alan Fisher

Latest pic from the protests in Athens http://twitpic.com/5btdxr

1 hour ago

AlanFisher Alan Fisher

From where I'm standing looks as if the crowd in Athens is around 8 - 10 thousand strong - probably bigger as i can't see the side streets

2 hours ago

AlanFisher Alan Fisher

Just been live from Athens with the latest on the #Greek protests. I'll

be back up live in an hour

2 hours ago

AlanFisher Alan Fisher

More protesters arrive in square in front of parliament in Athens #greece http://twitpic.com/5bsmuw

3 hours ago

AlanFisher Alan Fisher

A lot of hostility towards journalists in the square in front of the #Greek parliament. Told to go back to Scotland!

3 hours ago

[RedFxTrade]

"S&P says Greek bank outflows of domestic deposits could intensify'

i think S&P waits for front page headlines as well

:lol:yeah I think your right and print edition at that...As Rogers said this week The rating agencies are overrated.

Wasn't Ambac down to cents in the USD, down like 98% and S+P downgraded them..."ok this company might not be in good shape"

[cloudhopper]

Is it me or does his head look really huge? Anyway I don't agree that China Japan etc will stop buying US debt; as long as they want to sell anything to them anyway...

[Naam]

Is that why Spanish yields on 2, 5 and 10 years are up sharply...this week and today?

referring to bond yields and mixing them up or comparing them with the results of a t-bill auction tells a whole story. any additional comment, except , is superfluous but i can't refrain.

most investors and eggsburts who are familiar with the debt market expected a real explosion of spanish t-bill yields because of Greece's downgrade to CCC day before yesterday. but to the dismay of some gloom&doomers we are looking at an increase of 0.149% (12m maturity) and 0.165% (18m maturity).

disclaimer: one swallow does not make a summer. and in my heart of hearts i am still hoping for a PIIGS crash (at least one) and the opportunities accompanying it.

[Naam]

Is that not something to do with China and other countries diversifying out of USD - as I stated some months ago -- 'China coming to the rescue of the Euro ?' --- An idea not liked by Naam ...

what gave you the idea that i don't like the idea? but whatever, China can't "rescue" the EUR even by switching all her reserves into that currency. what China can is to prop up the EURo's forex value vs other currencies. nobody and nothing can rescue the EUR if the member states decide to abolish it and return to their former currencies.

personally i'd like the latter no matter how remote that possibility is. my reason is (mentioned several times in postings):

-sitting as in 2008 on a substantial pile of cash i am waiting for a (yummy) crash to go into the market for my last big kill, much bigger than what i achieved in 2009

[lannarebirth]

Europe .. seems to be slowly blowing up in front of our eyes - Will the US act before the same happens there ...

Greek Stocks And Bonds Are Imploding Right Now

Read more: http://www.businessi...r#ixzz1PKoI3OwY

Blowing up? My ticker shows Eur:USD 142.50 ish. Let me know if it breaks 1.15. , which is where it starts getting undervalued IMO.

[RedFxTrade]

Is that why Spanish yields on 2, 5 and 10 years are up sharply...this week and today?

referring to bond yields and mixing them up or comparing them with the results of a t-bill auction tells a whole story. any additional comment, except , is superfluous but i can't refrain.

most investors and eggsburts who are familiar with the debt market expected a real explosion of spanish t-bill yields because of Greece's downgrade to CCC day before yesterday. but to the dismay of some gloom&doomers we are looking at an increase of 0.149% (12m maturity) and 0.165% (18m maturity).

disclaimer: one swallow does not make a summer. and in my heart of hearts i am still hoping for a PIIGS crash (at least one) and the opportunities accompanying it.

Thats semantics, they are the same thing,,,T-Bill, note, bond...bills are have a less maturity, under 12-24 months...either way you dice it...yields are up from the shortest to the longest end.

12-month bill sold 3.96 billion 2.69 versus 2.54 (6% higher in a month) Bid-to-cover: 2.9 vs 2.5 (higher)

The 18-month bill sold 1.46 billion euros at 3.26% vs 3.09% (higher than previous month) Bid-to-cover 3.9 vs 4.1 (lower)

The red high lights show the parts of the auction that were worse, month on month, the blue better...over all it was not the roaring success...

As I have said its the banking system in Spain you need to be watching and the Cajas...5-10 yr yields are near break outs...and the up coming bond auctions, and the Spanish economic health in general.

[churchill]

'J&J reports special charge related to restructuring; to cut 900-1000 jobs, take USD 500-600mln charge. Bullish for unemployment'

...Not looking too healthy .....Recovery without employment ? I think Obama is going to be pushing for more stimulus ..

[RedFxTrade]

'J&J reports special charge related to restructuring; to cut 900-1000 jobs, take USD 500-600mln charge. Bullish for unemployment'

...Not looking too healthy .....Recovery without employment ? I think Obama is going to be pushing for more stimulus ..

Without a doubt in the election year...bunch of selfish, conceited pricks taking other peoples money, childrens future money to pay to keep them in....

The Humble Greek Depositor and the ECB

On the subject you mentioned earlier CH regarding Greece and money moving out to real assets...this was just posted on Alphaville...This FT blog is far ahead of the curve of the rating agencies as they have been talking about this for months....this was one of the links within the article of Londons Rich sell as foreign money pours in Apparently the Greeks are one of the groups buying UK property, or London property...talk about out of the frying pan and into the fire I wonder what real assets the rich sellers will buy?

As the tear gas swirls in central Athens…

Euphemism du jour, from an S&P downgrade of Greek lenders:

We observe that domestic customers of Greek banks have demonstrated their sensitivity to signs of deterioration in the sovereign's creditworthiness…

In fact, the whole statement is quite extraordinary for its singular focus on deposits. Standard & Poor's analysts note that the flight of retail depositors "could conceivably continue to intensify". Well yes. Half as many euros fell out of deposits from January to April as during the whole of last year (€13bn and €28bn). Frankly, it looks like an intensification is already here.

It isn't just because of fear about the safety of the banks in a default (or indeed the value of euro deposits if Greece leaves the currency). Obviously, the entire Greek economy is burning through cash reserves as joblessness rises. So it's not clear how much of this Greek depositor cash is going abroad, either into other deposits or real assets.

But whatever has caused the depositor flight, it's odd that not many are making the connections to Greek bank funding at the European Central Bank. Having fewer deposits to draw on, the only other place Greek banks can go for replacement funding is from the ECB. That means pledging more, not less, Greek government-backed collateral.

So, what are we to make of the ECB's repeated threats to cut off the collateral's eligibility if the Bank is prevented from dictating terms on a bond rollover?

Of course it's entirely within the Bank's purview to do this. It's not a lender of last resort to insolvent banks. But equally it's not in a central bank's purview to stop a sovereign debt restructuring and certainly no official throughout the eurozone is realistically able to control the deterioration of Greek deposits and credit.

Wake up and smell that tear gas, nos amis.

Edited June 15, 2011 by RedFxTrade

[RedFxTrade]

Is it me or does his head look really huge? Anyway I don't agree that China Japan etc will stop buying US debt; as long as they want to sell anything to them anyway...

That is the pivotal question...the stats show they have reduced purchases of US debt. They do not even need to sell them, but a reduction and if they stop buying them in my opinion is feasible...After all what cannot go on forever will not. To say they will not stop buying US debt proposes that they will buy it ad infinitum...thats not going to happen. The important point I guess is if they want to sell anything to them...the way I see it is this;

America has a population of 310 million...

If we take a very conservative 10% of developing countries citizens will move into a consuming middle to upper class income group, then those 300 million American consumers can be replaced...

China 10% would be over 100 million people

India 10% another 100 million people

Brazil 10% another 20 million people

Russia 10% another 15 million people

Add into that then another 100 million people between Australia, Canada, Europe, the Asean region and the US...and you have a consumer that can take up the slack of the American consumer...thats only from a 10% increase in middle classes in these countries.

I was listening to an interesting prgram on Radio 4 on Sunday which was talking about the trade relations between Brazil and China...its growing rapidly...Here is a special report PDF On China/Brazil trade relations. Electronic sales in Brazil are booming based on electronic imports from China, the same goes for clothing...there are many very important structural changes in trade between Brazil and China...China in return sees Brazil as a one stop shop for commodities in China, building huge ports and ships in Brazil...

China became Japans biggest trading partner in terms of exports and imports in 2009...These sort of structural changes do not occur overnight, and they do no reverse overnight also...

Forget all the scare stories of selling US T-Bonds a reduction in buying (already happening) will be enough to put upward pressure on yields and crimp the US consumer who have basically no savings...Americans will over time stop buying not through choice, but because they cannot afford to at least no where near the same manor they have done over the last two decades...This in itself will lead to a reduction in demand for Chinese exports from the US, and in that a reduction in Chinese demand for US T-Bonds

Perhaps the next biggest buyer of US T-Bonds as yields go up will be US citizens themselves as they begin to save.

Edited June 15, 2011 by RedFxTrade