A Video for Fred/EJ....(Gold bugs do not watch!)

[thousandmilemargin]

Re: Euro breakup- bullish or bearish

What Deutschmark?

The once-and-future Deutschmark. Was I being too subtle?

[GRG55]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

You actually mis-read my comments GRG. Read it again and you'll see what I was saying. I pointed out precisely, that iTulip has indeed flown at the RIGHT altitude for the past 8-9 years, by selecting an allocation of 20%-30% in PM's, and maintaining a steep position precisely in USD, they have straddled to the two main components of what's working itself out.

They have set their flight-trim so well that even transitioning from the rampant inflation of the past four years into a very large international deflationary interlude such as Hendry describes, they don't still don't need to change their stance ("altitude") at all.

You maybe looked at a picture of a balloon flying close to the ground and thought I was implying they were at the wrong "altitude" because it looks low. Actually not - the low altitude of the balloon is a synonym for not employing too much gold leverage to inflation. They figured a flight trim back in 2000 which is still valid today.

Apologies for my misreading of your post Lukester.

[Guest]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

Bad GRG55. Bad bad bad GRG55. Go stand in the corner GRG55. Don't talk to any of your classmates, and don't come out 'till after the recess and cafeteria break is over.

Apologies for my misreading of your post Lukester.

[qwerty]

Re: Euro breakup- bullish or bearish

It seems that they threw away the keys when they signed up for the Euro.

But what I'm reading is that a PIIG can't/won't leave unilaterally - that would be suicide.

What will happen is that a PIIG defaults, and that brings the others down too.

Then the Eurozone meets and is faced with two choices:

1) The Germans take a walk, maybe taking the French with them recreating new marks, francs or the core-Euro

2) The Germans sign up for a single Eurozone supra-national bond issuer. Greek government bonds become Eurozone Govt bonds. The Greeks have no fiscal power any more, and the Germans get to take on the PIIGs debt.

The smart money is on (1). But the problem is, which Euros have "Deutschland" printed on them? How if you are owning Euros before the breakup, can you make sure that yours get converted into New DMarks and not into New Drachmas?

[cjppjc]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

You pays your money and you places your bets...

Yes..............

[qwerty]

Who has the smarts? Bond or Equity Market

In another YouTube clip of Hendry's appearance on that show he says that the real brains are in the bond market.

He lambasts the equity "strategists" and says how they are hopelessly compromised by the necessary institutionalized bullishness of their industry.

The bond money is where the geniuses are, says Hendry. And, or course, it's much bigger isn't it (though H doesn't say that).

And the bond market is pricing in huge deflation over the next two years. (The 2yr Treasury yield which H has bought.)

So, does it boils down to that? Notwithstanding the notion that the central banks can prop up bonds, the 2yr note market is smart and should be listened to over and above the equity market?

[Guest]

Re: Who has the smarts? Bond or Equity Market

And gold too. Gold will tell us a thing or two in the next six months.

In another YouTube clip of Hendry's appearance on that show he says that the real brains are in the bond market.

He lambasts the equity "strategists" and says how they are hopelessly compromised by the necessary institutionalized bullishness of their industry.

The bond money is where the geniuses are, says Hendry. And, or course, it's much bigger isn't it (though H doesn't say that).

And the bond market is pricing in huge deflation over the next two years. (The 2yr Treasury yield which H has bought.)

So, does it boils down to that? Notwithstanding the notion that the central banks can prop up bonds, the 2yr note market is smart and should be listened to over and above the equity market?

[Dridamse]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

Hi There. I´m very fortunate to have found so many interesting people here thank you to all of you.

I think it is unlikely a Eurozone breakup most people in the rest of the world do not understand well how the Euro works.
Imagine that California due to the actual economic conditions have to get out of the USD: 1 Print a new currency 2 Change all of the teller machines vending machines, bank accounting systems, Privated accounting systems, taxes etc etc etc... It will take Years and they will rather still use the USD but the California economy wont count towards the official numbers of the USA.
The economy of California is integrated in the USA with hundreds of companys intermingled with other states of the Union same for banks etc as the economy of any Eurozone country is with the rest.

How realistic is to think about California Kicked out of the USA and the Dollar-Zone or California leaving the Union and the Dollar for their own will to compete in productivity or to have a better economy.

Each Euro nation cannot print Euros as much as they want they are supervised and need the agreement within the ECB and the political body of the Eurozone to do it. many times I watch CNBC ( My fault sorry ) and listen to talking heads saying Europe is printing as much Euros as we print dollars etc. The ECB prints nice stadistics in their website updated monthly and they are not printing money like the USA yet.

Central bankers and politicians know the above but Some Journalist, Investors and others have their own interest to ignore these facts pursuing diferent types of interest or just don´t know them.

The EU won´t let any nation of the Eurozone go broke because that will affect negatively the rest of the EU.

[GRG55]

Re: Who has the smarts? Bond or Equity Market

In another YouTube clip of Hendry's appearance on that show he says that the real brains are in the bond market.

He lambasts the equity "strategists" and says how they are hopelessly compromised by the necessary institutionalized bullishness of their industry.

The bond money is where the geniuses are, says Hendry. And, or course, it's much bigger isn't it (though H doesn't say that).

And the bond market is pricing in huge deflation over the next two years. (The 2yr Treasury yield which H has bought.)

So, does it boils down to that? Notwithstanding the notion that the central banks can prop up bonds, the 2yr note market is smart and should be listened to over and above the equity market?

I saw Hendry say in an interview before Christmas that he was closing out all his long Treasury positions and booking the profits for his clients...and then heading off on a holiday. Don't know if he reinstated any of those in the New Year...

[qwerty]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

The comparison is not the same between the US and the EU.

In the US there is the Federal Government which raises USD debt.

In the EU there is no such entity.

People in New York voted for Obama, as did the people in California. And so Obama has the mandate to give Federal money to California.

In Europe, it will be rather difficult for Merckel to give her voters' money to the Greeks.

(Also note the difference between printing currency and issuing debt. The Greeks cannot print Euros, nor can the Germans, but they can issue debt. That indeed is the problem.)

[qwerty]

Hendry in January

http://www.youtube.com/watch?v=uhCs-...eature=related

He has his tie back off.

Got to love this guy's performance.

Hear his story of the Texas oil man at the gates of heaven.

See him spit on the floor at what the "strategists" are writing.

"They tell me that you'll lose money over the next thirty years in 30-yr government bonds. I'M NOT INTERESTED IN NEXT THIRTY YEARS. I'M INTERESTED IN THE NEXT THIRTY NONTHS!"

Hear his take on the idea of an equity rally: "THERE IS NO MONEY ON THE SIDELINES."

I have only watched part 1 of 6 of this appearance, I'm going to watch the rest now.

[Dridamse]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

The comparison is not the same between the US and the EU.

In the US there is the Federal Government which raises USD debt.

In the EU there is no such entity.

People in New York voted for Obama, as did the people in California. And so Obama has the mandate to give Federal money to California.

In Europe, it will be rather difficult for Merckel to give her voters' money to the Greeks.

(Also note the difference between printing currency and issuing debt. The Greeks cannot print Euros, nor can the Germans, but they can issue debt. That indeed is the problem.)

In Europe there is a mandate Pact of Stability and Solidarity within the nations if someone gets too much debt, inflation or deficit it gets punished. Unless the rules are loosened for the rest too and that is more likely to happen.

In Europe, it will be more difficult for Merckel to lose her voters and german companies ' money due to a failure in the Euro + lose money on the investments of the vtrs & cmpns in the rest of the Eurozone. Also how to explain the other EU leaders these faliure etc. Not likely.

[qwerty]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

A Mandate? Oh well then, things should be fine.

[qwerty]

Re: A Video for Fred/EJ....(Gold bugs do not watch!)

Sorry. But we are talking of a piece of paper there, and we all know what the iTulip community thinks of paper.

What happens when the s*** hits the fan? Here is the worst case scenario from someone who thinks it unlikely but what would be bound to happen:

http://www.eurointelligence.com/arti...c4dc2ce.0.html

"But that does not mean that a breakdown of the euro area is inconceivable under all scenarios. Let us start with the hypothetical scenario of a Greek payment default. If the German finance minister, as I would expect, were to insist pedantically to apply the no-bail out clause, the crisis could, within hours, spill over to Portugal, Ireland, Spain and Italy, where bond spreads would be shooting up. Hedge funds will suddenly have discovered a good opportunity to make up for previous losses. Finance instruments such as Credit Default Swaps (CDS) are imminently suited to this type of speculation: If you stock up with Portuguese or Italian CDS during one of the panic runs, you stand to make very large profits. This in turn accelerates the domino effect of the crisis, and market interest rates will go up to double-digit rates all over southern Europe. The EU will hold an emergency summit at which it becomes clear that it is too late for a general bailout. This would have worked in the case of Greece or Ireland. But Italy and Spain are simply too big.


"The summit would summon experts who tell the prime ministers that there are only two alternatives. Either the euro-area is dissolved with immediate effect. Or, one creates an imminent fiscal union, starting with single the European issuance of all future debt, and the transformation of all existing debt into a single European bond. The member countries would lose the sovereignty over budgetary politics. The finance ministers would receive their daily marching orders from Brussels. This would, of course, require a whole new EU Treaty, which the prime minister would have to agree on almost in real time.

"I am not sure how Germany’s political leadership would jump when confronted with such a stark choice. Jean Quatremer, the Brussels correspondent of the French newspaper "Libération", asked on his blog on Tuesday whether Germany is still a European country? The political instincts of Angela Merkel and Peer Steinbrück have been clearly anti-European during this entire crisis. They have prevented any real economic coordination with persistent reference to the national interest. "

[qwerty]

Re: Hendry in January

Watched the lot. Just so entertaining. Hendry could have made a great barrister (trial lawyer). Smart, eloquent, arrogant, a tortured soul.

You have to fight hard to strip off his oratory's effect on you and concentrate on hard factual element of the basis of his opinions. I can see him easily prising millions out of an investor over lunch just by his loquacity.

Here's maybe an acid test for us: Who's view of China's prospects this year do you agree with in this segment.

http://www.youtube.com/watch?v=AVWK8...eature=related

He asks Carl the economist for the growth forecast for China this year.

"Consensus 8-9% growth for 2009." says Carl.

"You ...." and H catches himself before he utters an expletive.

Carl goes on to talk about the internal market filling demand and industrial production numbers; Hendry talks about electricity usage falling and the fact that you can't make up for exports going away by building more Canary Wharfs around China.