Austerity.....The new dirty word

Austerity is something we have come to hear a great deal about over the term of the global downturn and in particular in relation to the debt crisis in Europe.

Those holding the purse strings in Northern Europe are used to austerity as a tool that has been frequently used, in varying degrees, to manage their economies.

Those in Southern Europe, the so-called PIIGS, have not used austerity to manage their economies as they have been used to high interest rate, high inflation policies where when the worst came to the worst they de-valued their currencies and exported their way back to life.

Now with debt levels that can almost certainly never be repaid, bailouts unemployment and social strife on the increase, those Countries are being forced to “tighten their belts” even further.

This seems a very good time to be in opposition in the debtor countries. It is clear that the Government will have to agree to virtually any policy that is put forward by the Eurozone but the opposition can disagree without having to propose an alternative.

Such a situation will come about again today in Greece.

European Leaders have a conference call this morning, (obviously flying everyone to meet in person is not good P.A.) when the next steps for Greece will be discussed. Meantime further austerity (that word again) will be discussed in Athens with the opposition (no surprise) totally against any further measures.

It is almost impossible to imagine a scenario now where Greece can stay in the single currency without some serious back-peddling from their partners. Frau. Merkel says she wants Greece to stay in the single currency. Of course she does. The former CEO of Deutsche Bank reckons the cost of a Greek exit (I hate the term Grexit!) will cost several hundred billion Euros. That is without mentioning any potential knock-on effects with other countries following Greece through the exit.

All they want to do is cut Greek debt from 144% of GDP to 120% by 2020. Sounds simple? Patently isn’t!

The Euro is beginning to trade in ever narrower ranges, which usually means a violent breakout is coming. Technically it looks like the break will be higher but fundamentally it looks lower. Faced with such a paradox traders should become more like Eurozone leaders and ask for more time!

Well, everybody has to tight their belts time to time. That is the good thing of living in a third world country, you just get used to it and you don’t worry much about it because you know that tomorrow will be the same. I really get sick when europeans and north americans complains about it, i lived it what you describe above every day during 30 years including foreing intervention, first by USA and now by comunist countries such as Venezuela and Irán. And don’t know why they really complain we lived in poverty since i have memory, you don’t know what it is to live under dictatorship, you don’t know what it is to be under siege at one step of total anyhilation just because the new order doesn’t like your caucassian skin nor your jewish name, yes Bolivia is not an indian country as they made you belive. So people c’mon stop complaining, you really don’t know what is to work for 50 BOB a week (something like 4 USD or 5 EUR) wich it can only buy you a crappy lunch for two days including transportation if lucky enough. Yesterday i was complaining about how our goverment treats everyone (even their own ethnia) like animals, complaining about my misery life until a saw a very poor man diggin into the garbage, realy not a nice thing to see.

Greece to receive an additional bailout, estimated to be worth between EUR 15 billion - EUR 30 billion. It is expected to be announced between 12 - 14 November. Remember who you heard this from. It is being hushed but the big players know this. I will be buying the indices (DAX, SP and IBEX) after the non-farm payrolls if there will be big declines. Easy money :slight_smile:

Austerity…The new dirty word - ForexStreet.net

SarraFX, thought you were banned?

I do not intend to post any more on this site.

I got banned for advertising but i have seen a lot more blatant stuff than what I posted.

Anyway I may as well get banned again so if anyone wants to deal with a broker with integrity, knowledge, experience, decent (not unsustainable) spreads who manages the relationship not the transaction then come see us at sarrafx.com

It is a dirty game and austerity will do more harm in the long-term, something policy makers ignore.

If it wasn’t so for so much disgusting decadence, we wouldn’t have to even consider austerity now, no one complained 5 years ago too much was spent.