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View Diary: If the Euro fails. (282 comments)

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  •  try trillions - (25+ / 0-)

    billions insufficient to prop up the derivatives explosure of the large banks

    it would require an even more massive transfer of the wealth and resources of the nation than we saw as a result of the debacle that began the recent world-wide recession - which while it may have technically ended in the US still has not seen recovery.

    "what the best and wisest parent wants for his child is what we should want for all the children of the community" - John Dewey

    by teacherken on Sun Nov 27, 2011 at 08:05:11 AM PST

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    •  Unimaginable sums are involved, and that is (13+ / 0-)

      only the tip of the iceberg the interconnection of all our businesses is at the heart,

      "Another world is not only possible, she is on her way. On a quiet day, I can hear her breathing." Arundhati Roy

      by LaFeminista on Sun Nov 27, 2011 at 08:07:14 AM PST

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      •  It is the derivatives market that will (42+ / 0-)

        do us in. The fact that investors were allowed to buy insurance on assets they had no financial interest in, then engage in a game to bring those assets into default so they could get their payout, is the case and point that unregulated capitalism will destroy itself.

        Since those naked swaps have been allowed to proliferate through the global financial system like mold spores, they will bring the entire global economy down with them.

        Naked swap counterparties should be paid back only what they paid in and those contracts voided, then naked swaps should be banned completely. I just don't see the possibility of that ever happening.

        48forEastAfrica - Donate to Oxfam "Compassion is the radicalism of our time." ~ Tenzin Gyatso, 14th Dalai Lama -7.88, -6.21

        by Siri on Sun Nov 27, 2011 at 08:54:34 AM PST

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        •  Siri, could you diary this in detail (12+ / 0-)

          You put it so clearly and we (the finance-non-literate) need to be educated by those of you who do understand this.

          This is the best description I have read re. 'the derivative game'.

          tx

          I belong to the “US” of America, not the “ME,$,ME,$,ME,$,ME,$” of America!

          by SeaTurtle on Sun Nov 27, 2011 at 12:38:24 PM PST

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          •  Thanks Sea Turtle (12+ / 0-)

            Belgium has an important bond auction tomorrow. If it goes like I think it will (not well), I think it will be very illustrative of the power of traders to push a country to the brink of default. I'll try to roll all this into a diary tomorrow though I'm really no financial expert.

            48forEastAfrica - Donate to Oxfam "Compassion is the radicalism of our time." ~ Tenzin Gyatso, 14th Dalai Lama -7.88, -6.21

            by Siri on Sun Nov 27, 2011 at 02:27:41 PM PST

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          •  simple version: gambling is still a sin. (5+ / 0-)
            Recommended by:
            SeaTurtle, Chi, mrsgoo, Siri, ozsea1

            And "the wages of sin are death."  In this case the financial death of those who thought they could get rich quick on high-stakes gambling.   They should have stuck to poker.  But tough shit for them: let them fall and then rebuild without them.  

            "Minus one vote for the Democrat" equals "plus one vote for the Republican." Arithmetic doesn't care about your feelings.

            by G2geek on Sun Nov 27, 2011 at 03:15:04 PM PST

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            •  yeah, but G2, won't their fall take us down, too? (5+ / 0-)
              Recommended by:
              Bronx59, Chi, mrsgoo, Siri, ozsea1
              But tough shit for them: let them fall and then rebuild without them.  

              at least it seems as though they have their gambling game rigged that way.  You know, privatize the profits, socialize the losses......

              would love to just take the attitude that they can go down the crapper... but I am afraid of all the innocent people who would go down with them?

              I belong to the “US” of America, not the “ME,$,ME,$,ME,$,ME,$” of America!

              by SeaTurtle on Sun Nov 27, 2011 at 03:19:23 PM PST

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              •  they're taking us down as it is. (3+ / 0-)
                Recommended by:
                mrsgoo, Siri, ozsea1

                Better to pull the plug on them and get it over with.

                As in, if you eat rotten food you can either puke it up and get it over with, or suffer food poisoning for days.  

                "Minus one vote for the Democrat" equals "plus one vote for the Republican." Arithmetic doesn't care about your feelings.

                by G2geek on Sun Nov 27, 2011 at 04:18:13 PM PST

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          •  It is quite simple, actually. Think of it as (2+ / 0-)
            Recommended by:
            Siri, SeaTurtle

            this: The entire neighborhood has taken out homeowners insurance on your house and even worse, has successfully lobbied to make arson completely legal.  How long do you think it would take before your house was torched in such a case?

            There is no saving throw against stupid.

            by Throw The Bums Out on Sun Nov 27, 2011 at 06:15:20 PM PST

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        •  Do you know the old saw... (8+ / 0-)
          Recommended by:
          714day, Siri, DRo, Chi, Losty, ozsea1, bobinson, Joe Bob

          that the smart money is early?

          I first heard about the derivatives mess in October of 2006 on a yahoo group for people looking to leave the U.S.  

          Talk about the end of the Euro would get you branded a truther/wack job on this site not that long ago at all.  

          I bolded the line that stuck with me.  Hope you are well wherever you may be Markus.

          Hey all:  

          I am not an EXPERT but I do have a background and degree in finance, and I do not have a crystal ball, but there is a crash coming, you do not need to be a psychic to figure that out.  For the purposes of this site it is crucial that this dollar demise/world depression be kept in mind when selecting a place to go to.  

          I believe that when the time comes, and I rate the chances at about 50% in 12 months, nearing 100% in 24 months, and absolutely positively before Bush leaves office, I beleive that MANY places that are now havens for ex-pats will be much harder hit than the USA.  Do not look to the Euro as a "new dollar."  It will also go boobs up, as may the European Union itself, they came very close a few months ago when more than one nation refused to ratify the constitution in a plebicite, Germany refused to have a plebicite and allowed the German Parliament to decide the matter because she new the people would reject it.  See this from Google a few days ago,

          10.03.2006

          Prague- European Parliament President Josep Borrell considers the current text of the European constitution doomed, Czech Chamber of Deputies chairman Lubomir Zaoralek told CTK after a meeting with Borrell today.

          According to Zaoralek, Borrell believes that it would be easier to reach an agreement on the EU constitution if the process began from the very beginning and with a new text."

          The French will never ratify the current version.  I keep up on it because I have American and Irish/EU dual citizenship.  Anybody wanting information about getting a passport I am glad to help.  My Dad was Irish so for me it was easy, but if you or your spouse has a grandparent/parent with Irish citizenship you can too and it is legal because Ireland does not require an oath so the USA permits it.

          As I posted at Huff, if you are having dinner one night soon and hear the word derivatives on the nightly news, RUN and do not walk to the store and buy all the canned goods and toilet paper (which may be a new form of currency when the dollar fails, it will certainly be worth more)that you can carry.

          Markus

        •  You left out the word "unregulated" (2+ / 0-)
          Recommended by:
          semiot, Siri

          At least normal stocks and bonds are regulated by the SEC and other agencies. These new derivative markets are not regulated. More precisely, Congress made it illegal for the US government to regulate, or even monitor, these markets.

          It was the Commodities Futures Modernization Act that was passed two days after the Bush v Gore decision was handed down in year 2000. Beltway pundits completely ignored the new law that prevented the SEC or the Commodities Futures Trading Commission from looking into swaps. Phil Gramm wanted the US to be the world leader in credit default swaps. It would be the next Utopia.

          These swap markets are totally unavailable to regular folks. Not that we would want to play in that casino, but the crash of 2008 and probably the next one will be because we let the free market play itself out like the wild west. It will be the next Ethiopia.

          As God is my witness, I thought turkeys could fly. - Arthur Carlson ( WKRP in Cincinnati)

          by bobinson on Sun Nov 27, 2011 at 10:37:10 PM PST

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    •  I'd Say Trillons As Well. But That Is The Problem (6+ / 0-)

      nobody really knows.

      When opportunity calls pick up the phone and give it directions to your house.

      by webranding on Sun Nov 27, 2011 at 08:09:30 AM PST

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