Growth Stimulus and Bank Rescues
 

Growth Stimulus and Bank Rescues

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http://www.theforexnittygritty.com/forex/growth-stimulus-and-bank-rescues

Growth Stimulus and Bank Rescues

Growth stimulus and bank rescues appear to be the consensus of G 8 leaders in response to a worsening euro and increasingly likely Greek debt default. Several European economies are in danger of defaulting on their national debt obligations. If this situation is not fixed the Euro could go into free fall and, in fact, the European Union could lose several members. Greece was the object of global attention for months as European leaders hammered out a debt bailout package meant to cover payments on Greek debt. Conditions for the continuing bailout included severe austerity measures that were driving Greece further into recession. The ink was barely dry on the Greek bailout package when Greek elections threw the deal into a tailspin.

Trouble in Greece Again

The political party that negotiated the deal lost in recent elections. It appears that voters disagree with the terms of Euro Zone debt resolution. No one has been able to put together a coalition government so the country returns to elections next month, after they were scheduled to initiate strict austerity measures that will probably now not happen. There is already a run on Greek banks as depositors take out their Euros before the banks go bankrupt. It turns out that growth stimulus and bank rescues are needed instead of increasingly strict austerity measures in the Euro Zone. The Euro has jumped up and down over the last couple of years as the debt dilemma has played out on the public stage. Now the Euro is decidedly downward as both governments and banks are at risk. It turns out that European banks are the prime investors in government debt.

Voter Unrest

Voters in various European nations are not happy. Germans have been little by little voting against the political party of Chancellor Merkel, the leader in piecing together the various debt solutions in an effort to save the European Union. Greeks threw the bums out and cannot find anyone to govern. France elected a socialist and threw out the other leader, Sarkozy, who partnered with Merkel in Euro Zone rescue efforts. Germans are angry about footing the bill and others are angry at the economic downturn caused by increasingly strict austerity measures. Spain, the next on the list of possible defaults, has a twenty-five percent unemployment rate! The argument put forward by those opposed to strict austerity is that governments need people working and paying taxes in order to pay their debts. It appears that austerity measures across Europe and the Greek debt write off requirements were too strict. Voters seem to agree in many nations and now, it appears, that the G 8 leader agree that growth stimulus and bank rescues are needed to keep the Euro Zone afloat and, by the way, support the Euro.

Where Goes the Euro?

A continued low European Central Bank rate will be needed to help provide growth stimulus and bank rescues.

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    Growth Stimulus and Bank Rescues Growth Stimulus and Bank Rescues Presentation Transcript

    • GROWTH STIMULUS AND BANKRESCUES APPEAR TO BE THECONSENSUS OF G 8 LEADERS INRESPONSE TO A WORSENING EUROAND INCREASINGLY LIKELY GREEKDEBT DEFAULT. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • SEVERAL EUROPEAN ECONOMIESARE IN DANGER OF DEFAULTING ONTHEIR NATIONAL DEBT OBLIGATIONS. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • IF THIS SITUATION IS NOT FIXED THEEURO COULD GO INTO FREE FALLAND, IN FACT, THE EUROPEAN UNIONCOULD LOSE SEVERAL MEMBERS W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • GREECE WAS THE OBJECT OFGLOBAL ATTENTION FOR MONTHS ASEUROPEAN LEADERS HAMMEREDOUT A DEBT BAILOUT PACKAGEMEANT TO COVER PAYMENTS ONGREEK DEBT. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • CONDITIONS FOR THE CONTINUINGBAILOUT INCLUDED SEVEREAUSTERITY MEASURES THAT WEREDRIVING GREECE FURTHER INTORECESSION. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • THE INK WAS BARELY DRY ON THEGREEK BAILOUT PACKAGE WHENGREEK ELECTIONS THREW THE DEALINTO A TAILSPIN. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • TROUBLE IN GREECE AGAIN W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • THE POLITICAL PARTY THATNEGOTIATED THE DEAL LOST INRECENT ELECTIONS W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • IT APPEARS THAT VOTERS DISAGREEWITH THE TERMS OF EURO ZONEDEBT RESOLUTION. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • NO ONE HAS BEEN ABLE TO PUTTOGETHER A COALITIONGOVERNMENT SO THE COUNTRYRETURNS TO ELECTIONS NEXTMONTH, AFTER THEY WERESCHEDULED TO INITIATE STRICTAUSTERITY MEASURES THAT WILLPROBABLY NOW NOT HAPPEN. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • THERE IS ALREADY A RUN ON GREEKBANKS AS DEPOSITORS TAKE OUTTHEIR EUROS BEFORE THE BANKSGO BANKRUPT. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • IT TURNS OUT THAT GROWTHSTIMULUS AND BANK RESCUES ARENEEDED INSTEAD OF INCREASINGLYSTRICT AUSTERITY MEASURES INTHE EURO ZONE. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • THE EURO HAS JUMPED UP ANDDOWN OVER THE LAST COUPLE OFYEARS AS THE DEBT DILEMMA HASPLAYED OUT ON THE PUBLIC STAGE. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • NOW THE EURO IS DECIDEDLYDOWNWARD AS BOTHGOVERNMENTS AND BANKS ARE ATRISK. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • IT TURNS OUT THAT EUROPEANBANKS ARE THE PRIME INVESTORSIN GOVERNMENT DEBT. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • VOTER UNREST W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • VOTERS IN VARIOUS EUROPEANNATIONS ARE NOT HAPPY. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • GERMANS HAVE BEEN LITTLE BYLITTLE VOTING AGAINST THEPOLITICAL PARTY OF CHANCELLORMERKEL, THE LEADER IN PIECINGTOGETHER THE VARIOUS DEBTSOLUTIONS IN AN EFFORT TO SAVETHE EUROPEAN UNION. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • GREEKS THREW THE BUMS OUT ANDCANNOT FIND ANYONE TO GOVERN. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • FRANCE ELECTED A SOCIALIST ANDTHREW OUT THE OTHER LEADER,SARKOZY, WHO PARTNERED WITHMERKEL IN EURO ZONE RESCUEEFFORTS. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • GERMANS ARE ANGRY ABOUTFOOTING THE BILL AND OTHERS AREANGRY AT THE ECONOMICDOWNTURN CAUSED BYINCREASINGLY STRICT AUSTERITYMEASURES. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • SPAIN, THE NEXT ON THE LIST OFPOSSIBLE DEFAULTS, HAS A TWENTY-FIVE PERCENT UNEMPLOYMENTRATE! W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • THE ARGUMENT PUT FORWARD BYTHOSE OPPOSED TO STRICTAUSTERITY IS THAT GOVERNMENTSNEED PEOPLE WORKING AND PAYINGTAXES IN ORDER TO PAY THEIRDEBTS. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • IT APPEARS THAT AUSTERITYMEASURES ACROSS EUROPE ANDTHE GREEK DEBT WRITE OFFREQUIREMENTS WERE TOO STRICT. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • VOTERS SEEM TO AGREE IN MANYNATIONS AND NOW, IT APPEARS,THAT THE G 8 LEADER AGREE THATGROWTH STIMULUS AND BANKRESCUES ARE NEEDED TO KEEP THEEURO ZONE AFLOAT AND, BY THEWAY, SUPPORT THE EURO. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • WHERE GOES THE EURO? W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • A CONTINUED LOW EUROPEANCENTRAL BANK RATE WILL BENEEDED TO HELP PROVIDE GROWTHSTIMULUS AND BANK RESCUES. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • THIS PERSISTENTLY LOW RATE WILLTEND TO DEVALUE THE EURO INFOREX TRADING. GROWTH STIMULUSAND BANK RESCUES WILL NEED TOBE PAID FOR. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • THAT WILL MEAN PRINTING EUROSAS VOTERS IN SOLVENT NATIONSSUCH AS GERMANY ARE TIRED OFPAYING THE BILL FOR THEIR LESSSOLVENT NEIGHBORS. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • MORE EUROS OVER TIME WILLSTIMULATE THE EURO ZONEECONOMIES AND PROBABLY DRAGTHE EURO ZONE OUT OF RECESSIONAND IT DEBT DILEMMAS. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • IT WILL ALSO PROBABLY DEVALUETHE EURO STEADILY OVER TIME. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • AS ALWAYS THIS DISCUSSION ISMEANT TO STIMULATE THOUGHTABOUT FOREX TRADING AND IS NOT ASUGGESTION TO TRADE EUROS ORIGNORE THE CURRENCY IN FOREIGNEXCHANGE TRADING. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M
    • FOR MORE INSIGHTS AND USEFULINFORMATION REGARDING THEFOREX MARKETS AND FOREIGNCURRENCY TRADING, VISITWWW.THEFOREXNITTYGRITTY.COM. W W W . T H E F O R E X N I T T Y G R I T T Y. C O M