tag:blogger.com,1999:blog-16264003691028288592024-03-05T19:07:47.379+08:00Bursa Malaysia (KLSE) Daily Info Edge ZoneMalaysia Forex | KLSE Index | FTSE KLCI | Bursa Malaysia | MayBank Forex | Malaysia Stock Trading | Malaysia ShareUnknownnoreply@blogger.comBlogger2125tag:blogger.com,1999:blog-1626400369102828859.post-58976286352229372432011-12-17T08:49:00.002+08:002011-12-17T09:06:50.878+08:00European debt situation is significantly worse than 2008<a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://4.bp.blogspot.com/-n77YnxOeDHs/Tuvqya397zI/AAAAAAAAFhI/0aEhclk5mlI/s1600/eu111208euro.jpg"><img style="float: left; margin: 0pt 10px 10px 0pt; cursor: pointer; width: 400px; height: 270px;" src="http://4.bp.blogspot.com/-n77YnxOeDHs/Tuvqya397zI/AAAAAAAAFhI/0aEhclk5mlI/s400/eu111208euro.jpg" alt="" id="BLOGGER_PHOTO_ID_5686897106413809458" border="0" /></a>Michael Platt, head of a $30 billion hedge fund, BlueCrest Capital Management LLP, provided his thoughts on the sovereign debt crisis in an interview yesterday with Bloomberg. Platt contended that Italy’s financial situation is likely to worsen significantly over the next year and that “much more radical measures” are needed to prevent such a dire outcome from occurring. “If Italy and Spain are forced to roll their debt over, if they have to pay rates between 5 and 7% for this, then the situation in Europe is unsustainable. We’re not going to have any euro bonds, we’re not going to have a full political and fiscal union where the transfers can take place. It seems what we’re going to have is an attempt to control the European situation through continued austerity, which is pro-cyclical. As the economy slows down, we end up with more austerity which creates more slowdown.” <p>When asked to compare the 2008 financial crisis to the current situation in Europe, Platt responded that “What’s going on now is significantly worse than 2008…The European debt situation is fundamentally completely unstable. The process of refinancing your debt with a real rate of 5 when you have negative GDP growth, and we are heading into a recession in Europe, arithmetically can turn all of the countries in Europe, given enough time, into Greece.”</p>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-1626400369102828859.post-34926506054763263812011-12-13T08:04:00.003+08:002011-12-13T08:07:51.255+08:00Europe would bring on a crisis that would make the 2008 credit crisis seem like a walk in the park<a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://4.bp.blogspot.com/-A696-D-hNGM/TuaW0u6hJ9I/AAAAAAAAFes/MN9ExqDz7yk/s1600/euro-161x120.jpg"><img style="float: left; margin: 0pt 10px 10px 0pt; cursor: pointer; width: 161px; height: 120px;" src="http://4.bp.blogspot.com/-A696-D-hNGM/TuaW0u6hJ9I/AAAAAAAAFes/MN9ExqDz7yk/s400/euro-161x120.jpg" alt="" id="BLOGGER_PHOTO_ID_5685397412292667346" border="0" /></a>“So, nothing changed, in that the can was kicked yet one more time. Still, we may look back in ten years and see that this was the beginning of a very different Europe. Right now, the political leaders seem to be signaling, with the exception of Britain, that they are ready to sign on. I think they actually mean it. And those of us in the rest of the world had better hope they figure it out. A fractured Europe would bring on a crisis that would make the 2008 credit crisis seem like a walk in the park. Especially as the world seems to be getting ready for a synchronized recession.” <p>The above commentary is from John Mauldin’s weekly <em>Thoughts from the Frontline</em> letter, in which the long-time market pundit provided his analysis of the latest sovereign debt developments in Europe.</p> <p>Mauldin began by summarizing his argument: “We have come to the end of yet another European Summit that was supposed to be the one to fix the problem. If you are confused as to what happened then you are not alone. Was it something we will look back on in ten years and say, ‘This was where it all started,’ or will it be viewed as just another meeting in what will prove to be a string of even more meetings? I will argue that both views are the correct answer, depending on your frame of reference.”</p>Unknownnoreply@blogger.com0