Friday, January 13, 2017

Europe's Debt Crisis.

Tom's Journal.

OK, My Fine Feathered Friends,
     Sorry, but let the Party begin !   And I am not bragging, gloating, boasting, nor beating my massive chest, at all, no -- not one bet,  because I have a long way to go, too, and still recovering from a major "HIT" a few days before Christmas, one year ago.... LOL.   So I have had to start all over again [and not the first time, either].  

I guess that if I were a "Yes- Man" and gave up all my masculine authority, brains, and common sense, then I would probably get along better in some of my relationships...  but I am not.   I hope that I have learned some things about my worst enemy -- my BIG mouth, and how to wire it shut...Ha!   But when I hear big time ignorance and pure stupidity,  sometimes I am just driven to kindly correct it.   That is why I just LOVE wisdom, proper speech, the right kind of education and smarts, rather than just "good looks" in a lady.   And God only know that I an NOT looking for perfection  --- because I am so imperfect that a woman's PERFECTION would just drown my sorry behind in a heart beat.

Anyway,   just look at THIS picture of the world !  Holy Cow !  Now, please remember this one fact of life:  America is usually about one month later in the scheme of things -- to happen.   In other words, if something bad happen to Europe, we here in the USA can expect it to happen about one month later, or a bit sooner.  

Now,  I think I know what most of my cool, smart readers are thinking right now....  "if Tommy is so smart, why isn't he ahead of the game by now ?"   Well,  here is the bitter, goofy truth about me,   I am very human too, with my own vices, imperfections, and challenges,  so I am not as far ahead as I should be.   So... don't rob me... LOL !   I barely got enough to survive, and then, MAYBE !   I also put a lot of trust in God.  
      Now, I know, to most people, this is very "dry material,"  but you need to digest it, now, today.   Even the smart Germans have some failings and are also caught up in this whirl wind... sorry.  Thank the Liberal, Socialist, Angela Merkel, for most of that !

Tom  Schuckman

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Europe’s Sovereign Debt Crisis Thickens

I did a double-take when I just analyzed the latest news from the Italian banking sector.
The Italian banking behemoth UniCredit is now seeking investor backing for a mind-boggling 13 billion-euro rights offer – almost as much as its current market value.
The purpose for the money: Shore-up its lousy loan portfolio.
In fact, their plan is to use 8.1 billion euros to absorb losses on bad loans that are now being sold to investors for pennies on the dollar.
Talk about robbing Peter to pay Paul.
It’s downright unthinkable that this kind of an institution could dig a hole that big.
But the fact is, this is the banking world we are living in, especially for Europeans.
And it’s far from over.
Banca Monte dei Paschi di Siena, the oldest bank in the world and the third largest in Italy, received a government bailout after no one wanted to lend them 5 billion euros. And the bank’s woes are not over — not by a long shot.
They’re slated to present recapitalization plans to the European Central Bank in the coming weeks, but they’re meeting resistance from Germany.
The ECB will have to keep printing money, maintain artificially low interest rates and fuel an even larger bond market bubble.
In fact, German monetary authorities are opposed to covering Monte dei Paschi’s losses in a bailout. And in my view, they got it right: They insist that Italy sticks with a legal prohibition against using state funds to cover a lender’s future losses.
And I can see why: Italian bad loans keep piling up.
What does this mean?
The ECB will have to keep printing money, maintain artificially low interest rates and fuel an even larger bond market bubble.
If they don’t, the whole party could end abruptly.
Plus, the central bank will have to continue dealing with terrible government balance sheets and with renewed doubts about the governments’ ability to manage hundreds of billions in bad debt.
That means just about every government on the continent is going to look for ways to squeeze the last dollar they can get out of their citizens … their workers … and their companies. And that’s going to zap incomes, growth, and prosperity.
And those same governments won’t blink an eye when the average Joe is left holding the bag.
It’s not just in Europe …
And it’s not just Italy and the eurozone facing a sovereign debt crisis.
A report from S&P earlier this week downgraded almost three times as many countries’ sovereign credit ratings as they upgraded in 2016. And it’s likely to get worse.
Consider …
Of the 130 countries with a S&P rating, thirty started 2017 with a “negative” outlook compared with only seven with a “positive” outlook.
The picture is even bleaker for emerging-market economies, with negative outlooks outnumbering positives by a staggering six-to-one.
You read that right: Six lousy emerging-market economies for every positive one.
Investors are starting to read the handwriting on the wall: Government debt is simply too massive. It can never be repaid.
It would be financial suicide for them to continue loaning money to Brussels, Tokyo or Washington – insane to throw good money after bad.
The age in which all of us pay the price for our leaders’ reckless spending schemes – and these obscene debts – is about to begin.
So, hold on to your hats!
But don’t forget: With hardships like these come opportunities. And they’re going to be huge. So, stay tuned!
Best wishes,

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