If Italy, Spain, Portugal and Greece went bankrupt..........

Considering that Venezuela (1998), Russia (1998), Ukraine (1998), Pakistan (1999), Ecuador (1999 and 2008), Peru (2000), Argentina (2001), Moldova (2002), Nicaragua (2003), Uruguay (2003), Dominican Republic (2005), Belize (2006), and Jamaica (2010)have all recently defaulted, along with many smaller countries like Ghana and Ivory Coast, one wonders if it is really that much of an event.

When the above went under did we notice any financial consequences?  I think I heard somewhere that 70 odd countries had defaulted in the last forty years, if that be true, it all passed me by.

Oh my.....

Nothing like thinking about the small picture every now and again.
Must admit it works well for most.
A pity however that they seem to make up the majority of the electorate.
Just one of the minor failings of pure democracy, I suppose.

A real pity that the NOWT is no longer around to inform the common people on all high finance matters, isn't it juat ?

Sorry NOTW. I suppose you could say the NOTW is NOWT around.

@ Betfair Manager

Please remove this thread from the "Financials" forum and put it under "Comics"

Thank you.

Perhaps as a trained economist you should give the OP just a few ideas as to how he has both been effected by all past sovereign defaults and will be any future.
After all he did have the basic honesty to state that whilst he didn't seem to notice any personal micro consequences/effects, he did seem to question whether this was perhaps correct on a general, macro basis.
Why ridicule him for this honest question ?
I just ridiculed the concept of democracy, which is seemingly built on the lack of knowledge and thus pliability by vested interests of the common man.

'---and will be by any future ones."

FAFH, I think you're losing your sense of humour. Besides, do you suppose if someone posted on here that being diagnosed with cancer is actually good for you, I should feel obligated to write a long dissertation to refute that? I would rather laugh at that assertion and move on. Lighten up.

Losing my sense of homour ?
I am not amused.
Yeah let's move on.
Sovereign debt matters are far too airy fairy to be concerned with tbh.

Well, I guess the most important economic issue confronting us now is "too airy fairy to be concerned with" according to you. What is there left to be concerned with then anyways.....besides the new iphone release?

Just kidding....best we move on.

Menelaus.. what a smart arse answer you gave, I have no doubt atoll anybody who gives such an observation, which as you gave, is completly clueless. You smug stupid little man if your too thick to answer the question posed just dont get involved with the discussion.

Fine as frogs hair.. it seems every thread I have put up recently you seem to completly dominate, And to be honest none of your posts ever seem to  directly answer the particular point raised. Do you have to completly take over every thread on the forum?  Its almost as though your addicted to making writing appear, could it be some sort of alergy to white space?

Discussion??? What discussion??? Did I miss something???

I will give you the benefit of the doubt and assume that you are trolling, otherwise asking the question you asked by starting this thread has to be the most brainless question ever asked on this forum. Complete waste of time to even comment.

Trust me, I would participate in a discussion if there was something to be discussed.

Sorry about that no moves.
Not intentional I can assure you.
Im a a forumaholic, and  an alcoholic, and a chocoholic etc etc.
In fact if it ends in  "ic " then I'm probably it, except perhaps economic.
Sorty for jamming up the all white space you seem to think is yours to dominate.
I will make particular effort to try to avoid your threads in future.
OK ?

Actually I'm sort of more addicted to Menelaus' posted replies, wherever they occur. On your threads or anywhere.
Call me sick, call me sad, but they sort of transfix me in some sort of strange manner.
How can anything be so appallingly bad and good at the same time is endlessly fascinating.
There must be an "ic" to describe it. Hypnotic perhaps.

There's no if, it's a case of when. And you can add the UK, Japan and the USA to that list. Difficult to put a timetable on it but the longer we keep denying reality the harder the fall will be.

The consequences will be the banks going bankrupt again, the government bailing them out, the property market crashing (better late than never), the pound going down the toilet, unemployment soaring, riots on the streets and massive inflation.

Basically we'll have to start living within our means and seeing as we produce pretty much f*** all our living standards are going to fall quite dramatically.

Start preparing yourselves because it is not going to be pretty that's for sure.

The consequences will be the banks going bankrupt again, the government bailing them out, the property market crashing (better late than never), the pound going down the toilet, unemployment soaring, riots on the streets and massive inflation.

which governmets would bail out the banks which go bankrupt when the piigs (plus the uk, japan and the usa ) they all go bust as you say?

and do you really think we could have a property market crash, and at same time massive inflation?

answer: any government that can print it's own currency

answer: yes, property prices collapsed in relative terms in every hyperinflationary collapse in recent memory (yugoslavia, argentina, zimb.). I think it has something to do with people valuing keeping themselves fed over owning shelter.

Can't take out a loan, can't hold down a job, can't get a pay rise to even remotely keep up with inflation, why exactly would property prices rise?

They'd only start rising when everyone is a cash buyer.

Not so fast. That's not his point. He's not saying why would we see a property market crash in a deep recession or depression. What is saying is, if we experience massive inflation and for example a loaf of bread now costs £1000 (because of loss of confidence in fiat money - hyperinflation), why would there be a property market crash when homes are worth 1000's multiples of the price of bread?

On the surface it sounds a reasonable argument. Past experience during hyperinflation events suggests otherwise however. Property did not exchange hands for wheelbarrows of fiat money since everyone knew that paper money was worthless. Property exchanged hands for other tangible goods, the most predominant of which was...........drum roll please........GOLD ! So in relative terms the property market did crash. The property market crash was more evident in fiat money terms post-deflationary collapse, when confidence in new fiat money was restored, and fiat money was used as a medium of exchange again. Unfortunately by then, the damage was done, those societies experienced periods of economic depression and as you so ably put it "no job, no money, no loan" and property values as a result plunged.

correction: **** post-hyperinflationary ****

So what happens to the value of gold if the dollar becomes worthless ie what and how will it be measured (and who's call does that become)? I still believe that newsgroup pressure is bringing out the worst in everybody. On a sidenote, just back from hols in Mexico. They had lots of lovely things (that I didn't know about) to say about JP Morgan

Banwana:

The sky is the limit. As long as the dollar is the world's reserve currency gold will be priced in dollars, but you can measure it against anything you like.

However, it is important to understand that what we are witnessing is not a spectacular increase in the value of gold but rather the inevitable collapse of a forty year fiat currency bubble.

Inevitable ?
We shall see.

"The 'fiat' dollar is one of the world's astounding monetary creations. That a currency of no intrinsic value is accepted as money the world over is an achievement that no monetary economist up until not so many decades ago could have imagined. It'll be 40 years next month that the dollar has been purely faith-based. I don't believe for a moment it's destined to go on much longer. I think the existing monetary arrangements are so precarious, so ill-founded, and so destructive of the economic activity they are supposed to support and nurture that they will be replaced by something better."

----- Jim Grant, "Interest Rate Observer"

Well there you are.
Jim's said it, M's supporting it, Banwana'a on board, what are we waiting for ?

Sorry Live 4's on board, Banwana's still apparently sceptical ( apologies B).

I know you're all just waiting for the mass of ordinary people like me to follow like sheep, as we are  just just being led by the nose by whomever is in political power at any moment in time after all.
We'd all perhaps even be content to believe ( and even trust) the likes of Menelaus, but who's to say he's any more right than any other self-professed expert ?.

So if America, Japan, Spain, Italy, Portugal,Greece, Portugal and Ireland all went bankrupt it would basically be an apocalyptic vision we'd all be trying to eat as many things we could grow in our own gardens and they'd be nothing to buy in the shops.

Starvation would be rife and society would degrade to its lowest possible denominator. Anarchy and death would become the norm and the streets would be full of violent people trying to rob you. Is it possible?

It certainly seems to me that the developed countries are in denial about the crushing debt problem and believe, that in some not yet prodicted way, all these finacial woes will somehow eradicate themselves naturally.

I do believe myself that the fiscal problems of the last couple of years were the phoney war, the suggestion I've heard on the news is that the finacial crisis was at it worst about three years ago but surely that's wrong, isn't it true the worst is yet to come?

My reaction to your last post......since I didn't participate when you originally asked the question:

1. America, Japan, Spain, Italy, Portugal, Greece, and Ireland ARE bankrupt with public debt that they will never be able to repay, it's just that we haven't acknowledged it yet. Most people confuse liquid with solvent and also fail to see that some countries (those who can print their own money) have already technically defaulted on their obligations by debasing their currencies. You can add the UK in this "bankrupt" group.

2. What's well in it's way of failing at the moment is the fiat monetary system the world has in place. It relies on expanding credit growth to survive and this exponential growth (even with the Chinese "miracle" included) has come to an end. It is a system that was designed from the outset to fail in time, no one who understands that money is created as debt and the power of exponents is surprised.

3. Yes, if the FED in collaboration with other central banks who have been trying so desperately and rather unsuccessfully so far to inflate assets and prevent a bank balance sheet contraction fail to revive the system, without at the same time killing fiat money through their money printing orgy, very hard times lie ahead. How bad will things get is anyone's guess, we all have different visions of what "armageddon" following a financial system collapse, especially a global one, might look like. Mine is not as dramatic as yours ("death in the streets"). Hilary Clinton recently said "the next wars will be fought over water and food". I believe she is correct but what she neglected to say is that will happen once the realization sets in that cheap oil is gone forever. I also believe we are several years past that point.

4. Phoney wars indeed. It's all about securing access to the world's alpha commodity...OIL. Everything else they tell you (install democracy, fight terrorism, etc.) is nothing more than propaganda and brain washing for the masses. And you know what, so far they've gotten away with it. People are still waving the union jack and the stars and stripes in the streets while their children are being killed in foreign countries. It never ceases to amaze me how much the public has been dumbed down and easily distracted with trivial matters.

5. Yes, absolutely true that even under the most optimistic scenarios, the worst is yet to come.

All that will happen is that the rich will get richer and the poor will get poorer,
Why shouldn't history just repeat itself ?

The rich getting richer and the poor getting poorer has been happening all along in this system and the gap has widened since 2007. So you're not telling us anything new.

In a complete "re-set" however, it's quite possible the rich will get richer (in relevant terms), after all I suspect with gold at $1,600+ an ounce it's not your regular debt up to his eye-balls Andy Cap who's loading up, but it's also quite possible (if past history is any indication) that a lot of those rich money-elite power brokers can lose their heads to an angry mob.

Call me a defeatist or whatever, but nothing's going to really change.
Unless there is a world wide war ( religious) where the Islamic approach to banking, money lending takes over.

..spain and italys borrowing costs continuing to rise...

once it gets to 7 or 8 % then is unsustainable for them to borrow from the markets....

...and they are too big to turn to the European Central Bank.......

......August usually a time of volatilty dut to relatively lower volumes in the market...

..Carnage may not be too far away !!!!!!

http://www.bbc.co.uk/news/business-14385636

[:o][:o][:o][:(][:(][:(][:(][:(][;)][;)]

Berlusconi.....

...."nothing fundamentally wrong with the economy....all the doing of outside influences..."



..like heving a deaf and blind man navigating a supertanker filled with oil navigating the antarctic icebergs....

dopey c***