Failcascade

Endgame ahead

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IMF advisor Robert Shapiro: 2 to 3 weeks till meltdown

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In an interview with IMF advisor Robert Shapiro, the bailout expert has pretty much said what, once again, is on everyone’s mind: “If they can not address [the financial crisis] in a credible way I believe within perhaps 2 to 3 weeks we will have a meltdown in sovereign debt which will produce a meltdown across the European banking system. We are not just talking about a relatively small Belgian bank, we are talking about the largest banks in the world, the largest banks in Germany, the largest banks in France, that will spread to the United Kingdom, it will spread everywhere because the global financial system is so interconnected. All those banks are counterparties to every significant bank in the United States, and in Britain, and in Japan, and around the world. This would be a crisis that would be in my view more serrious than the crisis in 2008…. What we don’t know the state of credit default swaps held by banks against sovereign debt and against European banks, nor do we know the state of CDS held by British banks, nor are we certain of how certain the exposure of British banks is to the Ireland sovereign debt problems.”

So if you live in (Western) Europe, my investment advice would be to go long on: food supplies, fuel, guns & ammunition

Written by mo

October 7th, 2011 at 12:00 am

Current European market summary

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Quoting Peter Tchir of TF Market Advisors:

[…] we are back to rallying on headlines and sound-bites and hopes that “Europe Finally Gets It”   Maybe this time the details won’t disappoint.  Actually, maybe this time we will get to the details, since so many of the last few rallies were based on rumors or plans that never even made it to the detail stage.  In the meantime I will try and figure out how Italy providing money to EFSF so the EFSF can buy their bonds, how Italy contributing to the ECB which buys its bonds, how Italy providing money to the IMF to buy Italian bonds, and Italy working on plans to save Italian banks whose exposure to Italy is a part of their problem, fixes anything.

Yep, that seems to sum it up nicely.

Written by mo

October 5th, 2011 at 12:41 pm

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