European Union members on the European Union

[HOZ]

It ain't pretty unless you are China which owns America

Million dollar questions!!!

[Thor]

The EU has some dark times ahead, mind you its in its infancy but even factoring in growing pains as a new system/currency; its not a pretty beginning.

The obvious problem is when you join all these different countries together its difficult to rule them properly as an economic system.

However I see dark days ahead for all the world, we'll need a revolution of sorts in how we do business in the future and I think we'll see some of that coming up in the next 50 yrs as the US debt reaches crisis levels and the EU and Asia go through some serious crisis.

I'm in the camp of capitalism sucks but its the best system we have.

[Ozy_Flame]

Originally Posted by Thor

I'm in the camp of capitalism sucks but its the best system we have.

Pffff. . . Capitalism . . . . A robocracy is where it's at. We need robots to manage our money. PERIOD. Humans just aren't any good at it.

[peter12]

I'm in the camp of globalization sucks. Here's hoping the European Union bombs.

[mykalberta]

Anyone who had ever travelled to greece or some of these fringe EU countries had to have seen this coming. Greece using a currency as expensive as the Euro was a complete and utter joke. Their infrastructure is barely above that of Mexico and the currency was worth 8X as much.

I was there 2 years before they had the olympics and you could just see their impending doom, the general laziness of taking 3 hours off in the middle of the day. Shops that are closed at random days and random hours. Signs on stores that say when they will open and you get there and they arent open, hotels that give away your reservation even though you arrived before check in time - Italy seemed equally as disorganized when I went there.

Its probably why I hold Switzerland in such high regard, I visited there after Greece and Italy, and compared to those 2, Switzerland was like sweet Nirvana, except of course for the 16.99 Bic Mac combo But the sweet model train stores and underground malls and just the general awesomeness of Switzerland made it that much more of an awesome place.

[Pinner]

China certainly holds the world's purse strings, they can, will manipulate countries and their foreign policies buy selling/holding a countries bonds.

They could crush the US just by selling the debt they own.

[mykalberta]

I have heard alot of people say that, but if they own bonds that have a maturity date its not like they can come calling for the money now. If they sell the bonds at a loss the only thing the US loses is the value of future bond sales no?

Knowing the US if China ever did that the US might just start printing money and since China is pegged to the dollar they would only be hurting themselves.

Its not like the UK IOUs the US had after WW1.

[HOZ]

The European Union is in a whole world lot of hurt. Europe is not. Germany is looking like they are about to toss the whole thing under a bus. 30 hour weeks, retire at 50, cradle to grave safety net stuff is close to ending.

Pinner- yes....but they would be crapping into their own burger if they did so!

[Pastiche]

China owns bonds. They are an investor. As such, they are exposed to some fairly significant risk. They can't just start dictating the terms of a global economy without the risk of significant losses on their holdings.

[CaptainCrunch]

China - "We're calling in your debt America, we want our money"

U.S. - "Thats cool and all, but we spent all of our money on these invisible bombers and nuclear warheads and carrier battlegroups"

China - "You pay us later"

[Pastiche]

Thing with sovereign debt is that you can't just call in the debt. The U.S. isn't taking a loan out from China. They're selling them bonds. Bonds have maturity dates, you can't just call it in before the maturity date. The only way to do that would be sell the bonds on the secondary market.

If the yields get too high the U.S. would just inflate the hell out of their currency and pay the bondholders back. Nobody wins in that situation.

[Pinner]

All China really has to worry about is weather it can feed "most" of it's citizens...

They can defend themselves and feed themselves so it's all good, they don't need the same way the western world does and the people in power will not be voted out of office.

To them money is just paper, but to the west, it's power.

[mikey_the_redneck]

I hope the EU fails so Canadians/Americans don't accept being part of plans for the North American Union.

I would rather not hand our economic sovereignty over to some international central banking cartel thanks....

[Cowboy89]

Originally Posted by Thor

I'm in the camp of capitalism sucks but its the best system we have.

The problem isn't capitalism, it's in how it's administered in a democratic system. What has to be done on the debt/public expenditure front will not be done in the US and in European countries because their electorates lack the backbone and the will to endure life after austerity measures. They will keep in power governments that will do things for short term reasons. What ends up happening is half measures are taken to push the problems further into the future (Automaker Bailout, Bank bailouts, unemployment insurance, stimulus packages, government health care). Ultimately as the problem gets passed on it gets bigger, until the point at which the capacity to push it into the future will be no more and it blows up. Hence what already happened in Greece.

Yes there will be different world in the future, but it certainly will not be one in which capitalism and social darwinism are restrained out of existance but rather ones in which both the positive and negative consequences are felt. We have tried to insulate ourselves collectively from business cycle losses and other bad times of the economy by government debt. It only works until you can no longer borrow any more.

[CaptainCrunch]

I agree with Cowboy, what we're seeing is not capitalism. Under a capitalist system there would be no buyouts, the market would be allowed to adjust itself and competition would be king. None of this hoping for the government to jump in and save our jobs.

It would go back to a happier time when trade union members would be beaten, where machines would be smaller because we could use childrens small hands to unjam them. Where cheap labour could be procured through work farms for the unemployed.

[Flame Of Liberty]

Originally Posted by mikey_the_redneck

I hope the EU fails so Canadians/Americans don't accept being part of plans for the North American Union.

I would rather not hand our economic sovereignty over to some international central banking cartel thanks....

Too late, I'm afraid, way too late:

The German Economics Minister Rainer Bruederle has just confirmed precisely what many have known and said for years, namely that the US Federal Reserve is active in the secondary markets, in this particular case in FX. While not so much of a secret for some of the fringe players such as a the SNB, BOE and BOJ, the Fed has never had a formal statement on currency intervention, as, of course, it would have been seen as a sign of weakness (and allegedly could be considered an unconstitutional activity).

...

The U.S. Federal Reserve is also active in currency markets, German Economics Minister Rainer Bruederle said Friday.

"It is a regular procedure of central banks," to intervene in currency markets, Bruederle said. "It is not a secret," that central banks have a foreign exchange rate target, he added.

http://www.zerohedge.com/article/ger...ates-fx-market

[Pinner]

Originally Posted by Cowboy89

It only works until you can no longer borrow any more.

I'm no economist so forgive my ignorance, I imagine as currencies (debt) become less attractive the interest rates will rise and rise to make the debt more attractive until the economy is crippled.

Debt will also cripple everyday people when this happens right?

China doesn't necessarily have to sell much foreign debt, they could just stop buying it.

[Hack&Lube]

Great video but I'm not sure what the title of this thread means as this is a bit of satire from Australian TV with Australians.

[Shazam]

Originally Posted by Pinner

I'm no economist so forgive my ignorance, I imagine as currencies (debt) become less attractive the interest rates will rise and rise to make the debt more attractive until the economy is crippled.

Debt will also cripple everyday people when this happens right?

Well, that's one scenario.

China doesn't necessarily have to sell much foreign debt, they could just stop buying it.

Not on your life will this happen. China has such a huge trade surplus, they want to keep their currency low; they can't stop buying bonds as a result.

[Pinner]

Originally Posted by CaptainCrunch

It would go back to a happier time when trade union members would be beaten, where machines would be smaller because we could use childrens small hands to unjam them. Where cheap labour could be procured through work farms for the unemployed.

Kinda like China