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Paradox
10 May 2011
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Posted Mon 27 Jun 2011 14:09

I suppose I could have tacked this on in the "Economic Doom Looms" thread but I think it's important in its own right and shouldn't get lost in the multitude of posts there. So, do you think that we will revisit the GFC and if you do, why? And how do you think Australia will fare?

Some think that the PIIGS( Portugal , Italy, Ireland, Greece and Spain) , Greece in particular, could precipitate another. Others think that defaults by these countries on their loans will be absorbed seeing that they aren't major economic drivers like France, Germany and the USA.

Some writers think that Australia could be badly hit because the banks weren't very exposed to the rest of the world during the GFC but have since started to increase their exposure in these ticklish times.

Others think she'll be right because our resources sales, to China in particular, will keep us laughing.

Of course, there are many other perspectives.

Pete
14 Nov 2008
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Posted Mon 27 Jun 2011 17:15

I think it is quite plausable, but I don't think the powers that be are all that sure of what the flow on effects will actually be. If they were confident that Greece etc would have little impact they would have already let them collapse as an example to other countries. I expect they will take a more cautious approach and try to help them out as much as possible in an attempt to lessen any impact. During such time the banks of the remaining countries will no doubt tighten their books. We have already seen this in Australia as have reduced their exposure to property and business lending in an attempt to sure up their assets. I am not sure about them increasing their exposure to the rest of the world since the previous GFC, but unless funding gets cut to our banks from overseas (similar to RAMS) I don't expect much different from the previous GFC. The only differene being that last time we were so economically strong that we didn't notice the economy slowing down as much. If it happens again now it would be more noticable because of the lower starting point.

Firefly_au
30 Mar 2009
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Posted Mon 27 Jun 2011 18:14

It won't be another GFC this time IMO......

But there is still a debt crisis to be worked through the worlds financial system as those nations and individual entities come to terms with their creditors or default due to too much borrowing and not enough income to service the debt. Many will lose nearly everything but the ability to start again! Some may even lose that!

Those with manageable debt and capital to spare to invest will be the long term winners and enjoy all the available options and choices IMO.....

Cheers

Larry Phig Lau
20 Jan 2009
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Posted Mon 27 Jun 2011 19:30

Fundamentals in economy and stocks always changes after a big crash. How many big finance companies, miners and property trusts did we lost after the first crash. They were doing just fine before the crash, posting record after record profits and suddenly 6-12 months after the market crash they went broke. Basically any stocks that are exposed to extreme credit or debt is at risk banks or trust or miners or even retailers. Greece is a goner as far as I am concern and it is better of for it to default change government and start it over again with a new currency just like Argentina did. The losers will be the banks and the creditors. Sure it may trigger the bankruptcy of other piigs and create a global credit crunch but that is the risk the world has to take if it doesn't bailout Greece .

Larry Phig Lau
20 Jan 2009
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Posted Mon 27 Jun 2011 21:36

Hi Prof, how is your gold going? The down fall of the empires can be attributed to it's social ills. When citizens get too complacent or looses it's morality and doesn't take care of the family unit it is the next step to failing of a empire. Currently this society has lost it's values and we see the destruction of the family unit where wealth is created stored and left to the next generation. These days we get men with so many sets of wives and children leaving so many single mothers and children in poverty, this is magnified by drugs and other addictions like gambling. Too many children grow up without their fathers in their lives or without a stable home or even a descent dwelling. Most will have no inheritance either. The wealth of a society can only be created when there is morality, culture and responsibility. Society should teach it's young men to be more responsible how many sets of misery do they have to create.

JASON
04 Apr 2009
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Posted Tue 28 Jun 2011 08:24

Hi Larry,

100% agree with your last entry

Toby
08 Aug 2009
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Posted Tue 28 Jun 2011 21:43

Three quarters of Greeks oppose the austerity plan.

The austerity plan will likely go through, and 3/4 of greeks will be unhappy, actually having to pay taxes..

They'd prefer going to their bank tomorrow and finding the ATM has eaten eaten their card.

Maybe another stipulation the IMF should make before bailing anyone out is they'd have to stop using the Euro..

Pete
14 Nov 2008
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Posted Wed 29 Jun 2011 09:08

"Maybe another stipulation the IMF should make before bailing anyone out is they'd have to stop using the Euro"

The way I see it, all possible scenarios are basically the same end result. The only difference being who bears the burden most, and how much control do you want over the consequences.

1. Let Greece fail and it defaults on it's loans. The lenders bear the burden and in order to absorb that they call in their assets thereby spreading that cost.

2. IMF bails Greece out. But where does this money actually come from? The source of these funds then bears the burden. Here we also have 2 sub-scenarios

a. Keep Greece in the EU and you can use the strength of the Euro to lessen the burden on the IMF thereby spreading it across Europe as well.

b. Make Greece discard the Euro and it would take the IMF more to bail out Greece as it's alternative currency free falls.

To me this is a similar scenario as what happened in USA, they had the choice of spreading the burden across all it's citizens or letting the weak fail (which could still result in everyone suffering)

Bobby Green
05 Oct 2010
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Posted Wed 29 Jun 2011 11:53

This seems like a theory question here, about the real bill's dctrine vs quantity theory of money/inflation theory. We know Greek assets were wanted - for issuance of money - in support of the real bills idea.
If this is an economic experiment, maybe Greece may also need to be isolated from Euro, perhaps, somehow if possible, perhaps banning Grk from EU. Grk assets need to be taken by EU though, imho there is no way out of this for the Grks, and the EU, to reduce EU risks/Gk risks. Perhaps absorb Greec to make it part of another country even, or have EU invade it and take it over competely to force it to pay extremely high taxes.

JASON
04 Apr 2009
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Posted Fri 01 Jul 2011 17:53

"What do you think, Jason? Or do you still have your head stuck in the sand? Oh, that's right, I forgot. It doesn't matter anymore about what happens in the USA. That place is only full of conspiracy theorists"

Whats the question?
Rather than talking rubbish & then throwing abuse at me, how about you just ask a question?
As you know I always answer but I have yet to recieve any answers from you, just more rubbish.

USA will not collapse & its problems will only have a (needed) cooling affect on Australias & Asias booming times ahead.

"This is why stock markets look set to tank"
I'm not part of this ponzi scheme, lol, the sharemarket/stockmarket is more transparent than papermoney, but at least you can buy stuff with paper money, you can't buy anything with shares/stocks

From where I'm sitting the ones in the most trouble/losing/lost the most in USA/Eurozone are the greedy. It will be the same here, as I say I am not concerned at all.
I think I've said before on here I wouldn't hold shares or commodities, I always believe in self-sufficiency.

Toby
08 Aug 2009
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Posted Fri 01 Jul 2011 18:16

There's a good chance I might be wrong but didn't you also mention you worked in the LNG industries?

Toby
08 Aug 2009
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Posted Fri 01 Jul 2011 19:35

Rather than rant on about the relationship between share holders, exploration, development, capital raising, getting project's off the ground, ect.. I prefer to reminisce about my teenage years. When I was a teenager I planed to be self-sufficient. I was going to make my way to the most isolated area in Australia and live off the fat of the land, leaving society far behind me. Hunting kangaroos and Goannas, collecting bush-tuck, making fires with wood and sticks.

JASON
04 Apr 2009
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Posted Sat 02 Jul 2011 09:40

lol, hi toddy,

You are correct my business does have interests in lng, but I do not sell shares in my business, I just don't believe in that system (I understand why it happens, money raising) but for me a business should grow naturally & that means zero debt (as soon as possible) & 100% ownership (not share selling).
I get the feeling in your post you are calling me a dreamer, well I am living the dream, I don't worry about share prices, I don't worry about gold prices, I don't worry about banks printing money, I don't worry about currencies, I don't worry about lossing my job, I don't worry about interest rates.
The reason I don't worry is because from the age of independance I put a plan in place to be independant, I don't run to my parents for money (I worked from the age of 14), I didn't live under their roof for free either (I moved out at 16), I realised that working for others does not get you financially independant either & started my business at 21.
As I got older I realised that a large part of schooling was conditioning us to a long life of working & once working for others into your 30's & 40's you are conditioned to need to work, ever seen those 60 your olds in bunnings (thats not for me), living in the city is also another way of controlling people, you work for money but look at how much money you spend because of working in the city (toll roads/public transport costs, raised (convienient) food/drink prices, parking costs etc.

JASON
04 Apr 2009
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Posted Sat 02 Jul 2011 09:48

"I prefer to reminisce"
"I was going to make my way to the most isolated area in Australia"

Mate you don't have to reminisce, the dream is still possible & you don't have to live isolated to achieve this either.

"leaving society far behind me"

Last christmas I saw a man blinded in one eye during a visit to Brisbane thanks to drunken louts & a year before that we got broken into whilst the girlfriend was home alone. So we have chosen to move out of the city (society) & onto the beach (society),(less than 5mins walk & can see the ocean from my front lawn where the kangaroos are eating), this 3 bedroom house & 1500m2 land only cost $300,000. You can keep your $600,000 mortgage in the city.

" Hunting kangaroos and Goannas, collecting bush-tuck, making fires with wood and sticks"

lol, these days I feed the kangaroos rather than hunting them & I do have a nice open fire for winter QLD nights (free wood from the garden) but also enjoy the free solar power heating.

I have nothing against people who choose the city life & playing the sharemarket, but some come on here & whinge about it & go on about how hard life is (I know you are not one of them lol), it is just not for me my friend ;)

I will leave you to gambling your city money on the sharemarket until your 85 lol afterall you are one of the most positive members on this forum

JASON
04 Apr 2009
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Posted Sat 02 Jul 2011 09:50

Do you mind me asking your age toddy? Helps me link your entries to your stage in life

JASON
04 Apr 2009
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Posted Sat 02 Jul 2011 11:55

Calm down fruity, your getting excited again mate,

My reply to you (which you failed to notice was) What is the question?

But as usual you have got on your high horse & gone all defensive just repeating names & websites.

I am still waiting for your reply to many of my questions in relation to facts & figures I have posted on here that oppose your comments but you still choose to ignore them, just refering me to some other bunch of guys who make money out of the gulible.

Again What is your question?