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Ted, your comment reminds me of something Cramer said last week when the market was diving, and folks bought after the first 60 minutes on what they interpreted as a slight weakness. If you want to buy the dips, you should wait until the market actually dips.
Hi guys! I must agree with the Linkster....Monday is a buy day. All markets should be down. An international or global fund maybe as the dollar might strengthen. This week should be interesting---with China in the mix. Things are happening that can't be marked to a market price. As they say, the spread is your friend. the Pudd
IMHO you should not try to be a hero. The early bird may catch the worm but the early worm gets eaten . Best to wait till Thursday at which point the fog will probably lift and while there will be risk you may be able to evaluate it.
I think I heard that July 20 is the next day that a payment is due. Maybe they will work out something before then.
Interesting how some of the media portray Germany as a bully. Germany decided they wanted proof that Greece was doing something about their debt. Greece just wants to hit the reset button and start over as if nothing happened.
No, accepting austerity conditions, whatever they are, will not have any efficacy, and did not in the past. You absolutely cannot 'austere' your way here to economic improvement or economic health.
Wolfgang Munchau today in FT: If you have been unemployed for five years, with no prospect of a job, it makes no difference whether the money you do not get is denominated in euros, or in drachma.
Greece is more like a child who cannot find work. And if she is wayward and I lend to her, I am a larger part of the problem. She did not do any stealing from my wallet. And there is zero way for her to help herself in this situation; moreover, she already has done a ton to help herself. All respected economists writing today concur.
' ...most — not all, but most — of what you’ve heard about Greek profligacy and irresponsibility is false. Yes, the Greek government was spending beyond its means in the late 2000s. But since then it has repeatedly slashed spending and raised taxes. Government employment has fallen more than 25 percent, and pensions (which were indeed much too generous) have been cut sharply. If you add up all the austerity measures, they have been more than enough to eliminate the original deficit and turn it into a large surplus. So why didn’t this happen? Because the Greek economy collapsed, largely as a result of those very austerity measures, dragging revenues down with it. And this collapse, in turn, had a lot to do with the euro, which trapped Greece in an economic straitjacket. Cases of successful austerity ... typically involve large currency devaluations that make their exports more competitive. ... But Greece, without its own currency, didn’t have that option.' (Krugman last week)
One of the often-touted advantages of the American business mindset is the ability to declare bankruptcy, get up off the floor, and try again. Quite a few American financial heroes have business failures in their past record.
Different mindset if you're not American and not in business, though. Why is that? ... ... ... ...
Lending money to a close family member when the probability of payback is nonexistent is one thing: there are lots of other offsetting emotional factors working there. I notice no examples of individuals advancing loans to total strangers when the probability of payback is nonexistent.
Yet lots of large financial entities have advanced loans under similar circumstances to Greece, when it's been painfully obvious for decades that the odds of repayment were poor-to-none. Now everyone seems to act as if this is a surprise. Why is that? ... ... ... ...
While traveling in a country and asking lots of questions it's not too hard to form general impressions of that country. As I've noted before Greece has no significant industrial or international commercial base. It is a fractured small-agriculture, small shop-owner, tourist service oriented economy.
If I could figure this out in three or four weeks why should we be upset that the "professionals" who failed to perform due diligence are now squealing in dismay? ... ... ... ...
Greece and Italy never met the requirements for and should never have been admitted to the EU. That was certainly no secret at the time: it was widely observed in financial discussions. Creditors pretended that all was well though, because NATO needed presence in the Mediterranean.
Greece's financial situation is now important, because we evidently don't need Greece so much for military purposes (although that may prove to be very short-sighted, due to Mr. Putin's ambitions). You think possibly a cynical double-standard here?
We've all heard enough reasons why a country's budget should not be analogized to a household's. (For example, if they were similar, then one could "dynamically score" a household budget, and claim that losing a job - like cutting taxes - would increase household income.) Likewise, countries are not businesses. A country's raison d'être is not profit.
So these analogies don't work well for me.
Nevertheless, to address a couple of items:
- People throw money at companies (strangers) all the time. They put on blinders and hope and wish for some good outcome. Look at all the money lost in the dotcom bust on companies that didn't have a business plan, a market, a prayer.
- Bankruptcy/restart. IMHO it's a cultural thing (possibly legal as well, e.g. Puerto Rico). If you're immersed in the culture (e.g. Silicon Valley), bankruptcy is something you put on the table and talk about, even if you decide not to go through with it. Elsewhere, people seem to feel that there's some sort of stigma attached, whether it's moral, or a black mark on their resume, or whatever. Any mention of the possibility is hushed up.
In the US, at least, bankruptcy is designed to eliminate that stigma and offer a fresh start. If you don't understand that, if you're not living in that culture, you tend to avoid even discussing bankruptcy, regardless of how much sense it makes.
I've been through too many failed companies. The stories I could tell. I'm sure my lawyer (if I had one at the moment) would be advising me I've said too much already
Comments
Regards,
Ted
Ted, your comment reminds me of something Cramer said last week when the market was diving, and folks bought after the first 60 minutes on what they interpreted as a slight weakness. If you want to buy the dips, you should wait until the market actually dips.
I plan to sit back and do nothing for a bit.
I must agree with the Linkster....Monday is a buy day. All markets should be down. An international or global fund maybe as the dollar might strengthen. This week should be interesting---with China in the mix. Things are happening that can't be marked to a market price. As they say, the spread is your friend.
the Pudd
A good day for CNBC ratings.
Arends is invariably sensible, in my experience.
Interesting how some of the media portray Germany as a bully. Germany decided they wanted proof that Greece was doing something about their debt. Greece just wants to hit the reset button and start over as if nothing happened.
While I don't plan to exit this planetary boundry just yet; I don't know there will be a satisfactory "fix" before it is time for me to "leave".
Catch
No, accepting austerity conditions, whatever they are, will not have any efficacy, and did not in the past. You absolutely cannot 'austere' your way here to economic improvement or economic health.
Wolfgang Munchau today in FT:
If you have been unemployed for five years, with no prospect of a job, it makes no difference whether the money you do not get is denominated in euros, or in drachma.
Greece is more like a child who cannot find work. And if she is wayward and I lend to her, I am a larger part of the problem. She did not do any stealing from my wallet. And there is zero way for her to help herself in this situation; moreover, she already has done a ton to help herself. All respected economists writing today concur.
' ...most — not all, but most — of what you’ve heard about Greek profligacy and irresponsibility is false. Yes, the Greek government was spending beyond its means in the late 2000s. But since then it has repeatedly slashed spending and raised taxes. Government employment has fallen more than 25 percent, and pensions (which were indeed much too generous) have been cut sharply. If you add up all the austerity measures, they have been more than enough to eliminate the original deficit and turn it into a large surplus. So why didn’t this happen? Because the Greek economy collapsed, largely as a result of those very austerity measures, dragging revenues down with it.
And this collapse, in turn, had a lot to do with the euro, which trapped Greece in an economic straitjacket. Cases of successful austerity ... typically involve large currency devaluations that make their exports more competitive. ... But Greece, without its own currency, didn’t have that option.' (Krugman last week)
One of the often-touted advantages of the American business mindset is the ability to declare bankruptcy, get up off the floor, and try again. Quite a few American financial heroes have business failures in their past record.
Different mindset if you're not American and not in business, though. Why is that?
... ... ... ...
Lending money to a close family member when the probability of payback is nonexistent is one thing: there are lots of other offsetting emotional factors working there. I notice no examples of individuals advancing loans to total strangers when the probability of payback is nonexistent.
Yet lots of large financial entities have advanced loans under similar circumstances to Greece, when it's been painfully obvious for decades that the odds of repayment were poor-to-none. Now everyone seems to act as if this is a surprise. Why is that?
... ... ... ...
While traveling in a country and asking lots of questions it's not too hard to form general impressions of that country. As I've noted before Greece has no significant industrial or international commercial base. It is a fractured small-agriculture, small shop-owner, tourist service oriented economy.
If I could figure this out in three or four weeks why should we be upset that the "professionals" who failed to perform due diligence are now squealing in dismay?
... ... ... ...
Greece and Italy never met the requirements for and should never have been admitted to the EU. That was certainly no secret at the time: it was widely observed in financial discussions. Creditors pretended that all was well though, because NATO needed presence in the Mediterranean.
Greece's financial situation is now important, because we evidently don't need Greece so much for military purposes (although that may prove to be very short-sighted, due to Mr. Putin's ambitions). You think possibly a cynical double-standard here?
So these analogies don't work well for me.
Nevertheless, to address a couple of items:
- People throw money at companies (strangers) all the time. They put on blinders and hope and wish for some good outcome. Look at all the money lost in the dotcom bust on companies that didn't have a business plan, a market, a prayer.
- Bankruptcy/restart. IMHO it's a cultural thing (possibly legal as well, e.g. Puerto Rico). If you're immersed in the culture (e.g. Silicon Valley), bankruptcy is something you put on the table and talk about, even if you decide not to go through with it. Elsewhere, people seem to feel that there's some sort of stigma attached, whether it's moral, or a black mark on their resume, or whatever. Any mention of the possibility is hushed up.
In the US, at least, bankruptcy is designed to eliminate that stigma and offer a fresh start. If you don't understand that, if you're not living in that culture, you tend to avoid even discussing bankruptcy, regardless of how much sense it makes.
I've been through too many failed companies. The stories I could tell. I'm sure my lawyer (if I had one at the moment) would be advising me I've said too much already