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RBS issues global stock and credit crash alertBy Ambrose Evans-Pritchard, International Business Editor Last Updated: 12:19am BST 19/06/2008 The Royal Bank of Scotland has advised clients to brace for a full-fledged crash in global stock and credit markets over the next three months as inflation paralyses the major central banks.
Such a slide on world bourses would amount to one of the worst bear markets over the last century. RBS said the iTraxx index of high-grade corporate bonds could soar to 130/150 while the "Crossover" index of lower grade corporate bonds could reach 650/700 in a renewed bout of panic on the debt markets. "I do not think I can be much blunter. If you have to be in credit, focus on quality, short durations, non-cyclical defensive names. advertisement "Cash is the key safe haven. This is about not losing your money, and not losing your job," said Mr Janjuah, who became a City star after his grim warnings last year about the credit crisis proved all too accurate. RBS expects Wall Street to rally a little further into early July before short-lived momentum from America's fiscal boost begins to fizzle out, and the delayed effects of the oil spike inflict their damage. "Globalisation was always going to risk putting G7 bankers into a dangerous corner at some point. We have got to that point," he said. US Federal Reserve and the European Central Bank both face a Hobson's choice as workers start to lose their jobs in earnest and lenders cut off credit. The authorities cannot respond with easy money because oil and food costs continue to push headline inflation to levels that are unsettling the markets. "The ugly spoiler is that we may need to see much lower global growth in order to get lower inflation," he said. "The Fed is in panic mode. The massive credibility chasms down which the Fed and maybe even the ECB will plummet when they fail to hike rates in the face of higher inflation will combine to give us a big sell-off in risky assets," he said. Kit Jukes, RBS's head of debt markets, said Europe would not be immune. "Economic weakness is spreading and the latest data on consumer demand and confidence are dire. The ECB is hell-bent on raising rates. "The political fall-out could be substantial as finance ministers from the weaker economies rail at the ECB. Wider spreads between the German Bunds and peripheral markets seem assured," he said. Ultimately, the bank expects the oil price spike to subside as the more powerful force of debt deflation takes hold next year.
Comments
The US economy faces a big crash...the signs are very worrying... Hi Ambrose,
I applaud RBS for being the only truthful bank in the western world. Greenspan destroyed the western economies with his reckless and egocentric policies. We are all going to pay the price.....the dow and S&P will fail, people will go to bonds and get cut off at the knees, and then panicked managers looking for yield will buy up the energy and precious metals mining stocks because they will be the only companies making good profits. "DB" your revisionist history is interesting, almost like the other moonbats posting here. The real facts of 1929 are that Europe had been reeling throughout the 1920's (post WWI) and finally when the US imposed tariffs, the global markets nose-dived. And Joseph Kennedy had made millions, then he jumped out of the stockmarket when a shoeshine boy was talking about the stocks he had just bought. A contrary position by Kennedy saved his butt. But today is no where near like 1929 and yet we always hear about it when a recession is in the future. And then there are the political moonbats that talk about it nearly every Presidential election.
Mr. Ambrose Evans-Pritchard....you have guts to tell the truth. Thanks for your integrity. To the one on here who said "ride it out", that may be bad advice.... after the last 30 yrs. of plenty. For those of us who are older it may be something you should try to avoid. "As a contrary long-term investor, this MUST be perfect timing for investing in stocks." -- Steve-n-KC
"Such positive uplifting news. nothing, but negative, negative, negative in the press." RPT
The rich will dare NOT drive their luxury $edans down public streets when the common man sees his childrn cold and hungry. So prepare for radical changes... and some of these changes are going to be extremely violent. shylock is alive and well on wallstreet-hide your $ to all those people claiming this is alarmist nonsense: read something other than mainstream / faux news.
Such positive uplifting news. nothing, but negative, negative, negative in the press.
What people forget is that there were market crashes in 1826, 1838, 1847, 1854, 1866, 1873, 1893, 1907, 1914, 1929 and about every 8-10 years since World War II. The South Sea Bubble of the 1700s was a market crash, described by Winston Churchill in "History of the English-Speaking Peoples" in the same words that could have described the dot.com bubble. Probably there were others, but econometric data are a bit sparse from back then. These things happen. It's due. Life goes on. Ride it out.
Its nice that the architects of our
More war on the way. My book "The Debt Delusion", Universal Publishers, Boca Raton, Florida 2008, alrady forecast a global recession 2008/9. It is also available as an EBook.
Like I said, the moonbats are ALL howling. (per "Matt" and "Truth Seeker") The US Economy will face a complete crash in september. Iran will be attacked by August and the president bush will declare a national state of emergancey and remain in power.
we all gonna die! Does it really matter if everybody unloads over-valued shares of companies for over-valued shares of governments? This is news?
I would just like to say how much I enjoy all the contributors to your ed...I have learned so much about grass-roots economics from the coal-face...and that is where it counts. Observation: is Mr Bean really going to take control? Surely this is the final nail in the coffin? Or is fractional reserve banking going into la la land at last, and we of the CIGAs (Comrades in Golden Arms)will arise triumphant in our real value economy. The battle is yet to begin..but beware all you who trust in fiat currency....."forgive them, for they know not what they do"
Economic catastrophe on every side?
Don't Worry be Happy and Party like it's 1929.
From Mexico:
"The Boss of RBS attended the Bilderberg meeting in Washington last week.. what you are told is simply what you told. It bears no resemblance to reality. Enjoy the ride..... :-) Huggy bear @ 8:56 PM
I take the last sentence to mean that the price of oil and gas is expected to decline as the money supply contracts due to reduced lending and thus a reduced money supply. Alhtough oil and gas will be "cheaper" there will be fewer dollars to buy the products. In real terms the cost will continue to rise. This is a typical alarmist. I am sure he will take advantage of the panic he is trying to cause. Truthfully I thought the Euro would be in trouble before this. There is no way all the coutries would work togther for any period of time. Each country has its own special interets. They beat down the dollar to feel good now they worry about the U.S. Economy. Bottom line the U.S. economy drives the world economy. You can bash the U.S. all you want but that is the fact. Central Banking = Inflation = Fail
The Boss of RBS attended the Bilderberg meeting in Washington last week. I am a millionaire silver derivatives trader and it is common knowledge amongst the silver community that what you are told is simply what you told. It bears no resemblance to reality. Enjoy the ride..... :-) This alarmist should be hung from the
Too bad they did not have this forward looking talent when they grew their balance sheet to hold all the crap they are now warning us about. The crash already happened. Just look at the RBS stock price. Anyone happen to know what the last sentence in the article means?
1.143 Quadrillion in deriatives and that was in the last three months ,fannie mae and freddie mac both have deriatives in excess of 450 trillion each,, JP morgan wrote over 7 trillion in last three months when fed reserves only took in 198 billion in capitol flow, JP morgan has 117 trillion in deriatives all of it is in the red as all are kill the carry trades, clear hedge funds, stop deriatives out right and charge criminally as it is fraud out right,, back currency with gold and silver,, dollar is gone its history,, every major financial house in the world will be hit if any deriative becomes a notional value the the holder becomes liable ,, anyone believes this isnt damaging or out right fraud needs to investigate this, dollar will go to 0.42 or lower its none event now but wait till a event comes it will be far worse,, no banking system in any form is safe except gold and silver, every currency in the world will be touched every 401K pension plans will be hit none are save take physical holdings of your shares ,, get away from margins dont ever meet one Is anyone surprised? This is what you get with paper money a central banking. And it will happen again. And again, and again. Until we finally realise that price fixing worthless money with fractional reserves is severely damaging to the economy. I read this with concern and would ask if RBS are considering calling in loans early to cover any short fall in the figures. Also how are they equipped should loanees default. One such loan that springs to mind is the loan given to Tom Hicks and George Gillet aganist Liverpool Fotball Club and the estimated interest of £30million per year. shaun on June 18, 2008 7:26 PM
I understand this. The problem is there are to many in the banking businesses that want countries who have always been a high risk to get up to speed with the rest of the money markets, debt markets, and global businesses. Even the World Bank won't loan money to these people like they did at one time. When Brazil tells the World Bank they're not going to repay the money they owe, then they devalue their currency. They're not the only ones. Russia is still in bad position for loans, and many of the Balkin and Slavic nations are in bad finacial shape. When you have people like George Soros going in there and wreaking their economies and then leaving them in shambles what do you expect? When the banks in the U.S. loan money to people who have no business being loaned money what do you expect. What these banks want to create is a responsible behavior in people, and nations. They think that if someone loans them the money they desparately need they will finally responsible. Well, duh! Most of these countries are corrupt and have been. You can't make a corrupt nation not corrupt by loaning money to them. It always goes to the people of that nation that weren't supposed to get it. Then the nations becomes delinquint on their payments and then they can't pay at all. When are these do-good banks going to get tough on these countries and their corrupt businesses. The reason why these countries and their businesses are corrupt and bad risks are because of the kind of people the banks are dealing with. If there are any of these kinds of people left in office, and the people of those nations haven't been responsible and gotten rid of them, they are still a bad risk and will be. The reason why American investors didn't pour into the former Soviet Union when supposedly Communism fell was because these people hadn't gone through the birthing period they need to go through where they get their democracy legs. That may take a long time. You have to wait and see if the people are serious about wanting to be free and take over their own economy. They weren't and they didn't. It's that simple. Those nations are still bad risks. There might be alot of companies in those countries, like Africa, that would make good investments. But, when their governments are Socialist or Marxist/Communists that company's profits cannot make it to the market in loan payments. Those profits will be taken by the government and stolen. This leaves that company in debt they cannot pay. Why loan them any more money. It's not the company's fault, it's their countries fault. It's not ready to be democratically profitable. In other words they are ready to be capitalist. They've either been to corrupt or Communist to long and there are to many remnants of the old government left that would still cause problems with their nations companies making a profit that would be theirs to keep. But, it's irresponsible behavior even on the part of ordinary Americans that causes banks to look in other areas to make a profit. When they tell the government they can't make any profit on these people they convince the government to let them make loans to other kinds of people who may not have liquidable assets like the bank would like for them to have, but the bank is willing to take the chance anyway. And look at what happened. There are bad loans that has for far to long called a "boom" in the economy. It's not a boom, it's a bust waiting to happen. When the Bank of Ireland says the boom is about to bust they are pointing out that the time for all these bad, risky loans to run their course and go down. It will be bad on all of us when there isn't enough good business concentrated in enough good business countries like it used to be. A long time ago people wanted to work to make money. Easy credit is what killed the hard work ethic of the people of this world. There are to many money companies that have nothing but credit to loan that don't have to be responsible for the payback. Why dont these people just shoot them selves in the foot, OH! sorry that what they have just done! Morons When inflation was relatively high then the credit one took that may have been unaffordable in the short term soon became affordable through increased wages. Now the central governments plug ad nauseum how good for us is the concept of low inflation is the once unafoordable debt that became affordable still remains unaffordable. What we need is a good bout of inflation that will shrink in real terms the value of the debt, assuming of course that you get a wage increase to off-set the effects of the increased inflation. So the £ loses value on the foreign exchanges, so what? That is what makes the exports cheaper abroad and the imports from abroad more expensive. Those on fixed incomes, like annuity holders, will of course suffer but they will be in the minority compared to the numbers who will benefit. Looks like ALL the moonbats are howling (ie. environmentalists, liberals, Democraps, Republicans, bankers, and the author of this article)
Gold: Someone truly said that we give strange value to Gold , that we first dig, and then keep it in warehouse and spend money to secure it. It deliver no value to the society.
Wow, this realy conserns me. I with all i hade to do was read this disturbing news instead of trying to make a living. I realy don't know how you educated idiots can stand it. HAVE A NICE DAY. I've been reading about this developing crisis in the financial scam markets on the internet for the last three years. The mainstream media talking heads however seem to have been taken completely by surprise.
Buy Gold, silver and platinum. It's the way to go.
One of the gents said the banks are all "owned" by the same one... he missed it. he is not remembering that Pres. Jimmy Carter, signed the usa into a treaty with the other national banks to buy each others money "money" alias "paper". THAT IS WHAT TIES THEM ALL TOGETHER. Paper Is Paper And, GOLD Is GOLD Matt the Moron
Times are tough and will be tougher. I wish everyone would seriously view the film clip in the URL link below and realize why times are tough and will be tougher in the future. This is not "scolding" or "lecturing" this is simply a statement of facts. Please dissociate ego and emotional reaction from the presented facts. Prove this Ruppert wrong and you will claim $1000.00. To date no one has taken his money.
One of the gents said the banks are all "owned" by the same one... he missed it. he is not remembering that Pres. Jimmy Carter, signed the usa into a treaty with the other national banks to buy each others money "money" alias "paper". THAT IS WHAT TIES THEM ALL TOGETHER. Somewhere the Rothschilds’ are kicking back, drinking good wine and laughing! Don’t you love the fiat system?
Armando Machado on June 18, 2008 6:14 PM
It's funny. So many people are hip to our fiat money
WOW! I don't think I've ever seen a bigger collection of idiots! SOUNDS LIKE MEDIA SPECULATION, KINDA LIKE ....THE HOUSING MARKET SPECULTION- THIS IS A RAG Bravo to the ECB for taking a tough stand!
Might put a damper on Pills Limbaugh's plan of 1968 redux at the DNC convention...people will be to busy dumpster diving Ok. So is it cash in the bank (under £35k), or is Gold the place to be? Well, I'm off for a curry and a few beers then! You euro bashers here saying that Germans are refusing southern countries really shows who is the enemy of Europe!
"I wish people would just get it! From the chaos will come the calm. All this (fiat)currency devaluation and liquidity problems are DELIBERATELY caused by the central bankers. The central banks are privately owned by the same people, be it the FED, ECB, BOE . Listen closely and you will hear the solution the are proposing. They are already proposing GLOBAL regulations to prevent this from happening again just 1929. A step closer to a global government."
The FED and the central Bank in UK are PRIVATE corporations with PRIVATE share-holders. The government does not even have the right to audit the FED . So , know we know what to blame! Just a question, but isn't it a self-fulfilling prophesy
A financial apocalypse is imminent and a major war in the gulf will follow soon.Then as history has shown we will come out of the debris to start a new chapter, which will take a few years. HISTORY RHYMES Fortunately we have world leaders such as Beyond-Trading.com helping us to make a fortune in the stock market during the turmoil. I'm pretty enjoying the valuable lessons while making money *Cash is the key safe haven*
There is one point all so-called conservatives (including Dr. Paul) need to grasp: Modern conservatism is merely seeking to conserve the liberalism of 200-500 years ago. These conserva-liberals simply do not have the stomach to accept the logical conclusions of their own principles. Liberty is a MEANS, not and END. Until the 'Cult of Liberty' is forsaken, no good of any substance can come to pass. God speed. @ Posted by Ian of Bedfordshire on June 18, 2008 2:32 PM
Its too late for Obama to destroy the US economy, Bush has already done it. James you are correct its only 67% that favor talking to Iran.
From Mexico:
Fiat money is a ponzi scam & gold is just a proxy by convention.
I predict that Obama will do every thing in his power (as president) to destroy the U.S. economy.
This is why I live alone in the Forest. Matt, you're an idiot. Fools think credit is money. And you can't live on credit forever.
If anything, the reason Germans are exchanging notes is because there is a fear of massive counterfeit operations in those traditionally corrupt cultures.
Uh, a 300 point drop in the S&P 500 is only a 22% loss, and though it would be a bear market, peak-to-trough would only be 34%, much less than the dot-com bust, or 1973-4... people get too worked up over small moves, even hypothetical ones.
Apologize for the American gov? 90% of Americans would like to talk to Iran? Keep smoking that stuff fella and your brain will rot out. Maybe you are qualified for a job at CNN but you are not in touch with the rest of us. We should just go back to batering This is not an 'easy money' driven inflation - it is energy (and stupid energy policy) driven. In the 1970's the world got to see how well higher interest rates stemmed inflation. They did NOT. Hopefully the US Federal Reserve will not repeat this blunder by raising rates into increasing energy prices. Remember stagflation, Jimmy Carter, and I believe it was called the Misery Index. We don't need that again. Are rough times ahead? - most likely, but let us not make them worse by blindly following the fiscal advice of those who will gain from our suffering. Put your $, euros, etc. into commodities, esp. food. The flooding in the US midwest is a disaster of Biblical proportions (its extent is not yet being reported-- it's known and easy to predict, but not being fully reported. o act sooner rather than later), and the US gov't will, trust me, do nothing to help. Greetings from America
All these stupid green taxes, regulations and charges,might be the final nail in the coffin, (regulated to DEATH). "I dont know where you got this information from, but, there are no Euro notes published by particular countries. They are all the same, issue be the ECB."
I think we are reaching another inflection point. Loosening credit to facilitate will not work. Borrowers are tapped out and losing jobs, and lenders are panicked and are afraid to loosen credit and they are looking for security (tighter lending terms). It is a Mexican standoff in the credit markets. Real inflation is running at better than 11% in part because inflation indexes ignore food and energy price hikes. With borrowing rates at say 5 or 6% lenders are subsidized for borrowing money and there are few takers. The boom was consumer led and now that consumers are under water with housing prices they feel particularly poor.
A number of people above are incorrect in saying that you can not tell where Euros were printed.
As a retired RBS Manager I am hugely encouraged to hear these remarks.Why you may ask?
For country codes on EURO notes issued by national banks see
What is money? It is a medium of exchange. What is the medium of exchange? It is the bottleneck between the population's labor of goods and services that the population has labored to produce and distribute for their necessities and simple pleasures of life and the acquisition of same. That medium of exchange always has and always would have to be controlled. This is where the problem lies. Either the government has to control it. Or private interests would have to control it. If it is controlled by the government, then the private interests would worm their way in to get control out of government hands into their own hands and they would seek to exploit the monetary benefits that this control can, and has brought. Babylon as spoken of in the bible in Isaiah 47, Jeremiah 51, and the Apocalypse 17, 18, and 19 is a metaphor for the medium of exchange. I, for one, am tired of fooling with it. May the day come swiftly for God's destruction of it. What is money? It is a medium of exchange. What is the medium of exchange? It is the bottleneck between the population's labor of goods and services that the population has labored to produce and distribute for their necessities and simple pleasures of life and the acquisition of same. That medium of exchange always has and always would have to be controlled. This is where the problem lies. Either the government has to control it. Or private interests would have to control it. If it is controlled by the government, then the private interests would worm their way in to get control out of government hands into their own hands and they would seek to exploit the monetary benefits that this control can, and has brought. Babylon as spoken of in the bible in Isaiah 47, Jeremiah 51, and the Apocalypse 17, 18, and 19 is a metaphor for the medium of exchange. I, for one, am tired of fooling with it. May the day come swiftly for God's destruction of it. EURO notes are issued by national central banks and can be identified by serial codes as follows: countries are defined in reverse alphabetical order, omitting letters Q, W, B, I and O. So Belgique is Z, Ellas (Greece) is Y, Germany is X aso (V = Spain, U = France, T = Ireland, S = Italy, R = Luxemburg, P = the Netherlands, N = Austria/Österreich, M = Portugal, L = Finland). The "Experts" have a big problem. They cannot afford any more bank closures like Bear Stearns. Banks in Asia, Europe, and NAmerica have kept interest rates way too low in order to add liquidity to the currency and credit markets. This has prompted a huge sell-off of dollars, and in turn has created a commodities bubble. Last week the ESB signaled that it wished to increase interest rates, but US Fed Chairman has refused. End result - a further weakening of the dollar. The Fed Chairman must increase interest rates in the US at some point in time despite fears of further bank closings (which is a real danger). We went through this before in the 1970s and it wasn't pretty. EURO notes are issued by national central banks and can be identified by serial codes as follows: countries are defined in reverse alphabetical order, omitting letters Q, W, B, I and O. So Belgique is Z, Ellas (Greece) is Y, Germany is X aso (V = Spain, U = France, T = Ireland, S = Italy, R = Luxemburg, P = the Netherlands, N = Austria/Österreich, M = Portugal, L = Finland). If one invests in equities which are appraised at a true fair market value vs modern market hyperbole, then one has nothing to worry about unless one believes that the world economic system will collapse and everyone will begin trading pebbles and fish. Warren Buffett is buying and so am I. Yes, there will be serious economic downturns, but if one can buy a 10EUR/share company for 5EUR, there isn't much to complain about. "Support for euro in doubt as Germans reject Latin bloc notes"
"Refusing to take Euro Notes"
the serial numbers on the euro indicate the country of origin.
As the bank has got most of its other forecasts wrong I shall now start to buy equities. Anthony Lynton-Liar
A good article, finaly printed a traditional newpaper! The truth would never be printed in the US. I wonder if Congress, the Senate and the Excecutive Office will meet the same fate as that of Marie Antointee? "Already parts of the Eurozone are refusing to take Euro notes printed by Greece, Portugal and Spain."
What we are seeing is the end of a historic global credit expansion created by and for the world's central bankers. In effect, this is a repeat of the early 1930's. The paper money central bankers expanded, then contracted, the money supply, which caused a collapse of the major world's economies. Fasten your seatbelts folks ... we're in for a very long and scary financial ride. For all those who seem adamant that all Euro notes are the same, please read link
great finding and reading these comments from somewhere other than the u.s.
Everything will be fine... I know it will be fine... our politicians will never allow a crash... they'll pull strings, push levers...
link
How is inflation going to paralyse the major central banks, AND over the next 3 months? Actually, you can trace the origin of the notes. Incoded in the serial number is a letter which is different for each country that issues the notes. You can check it at Wikipedia under "euro notes" in the "serial number" chapter. "The way we live is quite heavily regulated (sometimes in extremis -wheelie bins, smoking, holding demonstrations), but when it comes to finance, where the impact of poor judgement can have long-lasting cosequences for all of us, there is basically nothing by way of controls.
Re: "Notes"
I wish people would just get it! From the chaos will come the calm. All this (fiat)currency devaluation and liquidity problems are DELIBERATELY caused by the central bankers. The central banks are privately owned by the same people, be it the FED, ECB, BOE . Listen closely and you will hear the solution the are proposing. They are already proposing GLOBAL regulations to prevent this from happening again just 1929. A step closer to a global government. Im personally sick of reading about all the high costs of fuel and food and now someone wants to write about a full blown depression which is really what this article is saying without saying it. All of these reports by the media must have some time of affect on the psycy of the people. I personally want to go out and buy an ipod touch and a new computer but after reading this essay many people will have second thoughs and probably not buy anything. Which would be playing in to the idea of the depression in this article. All of these articles take the negatives and feed it to people over and over again until that is all people think about. What about innovation, what about transition of lifestyles. Many scinentists are working on a bacteria that would eat garbabe and discreates oil. Im personally sick of all these articles again. It has for some time seemed more a question of "when" than "if." The FR, ECB and BoE have been working overtime to keep liquidity in a debt-burdened system, but they can't regulate or repeal the laws of economic gravity. "I dont know where you got this information from, but, there are no Euro notes published by particular countries. They are all the same, issue be the ECB."
Ther3e was a report that some German customers were requesting Euros issued in other countries to be replaced by those that were issued in Germany.
The credibility chasm just isn't there for those who know the source of the inflationary spiral we are going through. The inflation is not a result of qucikprinting of dollars or Euro's, nor one of poor central bank management (other than the credit crunch). It is purely a demand driven inflationary spiral - with the demand arising from China, India and the OIL PRODUCING NATIONS who subsidize their citizen's consumption, removing them from the consequences of ANYTHING.
Pondlife - you are right, people who post on these blogs do have a responsibiltiy, and that includes you.
Cheer up guys. Living in the UK is not a very good way to become wealthy anyways. Actually, you can trace the origin of the euro notes. Incoded in the serial number is a letter which is different for each country that issues the notes. You can check it at Wikipedia under "serial number". buy gold!!! hyperinflation is about to set in... Easy money and corporate greed has led to this meltdown as well as surging energy prices, led by speculator greed. Banks and others forsaking risk analysis, lent money to everyone, even if they couldn't afford to pay it back. Housing prices increased at rates that far exceeded income increases. It was only a matter of time before Humpty Dumpty fell off the wall. I believed the stupidity was confined to corpulent, debt ridden America, but alas, the Brits are just as stupid and in fact have a higher ratio of debt per capita. It was only a matter of time before the bubble burst and because we are all so interconnected nowadays, it will be a worldwide occurrence. In the long run, the pain we suffer or will suffer in the future, will be beneficial, especially the lowering of housing costs. For America, in the long term, higher energy costs are also beneficial as we should be more aware of our conspicuous consumption of energy; downsizing cars we buy and downsizing of homes. With regards to Germans not accepting Euro's printed in Spain, Italy, Greece and Portugal, you may want to read the article from this website. Maybe then you will retract your ignorant posts
You can easily determine which country issued a Euro banknote by the first letter of the serial number. Check 'Euro Banknotes' on Wikipedia. "Already parts of the Eurozone are refusing to take Euro notes printed by Greece, Portugal and Spain."
convert all assets into gold its the only thing that has any value,money is only a promasery note and has no vale what so ever . The source of the statement about people refusing Euro notes from some parts of the EU:
Its just another fact report which is bad for readers/traders/investors.
Since the day of it's dubious inception, the Fed has lived up to the infamy their adversaries predicted. And they've done so many times. And the losers in the banking and investment industries thanks to this self regulating nightmare that financial institutions DECIDED amongst themselves is their just dessert! "Already parts of the Eurozone are refusing to take Euro notes printed by Greece, Portugal and Spain."
Heiner on June 18, 2008 11:59 AM
Heiner and Pondlife...
The thing I find detestable is the way that the "shooters" in the money markets lay this off on the consumer.
This thirty year boom could only ever have ended in tears. Those who have got rich and those with real assets, like land, will be be fine financially, but they may not be able to resist the pressure from the rest who have little inkling how poor they will become over the next thirty years.
Pondlife -- It's always amusing how staunch advocates of the European superstate become apoplectic with rage in response to criticisms of the project. They often resort to insults and put downs. They are less secure than they make out.
The bat out of hell is coming soon. Many private equity funds and hedge funds will be demolished. Buying any company with 100% debt is madness. Who will be the first to hit the skids. My bet....CEREBUS USA with Chrysler-Jeep (home of the SUV/4x4). The saviour for America will be CHINA....if they feel like it. IF THE FSA IS SUPPOSEDLY LOOKING FOR THOSE WHO SPOOK THE MARKET ILLEGALLY,THEN THE CLEVER BOYS HAVE DONE IT LEGALLY.IF THIS DOESNT HELP THE SHORT SELLERS BY DEPRESSING THE MARKET,NOTHING WILL. "dont know where you got this information from, but, there are no Euro notes published by particular countries. They are all the same, issue be the ECB."
RBS ,of all our overrated and teetering banks ,is the biggest disgrace-MrGoodwin that so called powerhouse banker is lucky to have a job.He got so much wrong and allowed his bank to take ridiculous risks in loading up the balance sheet with bucket loads of subprime debt and massively overpaying for ABN AMRO just to see off Barclays-pure arrogance.What happened to your asset and liability committee-were they asleep too?
Ambrose
Houses of Cards comes straight to mind, or to be more biblical, some built they house in stony ground ( not many) and some built there house on sand,
Is this the same RBS that bought ABN Amro at a market historical high for around 50 billion euros ?? Clearly they saw the cred-crunch and the global bear-run in advance ??
RBS ,of all our overrated and teetering banks ,is the biggest disgrace-MrGoodwin that so called powerhouse banker is lucky to have a job.He got so much wrong and allowed his bank to take ridiculous risks in loading up the balance sheet with bucket loads of subprime debt and massively overpaying for ABN AMRO just to see off Barclays-pure arrogance.What happened to your asset and liability committee-were they asleep too?
There is blood on the street, but it is still flowing
Fallout, dire, severe, the words continue to flow, no one is expected to tell the truth or deal with the issues directly. As someone who is trying to run a business and stay optimistic these days I find it very hard. My staff are concerned and all governments must be trying to keep their heads. Sadly that is the balanced view, the truth is that everyone has their own agenda, greed and just securing ones future is all that matters so watch out, duck incoming and remember you had your chance and failing to plan is planing to fail. Unfortunatly this is something that may have to be taken with a pinch of salt, or maybe a spoonfull to be honest.
sir y sari kahani kya hai mkt ki kab tak sudhar jaygi ye mkt "Already parts of the Eurozone are refusing to take Euro notes printed by Greece, Portugal and Spain."
Heiner (11:59 AM), do your research first - each national bank uses a different letter in the notes' serial number, see this article for more: link Did anyone in their wildest ravings really think that the junk loan mess (Please don't euphemise it by calling it sub-prime) was going to be seen off in a few weeks by clever financing? that's what got us in the mess to start with.
Euros are printed by different countries and can be identified easily:
I headhunt in the uk banking and finance market and would have to say that companies are still recruiting still lending albeit in a more conservative way. Certainly commercial to mid corporate lending is looking quite good for the mid term. On that note if there any any top real estate, trade or invoice finance people out there please give me a shout The Greens must be thrilled with this report. Greenpeace, Johnathon Porrit, Prince Charles have all wanted less consumption. (For us, not themselves).
There are certain areas of economic activities surely to see these predictions come through, just like the floods in the Midwest of ol' U.S. But is the whole world flooded? No. Even in our Great Depression, 75% of the folks were working. The point is to do your best NOT to be one of the 25%. @inh
Well said "Foxe-Hole"(Posted by Foxe Hole on June 18, 2008 7:48 AM). Like you, we were offered some of the rights issue - thankfully we declined. A saying worth remembering is that "a bank lends an umbrella in dry weather and snatches it back when the rain begins". How a senior member of the bank staff can have the gall to issue such dire predictions just after about 96+% of the rights issue has been taken up by long-suffering shareholders is beyond me. These people are nothing more than spivs and robbers with briefcases. Remember the days, not so many months ago, when re-structured RBS shares were at more than £6 each? At current price the bank is devalued by about two-thirds. When I ran a business with a bank overdraft, if my income and business value had fallen by that amount my bank would have foreclosed. Honesty from boardrooms would be much appreciated, but that may too much to ask.
RBS is more right than wrong but then who cannot see the oncoming train when it's this large?
I too have been watching the housepricecrash website (and sister sites) and, as Anthony says, their insight into the financial fallout has been spot on.
Since the start of this crisis, people have overlooked the modern day role of lending institutions in the economic boom of the last 20 years. Their innovation has led to a massive rise in profits (and share prices)for them and leveraged customers have ridden that wealth wave too. The fact that financial stock prices have collapsed reflects the destruction of their future revenue streams rather than any losses now or in the future. With the banks hobbled, the rest of the economy can only go the same way....be afraid will MR Star and His colleagues will prove with certificates that they have sold all their personal as well as banks equity portfolio. Or is it just a gimmic to buy when every body is selling reading their reports. These fund managers are notorious in misguiding the general public.
of course, this was already long time ago in the make, the " sleep thou baby" talk was just in order to allow all the cheats to head for other heavens in time, now they are all safe on the other shore, heaven can drop in the neck of all the stupids. Seems like RBS is short. i have a simple question to ask yourself if you have money/cash... would you lend it against a depreciating asset ie property.stocks in certain businesses.in an environment where inflation and asset depreciation would likely deplete or possibly destroy your cash.?.so why would a bank do the same.result not credit crunch but credit crash .question 2 would you put more than 35k in uk banking institution.and feel entirerly secure.?..we are heading for the buffers the brakes have failed the gradient is increasing. Its a comment given by RBS's strategist and not by the bank itself... or in a corporate statement later on this great personality would be Bob Janjuah giving a clarification to his statement that his statement was fabricated and wrongly presented.... only we can wait & watch and hold your equity positions from where ever you belong to whether from India or in America or in Europe... Just watch the corporate Games with holding your positions I've been predicting the coming perfect storm since 1997 when I sold all my property and my shares and put the proceeds under the mattress because as you say, "cash is king". In 2001 when I could no longer afford to pay rent (a couple of months after my wife and kids left), we moved (me and mattress) to a lovely squat but were moved on when the building was converted by some loser into so called "lofts" - what a joke. No it's definitely about to hit hard and...needless to say I'll have the last laugh. Probably. A combination of cash and gold seems appropriate. We all know about Browns sell off of half of the BOE reserves but the real question is whether the remainder is leased out and in default? I believe it is. Necessinflation is now very much in the system but is that rising prices or the falling purchasing power of money! 16% increase in UK money supply last year and double digits for the previous years? I think i'm going to invest in ink, Brown seems to like printing. We all live in hope. Unfortunately hope seems to be disappearing rather fast. Everyone is affected, not just banks and financial institutions. Key words which come to mind are catastrophe on a big scale and meltdown. We have been told that the current recession is unprecedented. The global credit crunch of 2008 will go down in history and will be used for future comparisons. I give my full support to the Samaritans in these difficult times. when there is blood on the streets BUY! But the central bankers and MPCS are determined not to listen - ultimately it is the Fed's problem and they do not have the will to do anything about inflation. Well done the ECB - they appear to be determined to take action. Hindsight will tell who is correct - my money on ECB. Central banks are fast becoming irrelevant in the scheme of things. Market forces are now setting interest rates and about time too. Let's face it Central Banks are nothing but instruments of manipulation by the powers that be. How else can you explain the fact that they are unwilling to raise rates to combat rampant inflation. In the same way don't expect the FED to raise rates before the November American elections. That's simply not cricket, or should I say baseball. It is interseting to note the thoughts of these pundits from RBS.
House price forecasts and economic predictions get more and more like air traffic control instructions at Heathrow and just as frantic! Climb to. Bearing of. Descend. Up so much. Down so much. Speed so many knots. Make left Turn. Right turn immediate. Downwind. Upwind. Approach. Descend. Hold. Final approach. Where's the safe landing? Remember all safe landings end with, "finish with engines". "Already parts of the Eurozone are refusing to take Euro notes printed by Greece, Portugal and Spain."
I find it remarkable timing that RBS wiat until their £12bn rights issue has been finalsuied before telling everybody to avoid eqwuity as it will face a major major slump. Typical "bankers" How come Mr. Janjuah's boss, Fred Goodwin, didn't listen to him last year? Surely a pending credit crisis should have raised a red flag for the Amro deal? It did for me and I am a pensioner in Inverness (without a corner office).
Buy silver coins! The RBS man must be talking about me! I owe them a bit and without a job and on £60.50 a week JSA there's no chance of paying it back just yet and possibly for some years as the job market is starting to dry up trust me! How many others on the books? La fiesta terminó y la resaca sera larga y dura .
Before criticising RBS for not saying this before the
"Already parts of the Eurozone are refusing to take Euro notes printed by Greece, Portugal and Spain."
A rate hike in the Eurozone may not change much though as the EURIBOR is already a full percentage point above official rates. So money is already expensive, just look at rates for mortgages or term deposits.
The central bankers have only themselves to blame for all this. They panicked post 9/11 by lowering interest rates too far and then leaving them there for too long resulting in a colossal property and consumer boom. Even within the MPC's remit there was no real need to do so. Lessons to be learnt? No, they quite simply failed to learn from history. Sadly a deflationary credit collapse is the only way we are going to clean house. The rot has spread too deep for our regulators' and politicians' half-hearted remedies. Now nature will take its course, like it or not. Great scoop Ambrose, precious metals might be a better place to hide than cash, see this blog post:
We live in a world where half the adult population has never seen real financial stress - house prices where I live would take 100 years disposable income to save up for if you earned GBP£100k per year. This will probably match the early 70's for grimness, and house prices will probably fall by 75% in wave after wave of repossessions and negative equity.
Somebody said: "No gain without pain". QED? This sounds very plausable - as said before,a lesson from our elders - when you are in debt you are not in control of your destiny.
"Nasty times"? For Mr Janjuah it well may be if RBS makes cuts to its staff numbers. The way we live is quite heavily regulated (sometimes in extremis -wheelie bins, smoking, holding demonstrations), but when it comes to finance, where the impact of poor judgement can have long-lasting cosequences for all of us, there is basically nothing by way of controls.
Love this guy he has predicted 7 of the last 3 crashes.
The Big Four names which keep appearing are Alliance and Leicester, Bradford and Bingley, HBOS and good old RBS who, between them seem to have cornered the market both in the spectacular scale of their failures and the transparency of their lying attempts to cover them up. Perhaps we can therefore be forgiven for not taking anything they say at face value and asking whether this report is just a softening up measure so that later in the year RBS will be able to blame the Fed, the ECB or even God for something it knows is already festering in its own sty. Anyone whom has keenly followed the financial news over the last eighteen months, will be struck by the fact that the experts seem to be constantly re evaluating the situation on a weekly basis.We have gone from mild slowdown,soft housing landing,small blip in unemployment etc,to quite disturbing possibilities.
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