The ECB embarrassment. Borrowing 18 EUR generates only 1 EUR of GDP growth.
Independently from the effectivity of printing machines the ECB owns, the Eurozone is still in a very bad economic condition. According to the ECB to create 1 EUR of GDP growth the economy has to borrow another 18.5 EUR through QE or to use fashionable buzzword – ‘stimulus’.
This year the ECB has printed already 600 bn EUR creating growth of 31 bn EUR. For reference, the amount of Greek debt is equal to 360 bn EUR.
It may seem like all the bankers and politicians have a very short memory as they are trying to continuously profit without changing their modus operandi. One of the methods used is to offer politicians cushy positions for their cooperation with financial circles. This setup benefits both sides and confirms that the government is not what decides about the future of a country.
A few years ago I read a very interesting report. It alleged that the average memory of non-professional is less than 2 years back. In other words, if you are one of these people who encouraged by fashion or advertised recommendation made a mistake ones by investing in overpriced assets (and lost some money on the way) there is a high probability you are going to repeat your mistakes.
Deutsche Bank is again in the centre of attention. This time due to the Department of Justice penalty. The stock price of the German giant has now fallen to the levels last seen in the '80s . Investors started to question DB's future, Will DB fail just like Lehman Brothers?
Many of you already know that silver has the biggest share of my portfolio. The amount of written material about gold is immense and this is why investors have decent knowledge about it. When we talk about silver, though, there are some myths giving people wrong assumptions. It is time to recap and refresh what we know about silver.
The immigration crisis hit Europe dozen months ago was dominated by a strong unanimous voice of European officials and institutions. The debate was driven by sympathy and need to accommodate fleeing asylum seekers. This narrative was not broken by any threats posed by so massive crowd. Crimes and even terrorist attacks were not enough to change the policy of the Western Europe.
Greeks have to declare all their wealth
From January 2017, 8.5 million Greek citizens have to file a declaration of their belongings. The government is on the hunt for real estate, jewellery, art and even cash – outside the banking system.
Before government implements new tax, a directory of the soon-taxed wealth has to be prepared. Today Greece is required to auction public riches to service their debt. The debt which is impossible to be repaid even if all priceless monuments are sold. What is worse is a conflict between the IMF and the German government. A compromise between those two has not materialised yet, making Hellenic country afraid of every round of financial help negotiations. This time, the Greek government has to hedge against another crisis on the horizon – lack of liquidity – and money will be taken from those who still have some savings in one form or another.
Banking crisis in Portugal: Part 2
After the bankruptcy of Espirito Santo group, the number of non-performing loans (NPL) in Portugal rose from 10% to 15% only in the last two years. A similar event started political turmoil in Italy. Italian banks having 17% of bad credits are not alone in Europe. For anyone who understands reasons behind problems in the European banking sector, it shouldn't be a surprise. Not a single issue leading to 2008 crisis has been solved. Not learning from the past destines one to repeat the same mistakes. Today’s most probable solution – an inflationary reduction of debts (i.e. inflationary tax) with toxic derivatives pushed onto the back of an average taxpayer thanks to the ECB monetary intervention.
- Deutsche Bank on the brink of bankruptcy
- Global Structure of Ownership. Result of a 4 year long research
- War on Cash – a Piece of a bigger Puzzle?
- Immigrants flooding Europe
- Trader21 - lecture presented at Fx Cuffs
- Are we waiting for another ‘2008’?
- Permanent portfolio models and their long-term ROI
- The Madness of the ECB
- Why Brexit is sending seismic quakes all over the world?
- The true reason behind armed conflicts
- Independent Trader News – summary of October 2016, part 1
- Goldman Sachs – a repository of corrupted politicians
- Groupthink - a guarantee of a loss
- Deutsche Bank – who can save the giant?
- Silver – my favourite asset
- DIY: How to destabilise a continent?
- Independent Trader News - September 2016
- Independent Trader News - August 2016 part 2
- Clinton or Trump? Elections with global impact
- Independent Trader News - August 2016