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Showing posts with label euro. Show all posts
Showing posts with label euro. Show all posts

Tuesday, 21 February 2017

Exchange rates

It is my view that the Euro will lose value this year so the UK Pound will buy more Euros. Of course, I could be entirely wrong! The reasons for thinking this are:
  • Greek debt is still a big issue and there will be fewer nations able to bail them out.
  • Several nations are disillusioned with the Euro project and are worried by totally free movement within the EU.
  • Several nations are in favour of tariff-free borders to trade but are nervous of ever closer integration.
  • I think the UK will show the world it can succeed outside of the EU.
No, several things point to an improved exchange rate. As for the US Dollar and the Japanese Yen I am less clear.

Tuesday, 17 January 2017

EU and the UK pound

Since the Prime Minister clarified our position on leaving the EU following the BREXIT vote, I see that the UK pound is up against every currency. I guess people had already factored in that we are leaving the EU and are happy to have some certainty now.

Although I have said this before, it would not surprise me if the Euro lost a lot of value this year. The EU is in grave danger of falling apart.

I voted to "remain" in the EU, but many nations want free trade but NOT a United States of Europe. France is France. Germany is Germany, etc..  National identity IS important.  Originally the EU was about maintaining peace in Europe, but it has grown a lot in recent years and has rather lost its way.  Basically I think the EU is "a good thing" but it must not be a "gravy train": it should serve the people of Europe.

See http://www.bbc.co.uk/news/business/market_data/currency/default.stm .

Tuesday, 7 July 2015

FTSE 100 - on the slide

As I write this there is great uncertainty over Greece, which rejected the latest financial rescue package at their referendum last weekend. The FTSE 100 share index fell quite a bit today (down 1.58%).  It looks increasingly likely this "Greek tragedy" will end with Greece defaulting on its debts and leaving the Euro and possibly the EC.  The financial markets will be hard hit especially in those countries that use the Euro. A last minute deal is still (just) possible but I think the markets have assumed Greece is out. Certainly the European finance ministers and heads of government have run out of patience. If Greece leaves the Euro many nations will be impacted, not least Germany that stands to lose an enormous amount. For the Greek people, the future looks very bad for many years. No doubt they will eventually bounce back, but they risk civil war in the meantime. No, this is a real crisis for all of Europe.

See  http://www.bbc.co.uk/news/business/markets/europe/lse_ukx .

Wednesday, 24 June 2015

Greece - still in trouble?

International creditors are still not happy with proposals from Greece over their debt. Talks are continuing  but I think Greece will have to make further concessions or leave the Euro. Although deep in the mire now, they would be in dire trouble out of the Euro with no support from the ECB for their banks.

See http://www.bbc.co.uk/news/world-europe-33258624 .

Tuesday, 23 June 2015

Greece - market relief?

This may be just a blip but the FTSE 100 share index bounced back today on the news that Greece has been "saved" in the short-term, although they still have a massive debt to repay and Greece is in a real mess. As I see it, this is a temporary situation and Greece is still in deep trouble. The simple fact is that the Euro could simply fall apart if Greece defaults and Germany would be left with huge losses and they are desperate to avoid this.

No, the Euro is still in deep trouble. This crisis has a way to go yet. There is trouble ahead for sure.

Monday, 22 June 2015

Greece - a basket case?

Greece seems to be in a serious mess financially, although the EC seems desperate for the Euro to survive the current crisis. It would appear Greece became a member of the Euro club based on rather dubious figures. Tax avoidance and early retirement ages appear to be a way of life in Greece and this is anathema to countries like Germany. If Greece doesn't get kicked out of the Euro, they certainly need to change. We will see what happens. I expect we'll see yet another fudge and somehow Greece will survive, although it is not clear for how long. I'm very glad not to be Greek right now. Life there must be very hard, especially if you have no work.

UPDATE 1726z:  It sounds like Greece may be on the brink of a financial rescue. Time will tell.

Thursday, 26 February 2015

Euro exchange rate

Every day the exchange rate of the pound to the euro gets more favorable. It means holidays in the eurozone are cheaper, cheaper imports from the eurozone, but more of a struggle to export goods from the UK to the eurozone nations.

Because of my health, no holidays to eurozone countries have been planned.   I expect the rate will have fallen by the next time we go to Europe.

Come the late summer  I expect holidays to Greece will be very cheap if they go over to the Drachma again.  I know the eurozone wants to hold on to Greece, but 4 months debt extension is no time at all.

Tuesday, 24 February 2015

Market stability?

The FTSE 100 closed about 37 points higher today, an all time high.  The pound is worth 1.365 euros. Apparently the Greeks have reached agreement with their creditors for a 4 month delay in debt repayments.

It remains to be seen if this is the end of the Greek crisis or just a postponement of the inevitable?

Friday, 20 February 2015

Greece deal?

It looks like Greece has "won" a 4 month extension of its debt obligations, so they don't run out of money just yet. It still seems risky for Greece. At some point, not too far away in the near future, its creditors will want their money back.  It seems to me any deal just delays this critical point.

As they say, "you reap what you sow". Greece has lived too long way beyond its means and shortly their "chickens will come home to roost". Mind you, lots of other places including the UK have been living for far too long on borrowed money.

All nations have to live within their means.

See http://www.bbc.co.uk/news/business-31556754 .

Sunday, 1 February 2015

Greek debt

In some ways I feel sorry for the ordinary Greek man and woman.  They are having to replay huge debts whilst their economy is doing very badly.  Many in Greece are experiencing real poverty.  They should never have been allowed into the Euro club all those years ago.  Tax avoidance had become a way of life in Greece and they are so far out of step with the economies of northern Europe. In many ways the Greeks expected it too easy within the Eurozone. Now they are finding out the hard way.

I very much doubt they will be able to re-negotiate their repayment terms.  If they leave the Euro now it will be very bad for Greece and hard on the Eurozone.  Sadly,with other indebted nations "in the wings" Germany and others in the Euro club cannot give in to Greece.  Tough times are ahead.

See http://www.independent.co.uk/voices/as-in-1942-germany-must-show-restraint-over-greece-10015905.html .   Apparently,Germany has misread Greece in the past.

Wednesday, 28 January 2015

Euros

I continue to be puzzled by the Euro and the fact that so many different economies have been prepared to share the same currency when their underlying economic strengths are so different. Take for example Germany and Greece whose economies are poles apart. At the present time the Pound to Euro exchange rate is very favourable. One pound Sterling buys about 1.33 Euros. Greece has said today it will not default on its loans,but how will it pay its debts?

Wednesday, 21 January 2015

FTSE 100 jumps

The FTSE 100 jumped 1.63% today meaning it has almost made up ground recently lost. With great uncertainty in the Eurozone, especially with elections coming up in Greece, further big falls are possible in the weeks ahead.

Saturday, 5 November 2011

The future of Europe and the west - downhill?

There was an excellent article in The Times today by Matthew Parris entitled, "Face it. There is no answer to the eurocrisis". I'd like to link to it but don't subscribe to the Times app yet.  In summary, his thesis is that we have now past the best times in the west and our only route is downhill. We are kidding ourselves about our current fate by evasion.

We are kidding ourselves that the problems were created by the bankers whereas it is fundamentally down to our excesses in the last 50 years or more.  We elected our politicians. We allowed a system that rewarded bankers huge bonuses and allowed them to gamble our money for their gain. We could have seen the writing on the wall, but we chose to ignore it. We were all aware we were living beyond our means on money that didn't exist, but we all believed the myth that growth was making the world better for everyone. Now our chickens have come home to roost and we'd better come to terms with the new age we now face.

My own view is this new age is also an opportunity: one in which sustainable living within our means and personal happiness will be more important than growth and the culture of excessive consumption.  Just maybe we'll get our values more in focus and see the last 100 years as an aberration. It is up to us.