Earlie, I like your post and share it in a private stock chat room. Sighbase, who said he's from Europe, doesn't agree w/ some of your points. And I post his arguments here. Could u address it here? And probably to the guy who wrote it. His yhoo id is Sighbase. I think his email should be Sighbase@yahoo.com
<<There are a lot of plain wrong statements in this:
1) US corporations overburdened with historic debt coming from lending
in Europe. Neither do the statistics support the claim of historic debt
or overburden, the debt that exists was taken on primariliy in the US
market.
2) The Euro already _is_ the official currency of the EC, prices within
member countries are marked in Euros, the previous currency is given
only for a transition period. So how would the distribution of the paper
and coin currency change perspectives for companies? Companies
operating in Europe were required since last year to report in Euros and
perform business among themselves and with governmental entities in Euros.
Local currencies exist _only_ with regard to the consumer. As a business
currency they are out of the picture already. I wrote and modified
software to comply with these requirements.
3) The claim that borrowing in Europe would strengthen the Euro and
weaken the Dollar makes sense, in a way. Problem is that the Euro is week
and the Dollar is strong. The weekness of the Euro can in large parts
be attributed to the still dismal economic situation in Germany and
their "Reformstau" (reform backlog) especially with regard to their
tax-system and labor laws. Until that has been changed the Euro will remain
week against the dollar.
4) "The Euro is backed by 15% gold." How bullshitty can you get? No
European currency, especially not the Euro is backed by gold. The so
called powerhouse currency, the Deutschmark, never ever was backed by gold,
but only by industrial output, as is the Dollar by now. Part of the
Euro's problems is that in Eastern Europe the Deutschmark is being used as
a reserve currency, but German industrial output can not keep up with
the demand for the Deutschmark (thus horrendous inflation there,
compared to the US).
5) "The Euro has no "baggage" in the form of tons of treasuries, bonds
and greenbacks sloshing around the globe." Again, nonsense. All local
treasuries and bonds as well as corporate bonds were transferred to Euro
denomination and are freely traded. Note that this conversion already
has happened. If you consider treasuries and bonds 'baggage', then the
Euro has it's fair share. (Actually, European traders complain that
these instruments are not as liquid as their dollar-based counterparts).
Well, let's stop here (I could go on). As a European I follow these
things quite closely, so I recognize bullshit when I see it.>> |
