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To: GROUND ZERO™ who wrote (70799)	5/1/2015 11:41:58 AM
From: Bridge Player	Read Replies (1) \| Respond to of 218577

Alan Greenspan seems to agree with you: (2/09/2015) -------------------------------------------- Alan Greenspan has harsh words for Greece: hit the road jack. The former Federal Reserve Chairman told the BBC that Greece's best course of action is to leave the Eurozone. But Greenspan didn't stop there. He predicts Greece's exit is the beginning of the end for the euro. "Short of a political union, I find it very difficult to foresee the euro holding together in its current form," Greenspan told the BBC's Mark Mardell on Sunday. Greenspan went as far as to say the world would be better off without the euro. He says the currency union is too complex unless Europe decides to have one unified governing body to call all the shots. Greece is a good example of the uneasy strain of the currency union. The country is mired in debt that it can't figure out how to pay back. The Greek people are so fed up with all the cutback measures imposed by Eurozone leaders that they recently elected a new prime minister, Alexis Tsipras, who campaigned on a platform of fighting back. Related: Greece stocks tank as standoff intensifies "I don't see it being resolved without Greece leaving the Eurozone," Greenspan said. "It's just a matter of time before everyone recognizes that parting is the best strategy." Tspiras and European leaders are in ongoing talks about Greece's bailout for the rest of 2015. There's not a lot of optimism about a good solution. Greece's stock market is tanking again and dragging down much of Europe with it. More headwinds for the euro: Greenspan never liked the idea of the euro to begin with. When European leaders were negotiating the Euro in the mid-1990s, the desire for unity after two World Wars masked the difficulty of an economic tie, he says. "Fundamentally, what clearly was a driving force was the fact that we had two World Wars," says Greenspan. The Euro, "was a geopolitical decision with economic wrappings." Related: How Greece could accidentally stumble out of the euro When asked if it would be a catastrophe for the global economy if the euro broke up, Greenspan said no. "I think the system would function. Holding the system together is putting strains on everybody," he predicted. ------------------------------------------------------------- money.cnn.com

To: GROUND ZERO™ who wrote (70799)	5/1/2015 12:58:27 PM
From: Hawkmoon	Read Replies (3) \| Respond to of 218577

Great question... I'm not an economist of any sort, but my gut reaction is that it would be bullish for stocks worldwide. My .02 on this.. I agree that a Grexit is the best decision for the Greeks, especially if they default on their debt at the same time (which they obviously would).. It seemed to work for Iceland, which refused to bail out it's bloated banking system and that economy appears to be stabilizing. But Greece is just the land of corruption.. On their own they are going to have serious long-term difficulties until they change their ways.. The primary worry about Greece are the longer-term impacts. IF there's a Grexit, how long will it be until Spain, Italy and other countries find themselves under pressure to do the same thing? And if Greece defaults, the ECB has Greek debt that cannot be "hair-cut", which means, if I've read correctly, all the other EU gov'ts are on the hook to pay it back to the ECB.. There is so much leverage in the European (and US) financial systems right now, I can only imagine if this domino effect gets underway.. Btw, let me throw this at you and see what you think.. Since interest rates in most developed countries are at NIRP, and ZIRP, holding debt is basically the same as holding cash, right? But if interest rates go up, then bonds will decline in value, while deposited cash will receive a higher interest yield rate. It also puts a brake on economic activity, although the rate hike may be due to defending confidence in the currency, or Central Bank policies towards rate normalization (whatever that means now).. So.. with ZIRP, are we not already (technically speaking) at the point of seeing the bottom of currencies? They can either take rates higher, meaning the currency strengthens (eventually), or they can go further into NIRP and chase that money out of the banks and into some other asset. The Fed may now think they need to keep rates low, but if we see more bond routs/flash crashes, they may have to raise rates to follow the market. And if rates go up, currencies will eventually follow. Hawk