Expats to be 'rescued' from Spain and Portugal!!!!

I think the eurozone will definitely change, it may go or it may just shrink down to a few key countries. No-one can with any certainty say what will happen, but it's quite obvious that in it's current configuration the single european currency will not continue in it's current form.  The big question is, how dramatic the changes will be.

Thanks Foxilady.  I'll think about you when I'm lying in the sun tomorrow. 

hehehe Don you're sooooo bad.  But I shall be in Spain in 3 weeks.  Can't wait to get away fromt this rain.  Meanwhile I will continue with the colapso dance for you.

 I am referring to the fact that Los indignados were making a political protest.   Unlike our real riots in London.  The protests went on for over 6 months - and apart from some inconvenience in the city, caused very little hassle.   The damage - as in New York, was when they stopped them getting into the Puerta del Sol because they did not want them there for Christmas.  Not unreasonably I might add.   No fires, no looting, no deaths.  In fact - I would say - no riots in the sense we use the word in the UK. 

Understood Brian.  But unfortunately I don't think we have seen the last of the riots here in UK and other parts of the world, there's more to come I fear. 

No Foxilady, I think we are in for a lot of discontent having been robbed by our resective Establishments.  Where in Spain are you coming too?

Hi Brian, we're coming to stay with friends in Huercal Overa whilst looking in Granada at some cave properties.  Can't wait for the break.  Spent 3 months in Spain last year.  I did actually live in Sitges back in the last 60's and have spent many years tooing and froing to Barcelona. 

This may be of interest,  from Bloomberg Business News today

Jan. 4 (Bloomberg) -- The euro fell from almost a one-week high versus the dollar as European inflation slowed and Italy’s biggest bank said it needs to raise more capital, fueling bets Europe’s debt crisis is worsening. 

The 17-nation currency dropped toward an 11-year low against the yen as a 7.5 billion-euro ($9.7 billion) share offer from UniCredit SpA spurred concern European banks may struggle to raise more capital. The euro slid versus most major peers after El Pais newspaper said the Spanish government helped the Valencia region make an overdue payment to Deutsche Bank AG. The pound climbed to a 15-month high versus the shared currency. 

“Sentiment overall in the euro is still pretty negative,” said Mark McCormick, a currency strategist at Brown Brothers Harriman & Co. in New York. “It does look as if Spain could be the problem child for Europe in the months ahead.” 

The euro fell 0.8 percent to $1.2942 at 4:04 p.m. in New York after rising to $1.3077 yesterday, the highest level since Dec. 28. The common currency depreciated 0.9 percent to 99.29 yen. It dropped to 98.66 yen on Jan. 2, the weakest since December 2000. The dollar was little changed at 76.72 yen. 

Europe’s shared currency slid 5.6 percent over the past six months, the worst performance among the 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Currency Indexes, as investors sought safety amid the region’s turmoil. The dollar rose 7 percent and the yen climbed 12 percent. 

Pound Gains 

Sterling advanced today to 82.65 pence per euro, the strongest level since September 2010, before trading at 82.87 pence, up 0.6 percent. The pound slipped 0.2 percent to $1.5617.

 Hungary’s forint fell to a record versus the euro on bets financial-aid talks will be delayed.

 European inflation slowed to 2.8 percent for December from a three-year high of 3 percent the prior month, the European Union statistics office said. A euro-area composite index from Markit Economics based on a survey of purchasing managers in services and manufacturing stayed below the 50 level that divides contraction and expansion for a fourth month. 

Milan-based UniCredit said will sell shares at a 43 percent discount from yesterday’s closing price, excluding the value of rights. That exceeds the 30 percent discount from Commerzbank AG on its 5.3 billion-euro rights offer last May and the 39 percent when HSBC Holdings Plc raised about $17.7 billion in March 2009.

 Biggest Loser 

The Swiss franc was the biggest loser against the dollar among its 16 major counterparts tracked by Bloomberg. It dropped 1 percent to 94.14 centimes per dollar and fell 0.2 percent to 1.2187 per euro. 

The euro may depreciate to parity with the dollar if one or more countries exit the monetary union, said Adam Myers, a senior foreign-exchange strategist in London at Credit Agricole SA. He said he expects it to drop first to $1.25 as the current turmoil intensifies. 

“Now we’ll see momentum pick up, and we’ll see the euro start to fall more aggressively,” Myers said in an interview with Andrea Catherwood on Bloomberg Television’s “Last Word.” 

The shared currency may weaken to $1.20 by year-end as the European Central Bank cuts interest rates, according to Paul Robinson, global head of foreign-exchange research at Barclays Plc in London. The ECB may lower its 1 percent refinancing rate to 0.5 percent this quarter, Robinson said in an interview on Bloomberg Television’s “The Pulse” with Maryam Nemazee/ 

Speculation on Spain

 Spain’s Treasury gave a verbal guarantee to an unidentified lender persuading it to advance the funds the Valencia government needed to make a 123 million-euro payment, El Pais said, citing people it didn’t identify at the national economy ministry and the regional economy department.

 The euro also weakened amid speculation Spanish Prime Minister Mariano Rajoy’s government may apply for loans from the EU’s rescue fund and the International Monetary Fund, the Spanish newspaper Expansion reported, citing unidentified people with knowledge of the matter. The country’s deputy minister for communication, Carmen Martinez Castro, said in a phone interview there are no plans to seek external aid.

 Demand at a German auction of 10-year bonds was lower than the average over the past five years. Germany sold 4.06 billion euros of 2 percent debt due in January 2022 at an average yield of 1.93 percent. Investors bid for 1.27 times the amount allotted, versus a five-year average bid-to-cover ratio of 1.6. 

“If we get some very weak auctions through the course of the month, it puts a lot of pressure on the EU and its summit right at the end of the month,” said Neil Mellor, a strategist at Bank of New York Mellon Corp., by phone from London. “It does point to a positive dollar view.” 

EU leaders will meet Jan. 30 to discuss jobs and growth.

Dollar Index 

The Dollar Index, which IntercontinentalExchange Inc. uses to track the U.S. currency against those of six major trading partners, increased 0.5 percent to 80.085.

Orders to U.S. factories rose in November by the most in four months, the Commerce Department said today, showing gains in manufacturing will help the world’s biggest economy grow. Bookings rose 1.8 percent after a revised 0.2 percent drop the prior month, the data showed. 

Hungary’s forint dropped for a second day against the euro on concern a resumption in talks with the IMF and the EU on financial assistance will be delayed. It retreated 1.3 percent to 320.46 per euro after touching a record low 321.68.

 The bookies say the euro wont break up and they usually know best.But if you want a nearly free bet borrow euros in spain on a mortgage and keep your savings in pounds.You heard it here first.

GeorgeH,

The advice you give of keep your debts in Euro and cash in another currency sounds good to me.  But without belittling the comment, this is a widespread view and is why as things stand at present the euro is going to fail. 

It seems inevitable that before too long the governments of those countries imposing the extreme austerity measures will be made to realise the futility of their efforts and throw in the towel.  Mrs Merkel may be the last to do so, but there again the Germans have always had a thing about towels.   IMHO if this is not done very carefully there will be horrendous problems.

Towels

News just in - Greek prime minister Lucas Papademos says Greece may default on its debts in March unless unions accept further cuts to salaries - see my previous post if 1 country leaves the euro!  Could trigger it all off.
 

Think on folks should/when the euro collapses. The Spanish will not notice much dfference as everything will move in paralled except exports from UK, Gernay and FRance which will tend to become more expensive answer stop buying from these guys and re develop Spanish Manufacturing.

The real industry ie Tourism will benefit as the Brits, Germans, etc., find Sapin cheaper, many have been finding Spain under the euro, too expensive and have been going to Turkey instead SO the economy will start to boom.

House prices are currently TOO high, my Quad is now worth £200k which is more expensive than a larger property in Britain. So if Sapin comes out of the euro, property prices to foreigners will drop due to the exchange rate and become once again more affordable. SO the bank of overbuilds will be sold and some boyancy wil return to the housing market.

The single currenvcy was a silly idea since the different market forces of Manufacturing based countries against thise baed on tourism contradict each other. The EU is similar, instead of each country carrying their own parasite M.P's, there grows another central group of parasitial Euro M.P's and their ivory towers which are a waste of money.

If the Spanish banks collapse the the same thing will happen as has in the UK, the tax payer bails them out and the Spanish equivalent of Cameron will give away he banks for a song as Cameron has done to Branson.

So lets get back to basics,  return our sovereignties, get rid of the EU, allow each country to run its owjn affairs, sell off Strasboug and Brussels as theme parks and  sack all of the parasites who have worked the GRAFT.

Let the real people of Spain, Britain, France and Germany be free once again.

Can't wait for the euro to go myself.

Regards

Gordon

Gordon, I agree completely with your comment.  The Med countries at the very least should never have gone into the Euro.  Spanish workers are now substantially more expensive to employ than Germans, so they have lost their competitiveness.  Spanish houses are far too expensive in all areas where there is a limited amount of space due to the mountains to build, like for instance in the Costa Blanca.  Come to Murcia folks and grab yourself a bargain before the new Corvera airport and the Paramount theme park opens!

 Interesting thread.  I heard about this article when the newspaper was reviewed on SKY.  I did have a bit of a fit when I heard.  

Maybe it's because we are on an unchartered area that is making us jittery.

Our local farmacia hasn't been paid by the Spanish Gov  for subscription drugs since June 2011.  He says the gov owes him 280,000 euros.  He's very worried, but he says he is okay for now and can pay his staff.

So what happens when he can't pay to replenish his drug stocks?  Does the nation run out of medicine?

The local garage hasn't been paid for the petrol/diesel they have provided the police/ambulance/bomberos... so what happens when the garage can't pay his supplier?

I don't know what is going to happen, but I know it's going to be an interesting year.

If the worse does come to the worse - it will probably be chaos until the banks/gov settles down from the shock.  

It is so tragic though that youngsters here in Spain just cannot get jobs.  

Best advice I could give would be not to keep any savings in Spain .. only money to pay the bills. If it goes, it will go big time and imagine trying to retrieve your money with the type of record the Spanish authorities have for returning cash!!

My financial advisor who has superb and extensive contacts and who over

the years has NEVER given me wrong advice tells me Germany has started

printing the NEW D.MARK. Is this just a back up plan or are the politicians not

telling us the truth ?   

Yeah, I'd heard that too but really not sure whether it was just a rumour going round.

I certainly think the Greeks should start printing some Drachma and Spain should certainly start thinking off wiping the cob webs off of the old Peseta machines....

Justin

Apparently this was being done a while ago Midasgold.  I first heard the comment from Ian Hislop on TV a month ago and thought he was joking, but it's since been reported by several reputable financial sources.  Other Euro countries are alleged to be doing likewise, which no doubt they'll label as merely a contingency plan.

Apparently they started printing Deutsch Marks back in September 2011.

You may find this interesting.

By now everyone realizes that the euro is in major trouble and will no longer exist in its current form for much longer. However, the common view is that it is Greece and possibly other PIIGS countries who will be forced out if the eurozone is broken up.

But few are talking about another possibility- of Germany leaving the EU.

One who is talking about this is Dr. Pippa Malmgren, a former economic advisor to George W. Bush and a former advisor to Deutsche Bank (DB). According to Malmgren, Germany has already ordered the printing of Deutsche Marks in anticipation of a possible withdrawal from the EU.

Malmgren states,

The social contract between Germany’s citizens and its leaders preclude [debt monetization] given their history. Germany has already begun to emphasize the need for a new EU Treaty that would compel fiscal harmonization, penalties for those that break the Maastricht Treaty rules and other undertakings that would harden Europe’s defenses against economic default risks going forward.

If this is true, and Malmgren is correct, then the euro will absolutely implode. Germany is widely held to have the strongest balance sheet in the EU (though even the Head of its Central Bank admits that the country’s real Debt to GDP is over 200%).

However, compared to the PIIGS, Germany is relatively rock solid from a fiscal point of view. It’s also the largest economy in the EU. So if the Germany pulls out (70% of Germans believe the euro has no future) then Europe will experience a wave of defaults starting with Greece and spreading throughout the PIIGS.

We’re already seeing hints of this occurring. Germany Vice Chancellor, Philip Roesler said on September 11 that Germany won’t participate in any more bailouts and that any German politicians who approve more bailouts is committing political suicide.

We also have reports of Sarkozy and Merkel screaming at each other in recent meetings. France has announced plans to possibly nationalize several banks just “in case.” And Germany has dropped more than a few hints that it’s fed up with the situation.

Heck, even mainstream “thinkers” like Alan Greenspan says the euro is “doomed” to fail.

Something very bad is brewing behind the scenes. The Sarkozy- Merkel talks, the short-selling bans, the halted stocks, the leveraged EFSF, the hints of QE 3, all of this is telling us that the financial system is on DEFCON 1 Red Alert.

Ignore stocks, they’re always the last to “get it.” The credit markets are jamming up just like they did in 2008. The banking system is flashing all the same signals as well.

So if you have not already taken steps to prepare for systemic failure, you should do so now. We’re literally at most a few months, and very likely just a few weeks, from Europe’s banks imploding.