Archive for June, 2013

Could Italy be next for EU bailout ? Strike 2 in new credit crunch .

Italy’s former PM Silvio Berlusconi has been sentenced to seven years in jail and banned from public office for having sex with an underage prostitute.This was the main headline out of Italy but there was also another that didn’t get much attention .Mediobanca, Italy’s second largest bank, said its “index of solvency risk” for Italy was already flashing warning signs as the worldwide bond rout continued into a second week, pushing up borrowing costs,less supply demand high = HIGH price )

The Italian macro situation has not improved over the last quarter, it has actually gotten worst . With a new anti austerity government , looks to get even worst .

Italy has €2.1 trillion (£1.8 trillion) debt is the world’s third largest after the US and Japan.but is only the world 8th largest economy .

Rank Country/Region GDP (Millions of $US)
1 United States 14,991,300
2 China 7,203,784
3 Japan 5,870,357
4 Germany 3,604,061
5 France 2,775,518
6 Brazil 2,476,651
7 United Kingdom. 2,429,184
8 Italy 2,195,937
Source -Wiki

Any serious stress in its debt markets threatens to reignite the eurozone crisis. This may already have begun after the US Federal Reserve signalled last week that it will begin to withdraw QE and the ECB Mario Draghi has also been pulling liquidity . The cracks has started with Sibor in China last week , could this be the start for round 2 of the global crisis ?

Mediobanca is particularly concerned about the gap that between yields on short-term bills (BOTs) and longer-term bonds (BTPs) near maturity that expire at the same time. BOTs retiring on July 31 are trading at a yield of 0.48, while the equivalent BTP is trading at 0.74pc. The reason is that BOTs are protected from debt restructuring.

Italian 10-year yields spiked to 4.8% .

The key number before was 6/7% that meant a country needed a bailout . Looking at the situation 5% / 5.25% is looking more realistic .

Could it be time to call ” Super Mario “ back again to sort it out . We could but the problem is in a democracy is voters vote with their heart and not there head which is totally understandable people need to live today as tomorrow is just a promise .

Lets see but I am calling this strike 2 , first one was China credit problem my blog on it :

1.Is the Chinese bubble bursting ?! Perfect storm ahead

Cash is king ,

Regards

Tony Evans
Tokyo

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I don’t regret the things I’ve done, but those I didn’t do when I had the chance

I do not regret the things I’ve done, but those I did’t do when I had the chance

Today’s a day I’m not regretting anything ,

Lets lock and load .

Tony Evans

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Profits And Growth – Is Japan On The Right Track With Abenomics – iExpats

Just saw this article on Abenomics and how’s it’s helping the country move forward .

Good read

Tony Evans

Japan

Profits And Growth – Is Japan On The Right Track With Abenomics – See more at: http://www.iexpats.com/profits-and-growth-is-japan-on-the-right-track-with-abenomics/#sthash.SSomEQG5.dpuf

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The 7 Ways Successful People Approach Their Work -Forbes

The 7 Ways Successful People Approach Their Work

Great article in Forbes about being successful and the traits the successful people use .

Regards

Tony Evans

Is the Chinese bubble bursting ?! Perfect storm ahead

Thursday was a very bad day for China’s economy, the world’s second-largest and a crucial pillar of the global economy, with credit markets freezing up in an unnerving parallel to the first days of the U.S. financial collapse.The Short term borrowing rates in China have soared to record highs as credit dries up ! Looking at this people are fearing the liquidity is on the verge of drying up .

The indicator for this was Shibor (Shanghai Interbank Offered Rate) was at one point up over 29%! This could be the start of the end of the Chinese machine ? The central bank refused to do anything to calm the market .

Perfect Storm
As the Fed prepares to taper its bond purchases (QE) at the same time as tightening the spigot of worldwide dollar liquidity also with the ECB pulling liquidity out the market .

Chinese leaders appear to be causing this problem deliberately, likely to try to avert a much worse problem. And, second, if this continues and even it works, it could see China’s economy finally cool after years of breakneck growth, with serious repercussions for the rest of us.

The effects are felt across the world mainly in the commodity export economy ( Russia , South Africa and Australia ) Australia is looking it could be having its first recession in 25 years!

Fed chairman Ben Bernanke has brought forward his QE exit by lifting the unemployment target from 6.5pc to 7pc. He dismissed the looming threat of deflation as a “transitory” effect.

In my opinion the party’s not over but it’s slowing , and as such I am out you can never go broke by taking profits .

What people forget os that the Latin America’s debt crisis of the early Eighties and East Asia’s crisis in the Nineties were both triggered by turns in the US credit cycle. We never learn ,

China has so much excess in the shadow banking system its scary ! This can make the financial crisis look like a little shower !

China has credit worth $23 TRILLION ! Double the economy , or the same as USA and The whole European Union economy combined !!

When in doubt get out , re focus and re align your thoughts .

Happy Friday

Tony Evans

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Failure: It can destroy you, or it can make you so freakin mad that you work even harder to become the winner you know you are

Failure: It can destroy you, or it can make you so freakin mad that you work even harder to become the winner you know you are

Printed and placed on my wall.
lets lock and load,
Tony Evans

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The only thing, the ONLY thing you can count on at any given moment is YOU. It’s you versus them. You versus no. You versus can’t. You versus next year, last year, statistics, excuses. You versus history. You versus the odds. It’s you versus second place. Clock is ticking, let’s see what you’ve got. – ANGELS DEVIL

Now that’s a motivational speech !

The only thing, the ONLY thing you can count on at any given moment is YOU. It’s you versus them. You versus no. You versus can’t. You versus next year, last year, statistics, excuses. You versus history. You versus the odds. It’s you versus second place. Clock is ticking, let’s see what you’ve got.
– ANGELS DEVIL

You tube video of the speech !!! Must watch
http://youtu.be/pJf4USdb8lg

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