The Greek Demonstrations Will Slow Down Dramatically!

Everybody thinks that the Greek demonstrations will continue. I am going to say they will slow down dramatically. Reason?

In einem tödlichen Inferno eskalierten die Proteste in Griechenland. Der Ministerpräsident zeigt sich bestürzt über den Tod dreier Menschen. Eines der Opfer war offenbar eine schwangere Frau.

Let me translate. The demonstrators went heavy with the violence. The police stepped back and used minimal violence. The demonstrators then broke into the bank and set the bank on fire using molotav cocktails. It was at that point that three people became trapped. The firemen could not help for 15 minutes because the demonstrators blocked their way. Thus those three people died.

But to add insult to injury…  One of the people was a pregnant woman!

Dying people is bad, but a pregnant woman adds insult to injury! When I read that my heart just dropped. And from the comments that I have been reading this appears to take quite a bit of wind out of the sail.

As the commentators said, “Greeks have made strikes a pastime, but violence is not part of the Greek way of life.” As a reference Greece has the lowest crime in the world.

Moody’s, Fitch’s and S&P Ratings Are Being Disingenuous

So here we go Portugal is placed on review for downgrade.

Moody’s Investors Service said it has put Portugal’s Aa2 government bond ratings on review for possible downgrade, while the government’s Prime-1 short-term rating was affirmed. Moody’s expects that, in the event of a downgrade, Portugal’s Aa2 ratings would fall by one, or at most two, notches. The review of Portugal’s ratings — which had been on negative outlook since October 2009 — is expected to conclude within a three-month time horizon. Moody’s believes that increased risk discrimination in the financial markets may raise Portugal’s financing costs for some time to come. Nonetheless, Moody’s expects that debt service will remain very affordable in the near to medium term. Although its debt metrics may, on balance, turn out to be more consistent with a low Aa or a high A rating, the government’s debt is neither unsustainable nor unbearable

I am furious with the rating agencies. These guys are being disingenuous, and they are doing so because the ratings system is wrong.

Let me show you an image shall I from Stocks (a Swiss stock magazine):

ScreenHunter_01 May. 05 20.52

This image maps the total debt per GDP to the yearly debt. Look at it very closely. Griechenland = Greece and you can see that Greece deserved the ratings that it has. But look closer at Portugal. Notice how Portugal has less of each debt than the USA, Great Britain and Japan.

So I ask Moody’s, Fitch, and S&P WHERE ARE YOUR RATING WARNINGS FOR THE USA, GREAT BRITAIN AND JAPAN! Oh yeah I know why because you guys are so chicken s**t to do your job and instead you pick on the little guys. You pick on those that can’t defend themselves.

So what is the excuse for the ratings warnings for Portugal? It is not a dynamic economy and it can’t cope. You might be right, but again why are you not serving those countries with bigger deficits with warnings?

Let me be very very clear. I am not complaining about the warnings. I am complaining about the lack of warnings for other countries…

Hedge Funds Colluding To Take Down The Euro!

I can accept things when they are bad news, or problematic. But I can’t accept things when there is no real reason. The Euro Drop is such an example. 200 pips in a day? That is a 0.2% percentile action. What that tells me is that something is at hand.

The typical response is “Greece”. Really I thought that was ok. Oh now the comment is that these measures will kill Greece. Wow, now that is interesting, give them money you are not solving problems. Make them accept austerity measures and well you are killing the patient.

Well, here is what I think is going on, and it might be suspect as conspiracy. But consider the following link:

Im Zentrum der Wette auf den schwächelnden Euro steht laut «NZZ am Sonntag» die New Yorker Broker-Firma Monness, Crespi, Hardt. Diese Firma soll am 8. Februar bekannte Hedge-Funds-Vertreter zu einem Abendessen in einer New Yorker Privatwohnung eingeladen haben. Dies zu einem Zeitpunkt, als die europäische Gemeinschaftswährung bereits deutlich an Wert verloren hatte.

A bunch of hedge funds got together to plan the take down of the Euro. Interesting, yes? But here is the question. Why not cover after Greece? And this is where I think things will really get interesting. It seems like the analysts are saying, “hey Greece should go bankrupt”.

Why would you want that? CDS’s! How much do you want to bet that those people holding CDS’s are pissed to the point that they want Greece to go bankrupt so that they can cash in.

Does this sound familiar? Remember Lehmans, remember the entire housing market?

Folks the time for CDS’s to go onto an exchange is now! Not tomorrow, now! There is way too much hidden information on CDS’s and they are way to dangerous.

And if you don’t care, you should because wait until they take down something close to you… And they will because they are greedy!

My Hat is off to Greece!

I have been a very very vocal critic of Greece and how I thought they were incapable of tightening their belt. Well I stand corrected!

Greece from what I see I have to say, “thank-you you are showing the kind of metal you are made off. As a Eurozone citizen I am impressed and will support you to the teeth.”

People are still sceptical and think Germany will hemm and haw on this. Folks you don’t understand Germans. If Germans can push their point across and the other side is in an agreement there is no debate or hesitation from a German. Germans are very principle driven and thus so long as Greece fulfills its end of the deal (which I am becoming very convinced of) why second guess Greece? At a certain point of time you have say, “I trust you and will believe that you will do what is right”. You can’t second guess and say this is only a trick.

And I take my hat off to the Greek prime minister Papandreou. You have been thrown into one of the most difficult positions that a politician can face. You have to do the hard job that politicians like to weasel out of. Thus my hat is off to you!

Good luck Greece!

STOP THE PRESSES!!! Greek Deficit is 40% of Budget…

I know I said I would stop publishing on InvestorGeeks. However, I saw something that I would like people to comment on. Because I think it is very important, I would like as many people as possible to comment to say whether I am right or wrong. If I am wrong I will delete this post…

I have a habit of looking at the budgets of countries to understand whether or not the country is doing its thing properly.

Well I just looked at the Greek budget and what I saw scared the holy crap out of me. And anybody who buys Greek bonds is asking to have their money taken away from them. I say you buying a Greek bond is FOOL!

Take a look at the following link:

Then look at page 19:

ScreenHunter_01 Mar. 04 12.52

I see Tax Revenues of 91 billion, with a grand total of about 102 billion. What scares the crap out of me are the borrowing lines; 38 billion and 6 billion. In other words 44 billion of the revenue is from borrowing money. If somebody wants to say I am reading this wrong, PLEASE TELL ME. But as I read this it means 44 billion of the 102 billion revenue is money that needs to be paid back eventually. In other words Greece is borrowing 40% of budget!

I say WTF!

For comparison look at the Canadian 2009 budget. The Canadian budget has a maximum borrowing of around 10%. That is ok, and sustainable.

My Last Posting…

Well folks, my journey at InvestorGeeks has come to an end. I want to thank the Investor Geeks for giving me the opportunity to post, and comment. It was fun.

I will be continuing my posting on my own blog at If you wish to follow me, head on over there, otherwise it was nice having you as a reader. At my blog I will also be updating what I will be posting on. I am thinking I will be focusing on both commentary and using Excel for investing purposes, since that seems to be a popular topic according to my blog log files.

Read My Lips: Greece Will Most Likely Default!

I find it funny how the market is repricing that the EU will support Greece. The EU might support Greece, but not with Germany’s money. Without any cuts there is NO WAY, and I really do mean NO WAY that Germany will provide money for Greece. I was talking to some Germans in Germany and they said, “Give me a break with Greece. They think they can get away with it [no cuts, no changes]. I want Greece out of the Euro, they don’t deserve it.”

The EU is kicking the can down the road because I think they are battening down the hatches on the s**t storm that is going to result. I think the various Euro countries are getting ready to isolate themselves from the market. I also think that the Euro countries are happy that their currency is weakening. They can export more.

For reference here are the list of countries that are telling Greece to save more, and more. Sweden, Austria, Germany, Euro Group leader and the prime minister of Luxembourg, Finland has already said it is not helping. So who is left? Or let me rephrase this, who is left that has the money to help? Answer NOBODY!

Simply put Greece will most likely default… And the Euroland will sigh with relief…

Is Goldman’s Going Down?

I have been following this Greece situation quite closely and today I read something that is making me think of what the next potential step may be.

EU spokesman Amadeu Altafaj Tardio says the EU executive has given Greece an end-of-February deadline to give details on how deals called currency swaps affected government accounts since 2001.

He said such swaps weren’t illegal unless the Greece was not using market rates to calculate the exchange rate.

What I find interesting is that they seem to be focusing on the swap exchange rate, and the fact that fudging it is illegal. Let’s say that it was fudged and illegal? Greece will get a stiff talking to. But I am willing to bet the stiffer action will be against Goldman’s. And right now Goldman’s with its “God’s Work” comment, high bonuses, and the betting against the sub-prime would get YET ANOTHER thorn in its side.

What should make Goldman’s nervous is that if the Euro zone does go after them they better start getting out a big fact pocket book and start writing cheques. Or they will be barred from the Eurozone. And they will get a stigma of the Caribbean islands. Goldman’s has some bright people doing interesting things, but it appears to me that their management is dumb as straw!

But I am not the only one asking these questions. From Elitetrader I saw the following:

We now learn – from Der Spiegel last week and today’s NYT – that Goldman Sachs has not only helped or encouraged some European governments to hide a large part of their debts, but it also endeavoured to do so for Greece as recently as last November.  These actions are fundamentally destabilizing to the global financial system, as they undermine: the eurozone area; all attempts to bring greater transparency to government accounting; and the most basic principles that underlie well-functioning markets.  When the data are all lies, the outcomes are all bad – see the subprime mortgage crisis for further detail.

So I ask is Goldman’s going down?

I Think Greece Will Default, But The Euro Will Survive Nicely!

Many of you might be thinking, “Christian are you off your rocker… If Greece goes under the Euro zone will go under…” I say, no, it will in fact strengthen the Euro zone because a precedent has been set. Namely that the Eurozone must clean up its act and balance its budgets.

The Greek prime minister is doing best what politicians of Greece have been doing all along, namely avoiding the issue. Here is the problem Greece said that they are cutting wages by 20%. Yet is that an answer? That is a knee jerk reaction that is not serious. I mean after all what do you think is going to happen to the country? Do you really think anything is going to function?

I actually think that this is a ploy because the real measures that could work like increasing the pension age is only being done by two years from 61 to 63. What surprised me with that number is that why is Greece so low?

The Eurozone is taking a hard line against Greece because Greece cheated. I remember when the countries had to prove that they could join the Euro, everybody was surprised that Greece made it. And guess what it, seems financial engineering helped here.

According to Eurointelligence’s translation of Der Spiegel’s story: ‘Greece’s debt managers agreed a huge deal with the savvy bankers of US investment bank Goldman Sachs at the start of 2002. The deal involved so-called cross-currency swaps in which government debt issued in dollars and yen was swapped for euro debt for a certain period — to be exchanged back into the original currencies at a later date.’

‘But in the Greek case the US bankers devised a special kind of swap with fictional exchange rates. That enabled Greece to receive a far higher sum than  the actual euro market value of 10 billion dollars or yen. In that way Goldman Sachs secretly arranged additional credit of up to $1 billion [£642m] for the Greeks.’

Greece has not been honest and the individual eurozone members are not pleased, but they will not say this publically. It also does not help when Greece tries to go around the world to yet again circumvent the rules and tries to sell debt to other countries namely like China. Remember it is up to Greece to live up to its responsibilities.

I am starting to put the pieces together and I am thinking the EU is about to let Greece drop out of the Euro. I think they will pick up the pieces of default with respect to the Euro, but nothing else. Greece will try to retaliate with words, and will probably try to jump out of the union, but Greece will in the end default and probably be the first country to exit the union.

Though I am guessing with respect to the other countries the ECB will be kinder. And the fact that the Euro will fall will only make it simpler for Euro countries to export. In other words there is NO REASON WHATSOEVER for the Euro countries to show too much support for Greece.

I challenge the reader to name me one logical economical reason on why the Eurozone should show support for Greece. And please DON’T use emotions. Use economic reasoning…

The Google Super Bowl Ad SUCKS and Factually Incorrect!

I suppose I have been too long in Europe, but the Google Superbowl ad just sucks! The first time I watched it I stopped. Then I read what it was about, and it sucked again… It is a dumb story! I suppose this is due to the fact that I live in Europe and the story is so cliche that it is not even interesting anymore.

But the ad is in fact factually incorrect!

Namely…  If this person were indeed traveling to France, and indeed putting in his search requests they would have french references!

What am I talking about?

One of the annoying features of google search is that when you are in the local country the search defaults to the local country and the language. Even if you switch languages you get the results and hints to the local country. This tends to make sense since most people are interested in searching for things around them. Though I get annoyed because most of my searches if I use Google are non-local.

Another factual issue is that when he types in “translate tu es tres mignon” he has the apostrophe as he is typing. Notice I don’t since I don’t have a French keyboard. I have a Swiss german keyboard with Canadian English bindings. Thus it brings back my point. If he has access to the French keyboard then he would be in France and be referencing Google France.

Why am I being picky? Because I expected more from Google! I expected more because I thought they were geeks…

BTW I thought the add with the mounted moose hilarious, and the Doritos underdog ad was not bad.