Moment of Truth for Europe
Moment of Truth for Europe
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Markets responded positively to the "reality check" on the Greek situation. Banks are now ready to accept a 40% haircut on Greek bonds while Germany is pushing for as much as 60%. What is impacting positively the markets is that European leaders (and banks) are no longer in denial and finally accepting two important facts:
1) That the Greek situation has further deteriorated since last summer and more haircuts are needed;
2) That European banks will need a 100 bn. or more recapitalization;
From tomorrow's meeting we need an adequate response to the crisis with an expansion of the European Financial Stability Facility to 1 Trillion Euro or more.
I am confident that Italy will adapt the necessary reforms to reassure the markets.
Surprise Earnings: Materials and Commodities a buying opportunity===========================================
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Caterpillar reported higher than expected earnings and gave a positive outlook for 2012. This confirms my theory that we are moving toward a faster recovery and that we are not heading toward a recession.
Basic Materials producers and commodities like copper are still priced for a quasi recession and present a good opportunity for investors. This because growth will continue in China and other emerging markets (and also in Japan for the reconstruction).
The supply and demand deficit in several commodities will increase as worldwide growth accelerates.
Strategy: Commodities and European equities with exposure to emerging markets
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With an optimist outlook for a soon to come resolution of the European crisis I recommend exposure to commodity companies (or commodities directly through a broad commodity index) and many of the European multinationals with products and services that will benefit from the continuous growth in emerging markets and the reconstruction in Japan.
Reader Commentary
at 01:37 am
Yes, I agree, one should always keep very strict and proper accounting records. Although it may sound a lot of paperwork it is mandatory when you roport expenditures. It has always been an issue to explain those requiremnets to expats.
at 10:23 am
James bell.the answer is yes!.because of:
1.energy for labourers work.
2.deflating structural inflation.
3.helping selfemployed on daily income expenditure.
4.helping healthy condition.
5.stabilizing price equilibrium.
6.even the orphans can live.
7.economy with expected circulation of consumable good available will be stable and secured.when food is price ok, every services ok.good economy loving flow.
at 03:26 pm
I am a trustee in charity. Is it appropriate for us to be investing in food commodities?
at 01:11 pm
Of my first comment.fighting recensions and inflations by act of deflation can only lead to moments of trueth for each accounting year of economy suitability boom for money and goods and services equilibrium.
at 12:58 pm
Yes!!!,economy booming with actions and regulation always to audit each accounting years and keeping proper effecting accounting records.lets live in mindful health and love our laws and God.it will not fall anymore.happy new miliniun updates.its working for living world economy.i a job in europe!!!.