Thursday, 23 August 2012




Investment Strategy

everything about
30.05.2012
33

Professional money Felix"infinite suffering to Europe"

by Frank Doll

Greece will not be the only country that because of the economic depression has to give up the euro soon, says the famous financial expert. As investors their capital in the impending chaos bring ends meet.



Zulauf, born in 1950, is among the world's most prestigious asset managers. Since 1986 he takes annually with other investment legends place at the famous stock market Roundtable of the U.S. investment magazine and Business Week's cooperation partner "Barron's". Inlet was the first foreigner to receive this honor.Source: Press Photo

Content
  1. S1 "infinite suffering to Europe"
  2. S2, the process is far from over
  3. S3 naive faith in the euro zone
  4. S4 Europe wants Germany to balance costs
  5. S5 ignorant population
  6. S6 Euro will not survive
  7. S7 in the case of Germany
  8. S8 Farewell project Euro
  9. S9 government bonds and a portion of gold
  10. S10 Next year is dangerous for shares
  11. S11 Currency Reform for Japan on the march

Content
  1. S1 "infinite suffering to Europe"
  2. S2, the process is far from over
  3. S3 naive faith in the euro zone
  4. S4 Europe wants Germany to balance costs
  5. S5 ignorant population
  6. S6 Euro will not survive
  7. S7 in the case of Germany
  8. S8 Farewell project Euro
  9. S9 government bonds and a portion of gold
  10. S10 Next year is dangerous for shares
  11. S11 Currency Reform for Japan on the march

Business Week: Mr. Zulauf, which major European bank will soon run out of air?

Felix Zulauf: In principle, a number of banks in Europe, already broke, probably some in the United States. But governments are not a big bank can go bankrupt.

Why not?

The failure of a large bank failure would result in others according to who gave the bankrupt bank loan or purchased from these derivatives. So it would be a chain reaction, and ultimately come to a collapse of the financial system. To prevent, over the next two to three years more banks to be nationalized, in the periphery, but also beyond.

Large nationalization would have been cheaper to three to four years.

Right. Even during the crisis, then all systemically important banks should have been nationalized immediately - at low prices. Then you would be able to suspend bonus payments and maintaining the banks gradually to stronger balance sheets.After seven to ten years, the viable banks would again have been ready for the market. In its current form, many banks will not survive.

Why not?

They are too heavily in debt, and not just the banks alone. In recent decades, we have all, in government and in the private sector constructed at a level debt that the system can no longer function. We can not grow because we have too much debt in the neck.

The U.S. bank JP Morgan has with derivatives transactions set two billion dollars in the sand. Is it conceivable that this loss potentiated in the banking system?

Two billion dollars is a no brainer for JP Morgan. Put the loss away relatively quickly. But it could also be ten times more. The problem is different: There are only five banks in America, which have about 95 percent of outstanding U.S. derivatives on their books. JP Morgan is one of them. In Europe, the business is spread wider. Global, the derivatives market is somewhere from 400 to 700 trillion. These are huge sums.

If real economic trends then move on once the markets hard, there can be large fluctuations. Then there is the risk that a bank is not properly secured or simply speculated. Even threaten a system collapse, which would in turn prevented by nationalization. I see no other way out.

The regulatory authorities shall require the banks to hedge risky operations in future with more capital. Can the banks are implementing higher capital requirements at all?

It has since given them a lot of time. The tougher capital rules under Basel III agreement on access only from the 2019th

Some countries want to tighten the rules and push for an earlier implementation.

In principle, justifiably, to the recovery of the financial system, we need better capitalized banks. To date, however, weaken the capital rules, the financial system and massive damage to the economy. If matured loans are not renewed because shrinking bank balance sheets must for lack of capital, economic activity will inevitably decline. The problem extends into the emerging markets. There would be affected, especially in the countries of Central and Eastern Europe.

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Posted by Britannia Radio at 18:54