With the US dollar declining.........
04-11-2008, 08:41 PM
#12
Line Holder
Joined APC: Jul 2006
Position: Captain 767
Posts: 91
To put it into perspective, at least here in Japan, we have Captains making less today then they made as FOs 6 years ago in terms of "real money". These guys are Kiwis and Aussies paid in dollars. As an American, I am LESS affected, but all the same the contracts must improve in order to retain and attract guys, especially if NINE MONTHS OF TRAINING is in the cards as with ANA and JAL!!!
04-12-2008, 07:39 AM
#13
Line Holder
Joined APC: Nov 2006
Posts: 78
Originally Posted by f10a
From Forbes: http://www.forbes.com/opinions/forbe.../0421/034.html
The Demise of the Euro
Avi Tiomkin 04.21.08, 12:00 AM ET
Tensions between inflation-obsessed Germany and growth-hungry Latin countries will spell its end.
It is only a matter of time, probably less than three years, until the euro experiment meets its end. The financial crisis in the U.S. is hastening the process, as investors flee the dollar, pushing the euro to a price of $1.59. But it will not stay high for long. Countries like Spain and Italy will withdraw and return to their old currencies. Once that happens, get ready for the return of the deutsche mark and the French franc.
What will undo the euro: the mounting tension between the inflation-obsessed German bloc (including Austria, Luxembourg and the Netherlands) and the Latin bloc of France, Italy and Spain. The Germans, saddled with memories of the hyperinflation that brought the Nazi Party into power, remain singularly focused on fiscal and monetary discipline. Despite core inflation in the euro zone of only 2.4% and a slowing global economy, the Germans insist that the European Central Bank maintain a tight monetary policy. In direct opposition to Germany, the Latin bloc, joined by Ireland, wants the ECB to lower interest rates.
Spain's worsening real estate slump dramatically illustrates the problem faced by the Latin bloc. For years Spanish home building and buying outstripped that of Germany, Italy and France combined. Now that the boom has turned to bust, the Spanish central bank cannot lower interest rates. Nor can the treasury devalue the currency. Bound to the euro, Spain can only complain to the ECB, while watching its economy circle the drain.
European heads of state and the European business press are making their discontent public in stark language. "We cannot continue to cope with the autism of some bankers who do not understand that the priority is not fighting inflation, which is nonexistent, but fighting for more growth," declared French President Nicolas Sarkozy last year. In October, in response to German Finance Minister Peer Steinbrueck's comment that he "loves a strong euro," leading Italian business newspaper Il Sole ran a headline labeling the remark "a declaration of war." "Italy has lost the ability to grow," the Italian finance minister, himself one of the founding members of the ECB, admitted recently.
The euro has long had detractors, who question the viability of political and monetary union in Europe. Haunted by World War II, the generation of leaders that included Helmut Kohl and François Mitterrand was willing to give up sovereign powers and national interests to create a common currency. But with no shared language, customs, culture or political system, the euro zone has never existed except as a construct in the minds of bureaucrats and politicians.
Now, as the divisions increase, insiders are beginning to take a dim view of the prospects for continued monetary union. "We believe the euro will not survive in the long run in the absence of some kind of political support," the president of BusinessEurope, a pan-European business association, stated in early March.
Along with the steep selloff that will precede the disintegration of the high-flying euro, other markets will be shaken. Look for much higher interest rates for prospective euro deserters like Spain and Italy as spreads for benchmark German bonds widen.
What should investors do? Gradually start to hoard dollars and short the euro. Another strategy is to sell investments in Italy and Spain and buy German fixed-income assets.
The political situation in Europe is likely to accelerate the euro's demise. Now that the Spanish elections are over, politicians there no longer feel the need to remain silent about mounting economic woes. If, as Italian polls predict, Silvio Berlusconi becomes that country's prime minister, the man who criticized the euro as "a disaster" would join a common front ready to take action by the time Sarkozy's France assumes the European Union presidency this summer.
The tight-money Germans will not push to preserve the euro. A poll released at the end of 2007 by Dresdner Bank (other-otc: DRSDY.PK - news - people ) showed that 62% of Germans support reinstating the deutsche mark as the country's currency. It appears that their wish will come true.
The Demise of the Euro
Avi Tiomkin 04.21.08, 12:00 AM ET
Tensions between inflation-obsessed Germany and growth-hungry Latin countries will spell its end.
It is only a matter of time, probably less than three years, until the euro experiment meets its end. The financial crisis in the U.S. is hastening the process, as investors flee the dollar, pushing the euro to a price of $1.59. But it will not stay high for long. Countries like Spain and Italy will withdraw and return to their old currencies. Once that happens, get ready for the return of the deutsche mark and the French franc.
What will undo the euro: the mounting tension between the inflation-obsessed German bloc (including Austria, Luxembourg and the Netherlands) and the Latin bloc of France, Italy and Spain. The Germans, saddled with memories of the hyperinflation that brought the Nazi Party into power, remain singularly focused on fiscal and monetary discipline. Despite core inflation in the euro zone of only 2.4% and a slowing global economy, the Germans insist that the European Central Bank maintain a tight monetary policy. In direct opposition to Germany, the Latin bloc, joined by Ireland, wants the ECB to lower interest rates.
Spain's worsening real estate slump dramatically illustrates the problem faced by the Latin bloc. For years Spanish home building and buying outstripped that of Germany, Italy and France combined. Now that the boom has turned to bust, the Spanish central bank cannot lower interest rates. Nor can the treasury devalue the currency. Bound to the euro, Spain can only complain to the ECB, while watching its economy circle the drain.
European heads of state and the European business press are making their discontent public in stark language. "We cannot continue to cope with the autism of some bankers who do not understand that the priority is not fighting inflation, which is nonexistent, but fighting for more growth," declared French President Nicolas Sarkozy last year. In October, in response to German Finance Minister Peer Steinbrueck's comment that he "loves a strong euro," leading Italian business newspaper Il Sole ran a headline labeling the remark "a declaration of war." "Italy has lost the ability to grow," the Italian finance minister, himself one of the founding members of the ECB, admitted recently.
The euro has long had detractors, who question the viability of political and monetary union in Europe. Haunted by World War II, the generation of leaders that included Helmut Kohl and François Mitterrand was willing to give up sovereign powers and national interests to create a common currency. But with no shared language, customs, culture or political system, the euro zone has never existed except as a construct in the minds of bureaucrats and politicians.
Now, as the divisions increase, insiders are beginning to take a dim view of the prospects for continued monetary union. "We believe the euro will not survive in the long run in the absence of some kind of political support," the president of BusinessEurope, a pan-European business association, stated in early March.
Along with the steep selloff that will precede the disintegration of the high-flying euro, other markets will be shaken. Look for much higher interest rates for prospective euro deserters like Spain and Italy as spreads for benchmark German bonds widen.
What should investors do? Gradually start to hoard dollars and short the euro. Another strategy is to sell investments in Italy and Spain and buy German fixed-income assets.
The political situation in Europe is likely to accelerate the euro's demise. Now that the Spanish elections are over, politicians there no longer feel the need to remain silent about mounting economic woes. If, as Italian polls predict, Silvio Berlusconi becomes that country's prime minister, the man who criticized the euro as "a disaster" would join a common front ready to take action by the time Sarkozy's France assumes the European Union presidency this summer.
The tight-money Germans will not push to preserve the euro. A poll released at the end of 2007 by Dresdner Bank (other-otc: DRSDY.PK - news - people ) showed that 62% of Germans support reinstating the deutsche mark as the country's currency. It appears that their wish will come true.
The euro is riding high today, however I think it will be short lived primarily because of politics and nationalism. We Europeans and Scandinavians have never really got along with each other. We still have a vivid and emotional memory that it is a direct result of the war even though people don't discuss it. Like the article indicated, we have no shared culture, customes and language... only a common, nonsensical regulations to stiffle economic growth.
Few Europeans governments ask the people if we wanted the euro. The vast majority of Europeans never were given a powerful voice regarding the adoption of the euro. It was forced upon many from elite bureacratics and politicos in back room deals.
We Norwegians rejected this the common currency and all its pending regulations that would eventually flow from Brussels. The rest of 'EU Intelligentsia' can clean up the mess they created!
EAHINC
04-13-2008, 01:39 AM
#14
On Reserve
Joined APC: Apr 2008
Position: Getting back into the game
Posts: 13
My 2 pennies worth adjusted for inflation :D
Originally Posted by NZAV8R
I sure hope so. However, IMO, I think that the US economy is in deeper trouble than most people realize. The price of oil blazing a path upward like it’s catching a ride on the space shuttle, is very concerning. And with the Fed slashing interest rates left, right and center, and the recent near melt down in the financial lending markets, there's been a lot of outflow of $ going offshore. And if that continues over the long term it will only keep driving the value of the $US further downward. Hopefully not, as it'll keep driving up inflation. But, whatever happens, I think that it'll probably be a good while before we actually see any economic resilience really start to kick in.
Here's a recent CNN article that discusses the weakening $US:
http://money.cnn.com/2008/03/12/mark...pact/index.htm
Here's a recent CNN article that discusses the weakening $US:
http://money.cnn.com/2008/03/12/mark...pact/index.htm
http://www.theinternationalforecaster.com/
Please let him know a Mexican Pilot in SoCal referred you and he'll send you a free issue, but I caution you, it won't be easy stuff to digest....but you and I can agree on something...history ALWAYS repeats itself.
04-16-2008, 08:04 PM
#15
Gets Weekends Off
Joined APC: Jul 2006
Posts: 146
Originally Posted by Airflores
NZAV8R, may I piggy back your post by adding Bob Chapman's info here, there is much more than meets the eye with all the financial debacle going on in the US. Wish I could say more, but here is the link...follow the rabbit hole, lol
http://www.theinternationalforecaster.com/
Please let him know a Mexican Pilot in SoCal referred you and he'll send you a free issue, but I caution you, it won't be easy stuff to digest....but you and I can agree on something...history ALWAYS repeats itself.
http://www.theinternationalforecaster.com/
Please let him know a Mexican Pilot in SoCal referred you and he'll send you a free issue, but I caution you, it won't be easy stuff to digest....but you and I can agree on something...history ALWAYS repeats itself.
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