Comments
Transcript
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LSAs enjoyable and interesting as this was, i must say that I'm frankly quite amazed to hear people of higher education who should have first hand information STILL talk about Italy like this was the 2011 debt crisis. We're in 2020, yet they talk like it was 2011. Granted, this interview was done in early April, and much has changed in the last 3 weeks, but I'm still a bit disappointed to hear knowledgeable people simplify everything down to whether "Italy leaves the euro or not"... So goes Italy, so goes everyone else. Either they find a way to keep everyone afloat, or they all sink (taking the world economy down with them). The german parliament holds the final say on the fate of Europe. Merkel will do "whatever it takes" to save the eurozone, but she needs to convince the german people and lawmakers. Everything depends on whther she'll succeed at doing that.
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SRGreat interview Elle and Ed. Elle - after talking about how central banks were "mucking with the price of money" I was surprised to hear you endorse Draghi. I agree that Greenspan started the process but believe that Draghi is guilty of taking it to an extreme that has only added to Eurozone issues. Ed - you interviewed Warren Mosler a while back. He was consulting 5 Star about leaving the Euro and had some interesting ideas. It sounds like they might be doing it as you noted an IOU is essentially govt fiat. Next step w/be to make the IOU's eligible to pay taxes and you have basically created the currency. Keep up the good work!
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dbEd. Why did you laugh when you were told that Greece’s GDP had grown by 3.1% since the start of the Eurozone? It’s around the 23 minute mark.
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JHExcellent interview. Longer term question. Will this pandemic, and the likely chance we haven’t seen our last, impact Italy’s decision to join China’s One Belt/One Road project?
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III find in this interview everything stated is true, but not objective. Italy has a disgraceful public debt, but quite low private debt. Russell Napier for example has studied the French situation where public debt is around 100% of GDP , but private debt is very high, and so believes that France will end up with public debt at least the same as Italy's by the end of this crisis. The point is a different one: you can't have monetary union without fiscal union. Italy is a mess, but there are a few european countries which are in fact tax havens. the solution is to have the same taxation and fiscal rules in the Eurozone, and this will enable the eurozone to solve the problems and become stronger. Unfortunately the politicians of the 90's didn't explain this aspect to the voters when they promoted the Euro. On a geopolitical level Germany needs the eurozone to stay together so I don't really see any other solution, anything else would be a bandaid I believe.
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DM@ElleH if there was a pickup in global inflation down the line, do you see the ECB or the Fed going to fight it first? From my perspective at the moment, we're all in the same boat in terms of what's coming short term, they will do everything they can to backstop... but long term I just don't see the Fed raising rates to fight the inflation, the US just has so much debt...... Our national debt is 24 trillion, if rates went to 5% we'd be paying 1.2 trillion a year on the interest... I think the Fed would avoid that situation at all costs
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DMWow, she hits the nail right on the head.
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FGItaly is an economic black hole: You can throw any money to it, it will eat it and nothing will come out. World champions in value destruction. And it's not the fault of politicians alone. The government is just a reflection of how the population thinks and operates. The big problem with Italy is that Italians are not designed to operate as a country. They simply can't scale into large organisms. And that's ok. Way forward: Split Italy into independent regions (the old kingdom if you like, just without the nobility). Let everyone run its own show.
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JRDraghi? More ECB and Brussels? Interesting how this virus is targeting Italy. A country that has been moving further and further away from Brussels is now being brought to its knees, begging for the technocrats/globalists to come to their rescue. It's a very convenient crisis for those wanting to centralize power. Read Kissinger's article that was published in the WSJ the other day, "The Coronavirus Pandemic Will Forever Alter the World Order". Essentially what he's reiterating is that "you need us...give up your sovereignty...a new political and economic order ruled by my fellow globalists is the only solution." Never give in, folks. Never give in. Decentralization, sound money, free trade, property rights. We're in the Fourth Turning and the real war will not be between nation states (though there's a decent probability we see that). The real war is between the people of this world who want to live in a free society that respects privacy and the rule of law against those who wish to be (or continue to be for that matter) our feudal overlords. We either succeed or it'll be a Brave New World, with a boot stomping on our face - forever. For those of you who need be reminded of the first video ever posted on Real Vision, here's a link: https://www.youtube.com/watch?v=w8HdOHrc3OQ As Charlie states, fight for liberty!
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SBLenore's question at the very end (what to do with Euro denominated contracts in the event of a denomination) arose in Argentina in 2000 (when they removed the 1:1 peg to the US$). The government passed a law stating that all contracts dominated in US$'s would be converted to Pesos at a fixed rate. Mortgage holders did very well, out of this - the banks took a massive hit. But there was mass confusion (and a lit of litigation) between businesses - such as an Argentine company buying supplies from overseas, arguing that Argentine law applied (and they should pay their invoices in devalued pesos), or two foreign local subsidiaries arguing that they should still be paid in US $ (and not pesos). I was a CEO of an Argentine business at that time and it took years to resolve - and the businesses most affected were put out of business.
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KJAnd, right on cue: https://www.bbc.com/news/world-europe-52213898
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CMMy biggest takeaway was her experience in quarantine in Italy. Can't even go for a run or walk, This is how they got their curve to decrease. Since this will not happen in the US, makes one wonder how long it will take to get our numbers down without a vaccine. Stay at Home seems to be working OK right now, but when we restart, see that 2nd wave hitting.
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CHBig props to Ed! He's doing a fabulous job providing the straight goods daily. Thank you for your part being on the front lines. When this passes, I'll forever think of Ed who kept me grounded with his logical and thoughtful analysis each day during this unique time in our history. One day I hope to buy him a beer!
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ISCant believe i still have to ask this question Realvision. When was this filmed?!
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HJThose are rookie numbers, Italy can go much further than 60% debt to GDP. Japan runs at 236% and that was in 2017.
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SPTurn Italy into a Special Economic Zone, slash taxes, the place could be transformed within 5 years. There is no other solution.
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JQGreat job Lenore.
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GWGreat insight into a mix of on the ground macro and politics, thank you
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CBInteresting insights here. My favorite was the idea that Central Banks meddling in the true cost of money has obscured market signals that allow economic actors make good, data-driven decisions. I suppose this is true for politicians as well as businesses and investors. With every CB worldwide ramping up "meddling", expect even more mistakes to be made. Bumpy trails ahead.
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JEGreat insights. Thank you.
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AHFascinating perspective. Thank you!
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TSWow, she is great. More, please. And I am really enjoying Ed as well, he has a great way of making the complex simple. Which takes a *lot* of understanding.
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KEAmazing interview. I would love her to do a follow up in 3 to 6 months.
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NLToday Italy's new infections fell again and is just above 3k. I think they got over the worst and in 2 weeks there is a good chance for Italy to be reporting single digit new infections. But they need to stay closed for the next few weeks. Size of money printing needed to get over the virus.. I just can't see how any currency can hold against gold and perhaps bitcoin.
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arMs. Hawkins, your last speech sounds like it's straight out of the Mises Institute. Bravo! (I wont tell …)
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scMy understanding is that many of Italy's companies are Chinese owned and have thousands of Chinese workers from Wuhan working in those Italian factories. That's the connection and if they also attended the soccer matches, then there you go.
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AMI joined recently on the basic package to hear raouls views however we hear everyone e but raoul- think he has an obligation in these difficult times to inform his listeners on all package levels
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MTSouthern Italy sounds a lot like Alabama or Mississippi.
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SKYou should think about boots on the ground in China/Russia. IMO, one of the flaws of RV. Lots of arm chair quarterbacking from outside of those countries, but not enough boots on the ground there to even understand the culture, much less the macro. This limits RV's perspective, IMO. I'm just an investor, I'm not being political.
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RGLet's not forget the 300,000 Chinese workers in Northern Italy in spreading the virus.
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wjItaly has an opportunity to stop this. Lets hope Italy has learned more from this nonexistent union. Lets switch EU off Italy we all be better off. Poland will be next and other countries can follow. Lets switch production back to local countries and have less of a dictatorship which basically is the EU.
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DSExcellent. Boots on the ground. Very interesting about Italian government issuing IOUs, fiat currency, may be the starting point of the new Lira. Well worth listening again. Thanks, DLS
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OCDraghi, really? One of the reasons for the EU problems was Draghi. I don't who's more corrupt, Draghi or legaard?
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BKi dont get it.. she said "yesterday was april 1st".. 24:23... is this material 5 days old, really?
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GRMissing data: Lots of Chinese workers in Italy at Chinese owned factories making chinese shoes in Italy going back and forth. More missing data: Italian people virtue signalling by hugging Chinese to prove they aren't racists like the US is.
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CRItaly might have more hospital beds per capita, but the USA of over 2.8 times more ICU beds verses Italy. Only Germany comes close to the number of ICU bed per capita vs. the US Data here: https://www.forbes.com/sites/niallmccarthy/2020/03/12/the-countries-with-the-most-critical-care-beds-per-capita-infographic/#74c386e7f864
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III live in Italy, as for unemployment, in Europe the labour market is not so flexibile, I know lots of small business owners in difficulty of course, but you can't just fire people so the data would be hard to confront
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GHFiat on fiat haha
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ANStore of value and growth will come from: innovative tech and code governing inflation rates Altcoin run is inevitable
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Cd"We need an adult in charge" Same in Brazil :D
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SPOk, time to short da Pasta mama mia!
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soGood interview with helpful insight, but hard for me to accept that Draghi could be part of a solution. Not that I know anything about Italian pol/econ, but I've watched that arsonist for too long to believe he could bring a sane solution to anything.
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CBGreat video and insight however in these times filmed on date is needed for reference of the situation at that time. Videos lose at least 50 % value without date reference.
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OTIt was great to have a happy positive person like Lenore Hawkins deliver what is otherwise a tale of misery and destruction, it made the video somewhat hopeful :)
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GLCould you please label every video with the date / place of filming.
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CDIf gov pays the corporates with IOUs, is that money good for tax collection purposes or are businesses supposed to settle with euros? By the way I seem to recall that in sovereign CDS, redenomination is not an event of default if the country is in the G7.