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08-02-2011, 09:56 PM #1
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Europe on Brink of Major Financial Collapse: Guggenheim CIO
Europe on Brink of 'Major Financial Collapse': Guggenheim CIO
Published: Tuesday, 2 Aug 2011 | 1:24 PM ET
By: Gennine Kelly
Web Producer, CNBC
Europe is a "train wreck" and on the "brink of a major financial crisis," Scott Minerd, CIO of the fixed-income firm Guggenheim Partners, told CNBC Tuesday.
"The way Europe is operating right now, it's what I called recently 'cognitive dissonance,'" Minerd said, or "basically doing the same thing thinking they're going to get a different outcome."
"They keep throwing more and more liquidity at it thinking it's going to get better and it's not," he added. Europe fails to recognize that it has a "structural problem, not a liquidity problem."
People will "flee the euro" unless they find a way to bifurcate the euro in some way where strong countries are in the euro only and the weak countries are out, Minerd explained, adding, "To be honest with you, I don't see the mechanism to do that."
"As the capital is flooding out of Europe, which we're starting to see now, the first place it's going to go is to the safe havens—[U.S.] Treasurys, which [the market] perceives to be safe, and it'll chase gold," he added.
Compared to a 2 percent return on Treasury notes, investors will eventually say that "stocks with price-earnings multiples of 12 or 13 or 14 look relatively cheap, and the growth for corporate earnings in the United States is very good, and this is likely to help us," said Minerd.
The United States is "the least dirty shirt in the bag," Minerd concluded. "We have a very good chance of seeing equities up maybe another 10 percent [over the next six months] from where we are."
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08-02-2011, 10:01 PM #2
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http://drudgereport.com/
Silent bank run hits Greece... http://www.guardian.co.uk/world/2011/au ... nic-change
...exodus http://www.independent.co.uk/news/world ... 30675.html
Italy under fire... http://finance.yahoo.com/news/Italy-und ... ?x=0&.v=12
Pain in Spain... http://www.ft.com/cms/s/0/f07eab84-bcee ... abdc0.html
Woes Get Messier... http://blogs.wsj.com/marketbeat/2011/08 ... t-messier/Join our efforts to Secure America's Borders and End Illegal Immigration by Joining ALIPAC's E-Mail Alerts network (CLICK HERE)
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08-02-2011, 10:18 PM #3
At this point it doesn't really matter.
Europeans are so deeply rooted in Wall Street and the Dow Jones, if they go down we go down.
And I've told you about Europe bing China's largest export customer ..Join our FIGHT AGAINST illegal immigration & to secure US borders by joining our E-mail Alerts at http://eepurl.com/cktGTn
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05-03-2024, 11:30 PM in General Discussion