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« Silver Wheaton Corporation Call Options Update | Main | iShares Silver Trust (SLV) Growing at a Blistering Pace »
Monday
Nov152010

Europe needs more Life Boats

Bank of Ireland 16 Nov 2010.JPG

According to British radio the Irish need seventy seven billion euros in order to stave off an utter catastrophe, of which Britain is expected to stump up seven billion euros.

European officials, increasingly concerned that the Continent’s debt crisis will spread, are warning that any new rescue plans may need to cover Portugal as well as Ireland to contain the problem they tried to resolve six months ago, as reported in The New York Times, Global Business Section.

Any such plan would have to be preceded by a formal request for assistance from each country before it would be put in place. And for months now, Ireland has insisted that it has enough funds to keep it going until spring. Portugal says it, too, needs no help and emphasizes that it is in a stronger position than Ireland.

While some important details are different, the current situation feels eerily similar to what happened months ago in Greece, where the cost of borrowing rose precipitously.

European authorities stepped in with a rescue package, expecting an economic recovery and the creation of new European rescue funds to fend off future panics by bond investors whose money is needed by countries to refinance their debt.

But with economic conditions weakening, markets are once again in turmoil. Rescuing Ireland may no longer be enough.

Stronger countries and weaker countries using the common currency of the euro are being pulled in different directions.


Some economists wonder if unity will hold or if some new system that allows countries to move on one of two parallel financial tracks is needed.

José Manuel Barroso, president of the European Commission, said on Monday that Ireland had not requested aid. “We have all the instruments to address the problems that may come either in the euro area or outside the euro area,” he told reporters in Brussels.

Well, we dont share Mr Barroso's confidence regarding this issue as Ireland are in the firing line at the moment, however, the other weak countries could soon be put under the gun. Just how far can the European Union go in terms of rescue packages for its weaker members remains to be seen. The uncertainity needs to be resolved and quick in order to maintain stability in euro zone. It is also possible that a rocky euro could see the dollar strenghten with the inverse effect being to weaken silver and gold prices.

Hold tight its going to be a bumpy week.



Over in the options trading pit the team have just updated the progress chart to include last weeks closed trades as follows:

sk Chart 14 November 2010.JPG


The above progress chart is being updated constantly. However, to see exactly how it is going, please click this link.

So, the question is: Are you going to make the decision to join us today?


Stay on your toes and have a good one.

Got a comment then please add it to this article, all opinions are welcome and very much appreciated by both our readership and the team here.



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Reader Comments (5)

Bob, good report in yesterdays edition of Kitco, as is in this edition of Silver Prices.net.

Having published the comments in this report, where do you think that the first domino will fall to start the crash opening the door to the next depression, if it is going to happen? Thanks.
John

November 16, 2010 | Unregistered CommenterJohn Ell

All of the PIGS are giving me sleepness nights. To solve a problem we first of all need to state it clearly.

The financial problems that the PIGS are suffering from are hazy in terms of their magnitude. Every figure that comes out appears to be higher than previously thought, thus raising the question of just how bad is it.

Not knowing what we are up against worries us. We would add another 'I' to this list and that is Italy. The French have also been know in the past for being 'economical' with the truth, so they too are in the frame.

We need a new name along the lines of FIIGSP...or IFPIGS..

any thoughts?

November 16, 2010 | Unregistered CommenterSilver Prices

Try FIPGIS ... it even sounds funny!

November 16, 2010 | Unregistered CommenterTJ

Hey, but think of the bright side!
This can do nothing but good things for silver and gold as they are the only REAL money that's left out there.

November 16, 2010 | Unregistered Commenterdaveydog

True enough!

November 17, 2010 | Unregistered CommenterSilver Prices

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