Comments on: Ailing Belgium could be game changer http://blogs.reuters.com/james-saft/2011/01/11/ailing-belgium-could-be-game-changer/ Tue, 24 Mar 2015 16:54:45 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: Reisdier69 http://blogs.reuters.com/james-saft/2011/01/11/ailing-belgium-could-be-game-changer/comment-page-1/#comment-419 Wed, 12 Jan 2011 11:59:53 +0000 http://blogs.reuters.com/jim-saft/?p=253#comment-419 I honestly believe that investors take the whole picture in consideration, and not only the political crisis at the basis of which lies the age-old contradiction between the large majority of Dutch-speaking Flemings in the north and a minority of French-speaking Walloons in the South. The fact remains that 1) the economic recovery is in Belgium much stronger than in other European countries; 2) it is better to have an efficient Belgian government that tackles accurately the budget deficit, even if it takes a few weeks longer to make such a government, than to have a speedy but incoherent one with no apparent economic vision, which will only aggravate the budget deficit. 3) and, last but certainly not least, citizens of Flanders and Wallonia have enough savings deposits to cover the total national debt several times over – which, by the way, they do so. So, if anything, the height of the present risk premium between Belgian and German bonds is actually an excellent buying opportunity.

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By: BoudewijnDG http://blogs.reuters.com/james-saft/2011/01/11/ailing-belgium-could-be-game-changer/comment-page-1/#comment-417 Wed, 12 Jan 2011 09:45:18 +0000 http://blogs.reuters.com/jim-saft/?p=253#comment-417 Paragraph 8 of the article: ‘Europe is really a prisoner of this policy.’ Exactly, and Belgium as well. But Belgium could be more than a ( financial markets’ ) game changer. It could stop the game.
In fact, the belgian deposits on short and medium term are twice its total public debt, of which even a larger part is internal. So, in of course somewhat simplistic terms, if the Belgians would directly repay the external public debt, the ( markets’ ) game would be over.
This could trigger a dramatic policy shift for the rest of Europe, out of its financial prison, as for the rest of the world.

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By: Reisdier69 http://blogs.reuters.com/james-saft/2011/01/11/ailing-belgium-could-be-game-changer/comment-page-1/#comment-416 Wed, 12 Jan 2011 08:52:30 +0000 http://blogs.reuters.com/jim-saft/?p=253#comment-416 I honestly believe that investors take the whole picture in consideration, and not only the political crisis at the basis of which lies the age-old contradiction between the large majority of Dutch-speaking Flemings in the north and a minority of French-speaking Walloons in the South. The fact remains that 1) the economic recovery is in Belgium much stronger than in other European countries; 2) it is better to have an efficient Belgian government that tackles accurately the budget deficit, even if it takes a few weeks longer to make such a government, than to have a speedy but incoherent one with no apparent economic vision, which will only aggravate the budget deficit. 3) and, last but certainly not least, citizens of Flanders and Wallonia have enough savings deposits to cover the total national debt several times over – which, by the way, they do so. So, if anything, the height of the present risk premium between Belgian and German bonds is actually an excellent buying opportunity.

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By: Reisdier69 http://blogs.reuters.com/james-saft/2011/01/11/ailing-belgium-could-be-game-changer/comment-page-1/#comment-415 Wed, 12 Jan 2011 08:46:38 +0000 http://blogs.reuters.com/jim-saft/?p=253#comment-415 I honestly believe that investors take the whole picture in consideration, and not only the political crisis at the basis of which lies the age-old contradiction between the large majority of Dutch-speaking Flemings in the north and a minority of French-speaking Walloons in the South. The fact remains that 1) the economic recovery is in Belgium much stronger than in other European countries; 2) it is better to have an efficient Belgian government that tackles accurately the budget deficit, even if it takes a few weeks longer to make such a government, than to have a speedy but incoherent one with no apparent economic vision, which will only aggravate the budget deficit. 3) and, last but certainly not least, citizens of Flanders and Wallonia have enough savings deposits to cover the total national debt several times over. So, if anything, the height of the present risk premium between Belgian and German bonds is actually an excellent buying opportunity.

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By: Antwan http://blogs.reuters.com/james-saft/2011/01/11/ailing-belgium-could-be-game-changer/comment-page-1/#comment-414 Wed, 12 Jan 2011 00:28:08 +0000 http://blogs.reuters.com/jim-saft/?p=253#comment-414 I am a belgian. Here people (economists, politicians) are saying our situation is different because 1. most of our debt is internal (to belgian banks) and 2. we have one of the highest reserves in personal savings in the world.
Is this also said outside of my tiny country, or is it just a way to keep the people & media from panicking? :-)

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By: Gotthardbahn http://blogs.reuters.com/james-saft/2011/01/11/ailing-belgium-could-be-game-changer/comment-page-1/#comment-413 Tue, 11 Jan 2011 18:43:10 +0000 http://blogs.reuters.com/jim-saft/?p=253#comment-413 An entirely possible scenario. However, given that both China and Japan are now ponying up cash to assist in resolving the Euro-debt crisis – likely after some serious back channel arm-twisting – it’s conceivable these two countries, with their enormous FX reserves, will be buying lots more Eurozone debt in the not-too-distant future, allowing the Eurocrats to avoid needed sovereign- and bank-debt restructuring. It also would not be surprising if the Eurothugs have threatened Chinese and Japanese access to Eurozone markets, certainly not with outright trade bans but non-tariff barriers might go up. China wouldn’t be too pleased with that, now, would they?

Bottom line: Put nothing past the Eurocrats. They will do everything to avoid the collapse of the Euro and thus losing face before the ‘Anglo-American’ economic model. This may get ugly!

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