Subscribe for 12 months with recurring billing - $199

Buy 12 months of subscription time - $199

 

Search Gold Prices
Gold Price
[Most Recent Quotes from www.kitco.com]
Our RSS Feed

Gold Updates by Mail

Enter your email address:

Follow Us on Twitter
« UK gets a Regulatory Face Lift | Main | Gold Prices Update 14th June 2010 »
Monday
Jun142010

Greece downgraded and the UK slower than expected growth

Greek Downgrade 15 June 2010.jpg


(Bloomberg) — Greek stocks and government bonds tumbled on mounting concern the nation may struggle to meet its debt commitments as public finances deteriorate.

The benchmark Athens Stock Exchange General Index dropped as much as 6.1 percent, its biggest intraday decline since Nov. 26. The yield on the government two-year note rose the most since 1998. Fitch Ratings cut Greece one step to BBB+ today, the third-lowest investment grade. Standard & Poor's yesterday put Greece's A- rating on watch for a possible downgrade, signaling it may be reduced within two months.

"Greek bonds were already tanking on the S&P negative outlook and Fitch gave their fall a boost," said David Schnautz, a fixed-income strategist at Commerzbank AG in Frankfurt. "It's a long-term sustainability problem. Now the government has to tell the Greek public that something needs to be fixed."
Greece, the lowest-rated country in the euro region, is struggling to shore up its finances amid a year-long recession. Gross domestic product shrank 1.7 percent in the third quarter from a year earlier, the National Statistics Office said Dec. 4.

The socialist government of Prime Minister George Papandreou, elected in October, plans to cut the budget deficit to 9.1 percent of gross domestic product next year, from 12.7 percent this year. The measures, including a partial freeze on public-sector pay, "are unlikely by themselves to alter Greece's medium-term fiscal dynamics," given the prospects of high deficits, debt and sluggish economic growth, S&P said yesterday.


The Global Financial Crises reported the UK over-estimate as follows:

David Cameron 15 June 2010.jpg
David Cameron

Britain's newly-created independent Office for Budget Responsibility has revealed the previous government had over-estimated the UK's economic growth forecasts.

The British economy is set to grow 2.6 per cent in 2011, not the 3.25 per cent predicted by the previous chancellor, Alistair Darling, in March. The new government says it is damning evidence that the financial mess left behind by Labour is even bigger than thought. The new growth forecasts suggest higher unemployment and a harder time for Britons ahead. It prepares the ground for harsh austerity measures expected to be announced during next week's emergency budget.

Things look to be going from bad to worse in eurozone as the news stream continues to flow with less than encouraging news on all fronts. It looks to us as though the Greeks will be battered into submission and either take the austerity medicine or leave the euro and go back to having their own currency. Either way the wolves will keep the pressure on them.



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.

The latest trade from our options team was slightly more sophisticated in that we shorted a PUT as follows:

On Friday 7th May our premium options trading service OPTIONTRADER opened a speculative short term trade on GLD Puts, signalling to short sell the $105 May-10 Puts series at $0.09.

On Tuesday the 11th May we bought back the puts for just $0.05, making a 44.44% profit in just 4 days.



Accumulated Profits from Investing $1000 in each OPTIONTRADE signal 14 May 2010.jpg

Recently our premium options trading service OPTIONTRADER has been putting in a great performance, the last 16 trades with an average gain of 42.73% per trade, in an average of just under 38 days per trade. Click here to sign up or find out more.


Silver-prices.net have been rather fortunate to close both the $15.00 and the $16.00 options trade on Silver Wheaton Corporation, with both returning a little over 100% profit.

To stay updated on our market commentary, which gold stocks we are buying and why, please subscribe to The Gold Prices Newsletter, completely FREE of charge. Simply click here and enter your email address. (Winners of the GoldDrivers Stock Picking Competition 2007)

For those readers who are also interested in the silver bull market that is currently unfolding, you may want to subscribe to our Free Silver Prices Newsletter.

For those readers who are also interested in the nuclear power sector you may want to subscribe to our Free Uranium Stocks Newsletter, just click here.

PrintView Printer Friendly Version

EmailEmail Article to Friend

Reader Comments (4)

Greece is nothing. Wait for China, China is going to have a big crisis and that will be big news and it will hit commodity sector hard, including gold. (Don't have the date for this)

June 15, 2010 | Unregistered CommenterDi

What? No date? The entrails don't give you a date? What good are they? You need better entrails.

June 15, 2010 | Unregistered Commenterfallingman

Fallingman, too funny! And thanks for your advice yesterday, very helpful. In contrast with......

June 15, 2010 | Unregistered CommenterSnakeman

Gold and silver are both having a good day and the associated stocks are also doing well, keep an eye on SLW, we are expecting it to do very well.

June 15, 2010 | Unregistered CommenterGold Prices

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
Some HTML allowed: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <code> <em> <i> <strike> <strong>