^Yeah, and Spain + Italy + Greece is a larger % of Eurozone GDP and I really think this issue impacts the whole group given what appear to be unsustainable debt levels and forced austerity. Not bailing out Greece could force you into a much more severe bailout of Spain and Italy.
Black Swan is essentially right. E.U. has a structural problem. Price and wages need to adjust. Keep going into debt will not solve anything. It’s not just Greece, it’s all the peripherals.
USG NPV gap of negative $100T finally corrects in some unpleasant manner. It’s always there looming, growing larger, and people think it will continue forever, but one year bam it snaps.
IMO it’s likely political posturing from Tsipras. Greece would block itself from credit markets if they completely reneg on their euro deal. Greece needs credits. Greece needs the euro more than euro needs Greece.
Of course it could get heated between Greece and the rest of the Eurozone + IMF.
But in the end the Greeks are just going to swallow the pill IMO. Especially since things are improving over there.
Again ; just a politician banking on the people’s frustration. But I would be surprised if a shit storm results.
Oh I got one :
Unrest in China > Chinese Governement invests massively to creat jobs > China sells US Treasuries in huge amounts > downward pressure on the USD, upward pressure on Treasury yields leading to another unexpected QE
^ All paths lead to QE4. 
Why none of you are talking about japan? That economy will enter in a deep depression at any time
^ Japan in depression is not a black swan. Japan has effectively been in depression for 25 years and will probably be in the depression for as long as any of us care, unless they open the immigration floodgates and anglicize their society.
Not so much. Some things are still good. The stock market there isnt bad, indeed, its becoming a good investment since the beginning of 2013, as you can see here. Others important macroeconomics dates are not so bad. I think the real crash not happened yet
endlessly printing money and handing it to corporations who don’t then hand it over to their employees or expand in anyway is not the end of their depression. you can’t take a 2 year blip which includes rapid currency depreciation and related stock market appreciation due to the most radical policies fathomable and say things are better. even though there are some signs of economic improvement, the depression has actually intensified for Japanese citizens, more so than in any other 2 year period in the past 25 years.
EDIT: if you actually take time to understand what’s happening in japan, its metrics don’t even look good. stock market is up 90% since late 2012 but ~50% of this is due to currency depreciation meaning the market is only up ~25% over two years in which the S&P 500 was up ~50%. so despite Japan completely gearing its economy to be more business friendly (lower tax rates: 41% to 36% and heightened inflation expecations) which pretty much accounts for the 25% gain, it trailed the U.S. which virtually did nothing to help corporations. removing the currency effects, improved tax rates and higher inflation expectations, the Japanese market basically did not rise at all during the past 2 years versus nearly all other markets being up meaningfully.
yes. japan remains in depression.
Yes, but it helps create new bubbles and increase the economic distortion. They will pay for it (more)
see revision to my post above. there has been no gain for the japanese economy since Abenomics started. japan is already paying for abenomics. they never gained anything and never will. you can’t fight demographics and market psychology simply by printing currency and lowering corporate tax rates and raising sales tax rates.
One black swan is Google. A large manager is shorting it on the basis of a weakening moat or competition from FB having a stronger advertising platform/ROI. People aren’t expecting Google’s multiple to start contracting.
the other is the rising dollar will hurt companies like GE and UTX which export a lot of industrial goods. If this causes the industrial sector to slow down then it will certinaly hurt the over stock market. I think industrials are the most important sector in regards to the strength of the overall stock market. I’d be curious to see the analysis of how the market performs when GE and UTX perform poorly.
And how is that different than the last 25 years? The black swan event would be Japan not in recession.
Completely disagree on Google. FB is a toy, a fad that will be dead in 10 years. Google is a monster with an indestructable moat. It’s downfall to FB would be a huge black swan, IMO. 0.00000001% chance of ever happening.
More agreed on the industrials side, but these things tend to self correct. A weaker export sector in the US will lower the dollar. Depends on what is driving the buggy forward.
haha.
Black swan: Hong Kong punts Chinese control in a popular uprising. God knows what happens from there… Suppression, war, progress?
Great post, not just on Japan but on the nature of the “stimulus” policies sweeping the globe. It sort of ties in with the economic news in the US yesterday; that despite all this stimulating and apparent economic growth…wages still aren’t increasing.
I think China’s stimulus is interesting. It seems they are less interested in pumping up the financial markets and lowering rates to zero (markets are already pumped!), rather the government is investing in big construction projects. These create jobs, common people get paid, the country gets new railroads and such, and stocks (like railroad stocks for example) go up.
Bottom up stimulus, rather than top down.
Yeah, people just accept all of these stimulus plans as if the outcome is law, like gravity or something. They have to realize that we are in an unprecedented period of sovereign debt levels and global recession and that the concept of stimulus in this environment is still just a gambit on economic theory.
additionally, after another debate with other forum members I realized contemporary analysts have very little concept of quality of gdp, focusing entirely on quantity without grasping the implications for future stability.
First Black Swan of the year while I was sleeping
Switzerland unpegs from Euro and sets negative rates
http://www.bbc.co.uk/news/business-30829917
The Swiss franc has soared as much as 30% in hectic trade after the central bank abandoned the cap on the currency’s value against the euro.