- The prospect of Indian default…
A restructured loan occurs as follows:
Borrower: “Dear Credit Controller, I have no money to pay you back”
Credit Controller: “Buggery. How did I miss this on your credit application?”
Borrower: “As I recall, you were happy with my balance sheet. Although, I was very glad that you were so understanding about it not balancing to begin with. My aunt gets so confused by this book-keeping. But she made it balance.”
Credit Controller: panicking “Oh – I am going to be in SO MUCH TROUBLE with the bosses!”
Credit Controller: looking hopeful “I don’t suppose that you’re expecting to turn the corner?”
Borrower: “Um, well, yes. Possibly. Actually, I may need to borrow a little more to help with that…”
Credit Controller: “That makes sense. And, I suppose, it also looks better that way! Here’s a pen. Congratulations on your extension and new revolving line of credit.”
Lovely. The issue: what happens when the banks start to haemorrhage when they can’t possibly restructure any more? Answer: Ireland. The State is forced to bail out the banks in order to prevent a larger scale problem. And then, well, Ireland:
Pre-bailouts (2007), government debt was sitting in the 22-24% of GDP range. Post bailouts (2011), like over 105% of GDP. And suddenly, Ireland as a whole is being bailed out by Europe.
Only – where is India’s version of Europe?
- The iPhone 5 supply shortage.
The issue is scratched aluminium covers, which is causing a quality control crisis at Foxconn (wrote about it here).
And the yellow is chipping on the edges. Apparently, this is happening right out of the box – which is, you know, not ideal.
Apple’s share price:
I refer you to my initial observation about the AAPL share price on Tuesday 18th September. Mainly because I’m quite proud of myself. Which is a bit shameful – because this share price pattern is not an unusual one to call.
As an aside: some Apple supporters are saying that this is just hype to increase interest in the phone. Hmmm. I would say that Apple’s strategies generally seem to be cleverer than that?
- Oh Mr Welch.
Link: tweeting can be costly.
The US unemployment numbers came out this weekend last, and they were way better than expected (they fell to 7.8%, from 8.1% last month).
Mr Welch did this on twitter:
His reaction has been called, um, “irresponsible” at best. Frankly, I’m not sure why he’s attracting so much criticism.
Either way, following the backlash, it was announced that the former GE CEO will no longer be writing for Reuters or Fortune magazine.
Sherbet. Can you say “overkill”?
- An update on the South African strikes.
The “logistics engineers” have agreed to stop striking. Thank God. It was causing all manner of fuel shortage. And the Rand recovered slightly after the announcement.
But now strikes have started at one of the Xstrata operations. I wonder how that’ll affect the Glencore deal…
- Merkel visits Greece.
Link: the brave brave woman.
That said, it was only for six hours. Under heavy security.
The visit was intended to reaffirm Germany’s commitment to keeping Greece in the Euro. Not that there’s really a choice – there is, after all, no room in the treaties for expulsion or retirement from the monetary union. Barring changing the treaties, of course.
If anyone is interested in the arguments for staying versus leaving the Euro, I wrote this piece on it some time ago.
That’s all for now.
Have a good day.