The Coming Crash (no later than 1H2012)?

[KopiKat]

Extracted from Lim and Tan report (they seem cautiously optimistic),

http://www.remisiers.org/cms_images/rese...taland.pdf

Some extracts,

 European and US stocks reacted favorably to news out of the Dec 8-9 EU Summit, principally that 23 out of 27 EU members (but all 17 eurozone members) agreeing to need for fiscal compact, and the broad agreement between France and Germany.

 The main dissenter, and hardly a surprise, is UK, not happy with the proposed financial transactions tax, and insisting on concessions for the City of London. (As President Sarkozy rightly retorted those who did not want to join the euro are not in the best place to advise its members of its functioning.)

 We believe the deal struck on Friday as well as the “help” given by the European Central Bank (announced last Thursday) mark the end of the Euro Crisis, although the recovery process / trajectory is unlikely to match the recovery that followed the Mar ’09 bottom of the 2008 Financial Crisis (within 3 months, Dow had recovered an astounding 33% - Exhibit 1).

 There will likely be setbacks along the way, eg social unrest / demonstrations; elections in France, Greece in early 2012; slowdown in China; and the endless market cynicism.

 Besides, the treaties Merkel and Sarkozy worked so hard on, are set to be in place by Mar ’12.

 Meanwhile, bond markets will provide vital clues: how low will bond yields in key countries like Italy, Spain fall to (or prices rise to) after their recent surge (decline) to untenable levels.