Protests in Greece

[Toonpack 10411]

In the unusual position of agreeing with TP here.

 

 

Splendid, can we bomb the Middle East now please (I'll settle for nuking Afghanistan)

The Christian Right don't normally feel the need to ask

 

[Park Life 71]

In the unusual position of agreeing with TP here.

 

 

Splendid, can we bomb the Middle East now please (I'll settle for nuking Afghanistan)

The Christian Right don't normally feel the need to ask

 

Voices in head normally suffice.

[Park Life 71]

Romania to cut wages and pensions

 

 

 

IMF headquarters, Washington The IMF has also provided loans to Latvia and Hungary

 

Romania is to cut wages and pensions in the public sector later this year to comply with an IMF-led rescue deal.

 

Romanian President Traian Basescu said the "programme to cut public expenses was inevitable".

 

Public sector wages will be cut by 25% and all salaries, including the minimum one, will be affected. Jobless benefits and pensions will be slashed by 15%.

 

Romania is the recipient of a 20bn-euro aid package from the IMF, the EU and the World Bank.

 

The country, as well as two other bailed-out states, Latvia and Hungary, have missed targets for cutting their deficits by significant margins.

'Fat man'

 

"This [cuts] plan was inevitable," Mr Basescu told a news conference.

 

"The state sector is like a fat man of 200 kg sitting on the back of a 50 kg little man who is the real economy."

 

He also said that as part of negotiations with the IMF the country had narrowly avoided an increase in VAT from 19% to 24% and a rise in the tax on profits and income to 20% from 16%.

 

Meanwhile, the IMF said on Thursday it would extend a mission in Romania for two more days.

 

The IMF has cut its forecast for Romania's economic growth to 0.8% for this year, after the economy contracted 7.1% in 2009.

Edited May 10, 2010 by Park Life

[Park Life 71]

Bank Risk Soars to Record, Default Swaps Overtake Lehman Crisis

 

By Abigail Moses

 

May 7 (Bloomberg) -- The cost of insuring against losses on European bank bonds soared to a record, surpassing levels triggered by the collapse of Lehman Brothers Holdings Inc., as the sovereign debt crisis deepened.

 

The Markit iTraxx Financial Index of credit-default swaps on 25 banks and insurers soared as much as 40 basis points to 223, according to JPMorgan Chase & Co. The index closed at 212 basis points March 9, 2009. Swaps on Greece, Portugal, Spain and Italy rose to or near all-time high levels.

 

Credit risk rose for a sixth day on concern the Greek debt crisis is spiraling out of control and triggering concern banks may face losses on their sovereign bond holdings. The Group of Seven plans to hold a conference call today to discuss the turmoil, after a global stock rout that briefly erased more than $1 trillion in U.S. market value.

 

“Financials are caught in a really bad place right now,” said Aziz Sunderji, a London-based credit strategist at Barclays Capital. “Investors are selling bonds, not just hedging with CDS. It shows investors are repositioning portfolios and there’s a more long-term repricing of peripheral risk.”

Pacific Investment Management Co.’s Mohamed El-Erian and Loomis Sayles & Co.’s Dan Fuss said Europe’s crisis may spread across the globe because of investor concern that governments have borrowed too much to revive their economies.

 

Portugal, Spain

 

Markit’s financial gauge was trading at 198 basis points at 2:30 p.m. in London, according to JPMorgan. Contracts on Spanish and Portuguese banks rose to records, according to CMA DataVision prices. Portugal’s Banco Comercial Portugues SA increased 53 basis points to 579 and Spain’s Banco Santander SA rose 12 basis points to 253.

 

In the U.K., swaps on Royal Bank of Scotland Group Plc jumped 41 to 229 after Britain’s biggest government-owned bank posted the only first-quarter loss among British rivals.

The spread between the three-month dollar London interbank offered rate and the overnight indexed swap rate, a barometer of the reluctance of banks to lend that’s known as the Libor-OIS spread, is at 18 basis points, up from 6 basis points on March 15 and near the highest level in more than five months. It’s still far from the record 364 basis points in October 2008, almost a month after Lehman’s bankruptcy.

 

Swaps on Greece surged 75 basis points to 1,008 before the advance was pared to 950. Portugal climbed 42 to 502 before falling to 430 and Italy rose 24 to 255.5 before dropping to 227 and Spain increased 14 to 288 before trading at 246, CMA prices show.

 

British Swaps

 

Contracts on the U.K. rose 8 basis points to 99, according to CMA. Britain’s election produced a parliament without a majority for the first time since 1974, stoking concern the new government will be too weak to rein in its record budget deficit.

 

http://www.bloomberg.com/apps/news?pid=206...id=afPiOhKxYSq8

[Park Life 71]

[Rob W 0]

see they're naming and shaming non-taxpayers

 

personally I think we should have the same system as Norway where they publish the top 100 taxpayers in each district.....................

[Park Life 71]

Parky Thinktank © is predicting the collapse of the euro this year.

[ChezGiven 0]

Parky Thinktank © is predicting the collapse of the euro this year.

 

http://krugman.blogs.nytimes.com/2010/05/1...=NytimesKrugman

[Rob W 0]

Parky Thinktank © is predicting the collapse of the euro this year.

 

 

feel free to donate the worthless pieces of paper to me Parky..................

[Jusoda Kid 1]

Was riot dog there? He instigates all of this shit.

 

http://www.thisblogrules.com/2010/03/dog-t...for-years.html/

[Billy Castell 0]

I can't believe the stuff I read about the public sector worker's contracts in Greece. They get 14 months pay, dodge taxes and retire in their 50's? No wonder the Germans are so pissed off. They should cut out those lazy, hairy shouldered bunch of benders and leave them to burn. If they want to save the Euro, they'd kick out the Greeks and Portuguese immediately.

[ChezGiven 0]

I can't believe the stuff I read about the public sector worker's contracts in Greece. They get 14 months pay, dodge taxes and retire in their 50's? No wonder the Germans are so pissed off. They should cut out those lazy, hairy shouldered bunch of benders and leave them to burn. If they want to save the Euro, they'd kick out the Greeks and Portuguese immediately.

 

Not very European to kick 2 European countries out of Europe.

[Park Life 71]

I can't believe the stuff I read about the public sector worker's contracts in Greece. They get 14 months pay, dodge taxes and retire in their 50's? No wonder the Germans are so pissed off. They should cut out those lazy, hairy shouldered bunch of benders and leave them to burn. If they want to save the Euro, they'd kick out the Greeks and Portuguese immediately.

 

Not very European to kick 2 European countries out of Europe.

 

You only have to go into a Portugese cafe to know the Euro is fucked....All standing around talking while queues build.

[Park Life 71]

[ChezGiven 0]

The solution is quite straightforward anyway Parky.

 

Relative wages in Greece, Spain, Portugal etc have to fall 20 to 30% compared to German wages. This creates the same effect as currency devaluation as it increases competitiveness as well as reducing spending.

 

Flexible labour markets was once viewed as the key problem in the Southern EU economies. That was untill the crisis, when this sort of argument was dismissed as based on the 'now defunct anglo-saxon capitalist model'.

 

The economic reality has not gone away. This is going to hurt.

[Rob W 0]

locked themselves into Jorman rates without changing their ways - a recipe for disaster

[Park Life 71]

Look at recent soveirgn debt of Euro countries.

 

Rank Countries Amount Date

# 1 United States: $12,250,000,000,000.00 2007 Time series

# 2 United Kingdom: $10,450,000,000,000.00 2007 Time series

# 3 Germany: $4,489,000,000,000.00 2007 Time series

# 4 France: $4,396,000,000,000.00 2007 Time series

# 5 Italy: $2,345,000,000,000.00 2007 Time series

# 6 Netherlands: $2,277,000,000,000.00 2007 Time series

# 7 Ireland: $1,841,000,000,000.00 2007 Time series

# 8 Japan: $1,492,000,000,000.00 2007 Time series

# 9 Switzerland: $1,340,000,000,000.00 2007 Time series

# 10 Belgium: $1,313,000,000,000.00 2007 Time series

# 11 Spain: $1,084,000,000,000.00 2007 Time series

[sweetleftpeg 0]

Going on a national strike on Thursday for 24 hours allegedly, all airports going to be shut which will delight a few brit holidaymakers I should imagine. Just when you thought you'd beaten the volcanic ash and the air stewardesses, along come the Greeks!

[Happy Face 29]

As Britain's political class pretends that its arranged marriage of Tweedledee to Tweedledum is democracy, the inspiration for the rest of us is Greece. It is hardly surprising that Greece is presented not as a beacon, but as a "junk country" getting its comeuppance for its "bloated public sector" and "culture of cutting corners" (Observer). The heresy of Greece is that the uprising of its ordinary people provides an authentic hope unlike that lavished upon the warlord in the White House.

 

The crisis that has led to Greece's "rescue" by European banks and the International Monetary Fund is the product of a grotesque financial system that itself is in crisis. Greece is a microcosm of a modern class war rarely reported as such, but waged with all the urgency of panic among the imperial rich.

 

What makes Greece different is that it has experienced, within living memory, invasion, foreign occupation, military dictatorship and popular resistance. Ordinary people are not cowed by the corrupt corporatism that dominates the European Union. The right-wing government of Kostas Karamanlis that preceded the present Pasok (Labour) government of George Papandreou was described by the sociologist Jean Ziegler as "a machine for systematically pillaging the country's resources".

 

Epic theft

The machine had infamous friends. The US Federal Reserve board is investigating the role of Goldman Sachs, which gambled on the bankruptcy of Greece as public assets were sold off and its tax-evading rich deposited €360bn in Swiss banks. This haemorrhaging of capital continues with the approval of Europe's central banks and governments.

 

At 11 per cent, Greece's budget deficit is no higher than America's. However, when the Papandreou government tried to borrow on the international capital market, it was effectively blocked by the US corporate ratings agencies, which "downgraded" Greek debt to "junk". These same agencies gave triple-A ratings to billions of dollars in so-called sub-prime mortgage securities and so precipitated the economic collapse in 2008.

 

What has happened in Greece is theft on an epic, though not unfamiliar, scale. In Britain, the "rescue" of banks such as Northern Rock and the Royal Bank of Scotland has cost billions of pounds. Thanks to Gordon Brown and his passion for the avaricious instincts of the City, these gifts of public money were unconditional, and the bankers have continued to pay each other the booty they call bonuses and to spirit it away to tax havens. Under Britain's political monoculture, they can do as they wish. In the US, the situation is even more remarkable. As the investigative journalist David DeGraw has reported, the principal Wall Street banks that "destroyed the economy pay zero in taxes and get $33bn in refunds".

 

In Greece, as in America and Britain, the ordinary people have been told they must repay the debts of the rich and powerful who incurred them. Jobs, pensions and public services are to be slashed and burned, with privateers put in charge. For the EU and the IMF, the opportunity presents to "change the culture" and to dismantle the social welfare of Greece, just as the IMF and the World Bank have "structurally adjusted" (impoverished and controlled) countries across the developing world.

 

Greece is hated for the same reason Yugo­slavia had to be destroyed physically behind a pretence of protecting the people of Kosovo. Most Greeks are employed by the state, and the young and the trade unions comprise a popular alliance that has not been pacified; the colonels' tanks on the campus of Athens University in 1967 remain a political spectre. Such resistance is anathema to Europe's central bankers and regarded as an obstruction to German capital's need to capture markets in the aftermath of Germany's troubled reunification.

 

Shock therapy

In Britain, such has been the 30-year propaganda of an extreme economic theory known first as monetarism, then as neoliberalism, that the new Prime Minister can, like his predecessor, describe his demands that ordinary people pay the debts of crooks as "fiscally responsible". The unmentionables are poverty and class.

 

Almost a third of British children remain below the breadline. In working-class Kentish Town in London, male life expectancy is 70. Two miles away, in Hampstead, it is 80. When Russia was subjected to similar "shock therapy" in the 1990s, life expectancy nosedived. In the United States, a record 40 million cannot afford to feed themselves.

 

In the developing world, a system of triage imposed by the World Bank and the IMF has long determined whether people live or die. Whenever tariffs and food and fuel subsidies are eliminated by IMF diktat, small farmers know they have been declared expendable. The World Resources Institute estimates that the toll reaches between 13 and 18 million child deaths every year. This, wrote the economist Lester C Thurow, is "neither metaphor nor simile of war, but war itself".

 

The same imperial forces have used horrific weapons against stricken countries where children are the majority, and approved torture as an instrument of foreign policy. It is a phenomenon of denial that none of these assaults on humanity, in which Britain is actively engaged, was allowed to intrude on the British election.

 

The people on the streets of Athens do not suffer this malaise. They are clear who the enemy is and regard themselves as once again under foreign occupation. And once again, they are rising up, with courage. When David Cameron begins to cleave £6bn from public services in Britain, he will be bargaining that Greece will not happen in Britain. We should prove him wrong.

 

http://www.newstatesman.com/uk-politics/20...ger-britain-imf

[Matt 0]

That's a rambling nonsense of an article.

 

Budget deficit is the same as the USA but credit ratings are different, that MUST be an international elite conspiracy! Or maybe ratings agencies look at more than one metric.

 

You don't just have to take ratings agency's views- you can disagree with them- plenty of analysts will- and there arwe thousands- each of whom will undertake work to assess the true creditworthiness of a piece of debt. It's quite clear what the overall conclusion is.

 

So Greece is in revolt, but what is the solution? No mention of that in the article. Just a lot more huffing and puffing.

[NJS 4446]

each of whom will undertake work to assess the true creditworthiness of a piece of debt

 

As they point out - those agencies rated the sub-prime shit in the US as AAA - then again GS and the rest would have had an influence on these "independent" agencies.

[Matt 0]

each of whom will undertake work to assess the true creditworthiness of a piece of debt

 

As they point out - those agencies rated the sub-prime shit in the US as AAA - then again GS and the rest would have had an influence on these "independent" agencies.

 

I'm relating more to analysts than the agencies there. Plenty of analysts will disagree with the big agencies.

[Park Life 71]

The European parliament is expected tomorrow to approve a draft directive to toughen regulation of hedge funds and private equity firms despite a growing tide of opposition from leading politicians and lobby groups in the UK and America, where both industries are clustered.

 

Labour's City minister Lord Myners has described the proposed regulatory crackdown – being championed by France and Germany – as "fundamentally flawed and promot[ing] protectionism under the guise of protection". Both the Conservative party and Liberal Democrats have similar views. US treasury secretary Timothy Geithner has also been critical.

 

However, after months of deliberation members of the economic committee of the European parliament are expected to pass the text proposed by Jean-Paul Gauzès, the parliament's rapporteur on the proposed directive on alternative investment.

 

Directive rules on hedge funds would require non-European funds to have a "passport" to be able to trade in Europe, but they may not be able to earn one if their home country has different financial regulation. This would limit the presence of US-based hedge funds in Europe, which include some of the biggest firms, such as Paulson & Co.

 

Many hedge funds from both sides of the Atlantic operated registered operations from the Cayman Islands, the Caribbean tax haven. A passport blacklisting for the Cayman Islands could create huge problems for the industry.

 

The proposal has angered the financial industry, particularly in Britain, home to about 450 hedge funds, 80% of the European total. UK-based hedge funds employ 10,000 professionals directly and 30,000 others, such as lawyers and accountants, indirectly.

 

 

Whatever the Gurardian says it was an orchestrated Wall Street attack on the Euro (short selling) to gain protection and last gasp longevity for the dollar.

[Park Life 71]

The euro crisis is a judgment on the great lie of 'Europe'

The EU is paying the price for its pursuit of 'integration' at any cost, says Christopher Booker

 

By Christopher Booker

Published: 7:00PM BST 22 May 2010

 

Comments 168 | Comment on this article

Sarkozy and Merkel

Nicolas Sarkozy and Angela Merkel, grim-faced, emerge from an EU leaders' summit on the eurozone crisis Photo: AP

 

Easily the most telling statement by any politician last week was that from an anguished Angela Merkel, in pronouncing that "the current crisis facing the euro is the biggest test Europe has faced for decades, even since the Treaty of Rome was signed in 1957". "If the euro fails," she went on, "Europe fails," warning that the consequences for the whole of Europe would be "incalculable".

 

We have still scarcely begun to wake up to the gravity of the crisis now upon us, not just for the eurozone but also for us here in Britain and for the entire global economy. The measures so far taken to prop up the collapsing euro, such as that famous "$1 trillion package", are no more than gestures.

 

 

Greece was just the antipasto: Italy, Spain, Portugal and others are now hanging over an abyss of debt which scarcely all the money in Europe could fill – created by countries living way beyond their means, thanks not least to the euro's low interest rates. The only possible consequence of

the collapse of one of the world's leading currencies, leaving Europe with no money to trade in, would be utter chaos.

 

What we are witnessing here is a judgment on the entire deceitful and self-deceiving way in which the "European project" has been assembled over the past 53 years. One of the most important things to understand about that project is that it has only ever had one real agenda. Everything it has done has been directed to one ultimate goal, full political and economic integration. The headline labels put on the various stages of that process may have changed over the years, such as building first a "common market", then a "single market", finally a "constitution". But by far the most important project of all was locking the member states into a single currency.

 

This was always above all a political not an economic project, to be driven through at any cost, which was why all those "Maastricht criteria" laid down to bring it about were repeatedly breached. But as expert voices were warning as long ago as the 1970s, when it was first put on the agenda, there was no way economic and monetary union could work unless it was run by a single all-powerful economic government, with the power to raise taxes.

 

As was advised by Sir Donald MacDougall's report to Brussels in 1978, it could only work if, following the US model, between 20 and 25 per cent of Europe's GDP was available to such a government, to enable a huge transfer of wealth from richer countries such as Germany to the poorer, more backward countries of southern Europe – and how ironically has that come about!

 

When the 10-year-long construction of the euro began in the 1990s, all these warnings were ignored. The cart was put before the horse. So fixated were the Eurocrats on the need to get their grand project in place that the "rules" were treated as mere window dressing. The member states were locked together willy-nilly in a one-size-fits-all system, with a single low interest rate, enabling countries such as Italy, Spain, Portugal and Greece to live on a seemingly limitless sea of borrowed money. And now, entirely predictably, judgment day has come.

 

If the euro does disintegrate, as

Mrs Merkel warns, the consequences would be incalculable. Replacing all the national currencies was a gargantuan task, by far the most ambitious ever attempted in the name of European integration, and there is no Plan B. Without a currency, trade would collapse – leaving Britain, dependent on Europe for 50 per cent of its trade, just as seriously affected as everyone else. A system failure on this scale would make the 1930s pale into insignficance.

 

Inevitably, cries went up last week for the EU to be transformed into a proper economic government with control over national budgets and

the power to raise taxes – exactly

what MacDougall and others were talking about in the 1970s. But it is

too late, and all that remains are desperate gestures.

 

As reported by the think tank Open Europe, Mrs Merkel was even calling last week for a "global" tax on financial transactions to raise 321 billion euros a year Europe-wide – 204 billion euros of which would come from Britain, still the world's leading financial centre, with 43 billion euros from Germany and just 17 billion euros from France.

 

As alarming as anything, with this tsunami roaring down on us, has been the sight of our new leaders preening themselves with their list of irrelevant little "coalition policies" and babyish boasts about the "greatest democratic shake-up since the 1832 Reform Act", as if none of this was happening. As one analyst put it: "They are like children let loose in the sweet shop, seemingly oblivious to the horrendous reality unfolding before us."

 

A well-known economist said wryly to me last week: "Bring back the days of Alistair Darling and Gordon Brown. At least they had some grasp of what is going on. This lot are just totally out of their depth."

[ChezGiven 0]

I was with my richest friend on monday (has his own chemical distribution company). All we talked about was the imminent collapse and how to buy long-term assets.

 

We have 2 years left. The deficit hawks will squeeze us into a double-dip recession and the system will fail.

 

I'm stealing a boat and heading north, which will be like heading south once the magnetic polarity is reversed.