|
Post by Rich on Oct 8, 2011 10:09:12 GMT -5
wrong thread I know,
but
the mormons believe Christ was in Palmyra, New York?
hahahahahhahahhahahahhahahhahahhahhqhqhqhhqhqhqh hqhqhahahhahahhahahahahhahahahahahhahahahhahaha hahahhahahahhahahahahahahahhahahahahahahahha
|
|
|
Post by Clinton SPX on Oct 8, 2011 10:11:52 GMT -5
(Reuters) - The slogans on the street are about storming the barricades, but when you talk to Greeks about the financial crisis that has brought their country to its knees, their anger quickly gives way to resignation and despair.
With news on Monday that the recession will last at least a fourth year -- and the government promising ever tougher reforms that will bring even more hardship -- labor unions have vowed to call Greeks out into the streets.
They will turn out in their thousands, but despite escalating rhetoric and the prospect of unrest, Greeks express little hope that their public expressions of outrage can change their fate.
"What can you do? Throw stones? Throw oranges? Even if you spat on the politicians all day long it would accomplish nothing," said Amalia Dougia, a 45-year-old single mother, resting wearily on a bench in downtown Athens, where she was waiting to see a lawyer to find a way out of debt.
She has been unemployed for two years since the economic crisis forced her to close down her shop selling household goods, leaving her with nothing but unpaid bills and a benefit check of 175 euros ($250) a month.
Two daughters are at university studying cosmetics and project management, but these days they have little hope of a job in those fields when they graduate. The best they can find now is temporary work in the summer, waiting tables or handing fliers to tourists.
"The oldest wants to leave the country, but where would I get the money to help her out? I've given up planning for the future. I just accept life as it comes," she said. "I've thought about suicide, but I have to look after my children."
MORE PAIN
Three years into a recession that has seen wages tumble, unemployment surge and living standards eroded, the Greek government has little to promise the public but more pain.
To satisfy EU and IMF inspectors that it can sort out its debt, the government has imposed wave after wave of public sector wage cuts and tax rises but has yet to get its finances in order.
On Monday it announced that the deficit this year will be worse than expected, and the economy, once predicted to finally grow next year, will instead shrink by a further 2.5 percent. The newest package of austerity measures -- tax hikes, layoffs and pay cuts -- failed to make a dent in this year's deficit.
You can hear the pain articulated almost at random as you walk through the streets of Athens. At a busy intersection, nobody even glances up when an elderly man crossing the road shouts out, to no one in particular: "The 300 members of parliament have stolen everything!"
Yet there is virtually no support for abandoning reforms and turning back on membership of the euro single currency. Polls show four out of five Greeks want to keep the euro, although more than half expect Greece to default on debt within months.
Public sector layoffs, a headline part of the latest reforms, break a 100-year-old taboo in a country where the constitution guarantees state workers jobs for life. Labor unions have vowed to fight it, and the next few weeks will see at least two mass strikes.
The general secretary of public sector union ADEDY, which represents half a million Greek workers, told Reuters it expected a massive turnout in the next big strike on Wednesday.
"There is nothing people in despair cannot do. We've lost our jobs, our children are unemployed, we are outraged. This government is hurting the country and it must go," said Ilias Iliopoulos.
HEROES IN SLIPPERS
The power of street protests to bring about political change is a revered part of Greece's national mythology, perhaps more so than in any other country in Europe. Younger generations of Greeks lionize their parents, who took to the barricades in the 1970s and helped bring down a military junta.
Violence by militant leftist groups and urban guerrillas -- deplored by most Greeks -- has also been a perennial feature of the political landscape for decades.
Every day, protesters of one kind or another trundle through Syntagma Square in the center of Athens. Sometimes it's blackshirted self-proclaimed anarchists shaking fists in unison, sometimes uniformed military reservists.
On Monday it was the turn of about 300 high school students, who took a break from occupying their school building and boycotting classes to come to the square. They shouted "Cops, pigs, murderers!" and scuffled with a cordon of riot police.
Alex Stathopoulos, 16, said he did not know enough about economics to say whether Greece should stay in the euro and keep trying to pay down its debt, or declare itself bankrupt and set up its own currency. But he knew that crooked politicians had squandered his future.
"We need education so that we can have jobs and build the future of the country. And what have we got? If they cut our parents' pay, how can they pay for university? Even if I go to university, I can't find a job. I have nothing.
"I will study, for example, psychology. And I will be a pizza guy."
More than 100 people were hurt in clashes between protesters and police on Syntagma square in June. But that violence paled in comparison with massive riots that took place before the crisis in 2008.
It is almost as if the crisis -- rather than inspiring political ferment -- has reduced it. The rhetoric has got hotter, but the scope for real political alternatives has shriveled. Opinion polls show opposition parties have benefited little from anger at the ruling Socialists.
Katerina Grillaki, 40, a public sector worker shopping in central Athens, expressed a common sentiment: "This government must change, they must go home. The only problem is that there is no alternative."
Greeks will probably accept reforms in the end, seeing no other way out, said Antonis Makrydimitris, a politics professor at Athens university.
"Greeks, in a general sense, are flexible people. They have suffered a lot in the past. They have encountered very tragic events in their history and they have survived," he said.
"Greeks would be able to tolerate the dire measures of the day. But they have to be persuaded that the measures are just."
Sitting on her bench, single mother Dougia said she didn't care which party was in power. When she thought about politicians, she saw only greed. If she could have a cabinet minister's salary for a single month, she could support her family for three years, she said.
"If we can survive just this year, I will build a statue of myself. I will put it in the middle of the living room and bow to it every day, because I will be a hero," she said.
"We are the heroes. Heroes in house slippers: the ordinary people."
|
|
|
Post by Clinton SPX on Oct 8, 2011 19:38:42 GMT -5
We shall see in time.
Germany is assuming a 50% loss for their banks and insurance companies. Sean Egan (head of very reliable bond-analyst firm Egan-Jones) thinks the ultimate haircut will be closer to 90%. And that is just for Greece.
|
|
|
Post by novice08 on Oct 8, 2011 20:20:12 GMT -5
As Martin Armstrong says, it's always the government.
|
|
|
Post by Clinton SPX on Oct 8, 2011 21:41:09 GMT -5
IMF mission chief says Greece is at crossroads Published: Saturday, 8 Oct 2011 | 6:36 PM ET Text Size Twitter
9
LinkedIn
Share
BERLIN - Greece is at a crossroads and will need to implement "much stricter structural reforms" than seen so far, IMF mission chief to Greece Poul Thomsen was quoted as saying by a German paper on Saturday.
The gloomy comments suggested the IMF was still unsure whether current talks on a vital aid tranche for Athens would conclude positively, given doubts over Greece's willingness to reform and the impact of Greek strikes and riots.
"Greece is at a crossroads," he was quoted as saying by Welt am Sonntag. "It is clear the programme will not work if the authorities do not take the path that requires much stricter structural reforms than those that we have seen so far."
The IMF on Friday dismissed a statement by the Greek government that the deal on aid was already completed.
"It is going two steps forward, and one backwards," Thomsen said. "The Greek government understands that many of the most difficult changes lie ahead. At the same time, the political and social fatigue is growing."
Athens could run out of cash as soon as mid-November without the new eight billion euro aid installment, increasing the risk of a default that would drag the euro zone deeper into a debt crisis already shaking financial markets worldwide.
Inspectors from the IMF, the European Commission and the European Central Bank -- known as the troika -- resumed last week their review of Greece's progress under a multi-billion euro bailout, after leaving Athens four weeks before over disagreements on how to put its finances back on track.
"The Greeks believe it is enough to make laws," the EU Commission's Matthias Mors told the Welt am Sonntag. "But it takes time to implement. And often the right structures are lacking, for example in tax administration."
A senior troika official told Reuters on Wednesday that the inspectors were likely to give the green light to the aid but that it was not assured.
The EU and IMF first want to receive more details on the implementation and impact of plans announced last month to slash the public sector workforce and increase taxes to plug a bigger-than-targeted fiscal gap, the official said.
Talks between Greece and the troika will continue on Sunday, focusing on the country's deficit cut plan for 2013 and 2014, a finance ministry official said on condition of anonymity after a further, four-hour negotiating round between Finance Minister Evangelos Venizelos and the EU/IMF inspectors.
Athens shocked financial markets by announcing that it would miss 2011 deficit targets set as conditions of a bailout aimed at staving off bankruptcy, despite a series of tax hikes and spending cuts.
Thomsen said he had never seen riots against austerity measures as intense as in Greece.
"People express their frustration sometimes in very unpleasant ways," he said. "That is one of the ugly aspects of my work. And the intensity of it here is new for me."
EU leaders will meet in Brussels on October 17-18 to discuss revising a July 21 deal to provide Greece with a second rescue package. They may ask investors to accept losses on their holdings of Greek debt even larger than the 21 percent write-down set out in the July deal.
A leading member of German Chancellor Angela Merkel's conservatives told a paper on Saturday Greece was near bankruptcy and must give up part of its sovereignty to obtain the large debt forgiveness it needs to survive.
Michael Fuchs, a deputy parliamentary floor leader for Merkel's Christian Democrats (CDU), also told Greek newspaper "Real News" that the debt-laden country might be better off outside the euro zone.
|
|
|
Post by Clinton SPX on Oct 8, 2011 21:51:53 GMT -5
|
|
|
Post by novice08 on Oct 8, 2011 22:04:07 GMT -5
Here's a good one from John Mauldin who just returned from Ireland...it's long but worth the read: news.goldseek.com/MillenniumWaveAdvisors/1318145624.php Greece will only get more promises and more funds until Merkel gets a call from her accountants, who tell her they have figured out which banks need government funds. The next day she will call Papandreou and tell him to hold a conference announcing the haircut that Greece will get. It will all be orchestrated to the color of their socks. From what I heard, Europeans banks are worse than even the dire reports you read in the papers. Spreads are widening and liquidity is drying up. Drexia is the tip of the iceberg. I really have to wonder how much France can do in regards to its bank debt. Will the ECB lend them enough money? The answer is yes. But we are talking a great deal of debt for a country with serious fiscal deficits and where government spending is already 55% of GDP, with rising health-care and pension costs. Think French politicians will try and get their unions and public workers to take a 15% pay cut? The French will not be civilized and stoical, like the Irish. They will take to the streets. We are now in the final innings of the Endgame. Greece is likely to default no later than the end of this year, if not by the end of this month. Which for all intents and purposes they have already done. If you can't get the market to finance you, that means you can't pay your bills without the kindness of strangers. If Greece were an individual or a company, it would be in bankruptcy proceedings. It is now just a matter of time. Can the euro survive? The short answer is yes, but not without a lot of pain on the part of a lot of people. The drive for a united Europe is strong and may indeed overcome the drive that would tear the union apart. I actually hope so. But it will not be done without a lot of sacrifice. I think the valuation of the euro is at serious risk. And while European markets look cheap on a relative and historical-valuation basis, one needs to ask, compared to what? Long European stocks, short the euro? Maybe, especially if the Germans turn the ECB loose as a way to keep (and pay the price for) the European Union. There's much more about Ireland, France, Italy, Spain, Portugal and Germany in the article.
|
|
|
Post by Clinton SPX on Oct 8, 2011 22:04:41 GMT -5
funny- Analog to PIIGS -- FUKUS (France, UK, US) As seen in Pravda.
|
|
|
Post by Clinton SPX on Oct 8, 2011 22:07:15 GMT -5
Thx novice I will read it, im bored tonight
|
|
|
Post by Clinton SPX on Oct 8, 2011 22:10:58 GMT -5
There are those like McWilliams who simply want to repudiate the debt. "It should never have been done, so we will not pay it." He is not alone; that view is becoming increasingly mainstream now.
|
|
|
Post by Clinton SPX on Oct 8, 2011 22:12:43 GMT -5
Ah, so when Greece gets their haircut everyone else will want theirs. O boy thats gonna be messy
|
|
|
Post by Clinton SPX on Oct 8, 2011 22:13:14 GMT -5
I hadnt thought about that.
|
|
|
Post by Clinton SPX on Oct 8, 2011 22:14:24 GMT -5
But here is the issue for Europe. The amount of money needed for Ireland is going to be a lot more than they now think, or at least are willing to admit. When Eurozone politicians worry about "contagion," or one country wanting the debt relief that another country gets, it is a very real worry. And rightfully so, as voters in Portugal or Spain or (gasp) Italy who are burdened by debt that is seemingly intractable will also want relief. It is not just an Irish condition, it is a human trait.
And the money that Europe needs will overwhelm the €440 billion ESFS fund. Stratfor and others think it will take at least €2 trillion. The Boston Consulting Group put out a report that suggest the total number, at the end of the day, will need to be (drum roll, wait for it) over €6 trillion. I don't like their proffered solutions, but their analysis of the debt and the need for relief is sobering.
|
|
|
Post by Clinton SPX on Oct 8, 2011 22:15:22 GMT -5
Good post novice.
|
|
|
Post by Clinton SPX on Oct 9, 2011 9:17:30 GMT -5
Bloomberg Max Bank Will Fail Under Danish Bail-In Law, Government Says October 09, 2011, 5:28 AM EDT
inShare E-mailPrint MORE FROM BUSINESSWEEK
Dexia Board Meets as France, Belgium Tussle Over Troubled Assets RBS, Lloyds Cut by Moody’s on Declining Government Support ATP of Denmark Snubs French, Italian Bonds for Collateral S&P Says It Didn’t ‘Rubber Stamp’ Notes at Bank’s Bidding Denmark Will Fight Haircut on Covered Debt That Basel Seeks By Christian Wienberg (Updates to add calls placed in sixth paragraph, historical writedowns, solvency in seventh, eighth.
Oct. 9 (Bloomberg) -- The Danish government’s winding-up unit said it will probably take over regional lender Max Bank A/S, which would become the third failure this year to fall under the European Union’s toughest resolution laws.
The Financial Stability Company will probably take over and wind up the Naestved-based lender today, it said in an e-mailed statement late yesterday. In a separate statement, Max Bank said the Danish Financial Supervisory Authority had told it after an inspection to increase writedowns on bad loans and boost solvency before a deadline of 6 p.m. today.
Denmark enacted a law in October last year making it the first EU member to force senior bank creditors to bear losses within a resolution framework. Since then, two regional lenders have collapsed and international investors have withheld funding for most of the nation’s roughly 120 banks. Max Bank said yesterday the OMX Copenhagen stock exchange had agreed to suspend trading of its shares and bonds.
“If the bank can’t meet the deadline set by the FSA to raise sufficient capital, or find another resolution to the bank’s situation, it will allow itself to be settled under the resolution laws,” Max Bank said in its statement.
Seeking Takeovers
To spur takeovers and avoid more bail-ins, Danish lawmakers last month passed the country’s fourth bank rescue package since 2008. The legislation extends the maturity of state-guaranteed debt and allows the government to take over bad loans from ailing banks in the event of a merger. The Financial Stability Company said that Max Bank may be resolved under the fourth package, provided another bank steps in to take it over.
Financial Stability didn’t say by how much the FSA required Max Bank to increase writedowns or what the new solvency ratio requirement was. Henrik Bjerre-Nielsen, chief executive officer of Financial Stability, didn’t answer calls seeking details. Max Bank CEO Henrik Lund didn’t respond to a message left on his voice mail.
The bank wrote down 79.2 million kroner ($14.3 million) of bad loans in the first six months of the year in addition to 218 million kroner combined for the years 2009 and 2010. In its annual report published Feb. 28, Max Bank said 34 percent of its loans were related to the building and real estate industries, one of the sectors that the FSA has said is Denmark’s riskiest.
The bank had a solvency ratio of 13.8 percent at the end of June, exceeding its own calculated requirement of 11.3 percent, it said in August.
Share Slump
Max Bank has bonds out worth 3 billion kroner, according to Bloomberg data. The bank’s stock market value was 59.5 million kroner as of the Oct. 7 closing price after the shares lost 72 percent this year.
The bank had assets of 9.39 billion kroner at the end of June, according to its first-half earnings report. It was the third-riskiest of 99 Danish banks graded by researcher Niro Invest ApS in a June survey.
|
|
|
Post by Clinton SPX on Oct 9, 2011 9:58:13 GMT -5
BNP, Socgen deny reported plan to raise $9.4 billion
inShare Share this
Email Print Related News Merkel, Sarkozy tackle differences over euro crisis 10:05am EDT France, Belgium, Luxembourg agree Dexia rescue 9:33am EDT France, Belgium set to finalize Dexia break-up Sat, Oct 8 2011 Europe eyes buoying banks to weather debt storm Sat, Oct 8 2011 Dexia board set to meet as break-up looms Fri, Oct 7 2011 Analysis & Opinion Explaining the ECB’s latest program UK should participate in EU bank recap exercise PARIS | Sun Oct 9, 2011 9:57am EDT (Reuters) - Top French banks BNP Paribas (BNPP.PA) and Societe Generale (SOGN.PA) denied a report that they could seek to raise a combined 11 billion euros ($14.8 billion) as part of a broader European bank recapitalization plan.
Le Journal du Dimanche newspaper had reported that France's first and second largest banks by market cap would seek about 7 billion euros and 3-4 billion euros, respectively.
A BNP spokeswoman denied the report, reiterating that it planned to reach Basel III capital targets without a capital increase. SocGen also denied the report and also said it would reach Basel III targets without a capital increase.
The Journal du Dimanche report, which did not cite sources, follows one in German daily Frankfurter Allgemeine Zeitung saying that the top five French banks had agreed to receive 10 to 15 billion euros in fresh capital from the French state as long as Deutsche Bank (DBKGn.DE) agreed to a government capital injection as well.
The Journal du Dimanche report said most European banking groups would prefer a European recapitalization mechanism "so as not to be stigmatized," adding that the European Banking Authority could be in charge of such a plan.
A French finance ministry source told Reuters on Friday there was common agreement between Paris and Berlin on the need to recapitalize European banks, adding that injections of public capital would be a "last resort."
|
|
|
Post by Clinton SPX on Oct 9, 2011 10:51:55 GMT -5
Analysis: Qatar unlikely to be white knight for Europe banks
inShare Share this
Email Print Related News Merkel, Sarkozy tackle differences over euro crisis 10:47am EDT France, Belgium, Luxembourg agree Dexia rescue 9:33am EDT Europe eyes buoying banks to weather debt storm Sat, Oct 8 2011 Dexia board set to meet as break-up looms Fri, Oct 7 2011 Germany, France split on bank aid before summit Fri, Oct 7 2011 Analysis & Opinion Europe up a creek with no central bank Goldman’s mixed messages By Regan Doherty DOHA | Sun Oct 9, 2011 11:36am EDT (Reuters) - Hopes may be disappointed for an influx of money from Qatar and other rich Gulf states into battered European banks, since Gulf investors are likely to see many of the banks as too risky and out of line with their investment strategies.
As Europe's banking system has weakened over the last several months, financial markets have been abuzz with rumors and media reports about possible investments from the Gulf -- particularly from cash-rich Qatar, which has been on an international acquisitions spree.
In June, Spanish bank Santander (SAN.MC) denied a report that it was in talks on Qatar buying a stake in it. Last month, France's BNP Paribas (BNPP.PA) denied a similar report. The latest speculation centers on assets of financial group Dexia (DEXI.BR); the prime ministers of France and Belgium were meeting on Sunday to discuss breaking up the group.
Analysts and bankers said it was possible that Qatar would make relatively small investments, perhaps of several hundred million euros, in European financial firms. Some European media reports last week said Qatar was part of an international consortium discussing a purchase of Dexia's Luxembourg arm, valued at some 900 million euros ($1.2 billion).
But analysts said Qatar and other Gulf states were unlikely to invest aggressively enough to make much difference to big European financial institutions.
"Not even Qatar's pockets are deep enough to really throw meaningful capital at the European financial system. They could participate in some of the capital raising that banks are doing, but ultimately, public multilateral support is needed," said Rachel Ziemba, director at Roubini Global Economics in London.
"Investors like Qatar will be seriously looking to see whether the macroeconomic framework and policy response will give them a good return on their investment. Qatar was slow to invest in the first round of bank recaps in 2008 to 2009, and actually extracted some of the stronger returns."
A Doha-based financial industry executive said he believed Qatar was probably "talking with every bank in Europe. But it remains to be seen whether the negotiations will lead to anything concrete."
FUND
Official data are not available but Qatar's sovereign wealth fund, the Qatar Investment Authority (QIA), is estimated to have assets worth around $70 billion, of which an unknown proportion is currently uninvested and available for new deals.
QIA has been active abroad in the last several years, spending more than $20 billion on stakes in German carmakers Porsche (PSHG_p.DE) and Volkswagen (VOWG_p.DE), Agricultural Bank of China (601288.SS), Santander Brasil (SAN.MC), Spain's Iberdrola (IBE.MC) and German builder Hochtief (HOTG.DE). It has snapped up Britain's luxury department store Harrods and two European football teams.
In June 2008, QIA and a member of Qatar's ruling family paid about 1.8 billion pounds ($2.8 billion) for a stake in British bank Barclays (BARC.L), subsequently reaping a profit of about 600 million pounds on part of it.
In August this year it bought about 17 percent of the lender that will be created by the merger of Greece's Alpha Bank (ACBr.AT) and Eurobank (EFGr.AT), injecting 500 million euros into the new entity at a critical time for the cash-strapped country.
But analysts said the Alpha Bank merger did not indicate Qatar was willing to take on financial sector risk on a large scale -- especially at a time when, like other Gulf states, it is seeking to ensure political stability with a sharp boost in government spending. Qatar has roughly doubled some public sector salaries and pensions this year.
"I think the Qataris would be looking for value, and European banks will have to get cheaper and more desperate before Qatar would jump in," one Doha-based analyst said.
"It would not be on the scale that would have a massive impact on the crisis. Qatar will hardly be a white knight, but rather take a more opportunistic approach."
Other Gulf states may be even more cautious, analysts said. The Abu Dhabi Investment Authority has some $600 billion of assets, but Abu Dhabi was required to bail out Dubai during a property market crash two years ago and if the global economy worsens, it may yet need to provide more support.
And Abu Dhabi has been burned in the past; in 2007 it agreed to a $7.5 billion investment in Citigroup Inc (C.N) but filed an arbitration claim at the end of 2009 accusing the U.S. bank of misrepresentation, after its stock price plunged. Citigroup said it had not acted improperly.
Saudi Arabia also has a huge financial war chest, but its government embarked this year on a $130 billion spending program on housing and other projects. With global oil prices approaching levels at which its budget surplus could disappear, it may not want to undertake risky new investments abroad.
STRATEGIES
Another issue for Qatar and other Gulf states is whether European financial investments would serve their long-term, strategic aims. Increasingly, the Gulf is looking to Asia for growth and investment, while investing in energy and technology projects might make more sense than buying into an apparent sunset industry such as Western banking.
"I would expect Qatar and other Gulf SWFs (sovereign wealth funds) to continue to look for solid investments that are available cheaply, but they are not altruistic per se," Ziemba said.
"They are looking to make financial returns and invest in companies that help extend their supply chain, help Qatar...enter new supply chains and gain access to key technology transfer through partnerships to help build up human capital.
"Moreover, it remains to be seen how comfortable European governments will be with foreign sovereign wealth funds taking on a significant share in banking and corporations."
The financial market speculation about Qatar's intentions resembles that over China. Rumors have abounded this year that Beijing will deploy more of its $3.2 trillion in foreign exchange reserves to buy the government debt of Greece and other weak European countries.
But so far, Chinese buying has not prevented a collapse of the bond prices of indebted European states. There is no evidence that China is buying more euro zone bonds than the weighting of the euro in its reserves would indicate, and many of the bonds it does hold are believed to be German and other top-quality credits, not the debt of weak countries.
|
|
|
Post by Clinton SPX on Oct 9, 2011 11:25:39 GMT -5
Slovakia On Why It Votes "No" To EFSF Expansion: "The Greatest Threat To The Euro Is The Bailout Fund Itself" Submitted by Tyler Durden on 10/09/2011 12:17 -0400
Bond Creditors European Union Eurozone Fail Germany Greece Italy Portugal Slovakia
Yesterday we reported that tiny Slovakia's refusal to ratify the expansion of the EFSF 2.0 (even though a 4.0 version will be required this week after the "Dexia-event), may throw the Eurozone into a tailspin as all 17 countries have to agree to agree to kick the can down the road: even one defector kills the entire Swiss Watch plan. Yet an interview conducted between German Spiegel and Slovakia party head Richard Sulik confirms that tiny does not mean irrelevant, and certainly not stupid. In fact, just the opposite: his words are precisely what the heads ot the bigger and far less credible countries should be saying. Alas they are not. Which is precisely why the euro is doomed.
From Spiegel:
Only two countries, Malta and Slovakia, have yet to ratify the expansion of the euro bailout fund. Its fate may be in the hands of a minor Slovak party headed by Richard Sulik. In an interview, the politician explains why he hopes the fund will fail and what he sees as the only way to save the euro.
SPIEGEL ONLINE: Mr. Sulik, do you want to go down in European Union history as the man who destroyed the euro?
Richard Sulik : No. Where did you get that idea?
SPIEGEL ONLINE: Slovakia has yet to approve the expansion of the euro backstop fund, the European Financial Stability Facility (EFSF), because your Freedom and Solidarity (SaS) party is blocking the reform. If a majority of Slovak parliamentarians don't support the EFSF expansion, it could ultimately mean the end of the common currency.
Sulik: The opposite is actually the case. The greatest threat to the euro is the bailout fund itself.
SPIEGEL ONLINE: How so?
Sulik: It's an attempt to use fresh debt to solve the debt crisis. That will never work. But, for me, the main issue is protecting the money of Slovak taxpayers. We're supposed to contribute the largest share of the bailout fund measured in terms of economic strength. That's unacceptable.
SPIEGEL ONLINE: That sounds almost nationalist. But, at the same time, you've had what might be considered an ideal European career. When you were 12, you came to Germany and attended school and university here. After the Cold War ended, you returned home to help build up your homeland. Do you care nothing about European solidarity?
Sulik: If we now choose to follow our own path, the solidarity of the others will also crumble. And that would be for the best. Once that happens, we would finally stop with all this debt nonsense. Continuously taking on more debts hurts the euro. Every country has to help itself. That's very easy; one just has to make it happen.
SPIEGEL ONLINE: Slovakia's parliament is scheduled to vote on the bailout fund expansion on Oct. 11. How do you predict the vote will turn out?
Sulik: It's still open. The ruling coalition is composed of four parties. My party will vote "no"; the other three coalition parties intend to say "yes." What the opposition says is decisive.
SPIEGEL ONLINE: The Social Democrats have offered your coalition partners to support the reform in return for new elections. Do you think the coalition is in danger of collapse?
Sulik: I don't see any reason why it would.
SPIEGEL ONLINE: What will you do should the EFSF reform pass despite your opposition?
Sulik: For Slovakia, it would be best not to join the bailout fund. Our membership in the euro zone, after all, was not conditional on us becoming members of strange associations like the EFSF, which damage the currency.
SPIEGEL ONLINE: If the euro only causes problems, why doesn't Slovakia's government just pull the country out of the euro zone?
Sulik: I don't see the euro as the problem. It's a good project. Everyone involved can benefit from it -- but only if they stick to the ground rules. And that's exactly what we're demanding.
SPIEGEL ONLINE: Which ground rules should we be following?
Sulik: We have to observe three points: First, we have to strictly adhere to the existing rules, such as not being liable for others' debts, just as it's spelled out in Article 125 of the Lisbon Treaty. Second, we have to let Greece go bankrupt and have the banks involved in the debt-restructuring. The creditors will have to relinquish 50 to perhaps 70 percent of their claims. So far, the agreements on that have been a joke. Third, we have to be adamant about cost-cutting and manage budgets in a responsible way.
SPIEGEL ONLINE: Many experts fear that a conflagration would break out across Europe should Greece go bankrupt and that the crisis will spill over into other countries, including Portugal, Spain and Italy.
Sulik: Politicians can't allow themselves to be pressured by the financial markets. Just because equity prices fall and the euro loses value against the dollar is no reason for giving in to panic.
SPIEGEL ONLINE: But do you really believe that politicians can calm the financial markets by stubbornly sticking to their principles?
Sulik: Let's just ignore the markets. It's ridiculous how politicians orient themselves based on whether stock prices rise or fall a few percentage points.
SPIEGEL ONLINE: You're not afraid that a Greek insolvency could mark the beginning of the crisis instead of the end?
Sulik: No. There's not going to be a domino effect along the lines of "first Greece, then Portugal and finally Italy." Just because one country goes broke doesn't mean the other ones automatically will.
SPIEGEL ONLINE: Nevertheless, banks could run into significant problems should they be forced to write down billions in sovereign bond holdings.
Sulik: So what? They took on too much risk. That one might go broke as a consequence of bad decisions is just part of the market economy. Of course, states have to protect the savings of their populations. But that's much cheaper than bailing banks out. And that, in turn, is much cheaper than bailing entire states out.
SPIEGEL ONLINE: Does one of your reasons for not wanting to help Greece have to do with the fact that Slovakia itself is one of the poorest countries in the EU?
Sulík: A few years back, we survived an economic crisis. With great effort and tough reforms, we put it behind us. Today, Slovakia has the lowest average salaries in the euro zone. How am I supposed to explain to people that they are going to have to pay a higher value-added tax (VAT) so that Greeks can get pensions three times as high as the ones in Slovakia?
SPIEGEL ONLINE: What can the Greeks learn from the reforms carried out in Slovakia?
Sulik: They have to make cuts in the state apparatus. The Slovaks could also give them a few good ideas about the tax system. We have a flat tax when it comes to income taxes. Our tax system is simple and clear.
SPIEGEL ONLINE: One last time: Do you honestly believe the euro has any future at all?
Sulík: I believe the euro has a future. But only if the rules are followed.
Interview conducted by Maria Marquart
|
|
|
Post by Clinton SPX on Oct 9, 2011 11:30:24 GMT -5
I love this guy! Sulik for president!!
|
|
|
Post by Clinton SPX on Oct 9, 2011 12:20:05 GMT -5
Merkozy Reach Yet Another "Agreement", Adding "It Is Too Early To Enter Into Details" Submitted by Tyler Durden on 10/09/2011 13:07 -0400
France Germany Nicolas Sarkozy Reuters
No, the day is not August 7, 2011 when we had the first joint Merkozy statement attempting to prevent the latest and greatest round of the global financial crisis with nothing but pure rhetoric, in which however the word Dexia was strangely missing. The day is October 9, and yet we get another statement from the two, this time far more desperate. From Reuters: "We are very conscious that France and Germany have a particular responsibility for stabilizing the euro," Sarkozy said at a joint news conference with Chancellor Angela Merkel in Berlin. "We need to deliver a response that is sustainable and comprehensive. We have decided to provide this response by the end of the month because Europe must solve its problems by the G20 summit in Cannes." And the kicker: Merkozy "suggested that their proposals would include a plan for recapitalizing European banks, accelerating economic coordination in the euro zone and dealing with Greece's debt problems." In other words fix absolutely everything. But the punchline remains the same as always: Sarzkoy "added saying it was too early to enter into details." Ah yes, those ever elusive details, which nobody can ever provide, because, THEY SIMPLY DON'T EXIST, at least not in a universe in which 2 + 2 is still 4.
Yes, much to Europe's chagrin, a plan that in one swoop "recapitalizes European banks, accelerates economic coordination in the euro zone and deals with Greece's debt problems" which at the same time returns peace and prosperity, keeps the locals happy, and throws in the kitchen sink, sounds truly great on paper, but merely confirms to the markets that the ruling oligarchy is now completely out of bullets and the best they can do is jawbone with ever loftier promises that can never be kept.
And, as always, nothing but more promises:
"We are determined to do the necessary to secure the recapitalization of our banks," Merkel said at a joint news conference with French President Nicolas Sarkozy in Berlin. "Germany and France want the same criteria to be applied, and criteria that are accepted by all sides," she said. "We will ask all relevant authorities ... to check what we are doing is sustainable." "We are not going into details today, we will present a complete package" for stabilizing the euro zone at the end of the month, Merkel added. We have just one question: where will the $1 trillion in additional capital needed to recap said banks come from.
We can wait.
We eagerly anticipate to see the market's reaction to this moment of peak desperation when EURUSD opens for trading shortly.
|
|
|
Post by Clinton SPX on Oct 9, 2011 21:05:38 GMT -5
(Reuters) - Global banking regulators will press ahead with the first worldwide effort to force banks to hold more liquid assets, the chairman of the Basel Committee on Banking Supervision said in an interview with the Financial Times on Monday.
Stefan Ingves, who also heads the Swedish central bank, said the Basel group plans to put uniform implementation of the Basel III reforms at the top of its agenda.
The measures, which will also force banks to cut back on short-term funding, have come under scrutiny from some of the 27 member countries who say the rule changes could damage the broader economy.
The reforms, which were agreed to by the member states, will force banks to hold more top-quality capital against unexpected losses, but there are rising concerns that some countries will not stick to the agreement.
"It is going to be all about implementation in as uniform a way as possible. Balkanisation of the rules over the long term is not in anyone's interest," Ingves said.
The FT reported that the committee plans to publish "heat maps" that show which countries are in compliance with the measures. The committee will also send out teams of experts to look at whether each country's implementation laws and regulations are in accordance with the agreement.
The Basel group is still hammering out the details on two liquidity rules: the liquidity coverage ratio, which would require banks to hold enough liquid assets to survive a 30-day crisis; and the net stable funding ratio, which would force financial institutions to use more long-term funding.
|
|
|
Post by novice08 on Oct 9, 2011 21:39:53 GMT -5
Talked to a friend who just returned from Paris...they've increased their VAT too...she said a cup of coffee and croissant were $30, NO LIE! I have never heard this person speak about what anything costs as her husband is an investment banker in NY.
|
|
|
Post by Clinton SPX on Oct 9, 2011 21:41:28 GMT -5
That sounds like room service prices
|
|
|
Post by Rich on Oct 9, 2011 21:45:44 GMT -5
yes, doesn't sound like a sidewalk cafe. Not that I've ever been there.
But ole Clinton has...
|
|
|
Post by Clinton SPX on Oct 9, 2011 21:47:21 GMT -5
Ya its expensive but not that bad LOL
|
|
|
Post by Clinton SPX on Oct 10, 2011 7:21:40 GMT -5
Bloomberg Max Bank Will Fail Under Danish Bail-In Law, Government Says October 09, 2011, 5:28 AM EDT inShare E-mailPrint MORE FROM BUSINESSWEEK Dexia Board Meets as France, Belgium Tussle Over Troubled Assets RBS, Lloyds Cut by Moody’s on Declining Government Support ATP of Denmark Snubs French, Italian Bonds for Collateral S&P Says It Didn’t ‘Rubber Stamp’ Notes at Bank’s Bidding Denmark Will Fight Haircut on Covered Debt That Basel Seeks By Christian Wienberg (Updates to add calls placed in sixth paragraph, historical writedowns, solvency in seventh, eighth. Oct. 9 (Bloomberg) -- The Danish government’s winding-up unit said it will probably take over regional lender Max Bank A/S, which would become the third failure this year to fall under the European Union’s toughest resolution laws. The Financial Stability Company will probably take over and wind up the Naestved-based lender today, it said in an e-mailed statement late yesterday. In a separate statement, Max Bank said the Danish Financial Supervisory Authority had told it after an inspection to increase writedowns on bad loans and boost solvency before a deadline of 6 p.m. today. Denmark enacted a law in October last year making it the first EU member to force senior bank creditors to bear losses within a resolution framework. Since then, two regional lenders have collapsed and international investors have withheld funding for most of the nation’s roughly 120 banks. Max Bank said yesterday the OMX Copenhagen stock exchange had agreed to suspend trading of its shares and bonds. “If the bank can’t meet the deadline set by the FSA to raise sufficient capital, or find another resolution to the bank’s situation, it will allow itself to be settled under the resolution laws,” Max Bank said in its statement. Seeking Takeovers To spur takeovers and avoid more bail-ins, Danish lawmakers last month passed the country’s fourth bank rescue package since 2008. The legislation extends the maturity of state-guaranteed debt and allows the government to take over bad loans from ailing banks in the event of a merger. The Financial Stability Company said that Max Bank may be resolved under the fourth package, provided another bank steps in to take it over. Financial Stability didn’t say by how much the FSA required Max Bank to increase writedowns or what the new solvency ratio requirement was. Henrik Bjerre-Nielsen, chief executive officer of Financial Stability, didn’t answer calls seeking details. Max Bank CEO Henrik Lund didn’t respond to a message left on his voice mail. The bank wrote down 79.2 million kroner ($14.3 million) of bad loans in the first six months of the year in addition to 218 million kroner combined for the years 2009 and 2010. In its annual report published Feb. 28, Max Bank said 34 percent of its loans were related to the building and real estate industries, one of the sectors that the FSA has said is Denmark’s riskiest. The bank had a solvency ratio of 13.8 percent at the end of June, exceeding its own calculated requirement of 11.3 percent, it said in August. Share Slump Max Bank has bonds out worth 3 billion kroner, according to Bloomberg data. The bank’s stock market value was 59.5 million kroner as of the Oct. 7 closing price after the shares lost 72 percent this year. The bank had assets of 9.39 billion kroner at the end of June, according to its first-half earnings report. It was the third-riskiest of 99 Danish banks graded by researcher Niro Invest ApS in a June survey. Two More European Banks Nationalized Following Dexia's Example Submitted by Tyler Durden on 10/10/2011 - 07:00 Bad Bank Bond Creditors Fail Greece Nationalization ratings Real estate Reuters Thank god for Dexia's implosion this morning, or else the world would be forced to pay attention to the fact that Greece is still as insolvent as ever and still without a formal Troika approval for disbursement of the critical 6th tranche that Greece needs or else. Also, were it not for Dexia someone might notice that two other banks bit the nationalization bullet in the past 24 hours as the contagion, not from Dexia, but from the fact that there is simply not enough money around: as a result Danish Max Bank and Greek Proton Bank just handed the keys to their HQs to their primary regulators, with the management teams quietly riding off into the sunset. They are the lucky ones: in a few months it won't be nearly as easy to find "nationalization" funding and keep your depositors away from the "tar and feathers" toolshed.
|
|
|
Post by novice08 on Oct 10, 2011 11:26:21 GMT -5
That sounds like room service prices Pretty sure that isn't what she meant, but I'll ask. If it were room service, I don't think she'd have brought it up.
|
|
|
Post by Clinton SPX on Oct 10, 2011 13:53:29 GMT -5
|
|
|
Post by Clinton SPX on Oct 10, 2011 13:55:53 GMT -5
As a reminder the EBA stress test data showed Erste to have zero sovereign CDS exposure within its sovereign mix compared to the €2.8bn it now appears to have ‘fessed up’ to (taking a cumulative €460m hit).
|
|
|
Post by Clinton SPX on Oct 10, 2011 14:04:28 GMT -5
"The measures taken today will turn a profit of around EUR 700 million for the first three quarters of 2011 into a loss. But all of these measures are exclusively one-off charges which will prepare us as a bank for this situation ahead.
|
|