The Big Bailout of the Eurozone (Another crisis coming? - Seriously)

[muppet]

Meanwhile in London John Major says that any attempt to impose a tax on financial transactions would be a disaster for the UK.
The banks have bought politics.

Politics/Democracy is already gone. We in Ireland and Portugal have no sovereignty while Greece and Italy don't even get to vote for their puppets. Spain are somewhere in between and interesting have elected the first right wing leader since Franco.

The article above shows the next stage. Your rights to your property is not safe. Greeks legitimately owning assets abroad is now considered by the (unelected) EU Commission to be under their sphere of influence.

I really cannot believe it anymore.

To <insert whatever mantra they are spouting today here - I'll use 'impose Capital controls' >  they are willing to:
* ditch democracy;
* trample on individuals rights to their own property;
* order money they have no legal hold over whatsoever to be moved into based case institutions;

This is like watching a referee walking around slapping players and taking their wallets and expecting nothing to happen.

Does anyone in Europe read history anymore?

[seafoid]

Meanwhile in London John Major says that any attempt to impose a tax on financial transactions would be a disaster for the UK.
The banks have bought politics.

Politics/Democracy is already gone. We in Ireland and Portugal have no sovereignty while Greece and Italy don't even get to vote for their puppets. Spain are somewhere in between and interesting have elected the first right wing leader since Franco.

The article above shows the next stage. Your rights to your property is not safe. Greeks legitimately owning assets abroad is now considered by the (unelected) EU Commission to be under their sphere of influence.

I really cannot believe it anymore.

To <insert whatever mantra they are spouting today here - I'll use 'impose Capital controls' >  they are willing to:
* ditch democracy;
* trample on individuals rights to their own property;
* order money they have no legal hold over whatsoever to be moved into based case institutions;

This is like watching a referee walking around slapping players and taking their wallets and expecting nothing to happen.

Does anyone in Europe read history anymore?

Aznar was right wing, wasn't he? the ex Franco party was in power before Zapatero.
But it is getting very murky indeed .

[muppet]

Meanwhile in London John Major says that any attempt to impose a tax on financial transactions would be a disaster for the UK.
The banks have bought politics.

Politics/Democracy is already gone. We in Ireland and Portugal have no sovereignty while Greece and Italy don't even get to vote for their puppets. Spain are somewhere in between and interesting have elected the first right wing leader since Franco.

The article above shows the next stage. Your rights to your property is not safe. Greeks legitimately owning assets abroad is now considered by the (unelected) EU Commission to be under their sphere of influence.

I really cannot believe it anymore.

To <insert whatever mantra they are spouting today here - I'll use 'impose Capital controls' >  they are willing to:
* ditch democracy;
* trample on individuals rights to their own property;
* order money they have no legal hold over whatsoever to be moved into based case institutions;

This is like watching a referee walking around slapping players and taking their wallets and expecting nothing to happen.

Does anyone in Europe read history anymore?

Aznar was right wing, wasn't he? the ex Franco party was in power before Zapatero.
But it is getting very murky indeed .

I think Franco's outfit has had various re-incarnations but the new lot are to the right of where Aznar was according  to the media (I accept I am relying on them).

Edit: Wiki says Aznar is now on the Board of Directors at News Corporation, which of course has nothing to do with Iraq IIRC.

[seafoid]

irishtimes.com - Last Updated: Monday, November 21, 2011, 13:38Troubled states may face 'administration'
European Commission could, in extreme cases, put a euro zone country under administration if it fails to meet its financial obligations, according to guidelines for the possible introduction of joint euro zone bonds.

In a green paper to be published on Wednesday, the commission sets out how closer monitoring of countries' budgets could in the long-run make it possible to issue jointly underwritten euro zone debt.

In one section of the document, obtained by Reuters, officials flag the possibility that EU authorities could get powers to put a failing state into administration if it repeatedly fails to meet its commitments.

Such strict controls could satisfy Germany, which strongly opposes the idea of euro zone bonds, that such issuance in the future would not let spendthrift nations off the hook.

Germany is reluctant to back common bonds because it fears it would allow countries such as Greece to benefit from its top-notch credit rating without having to introduce overdue reforms.

Under the headline, "increased surveillance and intrusiveness in national fiscal policies", officials from the European Commission say the creditworthiness of any new scheme for common bonds must be steadfast.

"The servicing of Stability Bonds, or more specifically the payment of interest on common issuance, should not come under any circumstances into question," the green paper says.

"One option to this end would be to grant extensive intrusive power at EU level in cases of severe financial distress, including the possibility to put the failing member state under some form of 'administration'."

The paper flags another option of imposing a requirement on countries that borrow using a commonly issued bond to repay this debt first before they spend money in their national budgets.It also describes the benefits of a common bond for banks, which are finding it difficult to borrow and increasingly turning to the European Central Bank for support.

"Stability Bonds would provide a source of more robust collateral for all banks in the euro area, reducing their vulnerability to deteriorating credit ratings of individual member states."

[muppet]

irishtimes.com - Last Updated: Monday, November 21, 2011, 13:38Troubled states may face 'administration'
European Commission could, in extreme cases, put a euro zone country under administration if it fails to meet its financial obligations, according to guidelines for the possible introduction of joint euro zone bonds.

In a green paper to be published on Wednesday, the commission sets out how closer monitoring of countries' budgets could in the long-run make it possible to issue jointly underwritten euro zone debt.

In one section of the document, obtained by Reuters, officials flag the possibility that EU authorities could get powers to put a failing state into administration if it repeatedly fails to meet its commitments.

Such strict controls could satisfy Germany, which strongly opposes the idea of euro zone bonds, that such issuance in the future would not let spendthrift nations off the hook.

Germany is reluctant to back common bonds because it fears it would allow countries such as Greece to benefit from its top-notch credit rating without having to introduce overdue reforms.

Under the headline, "increased surveillance and intrusiveness in national fiscal policies", officials from the European Commission say the creditworthiness of any new scheme for common bonds must be steadfast.

"The servicing of Stability Bonds, or more specifically the payment of interest on common issuance, should not come under any circumstances into question," the green paper says.

"One option to this end would be to grant extensive intrusive power at EU level in cases of severe financial distress, including the possibility to put the failing member state under some form of 'administration'."

The paper flags another option of imposing a requirement on countries that borrow using a commonly issued bond to repay this debt first before they spend money in their national budgets.It also describes the benefits of a common bond for banks, which are finding it difficult to borrow and increasingly turning to the European Central Bank for support.

"Stability Bonds would provide a source of more robust collateral for all banks in the euro area, reducing their vulnerability to deteriorating credit ratings of individual member states."

What is the difference between where Greece is and administration?

[muppet]

http://www.rte.ie/news/2011/1121/supermarket.html

An increase in the maximum size of supermarkets in Ireland's largest cities has been proposed by the Government.
The development follows a commitment under the IMF-EU Programme that the State would consider eliminating the cap on retailers' size.
In a consultation document published today by Environment Minister Phil Hogan, the cap on supermarkets in the Greater Dublin area will increase from 3,500sq.m to 4,000sq.m.

Seriously, how does increasing the size of supermarkets find its way into an IMF-EU bailout programme? And why?? It is hard not to be cynical.

[Declan]

From the Telegraph but an interesting perspective with some truths

If you have half an hour, read the by Philip Whyte and Simon Tilford for the Centre for European Reform.
It is a forensic look into the deeper causes of Europe's crisis and why the reactionary policies being imposed on two thirds of the eurozone by Germany's Wolfgang Schauble and the northern neo-Calvinists – with input from 1930s liquidationists at the ECB – will lead to certain disaster.
It has been out for a week, but I have only got round to reading it. Better late than never. The CER is a pro-EU group with a broadly free-market leaning.
Here are a few extracts:
European policy-makers have been reluctant to concede that the eurozone is institutionally flawed. Even now, many assert that the crisis is not one of the eurozone itself, but of errant behaviour within it. If certain countries had not broken the rules, they argue, the eurozone would never have run into trouble. The way to restore confidence, it follows, is to ensure that rules are rigorously enforced.
These claims are wrong on almost every count. It is now clear that a monetary union outside a fiscal union is a deeply unstable arrangement; and that efforts to fix this flaw with stricter and more rigid rules are making the eurozone less stable, not more.
The reason the eurozone is governed by rules is that few of its member-states – least of all its wealthier North European ones – have any appetite for fiscal union. Crudely, rules (gouvernance) exist because common fiscal institutions (gouvernement) do not. But rules are no substitute for common institutions. And tighter rules do not amount to greater fiscal integration.
The hallmark of fiscal integration is mutualisation – a greater pooling of budgetary resources, joint debt issuance, a common backstop to the banking system, and so on. Tighter rules are not so much a path to mutualisation, as an attempt to prevent it from happening.
This course of action is more likely to precipitate the euro's disintegration than its survival.
Why is the eurozone in crisis?
The short answer is that the introduction of the euro spurred the emergence of enormous macroeconomic imbalances that were unsustainable, and that the eurozone has proved institutionally ill-equipped to tackle. North European policy-makers have been reluctant to accept this interpretation. For them, the crisis is not one of the eurozone itself, but of individual behaviour within it. If the eurozone is in difficulty, it is because of a few 'bad apples' in its ranks. In this interpretation, neither the design of the eurozone nor the behaviour of the 'virtuous' in the core were at fault.
Ever since the eurozone crisis broke out, the North European interpretation of it has prevailed. It essentially sees the crisis as a morality tale, pitting those who sinned against those who stuck to the path of virtue. The major sins of the periphery were government profligacy and losses of competitiveness. The way out of the crisis, it follows, is straightforward. It is to emulate the virtuous core by consolidating public finances and improving competitiveness (by raising productivity, reducing wages, or both). If the periphery can achieve this, then the eurozone debt crisis can be resolved without an institutional leap forward to fiscal union.
The North European interpretation is by no means all wrong (no serious observer disputes that Greece grossly mismanaged its public finances). But it is damagingly partial and self-serving. It skates over the contribution played by the euro's introduction to the rise of indebtedness in the periphery; it wrongly assigns all the blame for peripheral indebtedness to government profligacy; it makes no mention of the far from innocent role played by creditor countries in the run-up to the crisis; and it does not acknowledge how the it was wasted (perhaps unsurprisingly).
It is wrong, however, to blame government profligacy for the rise in peripheral indebtedness: Greece is the only country where this holds true. In Ireland and Spain, it was the private sector (particularly banks and households) that was to blame. Indeed, in 2007, the Spanish and Irish governments looked more virtuous than Germany's: they had never broken the fiscal rules, had lower levels of public debt and ran budget surpluses.
Creditor countries cannot be absolved of all blame. Not only was export-led growth in countries like Germany and the Netherlands structurally reliant on rising indebtedness abroad. But creditor countries in the core harboured plenty of vice: the conduits for the capital that flowed from core to periphery were banks, and these were more highly leveraged in countries like Germany, the Netherlands and Belgium than they were in the periphery (or the Anglo-Saxon world).
The eurozone crisis is as much a tale of excess bank leverage and poor risk management in the core as of excess consumption and wasteful investment in the periphery. If the eurozone had been a fully-fledged fiscal union, it would not be in its current predicament. Its aggregate public debt and deficit ratios, after all, are no worse than the US's. But it is not a fiscal union – which is why it faces an existential crisis, and the US does not.
The current crisis, then, is not simply a tale of fiscal irresponsibility and lost competitiveness in the eurozone's geographical periphery. It is also about the unsustainable macroeconomic imbalances to which the launch of the euro contributed (in creditor and debtor countries); about the epic misallocation of capital by excessively leveraged absence of fiscal integration has exacerbated financial vulnerabilities and made the crisis harder to resolve.
How did the euro's introduction contribute to the current crisis? The answer is that the removal of exchange rate risk inside the eurozone encouraged massive sums of capital to flow from thrifty countries in the 'core' to countries in the 'periphery' (where private investors thought the rates of return were higher). The influx of foreign capital cut borrowing costs in the periphery, encouraging households, firms and governments to spend more than they earned. The result was an explosion of current-account imbalances inside the eurozone. As a share of GDP, these imbalances were far bigger than those between, say, the US and China.
Ever since the Greek sovereign debt crisis broke out, the thrust of eurozone policy has been to try and turn the region into a less Mediterranean and more Germanic bloc – that is a shared currency held together by increased discipline among its members. The centrepiece of the framework that has emerged is a 'grand bargain' between creditor and debtor countries. Creditor countries have assented to the creation of a European Financial Stability Facility (EFSF) to extend bridging loans to countries that are temporarily shut out of the bond markets. In return, debtor countries have agreed to much stricter membership rules.
The grand bargain (or Plan A) has failed. The reason is that its  underlying philosophy – that of 'collective responsibility' – is flawed.
The demands of collective responsibility have been asymmetric: self-defeating medicine has been prescribed to debtor countries, while problems in creditor countries have been allowed to fester. Second, too much virtue has become a collective vice, resulting in excessively tight macroeconomic policy for the region as a whole.
The European Central Bank (ECB) believes that the faster budget deficits are cut, the faster private consumption and investment will pick up. The reverse has been the case. The ECB, meanwhile, has done too little to offset this synchronised fiscal tightening (in July, it actually raised its key official interest rate, citing "upside risks to price stability"). For a variety of reasons, the ECB has been deeply uncomfortable straying from the narrowest interpretation of its mandate. At times, the ECB has looked to be more concerned about inflation than about the eurozone's survival.
The ECB's reluctance to act as lender of last resort to governments, for example, has raised doubts in the financial markets about its commitment to the eurozone, and weakened confidence in solvent countries like Spain and Italy.
The punishing (and self-defeating) economic adjustments imposed on debtor countries contrasts with the self-righteous complacency shown in the creditor countries. Not only have the latter insisted that debtor countries implement the kind of structural reforms for which they have shown no enthusiasm themselves (like opening services to greater competition). But they have also been reluctant to accept the potential for write-downs among their banks. So the very countries that have insisted on wrenching economic adjustments indebtor countries have often been the ones that have done the most to conceal the fragility of their own banks.
This asymmetry in treatment has deepened the crisis and increased the cost of resolving it. A year's worth of punishing austerity and contracting activity has only succeeded in pushing Greece deeper into insolvency. Contagion has spread to Ireland and Portugal (which have been forced to accept bail outs and swallow the same medicine as Greece). And foot-dragging in a number of countries has condemned the region to a series of weak 'stress tests' which have given clean bills of health to under-capitalised banks. Eurozone policy has therefore actively contributed to the vicious feed-back loop that has developed between banks and sovereigns.
Having spent two years denying that many European banks were under-capitalised, eurozone leaders finally relented – but at a terrible time. Fresh capital is much harder to raise from the private sector than it was a year ago, and several eurozone governments (including France) can ill afford to step in with taxpayer funds.
The eurozone crisis is chronic in character and requires far-reaching reforms. The euro is a currency union without a Treasury or a lender of last resort. The macroeconomic policy framework is ill-suited to a big, largely closed, economy, and the national markets are insufficiently flexible and imperfectly integrated.
Policy-makers now face a choice. They must either address the eurozone's institutional underpinnings or risk a disorderly break-up.
They need to agree on a number of long-term steps. The first is a partial mutualisation of sovereign borrowing costs, via the adoption of a common bond. The second is the adoption of a eurozone-wide backstop for the banking sector. The third is growth-orientated macroeconomic policy: the European Central Bank needs a broader mandate, member-states' fiscal policy must be co-ordinated, and trade balances narrowed symmetrically.
On current policy trends, a wave of sovereign defaults and bank failures are unavoidable. Much of the currency union faces depression and deflation. The ECB and EFSF will not keep a lid on bond yields, with the result that countries will face unsustainably high borrowing costs and eventually default. This, in turn, will cripple these countries' banking sectors, but they will be unable to raise the funds needed to recapitalise them. Stuck in a vicious deflationary circle, unable to borrow on affordable terms, and subject to quixotic and counter-productive fiscal and other rules for what support they do get from the EFSF and ECB, political support for continued membership will drain away.
Faced with a choice between permanent slump and rising debt burdens (as economic contraction and deflation leads to inexorable increases in debt), countries will elect to quit the currency union. At least that route will allow them to print money, recapitalise their banks and escape deflation. Once Spain or Italy opts for this, an unravelling of the eurozone will be unstoppable. Investors will not believe that France could continue to participate in a core euro: the country has weak public finances and a sizeable external deficit.
Participation in a core eurozone would imply a potentially huge real currency appreciation and a corresponding collapse in economic activity. Investors will calculate that the wage cuts (to restore competitiveness) and cuts in public spending (to rein in the fiscal deficit) would be politically unsustainable. In short, France will effectively be in the same position as Italy and Spain are at present. While it is impossible to put a timescale on this, the direction of travel is clear.
Eurozone leaders now face a choice between two unpalatable alternatives. Either they accept that the eurozone is institutionally flawed and do what is necessary to turn it into a more stable arrangement. This will require some of them to go beyond what their voters seem prepared to allow, and to accept that a certain amount of 'rule-breaking' is necessary in the short term if the eurozone is to survive intact. Or they can stick to the fiction that confidence can be restored by the adoption (and enforcement) of tougher rules. This option will condemn the eurozone to self-defeating policies that hasten defaults, contagion and eventual break-up.
Indeed. Read it all.

[Declan]

Another opinion piece

Europe's hidden doomsday machine
Oliver Marc Hartwich
Published 6:14 AM, 22 Nov 2011 Last update 10:35 AM, 22 Nov 2011

How many crises are there in Europe? First, there is a sovereign debt crisis, which is plain to see just looking at bond markets. Second, there is the crisis of competitiveness in European periphery countries, which is exacerbated by their membership of the monetary union. Third, there is a crisis of Europe's banking system, which desperately needs recapitalisation. But there is a fourth European crisis that has so far escaped the attention of even many professional observers. And yet, this fourth and largely unknown crisis has the potential to overshadow all other crises. It is Europe's escalating balance of payments crisis.
Europe's countries have established a clearing mechanism to connect their banking systems. This 'Trans-European Automated Real-time Gross Settlement Express Transfer System' – or in short TARGET 2 – is meant to facilitate bank transfers across all EU member states (with the notable exceptions of the UK and Sweden). In ordinary times, Target would have been a technical tool without political implications. But times in Europe are not ordinary, and so over the past four years Target has become a potential time bomb for Europe's financial system. Since the beginning of the financial crisis interbank lending from core to periphery European countries has all but dried up. At the same time, periphery countries have experienced massive capital flight out of their countries. On top of that, there are trade deficits in European periphery countries which need to be financed by capital imports. All three factors combined have triggered a European balance of payments crisis under the Target system. Put simply, central banks in surplus countries have to fill the gap caused by capital flight and trade imbalances because private capital is no longer available to do just that. In this way, central banks from the healthier core of the eurozone are now sitting on enormous amounts of claims against the euro system.

The German Bundesbank as the biggest lender has so far accumulated claims totalling more than €460 billion (approximately $615 billion). This sum is more than twice the guarantees given by the German government to the European rescue fund EFSF, for which the German parliament, after a long discussion, had only provided the comparatively modest sum of €211 billion. The only other major creditors within the euro system are Luxembourg, the Netherlands and Finland, whereas all other eurozone countries are net debtors within Target. Are these enormous Bundesbank claims against most of the rest of Europe a problem? Or are they just an accounting technicality with no serious consequences? It depends not only on who you ask, but it also matters how the euro crisis develops in the long run.

The greatest critic of Germany's exposure to Target loans is Hans-Werner Sinn, president of Munich's Ifo research institute. According to Professor Sinn, Germany is effectively financing the trade imbalances in the eurozone. His argument goes like this: countries like Greece or Italy import more than they export, without being able to borrow to make up for the difference. What they do instead is run the (virtual) printing presses and transfer the freshly printed euros to Germany. In this way, Sinn argues, the Target system is being abused to maintain trade deficits which should have been eliminated in the crisis. He also believes that this process has restricted credit availability within Germany as most of the newly created central bank money is concentrated on the euro periphery. The controversy over the balance of payments crisis has raged mainly in German academic circles for some time now. Not least the Bundesbank and the European Central Bank have vehemently defended the Target mechanism against Sinn's claims. To them the Target imbalances are just a symptom of the euro crisis, not a crisis in itself. The imbalances within the system cancel each other out and would eventually return to normal levels once the crisis is over.

In any case, the ability of Germany's commercial banks to lend would not be limited in any way. The only thing to change is the way in which German banks refinance themselves, either via deposits or through the Bundesbank. But all of these defences ignore a more unpleasant long-term question. A few weeks ago the Council of Economic Advisers joined the debate in its annual report. The German government's experts concluded that not all of the Target imbalances are the results of trade imbalances. Fair enough, but not even Sinn had claimed that. The Council also confirms that credit restrictions should not be expected. It then maintains that there is no technical limit to Target balances. However, there may come a day when Germany's commercial banking sector turns from a net debtor of the Bundesbank to a net creditor. This would require some financial engineering on behalf of the ECB to avoid a zero interest rate. So is everything fine with Target after all? Not quite.

In its final paragraph on the Target problem, the Council drily comments that in case of a default of any debtor nation, their Target balances would have to be written off by other eurozone countries according to their share of the ECB's subscribed capital. In the German case this share is 27 per cent. In plain language: If, say, Greece defaulted, its negative €97 billion Target balance would lead to a Bundesbank loss of €26.2 billion. Ultimately, German taxpayers would then have to recapitalise their central bank. Unfortunately, this is not even the worst case scenario. The German share of potential writedowns increases with every country departing from the eurozone. If more countries left without being able (or willing?) to balance their Target books, Germany would take even higher losses. Conversely, should Germany one day decide that it wishes to leave the euro behind to introduce its new Deutschmark, the chances are close to zero that other European countries would voluntarily settle their half a trillion euro bill with Germany. It now looks as if for the past four years of the financial crisis, Germany has effectively kept the trade imbalances party going in the euro periphery countries. But when the party is over, Germany will be sitting on enormous claims against these other countries, which will be effectively worthless.

What was once meant as a technical tool to facilitate bank transfers has become a doomsday machine. Worse still, Target has cemented trade imbalances within Europe that should have been corrected during the financial crisis. The Germans have also implicitly subsidised banks in periphery countries, which should have been liquidated when they could no longer recapitalise themselves. For Europe there is no easy way out of this balance of payments crisis. The Target debtor countries will resist any restrictions on central bank credit, desirable as they are. On the other hand, a creditor exit from the system would finally reveal to the creditor public the amount of implicit subsidies given to the euro periphery (without any debates, let alone a democratic mandate). What Europe is still discussing and Germany is vehemently resisting – the transformation into a fiscal liability union – has long been achieved through the Target backdoor. Brace yourself for the day when Europe finally wakes up to its forgotten fourth crisis. Dr Oliver Marc Hartwich is a Research Fellow at the Centre for Independent Studies.

[Declan]

The good news just keeps on coming:

German bond sale 'a disaster'

Germany failed to get bids for 35 per cent of the 10-year bonds offered for sale today, sending its borrowing costs higher and the euro lower on concern that Europe's debt crisis is driving investors away from the region.

"This auction is nothing short of a disaster for Germany," Mark Grant, a managing director at Southwest Securities in Florida, said. "If the strongest nation in Europe has this kind of difficulty raising capital one shudders concerning the upcoming auctions in other European nations."

The debt crisis that began more than two years ago in Greece and snared Ireland, Portugal, Italy and Spain has closed in on France and now risks engulfing Germany, the region's biggest economy. Political leaders are struggling to find a fix for the crisis, with German Chancellor Angela Merkel rejecting proposals for the common currency-area bonds, while the European Central Bank resists calls to boost sovereign debt purchases.

The yield on 2.25 per cent securities maturing in September 2021 climbed four basis points to 1.96 per cent at 11.37am Irish time today. The price of the bonds slid 0.40, or €4 per €1,000 face amount, to 102.520. The cost of credit default swaps on German debt rose six basis points to 107, according to CMA prices. The euro weakened as much as 1 per cent to $1.3374.

Total bids at the auction of securities due in January 2022 amounted to €3.889 billion, out of a maximum target for the sale of €6 billion, according to Bundesbank data. The securities were sold at a yield of 1.98 per cent.

French and Belgian bonds fell for a third day after De Standaard newspaper said Belgium is seeking to renegotiate the break-up plan for lender Dexia.

"The notion some people had that Germany could be insulated against market developments was a pipedream," Fredrik Erixon, head of the European Centre for International Political Economy in Brussels, said. "The systemic crisis in the euro zone is eating its way into countries that are solvent and have competitive economies, like Germany. But because they are in the euro zone the crisis is spreading to them."

The rate on 30-year German bond climbed as much as seven basis points to 2.68 per cent, the highest since November 9th. Germany's Finance Agency sees no risk in financing the government's budget after demand was weak at a debt auction today, a spokesman said today.

The yield on 10-year French debt increased 10 basis points to 3.63 per cent, while the rate on similar-maturity Belgian securities was 14 basis points higher at 5.22 per cent.

German bonds have returned 8.2 per cent this year, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies. French bonds have gained 0.9 per cent and Belgian securities have dropped 3.3 per cent, the indexes show.

[seafoid]

Fiscal Assessment Report: Discussion with Irish Fiscal Advisory Council

Thursday, 17 November 2011

http://debates.oireachtas.ie/FIJ/2011/11/17/00005.asp

Stephen Donnelly "One of the roles the council can play is not just in providing analysis and recommendations but in communicating the analysis and recommendations. The information provided by the ESRI is not bad, but it is still fairly complex, while that provided by the Department of Finance is just political spin. I can read some of it, but I cannot read all the information that is coming from everywhere. The fiscal council can play an extraordinarily valuable role in explaining these things to the people of Ireland, who have become extraordinarily financially and economically literate over the last three or four years.
I love the graphics in the report and the way it is laid out, and I love the illustration of the benchmarking of different groups. I encourage the council to get people in - maybe it already has them - who can help nail the communications to different audiences, whether it is people such as Professor Barrett, trained economists or people who are scared about what is going on. Within that, some scenario modelling would be useful."

Deputy Stephen Donnelly: I wish to clarify this. With regard to the capital expenditure programme will the council have only the little booklet that came out? Is that all the council has to respond to?
Professor John McHale: That is all we have to respond to. We could

[Declan]

http://online.wsj.com/article/SB10001424052970204531404577054063759403588.html?mod=WSJEUROPE_hpp_LEFTTopWhatNews

Disaster Planning: Banks Ponder Euro-Zone Split

BY EVA SZALAY

A key part of the world's foreign-exchange trading infrastructure is bracing itself for the possibility of a breakup of the euro zone, the latest sign investor concerns about the Continent's debt crisis are on the rise.

CLS Bank International, which operates a platform in which banks settle most of their currency trades, is running "stress tests" to prepare for the possible dissolution of the euro, according to people familiar with the situation.

Some of the 63 banks that co-own CLS are making similar plans. "We always plan for contingencies," said a senior executive at one of the largest currency-dealing banks.

[seafoid]

http://www.irishtimes.com/newspaper/breaking/2011/1123/breaking4.html

Department of Finance secretary general Kevin Cardiff has been rejected for the nomination for Ireland's seat in the European Court of Auditors, by a budgetary committee of the European Parliament.

Mr Cardiff was questioned by MEPs in Brussels today as they scrutinised his nomination. The committee decided to reject his nomination by 12 votes to 11.

[Declan]

Yep - he failed the interview was voted out but still can get in as it has been referred to the Parliament - Democracy in action

[sammymaguire]

Yep - he failed the interview was voted out but still can get in as it has been referred to the Parliament - Democracy in action

Dont take this the wrong way but you seem to be revelling in all this mess. You love keeping us updated on the shit that is going on, the different angles of doom and misery and corruption etc.... which is good in one way of course but....

Are you going to actually do anything other than post stuff on here?

[Declan]

Are you going to actually do anything other than post stuff on here?

I'm not sure what you mean by that Sammy. If you mean will I offer suggestions of a possible way out of it well lots of better qualified people than me are struggling to but my fundamental belief is that govts are there to serve the people who elected them and not private financial institutions. In this regard I believe that the open ended bank guarantee given back in 2008 was the death knell for Ireland as we know it. Given that we have a track record of what could be loosely termed as a right wing monetarist economic policy I can't see anything happening outside of what ever European wide solution will eventually surface.
In the meantime the majority of the population will continue to suffer, struggle to heat their house, educate their kids, and even die due to the state of our health system but bar a sea change  in our national psyche we seem ready to accept this as our lot. ( I could theorise as to why I think that is but that would be another whole days work!!)

I honestly don't know where it's going to end but I can't see it ending well. Rumours abound that we are printing punts in preparation for the end game which will mean a drastic change in all our circumstances but which may well be the best course of action in the long term for future generations.

In the meantime I'll continue to post the "informative" pieces so people can make up their own mind