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

[muppet]

http://euobserver.com/economic/121160

Greece will need third bailout, German minister says
TODAY @ 17:53
RELATED German finance minister visits angry Greece
BY VALENTINA POP
BERLIN - A month before general elections in Germany, finance minister Wolfgang Schaeuble has broken the taboo of admitting that Greece will need a third bailout when the current one runs out, in 2014.

"There will have to be another programme in Greece," Schaeuble said on Tuesday (20 August) during a campaign rally in the northern-German town of Ahrensburg.

As part of a third programme, he mentioned another lowering of the interest rates on the loans the eurozone has given to Greece.

"They are not out of the woods yet," he said.

So far, the German government has steered clear of admitting that the current bailout, worth €130 billion, will not suffice to get Greece out of the vicious spiral of deficit and debt.

Chancellor Angela Merkel, who is seeking re-election on 22 September, has meanwhile struck a more cautious tone.

"We always said that we will have to reassess the situation of Greece end 2014 or beginning of 2015. It is wise to stick to this calendar," she told Ruhr-Nachrichten on Tuesday.

Earlier this year, Germany's insistence not to deal with a funding gap of almost €10 billion for 2015-2016 delayed the negotiations on the second bailout for Greece, as the International Monetary Fund (IMF) was reluctant to sign off on a programme that does not get the country out of its financial mess once and for all.

The IMF was insisting at the time for EU governments to also take a cut on their loans to Greece, in order to lower the country's debt.

But Schaeuble on Tuesday again ruled out another debt restructuring for Greece, after private creditors agreed to lose more than half of their money on Greek bonds as part of the second bailout.

Speaking to foreign correspondents in Berlin on Monday, Green opposition leader Juergen Trittin said he expects another debt restructuring, adding that "Merkel always delays a decision until the very last moment, even if in the end it turns out to be more costly."

The German central bank is meanwhile also expecting a third bailout for Greece shortly after the German elections or "early 2014, at the latest," German weekly Spiegel reports, citing an internal Bundesbank document.

[muppet]

http://www.irishtimes.com/news/world/europe/mp-asks-did-eu-taxpayers-underwrite-bale-s-transfer-1.1514965

MP asks: Did EU taxpayers underwrite Bale's transfer?

Who exactly is funding Real Madrid's record-breaking €100 million purchase of 24-year-old Gareth Bale from Tottenham Hotspur? Could it by any chance be the European taxpayer?

As the transfer window closed on Monday night, Deloitte's Sports Business Group calculated that UK premiership clubs spent a record-breaking €630 million this year compared to the previous record of €500 million in 2008, with Bale by far the most expensive signing.
However, as the deal was done, Dutch right-wing politician Geert Wilders tabled what he clearly hopes will be an embarrassing parliamentary question for Dutch finance minister Jeroen Dijsselbloem, who is also chairman of the Eurogroup of finance ministers.
As the Netherlands struggles to find public spending cuts worth €6 billion this year, what Mr Wilders wants is an assurance that it's not the squeezed Dutch taxpayer who's subsidising Bale's move.

Wilders, who has called for the first in a series of mass protests against austerity for later this month, argues that Real Madrid's €100 million largesse is only possible because the club has borrowed heavily from its Spanish bank, Bankia.

The problem, he maintains, is that Bankia is still in existence thanks only to a €19 billion EU bailout.

Wilders has begun a debate, and the question many Dutch are now asking has its own reverse logic: could Gareth Bale ultimately be used to guarantee the solvency of Bankia?

[Hound]

It's time for something different. Take back our oil and start again. Never, ever vote for FF, FG or Labour - they have all repeatedly failed the people. The people have suffered enough - it's time we took control back.

Damn right. It's high time we tried something else. Take a brave step and walk away from the civil war parties, just this once and see what happens. Start thinking nationally and forget the parish pump for once.

But nobody is interested in reducing the budget deficit....

There are two major things you need to do to end a budget deficit (1) decrease spending and/or (2) increase revenue. I propose (2) by taking back our oil. Then we could even increase spending on necessary services but only if and when proper reforms take place. We cannot waste this possibly final opportunity.

My brother in the US made the point about how the tans used to always say that we weren't fit to govern ourselves. Turns out they might have been right so far but it's never too late to break a bad habit.

Late coming to this but:

"Taking back our oil will increase revenue" - I'd love to hear how!

There's 10 billion barrels of oil equivalent beneath the seabed off the west coast of Ireland, that the country hasn't "given away". But we're not sure where exactly it is and, more importantly, we've absolutely no clue whether it can be recovered economically. It will take multiple of millions of euro to find out, and more again to extract it.

So what we'd actually be doing by taking it all on ourselves would be spending spending spending, with no guarantee of recovering that money much less of making profit.  An offshore exploration well costs anything from €20M to €100M. Tell me, how many of these do you think the exchequer should fund to increase our revenues???

The Irish Times article complains that where a company does have a successful commerical oil/gas find outside Ireland (very few and far between to date) they are allowed to offset their costs! As if this some great tax scam - FFS!

Plenty of media coverage that in Norway they tax oil companies at 78% - "we should follow the Norway model, we'd all be rich".
Much less media coverage of the fact that where a company makes unsuccessful explorations, Norway give them a refund of 78% of their costs!

How would we be coping if we took that route, I wonder?
We gave 8 licences to companies to explore in 1995, they all spent a lot of money investigating and exploring. They all handed back their licences without earing a penny. This cost the state nothing.
We gave another 11 licences in  1997. So far, 10 of those companies have handed back their licences without earning a penny.

Our policy at the moment is to give licences to oil companies for free. But they take all the risk . If they suffer a loss they incur all the loss. If they earn a profit, they keep 60%, we keep 40% (or 75/25 if its a small profit).

Some think this means we're giving stuff away, yet only 3% of Irish offshore is currently under licence, its clear this is no "gift" to exploration companies. We're doing a poor job in attracting oil and gas investment. If we want to get anywhere near Norway, or lets say even Scotland, we need to do more to attract these companies to invest. We should not be trying to scare them away as the some on this thread think!

[muppet]

It's time for something different. Take back our oil and start again. Never, ever vote for FF, FG or Labour - they have all repeatedly failed the people. The people have suffered enough - it's time we took control back.

Damn right. It's high time we tried something else. Take a brave step and walk away from the civil war parties, just this once and see what happens. Start thinking nationally and forget the parish pump for once.

But nobody is interested in reducing the budget deficit....

There are two major things you need to do to end a budget deficit (1) decrease spending and/or (2) increase revenue. I propose (2) by taking back our oil. Then we could even increase spending on necessary services but only if and when proper reforms take place. We cannot waste this possibly final opportunity.

My brother in the US made the point about how the tans used to always say that we weren't fit to govern ourselves. Turns out they might have been right so far but it's never too late to break a bad habit.

Late coming to this but:

"Taking back our oil will increase revenue" - I'd love to hear how!

There's 10 billion barrels of oil equivalent beneath the seabed off the west coast of Ireland, that the country hasn't "given away". But we're not sure where exactly it is and, more importantly, we've absolutely no clue whether it can be recovered economically. It will take multiple of millions of euro to find out, and more again to extract it.

So what we'd actually be doing by taking it all on ourselves would be spending spending spending, with no guarantee of recovering that money much less of making profit.  An offshore exploration well costs anything from €20M to €100M. Tell me, how many of these do you think the exchequer should fund to increase our revenues???

The Irish Times article complains that where a company does have a successful commerical oil/gas find outside Ireland (very few and far between to date) they are allowed to offset their costs! As if this some great tax scam - FFS!

Plenty of media coverage that in Norway they tax oil companies at 78% - "we should follow the Norway model, we'd all be rich".
Much less media coverage of the fact that where a company makes unsuccessful explorations, Norway give them a refund of 78% of their costs!

How would we be coping if we took that route, I wonder?
We gave 8 licences to companies to explore in 1995, they all spent a lot of money investigating and exploring. They all handed back their licences without earing a penny. This cost the state nothing.
We gave another 11 licences in  1997. So far, 10 of those companies have handed back their licences without earning a penny.

Our policy at the moment is to give licences to oil companies for free. But they take all the risk . If they suffer a loss they incur all the loss. If they earn a profit, they keep 60%, we keep 40% (or 75/25 if its a small profit).

Some think this means we're giving stuff away, yet only 3% of Irish offshore is currently under licence, its clear this is no "gift" to exploration companies. We're doing a poor job in attracting oil and gas investment. If we want to get anywhere near Norway, or lets say even Scotland, we need to do more to attract these companies to invest. We should not be trying to scare them away as the some on this thread think!

Don't make me laugh. They will write off far more than that. We will see feck all.

http://www.taxresearch.org.uk/Blog/2010/06/07/ryanair-is-paying-no-tax-despite-record-sales-irish-business-independentie/

[Hound]

Don't make me laugh. They will write off far more than that. We will see feck all.

http://www.taxresearch.org.uk/Blog/2010/06/07/ryanair-is-paying-no-tax-despite-record-sales-irish-business-independentie/

Muppet, are you a wind up merchant or do you believe Ryanair are doing something wrong regarding their tax per that article? If so, maybe you can explain it.

Do you actually believe that having spent €4 billion on new aircraft, that they are not entitled to tax allowances for this expenditure? (By the way, there isn't any country in the OECD world who would not give an aircraft company tax allowances for expenditure incurred in acquiring aircraft).

Also, whilst the Aer Lingus write-down of €220m would have been an expense in the Ryanair accounts, it absolutely would not have been allowed as a deduction against their trading profits for tax purposes.

[muppet]

Don't make me laugh. They will write off far more than that. We will see feck all.

http://www.taxresearch.org.uk/Blog/2010/06/07/ryanair-is-paying-no-tax-despite-record-sales-irish-business-independentie/

Muppet, are you a wind up merchant or do you believe Ryanair are doing something wrong regarding their tax per that article? If so, maybe you can explain it.

Do you actually believe that having spent €4 billion on new aircraft, that they are not entitled to tax allowances for this expenditure? (By the way, there isn't any country in the OECD world who would not give an aircraft company tax allowances for expenditure incurred in acquiring aircraft).

Also, whilst the Aer Lingus write-down of €220m would have been an expense in the Ryanair accounts, it absolutely would not have been allowed as a deduction against their trading profits for tax purposes.

You said if they earn a profit we get 40%.

That will never happen.

I just demonstrated an example with Ryanair. Huge profits, feck all tax. Corporations find ways of avoiding taxation and it is absurd to think our new oil mining friends would be any different.

[Hound]

Don't make me laugh. They will write off far more than that. We will see feck all.

http://www.taxresearch.org.uk/Blog/2010/06/07/ryanair-is-paying-no-tax-despite-record-sales-irish-business-independentie/

Muppet, are you a wind up merchant or do you believe Ryanair are doing something wrong regarding their tax per that article? If so, maybe you can explain it.

Do you actually believe that having spent €4 billion on new aircraft, that they are not entitled to tax allowances for this expenditure? (By the way, there isn't any country in the OECD world who would not give an aircraft company tax allowances for expenditure incurred in acquiring aircraft).

Also, whilst the Aer Lingus write-down of €220m would have been an expense in the Ryanair accounts, it absolutely would not have been allowed as a deduction against their trading profits for tax purposes.

You said if they earn a profit we get 40%.

That will never happen.

I just demonstrated an example with Ryanair. Huge profits, feck all tax. Corporations find ways of avoiding taxation and it is absurd to think our new oil mining friends would be any different.

The only thing absurd is your logic.

You clearly think if a company has a loss of 4,000 in Y1
but then earns profits of 1,000 in each of Y2, Y3 and Y4, that it should be paying tax.

As I said absurd.

Compnaies in every country pay tax on the difference between their profits and losses. That's how it works everywhere!

[muppet]

Don't make me laugh. They will write off far more than that. We will see feck all.

http://www.taxresearch.org.uk/Blog/2010/06/07/ryanair-is-paying-no-tax-despite-record-sales-irish-business-independentie/

Muppet, are you a wind up merchant or do you believe Ryanair are doing something wrong regarding their tax per that article? If so, maybe you can explain it.

Do you actually believe that having spent €4 billion on new aircraft, that they are not entitled to tax allowances for this expenditure? (By the way, there isn't any country in the OECD world who would not give an aircraft company tax allowances for expenditure incurred in acquiring aircraft).

Also, whilst the Aer Lingus write-down of €220m would have been an expense in the Ryanair accounts, it absolutely would not have been allowed as a deduction against their trading profits for tax purposes.

You said if they earn a profit we get 40%.

That will never happen.

I just demonstrated an example with Ryanair. Huge profits, feck all tax. Corporations find ways of avoiding taxation and it is absurd to think our new oil mining friends would be any different.

The only thing absurd is your logic.

You clearly think if a company has a loss of 4,000 in Y1
but then earns profits of 1,000 in each of Y2, Y3 and Y4, that it should be paying tax.

As I said absurd.

Compnaies in every country pay tax on the difference between their profits and losses. That's how it works everywhere!

Why would you assume I think that?

And why the Ad hominem all the time?

Ryanair has earned large profits every year since the early 2000s.

It still pays feck all tax.


And to your last point.

"Compnaies in every country pay tax on the difference between their profits and losses. That's how it works everywhere!"

It doesn't work everywhere that companies are given their raw material completely free of charge. They don't pay for the oil or gas. They take a risk on exploration but if they make a hit, they get it all for free. You are trumpeting the possibility of tax revenue from the profit.

Here is an equivalent. I decide to open a hotel. I spend money researching a location. I find a hotel I think is good. The State will then give me the hotel, or hotels completely free of charge. Any profit I make, they then are happy to merely take tax from, but they never ever charge me for the hotels. Of course, despite the fact the NAMA own half of the hotels in the country (due to them being unprofitable), no one in the State is stupid enough to just give them out for free. But that is exactly what they do for gas and oil.

[Hardy]

How then does Norway, the example we should be following, according to those who say we're giving away our oil, manage to collect its 78%?

[muppet]

How then does Norway, the example we should be following, according to those who say we're giving away our oil, manage to collect its 78%?

http://www.statoil.com/en/about/history/pages/default3.aspx

It was State Owned when it was set up. Since floated on the NYSE.

[Hardy]

Where does the 78% tax story come from?

[muppet]

Where does the 78% tax story come from?

I don't think that figure came from me.

[muppet]

http://online.wsj.com/article/SB10001424127887323716304578481402672631038.html

Prime Minister Jens Stoltenberg, facing elections in September, last week disclosed a plan to lower the amount of development subsidies paid to oil and gas companies in order to offset tax cuts planned for non-oil companies working in mainland industries.

Traditionally paying only 9% of development costs, oil companies must pay 12% of their project costs as of 2014 under Mr. Stoltenberg's plan. The change comes after a series of huge cost overruns on offshore projects and amid concerns about oil sector cost inflation, both of which are considered to be fueled by generous tax deductions.

Oil companies in Norway pay a 78% tax rate on income generated in Norway, compared with a corporate tax rate of 28%. The corporate tax rate falls to 27% in 2014

Can anyone explain all of the above in layman's (not Lehman's) terms please?

[muppet]

http://www.golemxiv.co.uk/2013/08/when-people-do-what-their-goverment-wont/

This is really sickening.

(Note: The original at the link above has links to sources which don't work in the copied piece below. You are better off reading it on his own site.)

When Irish people do what their government won't

by Golem XIV on AUGUST 15, 2013 in LATEST
It has been clear for some time now that the ideal of equality before the law has been buried.

The US.  Department of Justice made it clear a few months ago, after it had declined to press criminal charges against a string of banks (Citi, Wachovia and HSBC), that 'Too Big To Fail' meant while such institutions could be investigated and fined, they could not ever be found criminally guilty, because that would endanger their continued survival. Thus TBTF equals TBTP.

The list of G-SIFI's (Globally Systemically Important Financial Institutions – both banks and Insurers) is therefore a list of those financial institutions that are now above the law. If it profits those institutions, and those who own and run them, to disregard the law, they can and will because all they face is a fine. A fine is just another marginal cost of doing business. A tax. And a small, discretionary one at that.

In Europe we have had no similarly outright admission by the State that TBTF means TBTP. Instead the G-SIFI lists of banks and insurers have been published without anyone in government caring to make it clear that the State has taken it upon itself to raise the golden financial class above the law.

Of course there is one loophole – just a tiny one and one that is easily ignored – but one nevertheless. And that is that if no Public Prosecutor will take a Bank to court then it is still possible for an ordinary citizen to do so (Of course how easy or impossible it is depends on the country). But In Ireland it is possible and one man, Michael Smith,  has decided to try.

Michael Smith is a former barrister and the owner and editor of The Village magazine in Dubiln. He, like me and many others, has had a long interest in the on-going case of the UniCredit whistleblower, Jonathan Sugarman, AKA WhisteblowerIRL. It was Mr Smith who accompanied Mr Sugarman when he went to to talk to the Irish authorities about what he knew. It was at that meeting that Mr Sugarman was told by the authorities that they might well prosecute him if he told them about the crime over which he had resigned from UniCredit, whereas they could not promise to prosecute the bank.

For those of you who don't know, the crime in question is actually very straightforward. Mr Sugarman's job as Risk Managere at UniCredit, was to make sure the Bank was solvent at the end of each day – to check its liquidity. Mr Sugarman became alarmed when he found, at the height of the Bubble, that UniCredit was in breach of its requirements. Not by just a little but by huge sums, and not on one rogue day but regularly. The Irish Law is very clear. It was Mr Sugarman's job to tell his bank and the regulator of the breach. This he did.

The bank told him to shut up. The regulator ignored him. Of the very few concrete actions taken by the authorities perhaps the most symbolic was that they removed from the Central bank's web site the document in which the law can be seen. You can however still see the law for yourself, here in sections 9.4 and 10.

Sickened by this attitude Mr Smith, in consultation with Mr Sugarman, has decided if the Irish DPP will not insitute an investigation/prosecution against UniCredit Ireland and several other Irish based banks such as Anglo, then The Village will.

  In an open letter to the Irish DPP Mr SMith calls their bluff. Essentially he asks is the Irish state's legal aparatus whoring for the banks or does it still have a single grain of honour left?

You can read the editorial here. The  whole article is only available in the latest print issue. You can read the  two previous articles he has written about the Sugarman/UniCredit affair here and here.

It comes to somthing when ordinary people have to uphold the laws because their government refuse to. But that is where we are, not just in Ireland but in all of our nations.

It remains to be seen what measures the banks and their friends in government will be willing to take to close off from the people from any hope of legal and peaceful redress.

I sincerely hope Mr Smith does file suit against Unicredit, Anglo and the others. I hope people are able to support him. Perhaps we, in other countries, can hope to do the same. Most fervently I hope the government in Ireland and the Trioka in Bruselles do not close down this hope of redress.

[Hound]

How then does Norway, the example we should be following, according to those who say we're giving away our oil, manage to collect its 78%?

I think you may be getting close to my point of view that those who say we're giving away our oil don't really know what they're talking about.

Norway taxes petroleum companies at a rate of 78% on their profits (income less expenditure less any prior losses). Where a company ceases petroleum activities in Norway having made an accumulated loss, Norway will give it a refund of 78% of its losses.

This compares to Ireland's rate which varies from 25% to 40% on profits. But we give zero compensation to companies who leave having made an accumulated loss.