I have a feeling that this whole economic situation is going to end up with a "boy who cried wolf" scenario....there have been so many "crisis" stories since 2007 that no one cares any more, then one day we will wake up and the Euro will be on its knees ....then the media will be happy because there will be an actual crisis to report on !
In the mean time...A "French expansionary policy' would have to be paid for with German, Dutch, Finnish money. These payees may agree if as part of the package deal there was real external control at a federal level over spending in France (and Spain, Portugal, Italy, Greece) and as a result of this control see a roll back of many aspects of the huge government spending in France where 65% of GDP is direct government spending. What the payees want is a reform of rigid labor markets and money to be spent on supporting projects that will employ people and not on cradle to grave government largesse beloved of French socialists. On the other hand, the French ideal is an agreement where they get pots of other peoples money to allow them to carry on exactly as they where doing and even expand the dirigiste state more. Mr Hollande made lots of election promises (eg hiring 65000 more teachers that he now he is President he knows France cannot afford. He would love Germany to pay. France (and others) will never give up an iota of sovereignty over their economy, so don't expect the Germans and others to agree to mutualize debts....Well...It is really all a big scam. Governments borrowing money that they know they wont pay back, banks doing the same, senior politicians and banksters all know that they will be retired soon, into the sunset with their golden pensions and pots of cash. They wont be around to live in the hell they have created. Meanwhile, the workers, the poor, the unemployed, the pensioners will all pay the price of rising unemployment, failed social systems and rising crime. Eventually there will be an overthrow of the current system, but the crooks will all be gone to Dubai, USA or some other capitalist entity that doesnt ask questions about how they got their money. I live in the UK, the poverty is visibly worse every day and our politicians do nothing. Same everwhere I guess. Pity. Within weeks of taking office at the start of the year he was flooding Europe's banks with €1tn in cheap, short-term credit. Was that the same cheap loan scheme that was known as LTRO? Long Term Refinancing Operation? Either way Angela seems to have it well under control. She will play it her way, loosen the purse strings as and when necessary. The Germans really couldn't give a damn but if, in their desperation, the EU wishes to place the future of Europe in her lap, who is she, a mere frau, to refuse? Interesting times. Time for us to think about where's the EXIT maybe?
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Deeper eurozone union 'agreed'
EU leaders have agreed on a roadmap for eurozone integration beyond the deal on centralised banking supervision, Germany's Chancellor Merkel says.
THE opening shots in what could be a powerful Tory grassroots rebellion over Europe were fired in David Cameron’s direction yesterday.
A county council overwhelmingly backed a call for a national referendum on EU membership.
Lib Dems and Independents joined the Tory majority in Lincolnshire in a 72-7 vote for Britons to have a say on their destiny within the union.
Complaining of increased EU powers their motion stated: “Our residents are upset and angry that they have no powers to stem the tide, or change laws imposed on our country, which in part explains the distrust voters generally feel for all mainstream parties. ºIt is now the time for this country to be given the opportunity through a national referendum for their views to be known.”
BERLIN - Germany's central bank has poured cold water over a recently agreed deal of putting the European Central Bank (ECB) in charge of supervising banks in the eurozone.
A legal opinion by the Bundesbank, seen by Der Spiegel magazine, raises concerns over the landmark deal reached last week by finance ministers to put the ECB directly in charge of 150-200 of the largest banks in the eurozone, along with new auditing powers for the rest of the 6,000 banks which remain under national supervision.
The current deal lacks "a long-term solid legal basis," as a planned mediation committee between the banking supervisor and the ECB governing council may be attacked in EU courts, the Bundesbank said.
The mediation committee was a compromise introduced at the last-minute in order to meet German demands for not making the ECB automatically responsible for mishaps it cannot directly supervise.
The mediation committee is supposed to intervene when the ECB governing council (eurozone-members only) and the banking supervisor, which will include non-euro representatives, have diverging views on a particular bank, for instance if it should boost its capital reserves.
Meanwhile, Bundesbank chief Jens Weidmann has also expressed scepticism if the ECB is the right institution to supervise banks.
"I am not convinced that the ECB council is the optimal authority to decide when a bank has to be closed down or not," he told the economic weekly Wirtschaftswoche.
He reiterated concerns that the ECB's core task of overseeing the stability of the common currency and the banking supervision activities are not sufficiently separated to ensure the independence of this institution.
Weidmann also criticised plans agreed by EU leaders to complete the so-called banking union with a "resolution" authority able to close down banks and use taxpayer money until a fund based on contributions from the banks themselves is set up.
Such a banking union spreading the risks onto taxpayers in the eurozone should have democratic controls, he said.
But in a more conciliating mode than his legal service, Weidmann suggested the new set-up, expected to become operational in 2014, could be launched as a transitional arrangement. "The ECB can take over the role of a midwife, until the banking supervisor will be able to be separated from the central bank," he said.
Putting the ECB in charge of banking supervision was initially a German demand, after Chancellor Angela Merkel slammed the existing European Banking Authority - a less powerful body set up two years ago and whose so-called stress tests on EU banks failed to see the problems in the Spanish banking sector.
The EBA's powers were watered down by the EU governments themselves however, who wanted to retain as much sovereign powers for their national supervisors as possible.
A new set of "stress tests" will be jointly run by EBA and the ECB in the second half of next year, even before the new supervisor is to be set up, Austrian central bank chief Ewald Novotny said Friday.
"What we want to avoid is that there are isolated stress tests from EBA and then from the ECB. We said we should move ahaead in a coordinated way," he said.
Another Greek development -- the EU's task force dispatched to Greece has warned today that Athens has fallen behind its target of recovering €2bn of outstanding tax receipts during 2012.
By the end of October, the taskforce said, Greece had only recovered €1bn. Just 88 audits of large taxpayers had been conducted, against a target of 300, and just 467 of "high-wealth individuals"had been probed, versus a target of 1,300.
Despite the slippage, commissioner Olli Rehn declared that Greece was making progress, saying:
Greece is tackling deep-rooted structural problems with determination and resolve, as has been recognised by the Eurogroup.
The Task Force is working hard to help Greece implement essential reforms to boost its competitiveness, create a fairer and more effective tax system, and generate sustainable growth and employment.
The function of a currency is to facilitate the exchange of goods and promote trade.... not to destroy the social fabric of a country. With the rise of the developing nations and their lower labour costs, the only feasible way out for Spain is devaluation. This option is denied them whilst they remain in the Euro.
This tragedy has been going on for over two years... as one rescue scheme is replaced by another... indebtedness is concealed... the economy and tax revenues deteriorate... and hope is suffocated.
The obvious question is... why? Why do Europe's politicians cling to an economic model that is clearly destructive, both socially and economically. Despite the cynicism, these people are not fools.
The only logical conclusion I can arrive at is that Spain has two other equally desperate siblings - Italy and France. Their exit from the euro would result in a rout of the currency... and a catastrophic banking collapse.
Germany has little choice now. It was part of the problem. It (and France) promoted the euro for its own ends. Now it must pay for that privilege... or watch as its markets and the banking system collapse.
I just hope that Spain is not pushed too far.
Europe is in the hands of people who are imposing the rules of small minded office politics on an entire continent. This behaviour is a lethal, self defeating tendency of all arrogant anti-democratic and manipulative regimes.
Spain may well do what the UK has shamefully failed to do, which is to apply the final straw, to smash the delusions of bad rulers and a bad political system suffering from systemic ignorance and deep incompetence in information flow.
The best system to ensure rulers are well informed and motivated to listen, assuming no wholesale, long term lying to peoples, is democracy. The EU has turned its back on democracy and considers it dangerous to listen to people because little people do not agree with what it thinks is right.
Instead, this doomed regime tries to 'change reality' by propaganda and sticking to a wild and hopeless belief that they know what is right without listening to hundreds of millions of people.
In this box of self imposed ignorance, office politics becomes the overwhelming influence. It has broken out and the third rule of office politics is now causing needless catastrophic damage to hundreds of millions of people:
This law states: 'The more stupid and doomed a project becomes, the greater the anger and spite directed towards those pointing out that fact'. The worse things become, the less able these jobs for life, unelected rulers are capable of listening and acting on sound advice.
They are doomed. The damage they cause in the whirpool they leave as they sink beneath the ocean of their ignorance must be limited, in case they take millions of those they betrayed down with them.
The EU is fast becoming The Triumph of Ignorance.
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