A major Swiss gold refiner is being investigated on suspicion of money laundering linked to the processing of gold allegedly looted from DR Congo. Swiss federal prosecutors confirmed criminal proceedings against Argor-Heraeus SA, over claims it knew gold it handled in 2004 and 2005 had been taken from DR Congo during an armed conflict. The case has been brought by the Swiss non-governmental organisation TRIAL.  Argor-Heraeus has strongly refuted all allegations in a statement.  The Swiss gold refiner said the allegation had "arrived like a bolt out of the blue" and there had been "no request or contact whatsoever from TRIAL beforehand".

It said "Argor-Heraeus has been cleared of all above mentioned allegations", referring to an investigation at the time by the UN, SECO and FINMA.

The firm said it would "collaborate in complete transparency with the authorities" to prove its innocence.

'Growing pressure'

The Swiss federal prosecutor's office said on Monday that after reviewing the criminal complaint submitted by TRIAL, it had decided to initiate proceedings against Argor-Heraeus "for suspected money laundering in connection with a war crime and complicity in war crimes".

"Given the secrecy of the investigation and function, we are not able to provide more information for now," it said.

TRIAL alleges that gold looted from DR Congo in 2004 and 2005 was smuggled to Uganda and then refined in Switzerland by Argor-Heraeus.

According to TRIAL, the refinery knew or should have assumed that the gold resulted from pillage, a war crime.

DR Congo was in the midst of an armed conflict at the time, driven partly for control of natural resources.

An estimated six million people are believed to have been killed in DR Congo since 1997.

TRIAL says the sale of the gold "contributed to financing the operations of an unlawful armed group in a brutal conflict".

A report at the time by a UN Group of Experts recommended sanctions against Argor, saying the company must have known the gold was obtained illegally. Sanctions were imposed only on Ugandan businesses involved in the trade. TRIAL alleges that Argor escaped sanctions because of pressure applied at the UN by Swiss diplomats.

However, Argor says that "subsequent detailed in-depth verifications executed by SECO and UNO resulted in the removal of the name of Argor-Heraeus from the report and confirmed that the company was in no way directly or indirectly involved in the alleged claim".

Most of the world's gold is refined in Switzerland and the country is also a major trading hub for gold and other commodities.

The BBC's Imogen Foulkes in Geneva says there is growing pressure for traders and refiners to be more transparent.

Argor is owned partly by German company Heraeus, Commerzbank, and the Austrian Mint.

Public confidence in the European Union has fallen

Public confidence in the European Union has fallen to historically low levels in the six biggest EU countries, raising fundamental questions about its democratic legitimacy more than three years into the union's worst ever crisis, new data shows.

After financial, currency and debt crises, wrenching budget and spending cuts, rich nations' bailouts of the poor, and surrenders of sovereign powers over policymaking to international technocrats, Euroscepticism is soaring to a degree that is likely to feed populist anti-EU politics and frustrate European leaders' efforts to arrest the collapse in support for their project.

Figures from Eurobarometer, the EU's polling organisation, analysed by the European Council on Foreign Relations (ECFR), a thinktank, show a vertiginous decline in trust in the EU in countries such as Spain, Germany and Italy that are historically very pro-European.

The six countries surveyed – Germany, France, Britain, Italy, Spain, and Poland – are the EU's biggest, jointly making up more than two out of three EU citizens or around 350 million of the EU's 500 million population.

The findings, published exclusively in the Guardian in Britain and in collaboration with other leading newspapers in the other five countries, represent a nightmare for Europe's leaders, whether in the wealthy north or in the bailout-battered south, suggesting a much bigger crisis of political and democratic legitimacy.

                        

"The damage is so deep that it does not matter whether you come from a creditor, debtor country, euro would-be member or the UK: everybody is worse off," said José Ignacio Torreblanca, head of the ECFR's Madrid office. "Citizens now think that their national democracy is being subverted by the way the euro crisis is conducted."

EU leaders are aware of the problem, utterly at odds over what to do about it, and have yet to come up with any coherent policy proposals addressing the mismatch between the pooling of economic and fiscal powers and the democratic mandate deemed necessary to underpin such radical policy shifts.

José Manuel Barroso, the European commission president, said on Tuesdaythis week the European "dream" was under threat from a "resurgence of populism and nationalism" across the EU. "At a time when so many Europeans are faced with unemployment, uncertainty and growing inequality, a sort of 'European fatigue' has set in, coupled with a lack of understanding. Who does what, who decides what, who controls whom and what? And where are we heading to?"

The most dramatic fall in faith in the EU has occurred in Spain, where the banking and housing market collapse, eurozone bailout and runaway unemployment have combined to produce 72% "tending not to trust" the EU, with only 20% "tending to trust".

The data compares trust and mistrust in the EU at the end of last year with levels in 2007, before the financial crisis, to reveal a precipitate fall in support for the EU of the kind that is common in Britain but is much more rarely seen on the continent.

In Spain, trust in the EU fell from 65% to 20% over the five-year period while mistrust soared to 72% from 23%.

In five of the six countries, including Britain, mistrust prevailed over trust by sizeable margins, whereas in 2007 – with the exception of the UK – the opposite was the case.

Five years ago, 56% of Germans "tended to trust" the EU, whereas 59% now "tend to mistrust". In France, mistrust has risen from 41% to 56%. In Italy, where public confidence in Europe has traditionally been higher than in the national political class, mistrust of the EU has almost doubled from 28% to 53%.

Even in Poland, which enthusiastically joined the EU less than a decade ago and is the single biggest beneficiary from the transfers of tens of billions of euros from Brussels, support has plummeted from 68% to 48%, although it remains the sole country surveyed where more people trust than mistrust the union.

In Britain, where Eurobarometer regularly finds majority Euroscepticism, the mistrust grew from 49% to 69%, the highest level with the exception of the extraordinary turnaround in Spain.

A separate, more detailed study published this week on the impact of the currency and debt crisis and the austerity policies that have followed also found steep falls across the EU in faith in democracy and national political elites.

The study for the Cabinet Office by the European Social Survey, linking university researchers across the EU, found that soaring unemployment, anxiety and insecurity had eroded faith in politics.

"Overall levels of political trust and satisfaction with democracy [declined] across much of Europe, but this varied markedly between countries. It was significant in Britain, Belgium, Denmark and Finland, particularly notable in France, Ireland, Slovenia and Spain, and reached truly alarming proportions in the case of Greece," it said.

The financial crisis "not only eroded the objective economic conditions of many citizens, but also created widespread anxiety about a country's future even among those who did not experience hardship directly".

Faced with this erosion of political support and the battering traditional politics is taking from populist newcomers such as Beppe Grillo's Five Star movement in Italy, policymakers appear at a loss.

On Monday, Barroso said the austerity policies being applied, mainly under pressure from Berlin, had reached the "limits of political and social acceptance" and were "unsustainable" in their current form. On Tuesday, though, the commission in Brussels sought to row back on his remarks.

Within the eurozone, the key response to the crisis, apart from bailouts, has been to embark on a systematic surrender of budgetary and fiscal powers from national governments and parliaments to Brussels, as well as having countries being bailed out overseen by a "troika" of technocrats and economists from the commission, the European Central Bank and the International Monetary Fund. These are "federalising" steps in a long process of eurozone integration that might see it transformed from a currency into a political union.

"The EU has hit home and is here to stay as a watchdog of budgets, labour markets, pensions etc. This is unprecedented, and risky," said Torreblanca. "Unless it is fixed, it will feed the vicious circle between anti-EU populism and technocracy which we are currently seeing operating."

Barroso argued strongly in two speeches this week that federalism was the only answer to Europe's crisis of finances and of confidence. The German chancellor, Angela Merkel, brushing off widespread fears of a new German "hegemony" in Europe and the eurozone, also said that governments had to give up much more power to Brussels.

"We still haven't found the answer to the question of whether we're actually now prepared to unite on common economic parameters inside the single currency area," she said in a Berlin debate with the Polish prime minister, Donald Tusk. "If we want to have a common currency, a common Europe, we have to be ready to give up our hard-won habits … That means we have to be prepared to accept that in the end Europe has the final word in certain things. Otherwise we can't keep on building this Europe … To an extent, we have to jump over our own shadows. I'm ready for that."

But Tusk delivered an unusually stark warning that German prescriptions could bring increasing nationalism and populism across the EU in a backlash that was already well under way.

"We can't escape this dilemma: how do you get a new model of sovereignty so that limited national sovereignty in the EU is not dominated by the biggest countries like Germany, for example," he said pointedly. "Under the surface, this fear will be everywhere: in Warsaw, in Athens, in Stockholm. It will be everywhere without exception."

Aart de Geus, head of the Bertelsmann Stiftung, a German thinktank, also warned that the drive to surrender more key national powers to Brussels would backfire. "Public support for the EU has been falling since 2007. So it is risky to go for federalism as it can cause a backlash and unleash greater populism."

Ending the summit, Mr Putin said that world opinion was firmly against US-led intervention, and warned that Russia would take the Syrian side in the event of conflict.

“Will we help Syria? We will,” he said. “We are already helping, we send arms.”

He added: “We cooperate in the economics sphere, we hope to expand our cooperation in the humanitarian sphere, which includes sending humanitarian aid to support those people - the civilians - who have found themselves in a very dire situation in this country.”

Russia has been a long-time supplier of weapons to Syria, including a state-of-the-art air-defense system that would threaten even US warplanes attempting to attack. The Russian president said his country would stand with the Assad regime in Syria if the US launches airstrikes.

The apparent threat came as the G20 summit ended with a public split, 11 of its members issuing a statement hinting at the need for US action against the Assad regime of its alleged use of chemical weapons. Russia already supplies military aid to Syria, but the hint of more Russian backing in the event of a confrontation with the US sent jitters through financial markets worldwide.

Mr Putin also mocked Western leaders like US President Barack Obama considering intervening in Syria, suggesting that the majority of their electorates opposed any military action - including Prime Minister David Cameron for failing to persuade the Commons to back British involvement.

Mr Obama, meanwhile, compared the Syrian crisis to World War II, likening his country’s debate over intervention to the eventual American decision to support Britain against Nazi Germany.
 

Spanish fishermen have sailed into disputed waters off Gibraltar to protest about a reef put there by the British territory's government. The fishermen say the reef restricts their right to fish but Gibraltar says it will encourage sea-life to flourish.

The Royal Gibraltar Police said the protest, which appeared to pass off without incident, had ended.  The row over the artificial reef has led to tensions between the UK, Gibraltar and Spain in recent weeks. 'Not theirs' Spanish fishing boats sailed from the "Campo de Gibraltar" - the area in southern Spain just over the border from the British territory - to protest near the spot where Gibraltar recently dropped 70 concrete blocks into the sea to create the artificial reef.  The BBCs Tom Burridge, at the scene, said it was "chaotic and tense" as Spanish and Gibraltarian police boats and Spanish fishermen weaved among each other.

At the close of the demonstration, Gibraltar's chief minister Fabian Picardo tweeted: "Big thank you also to Royal Navy, Gib Defence Police, HM Customs and Port Authority for their deployment too. Cool, professional and calm!"

Meanwhile, GBC News, Gibraltar's public service broadcaster, posted: "Spanish fishermen's demo in #Gibraltar waters seems to have passed without incident. Most fishing boats returning to La Atunara now."

The IMF has wound up its latest inspection of the US economy - the so-called Article IV consultation - and has messages for the Fed and the government. The International Monetary Fund's executive board says deficit reduction has been "excessively rapid" and at the same time stresses that in order to minimise financial market volatility, the Federal Reserve must be clear about when and how it will exit its loose monetary policy stance. The assessment is available here. Highlights (with our own bolding up of key phrases, not the IMF's) from the Executive Board Assessment: Executive Directors welcomed the improvement in the underlying conditions of the U.S. economy, which bodes well for a gradual acceleration of growth, while noting that the balance of risks to the outlook remains tilted to the downside. Directors generally concurred that the fiscal deficit reduction in 2013 is excessively rapid, and that the automatic spending cuts (“the sequester”) not only reduce growth in the short term but could also lower medium-term potential growth. They stressed the importance of adopting a comprehensive and back-loaded medium-term plan entailing lower growth in entitlement spending and higher revenues. Together with a slower pace of deficit reduction in the short run, this fiscal strategy would help sustain global growth, place the U.S. fiscal position on a sustainable path over the medium term, and support the reduction of global imbalances... Directors broadly agreed that accommodative monetary policy continues to provide essential support to the recovery, but cautioned that its financial stability implications should be carefully assessed... Directors noted that the Federal Reserve has a range of tools to manage the normalization of monetary policy, but that there are significant challenges involved in unwinding accommodation, including risks of market reactions leading to excessive interest rate volatility that could have adverse global implications. They stressed that effective communication on the exit strategy and a careful calibration of its timing will be critical for reducing these risks.

A week of talks by Portugal's three main parties on how to end a political crisis has broken down, leaving the country's bailout programme in doubt. President Anibal Cavaco Silva is seeking a "national salvation" deal to back austerity policies demanded by EU and IMF lenders. But opposition leader Antonio Jose Seguro said the governing coalition had rejected most of his party's proposals.

He said it was now up to the president to decide how to end the crisis. It began nearly three weeks ago with the resignation of the finance and foreign ministers.

Foreign Minister Paulo Portas was unhappy with the extent of the austerity measures needed to comply with the conditions set in the 78bn euros ($102bn; £67bn) bailout received in May 2011.

Finance Minister Vitor Gaspar - seen as the architect of austerity - quit because of a lack of support for his approach.

Lisbon has had to request a delay in the eighth review of the bailout by its creditors. The review was due to start last Monday but has been put back until the end of August or early September.

Coalition parties made no comment in the immediate aftermath of the talks on Friday.

However, socialist leader Mr Seguro told reporters: "There were two different visions to exit the crisis. That being clear, it made no sense to continue negotiating for the sake of negotiating."

Analysts say the president could still avoid an escalation of the crisis by keeping the governing coalition in place rather than calling a snap election.

The austerity cuts are widely blamed for keeping Portugal in recession over the past two years, angering trade unions and left-wing parties and causing a wave of street protests.

On Friday, Portuguese government bonds had outperformed others in Europe on hopes of a deal.

The BBC's Alison Roberts in Lisbon says there are now fears that the markets will take a tumble on Monday

Fiat money ...and than some...

The global economy cannot operate without fiat money  - it is too big. To be successful a thriving economy needs an expanding money supply. Unfortunately our expanding money supply has been achieved by commercial banks creating new money as a debt to them. Their greed ensured it got out of hand and now they are destroying money as quickly as they can "shrink their balance sheets" as they call it. It should never have been allowed to happen. The new money needed by thriving economies should have come in as debt free money created by the BOE/Treasury to pay government expenditure on normal outlays or on new infrastructure - or, of course as lower taxes. Just as with money created by the banks as debt, too much will cause inflation and too little will result in recession, deflation and ongoing depression - which is where we are now. But at least money created as cash does not have that debt to service. It is the creation of money as debt that has got us into the mess we are in. Ironically it is also the creation of money as debt that has prevented the excess that has been created causing hyper inflation. I'm afraid the banks are not fit for purpose; they are self programmed to cause Boom and Bust...  Well, the current experiment with fiat money has certainly demonstrated that central banks cannot be trusted to run the system.  That aside, the principle of fiat money only has peripheral connection with the size of the money supply - and will always tend towards fraud. There is no reason not to have an asset-correlated money supply assuring that money supply only increases in line with productivity.  Anyway, it appears that Stein's law applied to consumer leveraging has finally kicked in so the necessary correction may well happen on its own and the central bankster-induced super-bubble burst. Let's see what the Keynesians have to say as the consumer deleveraging gains pace...

 

FRANKFURT—Germany's central bank Friday cut its growth forecast for Europe's largest economy this year and next, tying the nation's fate to whether the euro-zone emerges from recession. "Much will depend on whether the economic situation stabilizes in the euro-area crisis countries," Jens Weidmann, president of the Deutsche Bundesbank, said in a statement. In its semiannual economic projections, the central bank lowered its growth forecast to 0.3% this year from its December estimate of 0.4% expansion, and reduced its forecast for 2014 growth to 1.5% from 1.9%. Germany has managed ride out the euro-zone crisis while many other European economies have floundered, but weak investment and sagging exports amid recession in some euro-area countries and the slowing global economy caused Germany's economy to contract sharply in the fourth quarter. Germany narrowly escaped recession in the first quarter, when its gross domestic product, a measure of economic growth, increased just 0.1%, on the back of robust private consumption. The Bundesbank's forecasts follow those of the European Commission, which last month lowered its 2013 growth outlook for Germany to 0.4% from a previous estimate of 0.5%. Earlier this month, the International Monetary Fund also cut its estimate for German growth in 2013 to "around 0.3%" from 0.6%. Despite the dulled forecasts, the Bundesbank said Germany's economy is slowly picking up again, as other euro-zone economies bottom out and the world economy gains momentum. A solid labor market, wage increases and a general easing of inflation are supporting private consumption in Germany, Mr. Weidmann said. According to the Bundesbank, consumer price inflation, as measured by the Harmonized Index of Consumer Prices, is set to accelerate modestly this year to 1.6% from its December forecast of 1.5%. Next year, it will slow to 1.5%, the central bank said.

Who gives these people the right to change the rules that many signed up for years ago? Nothing is sacred anymore and no one can be sure that their investment in making provision for retirement and their families is safe. Unelected mad men hell bent on creating more and more regulation and more and more control of the individuals rights to care for themselves. This one might have been stopped or delayed but you just know they are working on other ways to screw the little man.  I am in the US but more than half of my retirement funds are in UK investments that I toiled for, for years and its already been f####d over by the Brown government. Worse that it's my money but I can't take it out of the UK because of punitive rules it is still vulnerable to these  idiots in Brussels. Where did the people give the right to have this controlled outside of British sovereignty? The rules, known as "Solvency II", would have required schemes to hold more much money in reserve. Experts say that their introduction would have caused every remaining pension scheme in the private sector to close.  The European Commission announced today that it would not include solvency rules in a new pensions directive, effectively kicking Solvency II into the long grass.  It said: "Commissioner Barnier has indicated his intention to come forward with a proposal for a directive to improve the governance and transparency of occupational pension funds in the autumn of 2013.  "At this stage, and as long as more comprehensive data is needed and Solvency II is not in force, the proposal for a directive will not cover the issue of the solvency of pension funds. In light of the differing situations in member states regarding retirement products and pension funds, it is necessary to continue technical work on the issue of solvency."  The National Association of Pension Funds (NAPF) said this meant the Solvency rules had been postponed indefinitely and would become a task for the next commissioner, who will take office in November 2014.

YESSSS.... DOWN WITH THE 4th Reich and Bruxelles Natzies !!!

Nigel Farage, the Ukip leader, has declared his party is on course to change the face of British politics in the wake of its strongest performance in local elections, making a series of gains across England...In the biggest surge by a fourth party in England since the second world war, Ukip averaged 26% of the vote in council wards where it stood, according to a BBC estimate.

The Ukip success saw Farage's party deprive the Conservatives of control of Lincolnshire county council after gaining 16 seats to become the main opposition. The Tories also lost control of Gloucestershire, where Ukip gained three seats and Labour gained four.This is fantastic news. Anything that pulls votes away from the Tories or pulls the Tories away from the center will damage them. See what happened to the republicans in the USA: dragged further away from the political center by the Tea Party, they made themselves unelectable. And single-issue parties will never have any long term impact in British politics. GO UKIP!...Nigel Farage, the Ukip leader, has indicated Ukip are not looking for power - but influence.   He compared the role of UKip to that of the SDP in the 1980s which, he argued, pushed Labour into a rightwards turn. Tony Blair, he said, was an "SDP Prime Minister."

He said: "I accept when it comes to a General Election we have a problem, that is the first-past-the-post system.

He said of the SDP: "They fundamentally changed the entire Labour Party - Foot and Benn and the hard left were all gone and the new modernising Labour Party ... with people like Peter Mandelson in strong positions.  "If ever there was a pressure group in British politics it was the SDP."   The Ukip leader said his goal was to "fundamentally change" British politics, insisting it "can happen".

Mr Farage told the programme he did not feel he was a Tory but supported the reforms made in the 1980s.

"We need radical reform and I am absolutely certain the getting back control of our country ... there is now a settled majority out there that wants us to get our country back," he said.

GERMANY–Deutsche Bank said Monday it will raise €2.8 billion ($3.65 billion) in fresh capital in a dramatic about-face for the bank, which has repeatedly said it won't turn to shareholders for help boosting its capital cushion. The bank, Europe's second-largest by assets, has long faced doubts from investors and analysts about whether it has enough capital to absorb potential future losses and to meet increasingly stringent regulatory requirements. On paper, Deutsche Bank had one of the thinnest capital ratios of large European banks.  The Basel rules don't fully kick in until 2019, but banks across Europe are under pressure from regulators and investors to comply with the rules well before then. Few investors or analysts expected the bank to meet the targets in 2013.  The size of Deutsche Bank's capital hike is relatively modest compared with what some bankers, analysts and investors think it needs. Analysts previously estimated the bank needs up to €10 billion. Deutsche Bank executives have been meeting in recent weeks with senior investment bankers to sound them out about how much capital the bank would need to raise to placate investors, according to people who participated in the meetings. The bankers' response: Deutsche Bank should come up with at least €6 billion and possibly as much as €10 billion to put the capital concerns behind it, these people said. The bank's change-of-heart apparently stemmed from executives' frustration with the lack of reaction among investors to the bank's strategic changes, according to industry officials. The bank's management felt they could raise a token amount to alleviate market concerns without destroying credibility, these people said. "This is a blatant U-turn," said a senior investment banker who was involved in the talks. "It's a real climb-down for them."  The timing of the capital increase could raise questions because earlier this year, with Deutsche Bank's stock trading more than 15% above its current levels, executives insisted they had no plans to raise new capital. If they had proceeded with the share sale at the time, they could have raised more capital by selling a fewer number of shares, a preferable outcome for the bank's existing shareholders. While Deutsche Bank didn't disclose the terms of the share sale, industry officials said the deal's structure would likely involve a small number of big institutional money managers picking up the shares at a small discount to the stock's current trading price. Because the share sale is relatively small, Deutsche Bank doesn't need to go through the process of offering all existing shareholders the right to participate, a potentially costly and complex process that Deutsche executives were eager to avoid....NOW, WE ALL KNOW THAT THE fed PUMPED OVER 25 TRILLION DOLLARS IN THIS BANK IN THE PAST TWO YEARS !!! Show us the money Mrs. Merkel !!!!

We are gradually realising how stupid and falsely mis-led we have become...

We are gradually realising how stupid and falsely mis-led we have become. - Fundamentally, it is energy and a cheap supply of energy that fuels our economy - not the bankers, and the monetarists who now rule over the hegemony of the market. Their 'stake' in the economy, is largely 'unreal', what is 'real' is energy, and particularly oil, and the products it manufactures.

We see this we've all the propaganda about Thatcher. She wasn't the 'Iron Lady' - a personality cult - she was the 'Oil Lady' - her crude policies were made possible through crude oil.

Without a supply of cheap energy, there can be no cheap production of goods, or pump-priming consumption, or financial inflation in the developed world making us 'feel' rich.

The 'first world consumers' / 'third world producers' model of global capitalism is gradually breaking down because the producers are catching up with the consumers - in a race to the bottom - driven by economics (and crippling debt levels) and an increasing lack of cheap energy.

The average man or woman in the west, is having to pay more for their fuel/food bills than ever before. They can't afford to buy the latest goods made in India or China. They could only afford to do so, latterly, through building up debt, which they are now having to pay back, and at the exact same time, the cost of living, i.e. food and energy is going up.

I think that is what is being revealed to us. Economic debt is the tip of the iceberg, with energy distribution being the mass of the ice berg. Consequently, our high living standards cannot be sustained - economically, or more importantly - via high energy consumption.

Economics in many ways is only a proxy measurement for energy consumption. Where there is a high consumption of energy, there are developed economies. Where there is a low consumption of energy, there are developing economies. Modernity is based on oil and energy development - primarily, and economic development - secondarily. We seem to have completely forgotten which way around things go.  We've certainly become consumer junkies in the developed world, but the things sustaining that (cheap, plentiful energy and cheap, plentiful debt) is no longer available to us.

The question is what comes next? What are we as 'consumer junkies' going to demand? A rational and reasonable solution that suits most people doesn't seem possible, as long as people keep buying into what they're currently sold.

We are witnessing the unraveling of the hard truth: The economy is built largely on the reality of finite energy resources, not on the unreality or symbolism of money as a resource.

Thatcher is dead, and her economic philosophy is dying because, as we are seeing - it is wholly false ideology - not based on the core truth of what makes modern life; modern economics; modern politics; and modern society, possible and 'sustainable': oil and energy resources.

Investors are once again being spooked by political uncertainty from both Spain and Italy as both countries deal with local political difficulties that could derail ongoing and future reform programs.

While markets appear able to shrug off bad economic data, as Spain January unemployment jumps 132k, it is politics once again that has markets worried as Spanish PM Rajoy deals with a corruption scandal over illegal cash payments that could have the potential to seriously damage his government.

Even in Italy the calm waters of recent weeks have hit stormy seas as the general election campaign starts to see a rise in support for Berlusconi which has increased the risks of political deadlock post-election rising here as well....

A team from the IMF visited Madrid at the end of January to check on the status of aid it had received to recapitalise its banks.

What a bunch of BS ...ohhhh. gooood ...In a statement released today, the IMF said: "The clean-up of undercapitalized banks has reached an advanced stage, and key reforms of Spain’s financial sector framework have been either adopted or designed.

"Indeed, the bulk of all of the measures for the entire program have now been completed."  In particular, it added that action was being taken to address banks' capital shortfalls.

"This clean-up is a major achievement that should strengthen confidence in the system and improve its ability to support the real economy," the IMF said.

"Remaining elements of the recapitalization and burden sharing exercise should be completed in a timely manner and in ways that minimize taxpayer costs."

MADRID—Spain's central bank said a recession in the euro zone's fourth-largest economy deepened slightly in the final quarter of last year, but it said austerity cuts are bringing the country's runaway budget deficit under control. In the first estimate of fourth-quarter economic performance, the Bank of Spain said the economy contracted 1.7% compared with the same period a year earlier and likely contracted 0.6% from the previous quarter. In the third quarter, the economy had shrunk 0.3% from the previous quarter, and 1.6% on an annual basis. The Bank of Spain said gross domestic product fell just 1.3% in the whole of 2012, which was less than the 1.5% contraction anticipated by the government and a sign that strict budget cuts across the board are having a less detrimental effect than some feared. It cautioned that continuing cuts could still weigh on an economy already hurt by efforts to trim debt. "This budget consolidation effort has had a net contracting effect on activity throughout the year, especially in the last few months," the central bank said. This year, meeting even stricter austerity targets "will require an additional, very ambitious fiscal effort by the central and regional governments." Those comments are in line with heightened concerns by local and foreign observers that accelerated austerity measures promoted by the European Union are self-defeating, as a collapse in economic activity makes it harder to boost tax revenue, putting pressure on budget deficits. Earlier this month, the International Monetary Fund said it revising its metrics for how quickly governments should cut their budgets and the IMF's top economist Olivier Blanchard made the case that Europe's fiscal tightening has been too severe. "We do need to reduce the deficit, but the EU should be more flexible about the deadlines," said Josep Comajuncosa, an economics professor at Spain's ESADE business school. "Requiring a fast and drastic reduction of the public deficit could backfire. The deficit target should be pushed back one or two years." The central bank said tax revenue increases in recent months will make it easier for the government to get closer to its target of lowering the 2012 budget deficit to 6.3% of GDP from 9% in 2011. The target for this year is 4.5% of GDP. The latest data available, the central bank said, indicates tax revenue picked up in recent months due to higher value-added and corporate tax receipts, while expenses fell after the government suspended an extra monthly payment for civil servants and decided not to adjust pensions for inflation—two measures which eroded popular support for Prime Minister Mariano Rajoy. Spain's statistics institute is due to release an official preliminary estimate of fourth-quarter GDP Jan. 30. Full data on Spain's 2012 budget deficit, including for regional governments, will likely be released late February.(sursa : WSJ)

MY POINT OF VIEW : David Cameron is now speaking more like the type of person of Scots ancestry, whom I’ve known throughout my life, in four different countries. I, too, was named after the Old Testament legend. Let us hope this David is able to skilfully negotiate, with his slingshot, an escape from the crushing, networking giant of the Continent, knowing euphorically as the ‘Guy Fawkes Club’ – to put it into context. As every attempt has been made to make the bible look irrelevant in today’s world (just see what Romans Ch1v22-32 says of homosexuality), those directing the course for British governments seemingly more concerned to make it easier for the Anglican church to be gobbled up by the Guy Fawkes Club – which long ago gave up any pretence of following Scripture (apart from the subject of marriage – talk of straining at a gnat...swallowing a camel)! Perhaps David has done a crash course in Comparative Religion, and has noticed how undemocratic it has been, for mostly Romans to have held key positions in government & quasi government organisations since UK membership of the Common Market – if only because no decent, self respecting Protestant could bring his/herself to be involved in the systematic destruction of the English Speaking peoples, to advantage that jealous rabble on the Continent. Which Cardinal was it who said, ‘Secret mines may take the town when open batteries fail,’ – on the very same subject ! At last, David Cameron is speaking like a Prime Minister of the Greatest little Britain of all time! UK only started to prosper, to the benefit of the rest of the world, also, when Henry VIII cut the haemorrhage of resources to Italy, & UK began to stand on her own two feet, trusting only in holy scripture, & herself. Mussolini’s mentoring Hitler was meant to reverse all that, & when it didn’t, citizens steeped in Mussolini’s theory & logic began settling in the nations of the victors after cessation of WW2 hostilities, with Mussolini’s Plan B. Part of that was Franca Arena’s setting up our first ever republican movement in Australia, & Ray Bellisario, family also from Italy, setting up England’s first republican movement since Cromwell, to discredit the leadership which caused Mussolini to lose, while other aspects of his culture were trumpeted as superior both directly & subliminally in influential nations, so that, for instance, cat spew chino & pissa (my spelling) became something considered superior, & with an arrogantly assumed dash of romance attached to it. A sense of inferiority amongst the nationals of some other countries, about their own cultures, only helped feed the appetite for self aggrandisement, of those keen to rebuild a new Roman Empire. To assist in this plan the IRA were entrusted with the removal of those who could have warned Great Britain’s leadership what was really going on: battle experienced heroes like the Queen’s relative, Earl Mountbatten, & Airey Neave, MP. I fear, though, that Cameron’s telling the nation how he would vote in any referendum, will tend to make it a foregone conclusion, as voters seem to follow what is seen as the ‘party line.’ Even the Soviet Union discovered that ‘individualism’ whether as nations or as persons, do far better when left to find their own level, instead of being part of some vast metaphorical farm growing peanuts, with individual humans’ means of self expression being emasculated – as though ‘bigger’ is ‘better !’ The communist experiment failed, so why allow catholic activists promote the lie that the British were better off under the Treaty of Rome? It has been an entirely religion driven exercise, cynically aimed at achieving what Mussolini failed to during WW2.

As there will now be another meeting of the eurozone finance ministers next Monday (November 26), the Greek Prime Minister Antonis Samaras has postponed a visit to the wealthy Gulf state of Qatar, which was due to happen next week. "The prime minister will stay in Athens to coordinate things," spokesman Simos Kedikoglou told Reuters. Samaras was due to meet Qatar's emir and prime minister as well as top officials from Qatar's sovereign wealth fund to discuss investment in the country's recession-mired economy.  The German Finance Minister Wolfgang Schaeuble also spoke after the meeting. He told lawmakers at a closed-door session that Greece's lenders remained divided over how to fill a €14bn hole in the country's finances through 2014 and how to define debt sustainability for the eurozone's weakest link, participants told Reuters. Schaeuble met members of parliament on Wednesday morning to explain the failure of the negotiations. One participant said Schaeuble had told members of his conservative party that lenders had failed to resolve the issue of whether 2020 or 2022 would be used as a benchmark for Greek debt sustainability. The source said Schaeuble had explained that the ECB believed Greece could raise €9bn itself by issuing short-term debt. Another Christian Democrat lawmaker said the minister had told participants that a debt buyback could be part of the solution.

At least the Greeks, the Spanish and the Portugese are starting to fight against the rape of their countries by the EU and the IMF.
Unlike the spineless Brits who just bend over and take it, from Cameron and his Atlantic Bridge coterie.
The fire-sale is under way, and the taxpayer will be paying for the largesse enjoyed by the shareholders and parasites of the multinationals.

It isn't going to be a two-speed Europe; it is going to be Greater Germany and the rest. And sooner or later, if Angie is still in office, she is going to be kowtowing to a (German) president of Europe. Only vassal states need apply. And they have. It's just that one or two are choking on the small print....Anthee Carassava is on the ground in Athens and she writes:

Thursday's protests are part of a 24-hour nationwide strike the country's two biggest labour unions have organised as European leaders meet in Brussels to decide the fate of the single currency. It is the second job walk out millions of Greeks have taken to in three weeks; the 20th since the financial crisis here erupted nearly three years ago.

“Just once,” said Yannis Panagopoulos, head of the GSEE private sector union, “the government should reject [international] lenders’ absurd demands. “Agreeing to catastrophic measures means driving society to despair and the consequences as well as the protests will be indefinite.”

From taxi drivers to doctors and diplomats, the strike is expected to paralyze an already suffocating economy. Ships remained docked, hospitals were operating on skeleton staff, and dozens of domestic and international flights face cancellations leaving travelers stranded as air traffic controllers joined the protest, keeping aircraft grounded and the country isolated from the rest of the world for three hours.

At least 4000 police have been deployed in the city centre alone. At least 12 buses of riot police and three water canons were propped outside parliament, shielding the building -- a favourite target of protests -- from militant demonstrators.

TRUTH IS : Private sector activity shrank for the tenth time in 11 months

Who on earth is investing to raise these stock markets so high? If I were Warren Buffet I would say this is a typical bubble Companies are not making real profits Banks aren't either so who is doing the investing????...Bond yields are down, oil prices high, USA crops are devastated by drought, housing in USA is still very much wasted. So are "the powers that be" simply doing what analysts do talking up the benefits of share ownership until even "my mate Joe Blw" decides that investing in stocks beats keeping his money under the mattresse ? I have had it with markets banks and politicians lies and deceits. I am closing all my banking accounts and simply paying in earwigs from now on.We are living in the Alice of Wonderland World. The more bad economic data we gets, the more the worlds stock markets rise..... Hopes that Europe’s leaders will act decisively drowned out weak data showing the eurozone endured another torrid month in July. Private sector activity shrank for the tenth time in 11 months and pointed to a 0.6pc rate of quarterly contraction, according to the purchasing managers index. Offsetting that was the strong US jobs data. July saw 163,000 people find work in the world’s largest economy, beating forecasts of 100,000. The sense of relief was sharpened because almost all the recent US data have pointed to a deterioration since the first quarter of the year. “It will alleviate fears that the US might be tipping back into recession,” said Nigel Gault, an economist at IHS Global Insight. The utterly repellent EU freak show stumbles from crisis to crisis, a crisis which conveniently gives the bureaucrats an excuse to force member countries into a fiscal union with budget control being handed over to Brussels, effectively crushing the last breath of democracy of the nation state in favor of an EU super state, but the light of freedom, sovereignty, cultural identity and the ability to decide one owns destiny will not be extinguished whilst the euro sceptics still have a voice. The common market worked well, that is where Europe should be heading not more Europe.....However : While U.S. employers hired an additional 163,000 "human resources" they also sacked an additional 195,000 "human resources" last month, including a decrease of 228k full-time jobs which was only partially offset by a 31k rise in part-time jobs (defined as 1 to 34 hrs/wk). Furthermore, a new group of 199,000 Americans joined the "Working-Age" pool last month and will need jobs as well. Not only is the U.S. economy in such a severe situation as reported, it is, in fact, in a worse one. Currently some 87 million Americans, or about 36% of the working-age population of the U.S., are no longer even looking for work and are considered "out of the labor force." If it were not for workers who dropped out of the labor force, the real UE rate would be far north of 11%. All of this MSM "rah-rah" reporting and "growth and recovery" hopium smoking needs a reality check.

The collapse of our debt based monetary system is a lot closer than many people think.

Moody's Investors Service downgraded Greece's sovereign debt rating yet again on Friday, dropping it to the lowest possible level after a debt-restructuring deal left private creditors facing heavy losses --- REUTERS - Moody’s Investors Service on Friday cut Greece’s sovereign debt rating to the lowest possible level after a debt-restructuring deal that imposes hefty economic losses for private creditors.... Moody’s lowered Greece’s local and foreign-currency bond ratings a notch to C from Ca, becoming the third credit rating agency to downgrade the country following the announcement of the swap deal to lighten its debt burden. Moody’s says that bonds rated C “are the lowest rated class and are typically in default, with little prospect for recovery of principal or interest.” The rating agency added that it did not assign any future outlook. “The announced debt exchange proposal,” the credit rating agency said in a statement, “implies that private creditors that participate will incur substantial economic losses on their holdings of the Greek government debt.” On Monday, Standard & Poor’s cut Greece’s long-term ratings to “selective default,” the second ratings agency to proceed with a widely expected downgrade after the country announced the bond swap. Fitch had announced a cut to its lowest rating above default last week. Greece formally launched the bond swap a week ago. Under the deal, which is part of a second 130-billion-euro rescue package to claw Greece back from the brink of a disorderly default, bondholders will take losses of 53.5 percent on the nominal value of their Greek holdings, with actual losses put at around 74 percent. According to Moody’s, “the announced proposal for private sector involvement, a precondition for the provision of further financial assistance from the euro area, would constitute a distressed exchange, and hence a default, on Greek government bonds.” The rating agency makes a distinction between a distressed exchange - where investors are losing money - and an outright default that is likely to happen when the exchange does not take place. “Both these conditions are met in this case,” Moody’s said. When the Eurogroup’s assessment has been finalized and debt exchanges have been completed, Moody’s will re-assess the credit risk profile and ratings of any outstanding or new securities issued by the Greek government. Moodys’ concludes that “the risk of default even after the debt exchange has been completed remains high,” and any upward movements in Greece’s sovereign ratings after the debt exchange are likely to be small.

hahahaha,,,I am absolutely shocked! Putin, the "underdog", has actually won ? This just proves that it is indeed possible to be "honest and still win" a Russian election. So another 10 years of midget nr 1 = Mr Putin then 5 years of his midget lapdog then another 10 years of Putin then another...I am becoming dizzy just thinking about it. Boy, am I glad that I am not Russian!...Oh no...I am baffled !!!

TWO NAMES : Horst Reichenbach = GREECE'S APPOINTED GOVERNOR and Klaus Regling = CEO - ESFS !!!! THE GREEKS ARE WRIGHT !!! ...At a press conference Mr Sarkozy said: "Our Greek friends must decide whether they want to continue the journey with us. "We cannot commit European taxpayers' money unless the rules unanimously adopted in Brussels are respected to the letter." He was flanked by Mrs Merkel, who added: "The referendum will revolve around nothing less than the question: does Greece want to stay in the euro, yes or no?" David Cameron said that the world was facing a "financial storm" as Greece may now be forced out of the single currency. Simon Johnson, the former chief economist at the IMF said Europe was "looking straight into the face of a great depression". The National Institute of Economic and Social Research said that Britain had a 70 per cent chance of falling back into recession under the "increasingly more likely" scenario that the euro crisis will not be resolved imminently. The Prime Minister will travel today to the G20 summit but is expected to be little more than a bystander as key meetings take place between European and American leaders. The British government has refused to contribute money to help the euro but European leaders are expected to lobby the Chinese, Russians and Brazilians for loans. An EU diplomat claimed last night that European leaders thought they had been misled by the Greek prime minister – as he had used the threat of a referendum during a eurozone summit last week in order to win concessions. "Everyone thought the threat had been dropped. Only one way to describe this: 'absolute bloody fury'," said the diplomat. "If it wasn't a case of mutually assured destruction this would be the moment that it is game over for Greece." With Greek national opinion currently against perceived European interference in its affairs, the country could be forced out of the single currency in a disorderly and chaotic manner. The removal of EU support comes as Greek politicians begin discussions on whether to vote in favour of a no–confidence motion in Mr Papandreou, which could trigger the government's collapse. European leaders are hoping that, by increasing dramatically the pressure on Greece, politicians may demand that the referendum is scrapped. An IMF source said: "The [IMF] board would not want to give money to Greece and then wonder what will happen. The board will want comfort that Greece will fulfil its commitments and right now Papandreou is unable to give that." There are mounting fears that the Greek crisis will fatally undermine Italy's economy in the coming days.