Schauble supports a European government,which clearly means that Merkel does too. Both of them know well that such a government will be dominated by the Germans, know the the Krauts will have the major voice in policy decisions.The notion that voters in E.U. states might not care for sovereignty losses, in effect to Germans seems to be of little concern to them and to to Trichet.  Recently Merkel called for 'More Europe' with sovereignty surrenders, an echo of what a former Chancellor Gerhard Schroeder called for last year a United States Of Europe.To repeat ,any USE would be German dominated so in effect what Merkel , Schauble,Schroeder want is a United States Of Germany,which would give Merkel much more scope for her arrogance and meddling in the internal matters of other states, like telling voters in France to back Sarkozy..Where will she next meddle will she try in in the UK in 2014, imagine the vitriolic reaction, I would love it?  Last year Merkel told David Cameron to accept a financial transactions tax,it is not for any German to tell a British P.M. even one as weak as Cameron what to do.  It is I think inevitable that in the U.K. an E.U. referendum is inevitable despite the lying reasons from Cameron, Clegg, Milliband for not holding one,I want to cast my vote.If eurosceptism continues to grow such a vote might be to leave the E.U.,I have a feeling that in many E.U. members such a result would be welcome....  For starters, the Stability and Growth Pact (SGP), intended to ensure sound fiscal policies in the eurozone, was never correctly implemented. On the contrary, in 2003 and 2004, France, Italy and Germany sought to weaken it. The European commission, the European Central Bank and the small and medium-sized eurozone countries prevented the SGP from being dismantled, but its spirit was gravely compromised.  Moreover, eurozone governance did not include monitoring and surveillance of competitiveness indicators – trends in nominal prices and costs in member states, and countries' external imbalances within the eurozone. (In 2005, long before the crisis, I called, on behalf of the ECB's governing council, for appropriate surveillance of a number of national indicators, including unit labour costs). A third source of weakness is that no crisis-management tools were envisaged at the euro's launch. For much of the world at the time, "benign neglect" was the order of the day, particularly in the advanced economies. Finally, the high correlation between the creditworthiness of a particular country's commercial banks and that of its government creates an additional source of vulnerability, which is particularly damaging in the eurozone.

AP - The head of Belgium's federal agency for nuclear safety AFCN said on Friday he was "sceptical" that an ageing reactor closed over fears of cracks could be restarted.  "I'm fairly sceptical for the moment," Willy de Roovere told RTBF public radio, even if "the possibility remains that I am wrong."

According to French-language daily Le Soir, a crack of between 15 and 20 millimetres (0.6 and 0.8 inches) was discovered during a test in June. There has been no denial of this report.  According to the agency, repairs are "practically impossible" and are "not an option" for fear of creating new tensions "which we must avoid at all costs."  Installing a replacement meanwhile has never been attempted anywhere because of the problem of high radiation levels.

The AFCN revealed on Wednesday that the Doel 3 reactor, located 25 kilometres (20 miles) north of Antwerp, would remain closed at least until August 31 after the discovery of possible cracks in the protective vessel surrounding the core during routine June testing.  The agency is also mulling the permanent closure "in the worst case" of a second reactor in the country's south near Liege.

The tests showed "faults in the steel base material" on which the reactor vessel is mounted, the AFCN said.  The Dutch firm, Rotterdam Drydocks, that made the vessels is out of business, which has amplified concerns about others it delivered in Europe and in the Americas.

Spain has indicated it has two reactors in the same bracket, Switzerland and Sweden one each.  The firm supplied one to the Netherlands, but had not manufactured it. The government in The Hague said it has still to decide whether to test its nuclear facilities. The German government said reactors supplied by the defunct company were no longer in service.

Representatives of nuclear safety bodies from all the countries involved will meet in Brussels on August 16 to "exchange information," the AFCN said.

"Indignados" in Spain

"Que se vayan todos," or "Away with all of them," became one of the slogans chanted by the tens of thousands of "Indignados" in Spain at protests last year. In addition to their eponymous outrage, many had one thing in common: Most were young and viewed themselves as victims of the crisis.

They might have been more specific and instead chanted: "All the old people must go!" This phrase would apply because, in many ways, the euro crisis is also a conflict between generations -- the flush baby boomers in their fifties and sixties are today living prosperously at the expense of young people.

Intergenerational equity -- measured among other things by levels of direct and hidden debts and pension entitlements -- is particularly low in Southern Europe. In a 2011 study of intergenerational equity in 31 countries by the Bertelsmann Foundation, Greece came in last place. Italy, Portugal and Spain didn't do much better, landing in 28th, 24th and 22nd place respectively. Currently, the unequal distribution of income and opportunities is particularly distinct:

The employment market collapse has hit young Europeans much harder than older generations. In Greece and Spain more than half of those under age 25 are unemployed -- twice the rate of older workers. Things are even worse in parts of southern Italy, where youth unemployment has risen above 50 percent. One reason for this situation is unequal employment circumstances. Older Spaniards and Italians, for example, profit from worker protection laws preventing them from getting fired that are quite strong by international comparison. But almost half of young Italians and 60 percent of young Spaniards are on temporary employment contracts and can easily lose their jobs.  The burdens and risks of the euro bailouts are also mainly borne by young people. Ultimately, growing national debts and bailout funds worth billions will be financed through bonds that won't be due for many years to come.

I am with the faux Angela Merkel (Queen of Europe ) on this - using a fund that doesn't exist - and if not the ESM then who is picking up Spain's share of the ESFS?

Brussels, 29 June 2012 - EURO AREA SUMMIT STATEMENT - 29 June 2012  • We affirm that it is imperative to break the vicious circle between banks and sovereigns. The Commission will present Proposals on the basis of Article 127(6) for a single supervisory mechanism shortly. We ask the Council to consider these Proposals as a matter of urgency by the end of 2012. When an effective single supervisory mechanism is established, involving the ECB, for banks in the euro area the ESM could, following a regular decision, have the possibility to re capitalize banks directly. This would rely on appropriate conditionality, including compliance with state aid rules, which should be institution specific, sector-specific or economy-wide and would be formalized in a Memorandum of Understanding. The Eurogroup will examine the situation of the Irish financial sector wit the view of further improving the sustainability of the well-performing adjustment programme. Similar cases will be treated equally.

• We urge the rapid conclusion of the Memorandum of Understanding attached to the financial support to Spain for overcapitalization of its banking sector. We reaffirm that the financial assistance will be provided by the EFSF until the ESM becomes available, and that it will then be transferred to the ESM, without gaining seniority status.

• We affirm our strong commitment to do what is necessary to ensure the financial stability of the euro area, in particular by using the existing EFSF/ESM instruments in a flexible and efficient manner in order to stabilize markets for Member States respecting their Country Specific Recommendations and their other commitments including their respective timelines, under the European Semester, the Stability and Growth Pact and the Macroeconomic Imbalances Procedure. These conditions should be reflected in a Memorandum of Understanding. We welcome that the ECB has agreed to serve as an agent to EFSF/ESM in conducting market operations in an effective and efficient manner.

• We task the Eurogroup to implement these decisions by 9 July 2012.

I am with the faux Angela Merkel (Queen of Europe ) on this - using a fund that doesn't exist - and if not the ESM then who is picking up Spain's share of the ESFS?

Italy borrowing at 6% to lend to Spain via the ESFS at 3% sounds like a great plan. Or maybe it isn't.

EU leaders are due to discuss measures for closer integration

There is a consensus in the corridors of power that if any eurozone member defaults or leaves, contagion and collapse are assured. This is a fairy tale designed to frighten voters into submission to bizarre government policies. It also ignores two historical lessons. ---GERMANS could vote in a referendum to decide whether to stay in the European Union, an ally of Chancellor Angela Merkel indicated last night. Wolfgang Schaeuble, Germany’s finance minister, said a poll may be needed to get agreement on moves towards closer economic and political union in response to the euro crisis. He suggested it could be held sooner than anyone expected – despite the fact that Germany largely outlawed referendums after Hitler’s misuse of them to manipulate public opinion in the 1930s. Mr Schaeuble’s outburst in a German newspaper, ahead of this week’s crucial summit of EU leaders in Brussels, has led to widespread surprise in Germany. They also sparked renewed calls at home for a referendum on Britain’s membership of the EU. Mr Schaeuble said: “Those who want a strong Europe also have to be willing to surrender decisions to Brussels.” He admitted this could strain Germany’s constitutional law and said such a change would require the German people to decide. Asked directly if the country could soon hold an EU referendum, he replied: “I assume that it’ll happen sooner than I would have thought a few months ago. I would have said, ‘In five years? Never!’ But now I'm not so sure.” Tory MP Douglas Carswell said last night: “If Germany can have a referendum despite tough rules limiting such votes, then why the heck can't we?” Paul Nuttall, a Euro-MP and deputy leader of the UK Independence Party, said: “Taking lessons on democracy from the Germans – isn't that a bit shaming, Mr Cameron?” EU leaders are due to discuss measures for closer integration for the 17 eurozone countries this Thursday, including a “banking union” and more centralized economic planning.
Reuters has now got hold of the document prepared for this week's eurozone summit. The report was compiled by European Commission President Jose Manuel Barroso, European Council President Herman Van Rompuy, European Central Bank President Mario Draghi and President of the Eurogroup Jean-Claude Juncker (pictured below with Draghi). According to the newswire, it suggests the eurozone could create a treasury for the single currency and issue eurobonds in the medium term as the final stage of a fiscal union. ---- Here are some other snatches from the report: In a medium-term perspective, the issuance of common debt could be explored as an element of such a fiscal union and subject to progress on fiscal integration. Steps towards the introduction of joint and several sovereign liabilities could be considered, as long as a robust framework for budgetary discipline and competitiveness is in place to avoid moral hazard and foster responsibility and compliance . The process towards the issuance of common debt should be criteria-based and phased, whereby progress in the pooling of decisions on budgets would be accompanied with commensurate steps towards the pooling of risks . Several options for partial common debt issuance have been proposed, such as the pooling of some short-term funding instruments on a limited and conditional basis, or the gradual roll-over into a redemption fund. Question is : Who is going to buy these fake bonds ????
I would just love to hear a banker explaining why it's better to get commercial banks to create money to lend the the US government, who then ends up paying $8.5 trillion in interest charges since 1988 (i.e more than half the entire US government debt), rather than just allowing the treasury to print its own money debt free like Abraham Lincoln and the Colonists. 

June - the fifth consecutive month in wich activity across the 17-nation bloc has declining

June turns out to be the fifth consecutive month in wich activity across the 17-nation bloc has declining, dragging down heavyweights Germany and France and increasing pressure for the European Central Bank to take action to support the economy. Markit's Eurozone Composite Purchasing Managers' Index, a combination of the services and manufacturing sectors and seen as a guide to growth, held steady at 46 this month, the lowest since June 2009 when the bloc was mired in a deep recession. That was better than a slide to 45.5 predicted by economists but the index has been below the 50 mark that divides growth from contraction in all but one of the last 10 months......EUROCRISIS --- Sometimes there is no answer except just to tough things out. This is what the doctor often says. "Go home, kep warm, rest and drink plenty of water and you'll feel better in a few days." In this crisis everyone is thrashing around for an instant solution, especially a "magic solution"..... Well THERE ISN'T ONE. Therefore : - While you're waiting for an upturn, sort out your lunatic practices; specifically get your taxation, bureaucracy and civil services down to levels that apply in the successful countries - be patient - tough it out - share the pain more equally than  usual... - in the case of Greece - don't reelect the people who got you into this mess in the first place and at all costs stop these vastly-expensive summits that achieve nothing. By the way, WHY DID VAN ROMPO GO TO THE G20 ? He has NO POWER OF DECISION and NOTHING WHATSOEVER was or COULD HAVE BEEN decided by the G20 that depended on his presence. (this goes for his stooge Borrosso)....This WASTE is HORRENDOUS - and STUPID.

A global economic storm is set to unleash in 2013 and there are no safe harbors to ride it out, says New York University economist Nouriel Roubini. The European debt crisis continues to build, while Asian economies are cooling and Middle East tensions involving Iran's nuclear ambitions are likely to flare up again. That leaves the United States as an investment safe harbor — for now. Yields on the 10-year Treasury note recently plunged to below 1.5 percent on demand from investors seeking shelter from Europe. Yields fall when bond prices rise, and falling yields reflect investor perception of lower risk. But the United States carries its own problems, Roubini says. "U.S. economic performance is weakening, with first-quarter growth a miserly 1.9 percent – well below potential. And job creation faltered in April and May, so the U.S. may reach stall speed by year end," Roubini writes in a Project Syndicate column.
Furthermore, tax breaks are set to expire at the end of this year when automatic spending cuts kick in, a combination dubbed as a fiscal cliff that could send the country into recession next year even if Congress acts now to prevent it. "Worse, the risk of a double-dip recession next year is rising: even if what looks like a looming U.S. fiscal cliff turns out to be only a smaller source of drag, the likely increase in some taxes and reduction of some transfer payments will reduce growth in disposable income and consumption," Roubini says.
"Moreover, political gridlock over fiscal adjustment is likely to persist, regardless of whether Barack Obama or Mitt Romney wins November’s presidential election. Thus, new fights on the debt ceiling, risks of a government shutdown, and rating downgrades could further depress consumer and business confidence, reducing spending and accelerating a flight to safety that would exacerbate the fall in stock markets." The U.S. economy grew 1.9 percent in the first quarter of this year, down from an original estimate of 2.2 percent. Economists worry the country might not be growing fast enough to achieve escape velocity and break free from the pull of a fresh slowdown. Like a plane that moves too slowly, the economy may hit stall speed and tank, and that doesn't bode well for President Barack Obama, experts say. "Historically, presidents don't usually get re-elected when the economy is performing as sluggishly as it is now," says Nigel Gault, chief U.S. economist at IHS Global Insight, according to Reuters. "Many people out there, if you asked them in surveys, they'd say they still view the economy as being in recession."

So far, almost the only thing that happened due to the memorandum was Greece getting lots of money to pay its debtors

Monti path to salvation is looking very much like a hike up the "Brenner Pass", and that is among the main concerns of investors. Italy's prime minister has so far made a good fist of imposing fiscal austerity. But he is having a lot more difficulty with phase two, which is to stimulate growth. None the less than four different measures are stuck at various stages on their way to the statute book. They include a bill to introduce greater flexibility and fairness into the labor market (which is horrendously complicated, and problematic for the left); another to tackle corruption (which is being held up by objections from the right who seem to think it could have unpleasant implications for one Silvio Berlusconi) and a wide-ranging "growth package" that hasn't so far made it past the cabinet.
Quite a few reports in the German media the last couple of days on Monti's inability to truly reform his country and becoming increasingly unpopular.....Monti is another Goldman Sachs operative. He is working for the International banking cartel for sure. He's not interested in the Italian people or their standard of living. Interesting too is news (haven't seen it in the MSM) that an Italian investigative magistrate has filed papers against Standard and Poor after a thorough investigation into their downgrade of Italian banks. At least someone is fighting back against this totally corrupt system. The Italian banks need another 100 billion to get by. Like Spain, we are told by the so called specialists (bank spokespeople) and then we are told after less than 24 hours ( in the case of Spain) it hasn't worked. Are these people taking the piss out of us ? We are basically giving the banks money directly so as they can pocket it all and keep asking for more. And this morning the BBC described our current crisis as the worst for over 100 hundred years. Sorry but don't think the thousands queuing at soup kitchens and dying of poor health conditions etc in the 1930's would agree with the current policies ---- This is a man made crisis of greed. A brief report in Spiegel online that Greece, since getting that second bailout or "memorandum", has hardly done anything regarding implementing the obligations of the memorandum.... Considering this information and the fact that the memorandum is just 3 months old I wonder how comes so many people are confidently telling us that the memorandum did not help Greece, made matters only worse, is not working at all (they're right there, but not in the way they think), is another fiendish plot against the people of Greece and needs to be stopped (again of course only regarding Greece's obligations, not the payments it receives).... So far, almost the only thing that happened due to the memorandum was Greece getting lots of money to pay its debtors - as the reforms demanded in the memorandum are allegedly not yet implemented any ongoing deteriorating of the Greek economy can hardly be blamed on the memorandum, and calls for its abrogation because it would be "too harsh" seem disingenuous to say the least....Officials in Berlin say privately that Chancellor Angela Merkel is willing to drop her vehement opposition to plans for a “European Redemption Pact”, a “sinking fund” that would pay down excess sovereign debt in the eurozone. “It is conceivable so long as there is proper supervision of tax revenues,” said a source in the Chancellor’s office. The official warned that there would be no “master plan” or major break-through at the EU summit later this month. Mr Merkel rejected the Redemption Pact last November as “totally impossible”, even though it was drafted by Germany’s Council of Economic Experts or Five Wise Men and is widely-viewed as the only viable route out of the current impasse. Fast-moving events may have forced her hand. She is under immense pressure from the US, China, Britain, and Latin Europe to change course as the crisis engulfs Spain and Italy, threatening a global cataclysm.The debt would be covered by joint bonds, paid for from a designated tax. Each country would be responsible for its own share of debt in the fund -- Italy €960bn, Germany €580bn, France €500bn, and so forth -- but would issue bonds jointly.".... How can this work exactly? And what price would the debt be issued at?... Surely the market would price it at a rate closer to that Italy and Spain have to pay now, rather than the German 10-yr bond rate, because Italy's debt would not have fallen, and essentially Germany's would increase....And, how useful is it for Italy to put up just 20% collateral?....And how will it fix the chronic uncompetitiveness of Southern Europe compared to Germany? Isn't it just another last massive kick of the can down the road?

Mircea Halaciuga, Esq.
004.0724.58.1078PROXEMIS - Managementul Riscurilor

SPAIN ...Merkel wins , the german boot upon the spanish neck...

Austerity is already harsh in what has traditionally been the continent's most euro-enthusiastic country - Spain. Unemployment, now affecting one in four workers, is set to continue well into next year. In the Spanish capital, a largely conservative place, the mood is of resignation rather than revolution. There will be no Athens-style protests in Madrid – or not soon, although the ongoing battles between balaclava-wearing miners and police in northern Asturias are proof that anger is spilling over elsewhere. Photographers seeking dramatic pictures on protest days travel to Barcelona, where radical left wingers see police persecution in a wave of recent arrests, while police say they are picking up those behind street violence during strikes. With the rescue money in Spain's "bailout lite" looking likely to go straight to former savings banks, the roots of its banking problem lie fully exposed. A decade-long housing boom, fueled by cheap credit thanks to low interest rates needed by Germany, has left the banks stuffed with toxic real estate. It is clear : "Europe needs fiscal integration with a fiscal authority and banking integration, a banking union with eurobonds, a banking supervisor and a European guaranteed deposit fund," Rajoy said last week. A bank bailout does not provide that. "The future of the euro is going to play out in the next few weeks in Spain and Italy," finance minister Luis de Guindos has warned. The problem is that Spain has already introduced harsh austerity measures, with official unemployment at around 25% and over 50% for those under 25. If they push that any further social explosion awaits. The further problem is that within this system there is no alternative to a very bad decision. Either you bail out the banks and shift the debt around the central banks in order to put off the awful day or you let them go to the wall and then watch the whole economic system collapse around our ears right now.

The trouble is that the orthodoxy of the last 50 years means that the IMF, World Bank, European Bank and almost every university economics department are run by Economists brought up on a paradigm that has failed spectacularly....Monetarism, Thatcherism, Hayek, Friedman, the Chicago School and the Austrian School ... all bollocks. We need a new paradigm and young economists with new ideas. Otherwise we really are screwed.

Yep, Stiglitz and Krugman have been shouting from the rooftops ... but they are on the outside of the System ... they are effectively economic dissidents.

Spain has given up the battle to rescue its ailing banks alone and accepted a European bailout of up to €100bn to join Greece, Ireland and Portugal in requesting outside aid to survive Europe's debt crisis.

European leaders hope a bailout will prevent a wider deterioration of the eurozone's fourth largest economy, which is paying punishing interest rates on borrowed money and is key to the survival of the single currency.

"The Spanish government states its intention to request European financing for the recapitalisation of banks that need it," the country's finance minister, Luis de Guindos, said after an emergency video conference with fellow eurozone ministers. It remained unclear, however, exactly how much of the €100bn Spain would need, with De Guindos saying it preferred to wait for two independent reports on its banking system before making a formal request. These reports would be ready within weeks or days, according to De Guindos, who implied that the final sum would be lower than €100bn. "The €100bn sum is a maximum figure," he stressed. "It includes a considerable margin of security."

Eurozone policymakers had been eager to shore up Spain's position before 17 June elections in Greece that could push Athens closer to a eurozone exit and unleash contagion. Various estimates have put the outside capital needed by Spanish banks at between €40bn and €100bn. "The loan amount must cover estimated capital requirements with an additional safety margin," the eurozone ministers said. (source : the guardian)

WELL ---the Spanish (and worldwide) Property Bubble. The gift that keeps on giving.  If the Spanish banks own all these properties (I presume they own them), wouldn't it make more sense to sell them off at some ridiculously low price simply to not be carrying these negative assets on their books? The banks are never, ever going to get the ridiculously over-inflated prices that were so common during the heyday of the global property bubble; far better off for the banks to sell these properties for €1,000 or so and clear them off the books. I would imagine if that you could purchase, let's say, a 3 room apartment on the Mediterranean Coast for €4,000 don't think for one minute they wouldn't have buyers.  Property prices aren't coming back, at least not in our lifetimes...THAT'S FOR SURE...

WASHINGTON—The Federal Reserve shocked bankers Thursday by approving a proposal that would force even the smallest lenders to comply with the elaborate international bank-capital standards known as Basel III.

The draft requirements would apply to all 7,307 U.S. banks, according to a proposal circulated by the Fed. Many bankers had expected regulators to exempt some small lenders from the new rules, which are aimed at shoring up the biggest global banks whose troubles fueled the financial crisis.

While the core Basel III rules will apply to all banks, other aspects of the new regime single out the biggest, most complex institutions and transactions.

BRUXELLES - Considering that the ESM currently has no money yet, and that many of the largest proposed contributors are actually those countries most likely to seek bail out, it appears to be a concept failed before its inception.

The only thing currently keeping the Euro afloat is bluff and bluster floating on a cycle of summits. News of the size of the Spanish bail out is being managed and uncovered in tantalising steps like a magician's trick

"JP Morgan is expecting the final package for Spain to rise above €350bn, while RBS says the rescue will "morph" into a full-blown rescue of €370bn to €450bn over time - by far the largest in world history." All this as Italian banks are on life support. "Italian banks tapped the European Central Bank for 272.7 billion euros ($343.1 billion) In May, a 0.6% rise from the previous month, said the Bank of Italy Thursday." All of this is held upright by IOU's whose credibility will come under serious scrutiny if Greece defaults.

German Chancellor Angela Merkel has mooted the idea that Greece should hold a referendum on the euro alongside its second round of elections next month. Mrs Merkel's proposal came up in a jaw-jaw with the country's president Karolos Papoulias earlier today, according to a spokesman for the Greek government. Official statement from the President of Hellenic Republic's office, concerning what Angela Merkel asked for this morning in their telephone conversation. Apparently, she asked for a referendum to be run concurrently with the next Greek elections, asking the question, "Do you want to stay in the euro?" Is she demented? Wasn't she the one along with Sarkozy that gave an ear ache to the ex Prime Minister of Greece, Mr George Papandreou for daring to ask the same thing in Greece a few months ago, and eventually forcing him to step down? In a statement, Dimitris Tsiodras said the proposal was "obviously" outside the scope of a Greek caretaker government. In Greece, Goldman Sachs got lots of Greek assets on the cheap in order to help the Greek government to massage its debt profile in order to qualify for the Euro.The fact is that in or out of the Euro, we are all being screwed by international financiers such as JP Morgan and Goldman Sachs. These fraudsters control the government, they control the regulators, the media ... and they rip us off and then demand austerity. They know that the Fed and the ECB will always cover their bets. Which means ultimately that we will cover their bets. In other words, ordinary Greeks and the rest of us are paying through "autierity" for the thieving and greed of usurers. Max Keiser on Russian TV is the closest you will get to an honest media commentator on the financial system.

Elswhere in Europe - More than 400 people have been arrested today while participating in an anti-capitalist protest outside the European Central Bank offices in Frankfurt, Germany. "Blockupy Frankfurt" protesters have been in the city since Wednesday, and have called for four days of protest against austerity measures in Europe.

Lies and lies again ...The poisen = is the euro ...it should go and Germany should be on trial again for the distruction of europe !!!

BS no 1. ----The news that the eurozone has avoided recession is politically tricky for the UK government, which has repeatedly blamed Britain's economic woes on the problems over the English Channel.

Just last night, chancellor George Osborne warned that the eurozone crisis was affecting the wider economy, saying in Brussels that:

The euro zone crisis is having a real impact on growth across the European continent, including Britain....

The British recovery has been damaged over the last two years not by Britain getting a grip on its public finances but by uncertainty in the euro zone.

So it's somewhat embarrassing to now find that the Eurozone managed to avoid contracting in the last three months, while the UK shrank by 0.2% (although, in the spirit of balance, many business leaders reckon that reading was too negative). Ed Balls, Labour's shadow chancellor, has already argued that today's GDP data shows the UK's double-dip was caused by domestic policy.

BS no. 2 ---- A strong performance by the powerhouse German economy, which grew by 0.5pc, helped haul the 17-members over the line and prevented the eurozone recording a second quarter of contraction in a row, according to the latest figures from Eurostat. In the fourth quarter of 2011, eurozone GDP shrank by 0.3pc.

Howard Archer, economist at Global Insight, said: “While it is welcome news that the eurozone avoided recession, its performance is hardly something to celebrate as GDP was only flat year-on-year in the first quarter of 2012. Furthermore, generally weaker latest data and, particularly, survey evidence suggests that renewed GDP contraction is very much on the menu for the second quarter.”

The debt crisis took its toll on the other core economies. French GDP failed to grow at all in the first three months of the year; Austria and Belgium showed modest growth; the recession in the Netherlands continued as its economy contracted 0.2pc quarter-on-quarter.

Poor manufacturing data from Italy, Spain, France and Germany erodes early gains on European markets, while eurozone unemployment hits a record high of 10.9pc.....Unemployment in the eurozone reached a record high again in March as spending cuts continued to hit the working population. For all 17 nations in the eurozone, the jobless rate rose again to 10.9%, the highest since the euro was formed in 1999, Eurostat said. For the eurozone, 17.4 million are now looking for work and more than 3 million of those are under 25. Italy's unemployment rate reached a 12-year high, up to 9.8%. And in a surprise move, the jobless rate in Germany rose to 6.8% in March, official figures showed, having been expected to stay at the previous month's 6.7% after six months of declines. The number of Germans out of work is now at 2.87 million.For the whole of the European Union, including countries such as the UK and Denmark, the jobless rate is 10.2%.

Austerity or growth ... Last week, Spain said that the number of job seekers rose for the eighth month in a row in March to hit 5.6 million, a record rate of 24.4%. Spain has the highest unemployment rate in the European Union and it is expected to rise further this year. Spain and Italy are both in recession and have seen borrowing costs rise, raising the prospect that they may need help or even bailouts. A debate is raging in Europe about whether politicians have prioritized austerity at the expense of economic growth, making recovery even harder for themselves.