Showing posts with label RomNET. Show all posts
Showing posts with label RomNET. Show all posts

Wednesday, November 6, 2013

The following information focuses on earthquakes because seismic activity poses a significant risk for Romania. However, Romania is at risk for other natural and manmade hazards. While much of the information below specifically addresses earthquakes, it is applicable to multiple hazards, and we encourage you to think broadly about the possible risks you and your family may face and to be prepared for any kind of emergency that may arise.
Romania is situated in a seismically active region and has a history of devastating and deadly earthquakes. The Bucharest area has experienced a number of tremors of varying intensities, and the probability that a severe and damaging earthquake will occur is high. The consequences of such a disaster will vary greatly depending upon the circumstances surrounding the quake, and no one can predict with any certainty what conditions will exist immediately following an intensive shock.
It is prudent that everyone be prepared to care for themselves in the immediate aftermath of a major earthquake. Every family and company should develop its own emergency plan, stock its own emergency survival kit, and ensure that its personnel and their family members familiarize themselves with emergency procedures and take precautions to protect their personal safety.

The Role of the Embassy

The Romanian Government is responsible for assisting foreigners in the event of a disaster, but authorities may be stretched beyond their capacity to respond in the immediate aftermath of a major earthquake. Telephone services will be severely overloaded, if they are functioning at all, and the Romanian Government will likely restrict phone use to priority users. Nonetheless, the Embassy will quickly want to ascertain the welfare and whereabouts of American citizens.
To aid in this process, American citizens should cooperate with Romanian authorities at evacuation sites and clearly identify themselves as Americans. Those connected with larger organizations such as companies, schools, or church groups should try to let these organizations know of their welfare and whereabouts if this is practical. If possible, American citizens should try to contact their American Citizen Services wardens and/or the Embassy.

The Embassy will be in touch with the Romanian Government and with larger umbrella organizations to attempt to identify as many American citizens as possible and determine their welfare. In the likely event that it is impossible to communicate by telephone or use motor vehicles, Embassy consular assistance teams may be deployed to major evacuation sites, international schools, hotels etc. to collect information from and about American citizens.

The Embassy will help provide information about the situation and communicate with Romanian government officials, if necessary, in order to obtain proper food, shelter and medical attention. However, a significant earthquake will likely overwhelm the Romanian government’s resources and individuals should be prepared to provide for their own emergency needs.
We will pass as much information as possible about the welfare of individual U.S. citizens back to the Department of State in Washington, D.C. so that this information may be shared with families, friends and employers.

The Role of the Romanian Government

The Romanian Civil Protection Command is part of the Romanian Defense System and is responsible for protecting the population, assets, national heritage and geographical environment in case of a natural disaster. The command’s activities include disaster intervention, search & rescue, warning and notification, sheltering, evacuation, etc. A central committee for evacuations is set up under authority of the Government if evacuation is required. In the event of a disaster, the location of the centers is determined depending on the area affected and the type of disaster that occurred. The Civil Protection Command coordinates with the local authorities in order to notify the population regarding evacuation or taking shelter.


Evacuations will likely occur after an earthquake. City authorities will issue evacuation advice. Americans, as well as others affected by the disaster, may seek assistance from the Romanian authorities, but you should be prepared to take care of your own emergency needs for the first several days of any disaster.

Earthquake Preparedness/Survival Information

FEMA produces a comprehensive Disaster Preparedness Guide called Are You Ready?, which can be easily downloaded by section or in its entirety. This indepth guide provides a step-by-step approach to citizen preparedness by walking the reader through how to learn more about local emergency plans, how to identify hazards that affect their local area, and how to develop and maintain an emergency communications plan and disaster supplies kit. Other topics covered include evacuation, emergency public shelters, animals in disaster, and information specific to people with disabilities. However, it is designed primarily for residents of the United States, and not all of the information will be relevant to disaster preparedness in Romania. Regardless, it can be a useful resource and a good starting place when preparing for a disaster.

Additional resources are also available online. Please visit the following websites for additional information about preparing for a disaster:

Emergency Supply Kit

Essential Supplies (Store enough for three-five days)
  • Water (four liters or one gallon per person per day. Change water every three to five months)
  • Food (canned or pre-cooked, requiring no heat or water. Consider special dietary needs for infants, the elderly, pets, etc.). Can opener.
  • Flashlight with spare batteries and bulbs
  • Radio (battery operated with spare batteries)
  • Large plastic trash bags (for trash, waste, water protection, ground cloth, temporary blanket)
  • Hand soap and/or disinfecting hand cleaner gel that does not require water
  • Feminine hygiene supplies, infant supplies, toilet paper
  • Essential medications as required; glasses if you normally wear contacts
  • Paper plates, cups, plastic utensils, cooking foil and plastic wrap and paper towels
  • First Aid kit with instructions
  • Lei, euros, and/or dollars in small bills (ATMs may not work after a disaster), with coins and phone cards for public phones. Credit cards.
  • Sturdy, closed-toed shoes and work gloves
Place emergency supplies in a sturdy tub where you can quickly and easily access your kit.

Essential Home Preparations Before a Disaster
  • Secure water heaters, refrigerators and tall and heavy furniture to the walls to prevent falling.
  • Move heavy items to lower shelves, and install latches or other locking devices on cabinets.
  • Install flexible connections on gas appliances.
  • Remove or isolate flammable materials.
  • Move beds and children's play areas away from heavy objects which may fall in an earthquake.
  • Register at Embassy or Consulate serving your area. You can do so online at or contact the U.S. Embassy to register.
Essential Planning Before a Disaster
  • Draw a floor plan of your home showing the location of exit windows and doors, utility cut off points, emergency supplies, food, tools, etc. Share it with housekeeper, babysitters, neighbors, and guests.
  • Establish family meeting points with alternate sites inside and outside of your home for all members to gather in the event of an evacuation.
  • Establish reunion sites with alternate sites for when the family is not at home, e.g., local shelter, neighbor's house, park, school.
  • Designate a person outside of your immediate area for separated family members to call to report their location and condition if separated.
  • Learn or establish disaster policy/planning at your children's school.
  • Know your neighbors and make them aware of the number of people and pets living in your home.
  • Learn where the nearest designated shelter for your neighborhood is.
  • Photocopy passports and other important documents. Store copies away from home (for example, at work). Scan important information and keep a thumb drive with critical documents in a safe, easy-to-access place or save it in email that you can access from anywhere.
  • Learn how to contact the police, fire and rescue services in Romanian. Be able to provide your address in Romanian.
Essential Steps Immediately After a Disaster
  • Check your immediate surroundings for fire, gas leaks, broken glass, and other hazards.
  • Check your home for significant damage. Do not remain in your home if you believe there has been structural damage.
  • Open doors and/or windows to avoid being locked in if there are after-shocks.
  • Contact one friend or relative in the U.S., and ask them to inform other parties of your situation.
  • Monitor local TV and radio for evacuation information. Contact your American Citizen Warden or the Embassy, if possible.

Wednesday, September 25, 2013

About deceit, lies and bribes received by the Romanian Governments and Authorities !!!

Monday, September 9, 2013

China's National Bureau of Statistics has accused a county government in southern China of faking economic data by coercing local companies to boost industrial output figures, state media have reported. Luliang county in southern Yunnan province pressured 28 local companies to report 6.34bn Yuan (£665m) of industrial output last year, while according to "initial calculations" the true figure was less than half of that, the state newswire Xinhua reported on Thursday night. "Companies complained that if they did not fraudulently report higher data their reports would be returned by local government departments," it said, citing a National Bureau of Statistics report. "They also said that fake reports would ensure they would enjoy favorable policies such as securing bank loans."
The county government itself reported fake investment data, Xinhua added. Analysts say that phony economic data is nearly ubiquitous in China, as officials are promoted based on their ability to present favorable numbers. "You have an incentive system that encourages the falsification of data," said Fraser Howie, the co-author of Red Capitalism: The Fragile Financial Foundation of China's Extraordinary Rise. "We known that for literally decades provincial GDP figures have never totaled the national GDP figures – you have a fundamental mismatch of those numbers." "Anybody who's working with Chinese statistics runs up against problems, inconstancies, and incomplete data," Howie added. "There are just black holes in information gathering." Howie said that while false data was a long-running national problem, Chinese authorities may launch selective crackdowns every few months to demonstrate vigilance. "It could be that this is a particularly egregious case, it could be that there's political infighting, it could be that this leaked somewhere else first," he said. He drew a parallel to President Xi Jinping's anti-corruption drive, which critics have dismissed both as lip service and as a political purge. "Its like the corruption thing – they're not going after nobody, but they're certainly not going after everybody," he said. "Yunnan is far away, nobody really goes there, nobody really cares. It's not like this happened right in Beijing, at the heart of things."

Monday, April 1, 2013

"It defies belief that Poland and others are still keen on joining the economic doomsday machine of the single currency"
No.....What defies belief is not that they may wish to join,but that they may still be allowed to do so. The EU if it contains any semblance of self awareness should by now have come to understand that it has a problem in trying to operate a single currency in the way it does. That problem being manifest by the broadening economic malaise in Europe and the growing political risk arising from it.
One might think therefore that the EU might at this juncture wish to pause and rectify the problem it has before it spreads it net and brings into the fold new 'meat' that will simply feed the problem for the future.
One of the main things that makes the human race superior to other species in it's ability to survive is we learn through iteration. When we do something wrong we figure out what it was and adapt doing something differently next time so that we do not simply perpetuate all of our previous mistakes. The EU in considering expansion without first learning from it's current litany of mistakes and problems promises to continue to do the same thing expecting a different outcome. Begs the question then if it cannot learn from it's mistakes is it even 'human'? !
Certainly when I consider the behaviour of individuals like Wolfgang Schaeuble I find myself thinking of the cult film "Terminator". What did you say Wolfgang? "I'll be back".
Yes,that's what we are all afraid of.

NOW, about Cyprus ...Cyprus has been destroyed by the EURO, the TROIKA and its own Cypriot politicians....Europe is a mess because of the liberal elitist puke scum that want to destroy SOVEREIGNTY / CULTURE / RELIGION...Even the Archbishop see this....Cyprus, like all the European Countries , needs leaders that love their country.

It is a sign of the times when I find myself agreeing with the Archbishop and must acknowledge he is the only Cypriot offering leadership. Today he put the Church's resources at the disposal of the Cypriot people. His exact words were 'no one will starve'. A 'Christian' acting like a christian for once instead of chanting meaningless words and dogma.

Saturday, March 30, 2013

Waiting for poverty to strike is no game. It makes ordinary men and women helpless, desperate and scared. "If you look at it mathematically, there is no way out: we will just never be able to repay our bills to the EU and IMF," said Haris Christou, one young Cypriot speaking for his compatriots. "Am I afraid? Of course I am afraid. Everybody knows everything in Cyprus is going to get bad, really bad. And nobody knows where exactly we are headed."
On Wednesday night men and women, some young, some old, gave voice to that fear. They gathered outside the offices of the European commission, and then lined the road that leads up to Cyprus's colonial-era presidential palace, to protest against a rescue programme that, wittingly or not, will destroy their country's banking sector and bring its economy to its knees.
"Out with the troika", "Fuck the troika", "Go home Troika", said the placards. "No to the policies of austerity." "No to privatisations." "No to the memorandum of catastrophe."
But more than words, or any amount of hoarse chanting, it is uncertainty that now speaks loudest in Cyprus. The uncertainty that has come with the knowledge that the island's economic output will shrink dramatically as a result of the austerity now being demanded in return for €10bn in aid. The uncertainty unleashed by policies that will see many Cypriots wake up with much less than they once had in the bank. And the insecurity of suddenly being the subject of capital controls that possibly could change Cypriots' lives for years....I, too, would be inclined to withdraw all my funds from any Cyprus bank and I suspect there will be a run on them. There are 'policies in place' to restrict such a run but I don't see how they can prevent people taking out what is their own money. That is the worry. The Russians called it theft and so would any Cypriot who cannot access savings. The safest place to deposit money is still the UK and I'm surprised that London has not offered to make itself a safe haven for Italians, Portuguese and the Spanish to place their life savings. That's what I'd do if I were a Mediterranean saver. The GBP and USD have their moments but nobody will lose a penny by keeping their money in those currencies which are trusted around the world. I don't know how any Cypriot would be able to do a SWIFT transaction to get cash out of harm's way but surely it can be done.

Thursday, March 28, 2013

The plot thickens...The European Commission has told reporters in Brussels that large uninsured depositors could to be "bailed-in" to help rescue a bank, under a new draft EU law on bank resolutions.
The comments came as the EC fielded questions on Jeroen Dijsselbloem's (the governor of Ciprus designate) comments yesterday that Cyprus showing the way ahead for handling financial crisis.
Brandenburg civil servant pensions exposed to Cyprus.
The German state of Brandenburg has admitted that around €2m of its civil servants' pension fund is in Cypriot bonds.   Much of the rest of the fund is in other crisis countries such as Ireland, Spain, Portugal as well as the Cayman Islands. Its finance minister Helmuth Markov from the far-left Linke party says he's confident their value will bounce back. (well, he has to say that, doesn't he?)Will perhaps trigger a bit of much-needed Schadenfreude in Cyprus?
Schäuble blames classroom jealousy...Remarkable comments from Germany's finance minister, Wolfgang Schäuble, this morning -- he's compared criticism of the tough German approach to the negotiations to classroom envy.
Here's the quotes (via Kathimerini) : "It always works out like that,” he told ZDF television.  “This also happens in classrooms. Sometimes when you have better results, others have difficulties with this, sometimes they are even a little jealous."
Ironic timing, as children in Nicosia left the classroom to protest against the bailout terms.
His Cyprus counterpart, Michalis Sarris, looked like a man still reeling from a nasty encounter with an exam paper* this morning. He told Bloomberg that there's been little Esprit de corps during Sunday's negotiations. Europe Union should be about showing support to fellow members, but...We did get some support from some participants, but there was a definite hard line by others.

Wednesday, March 27, 2013

Cypriots face a suspension of credit card payments for overseas goods and a ban on cashing cheques under draft capital controls designed to avert a run on the banks. Here is the government document outlining the capital controls in full. The only notable correction from the measures outlined at 15.51 is that the limit on cash that can be taken out of the country per trip abroad is €1,000, not €3,000 as previously reported: Cypriot finance minister Michalis Sarris has said capital controls are needed because of the "lack of substantial liquidity and significant risk of deposits outflow, with a possible outcome the collapse of the credit institutions". This could cause "chain effects that could lead to systemic instability of the financial system and have destabilizing consequences on the economy as a whole".... Cyprus central bank official Yiangos Dimitriou has confirmed that the cashing of checks will be banned as part of the introduction of capital controls. Dimitriou also told state TV channel CYBC that bank withdrawals will be limited to €300 a day, and that the effectiveness of the controls will be evaluated on a daily basis.

Friday, March 22, 2013

French authorities search Christine Lagarde's flatAway from Cyprus and indeed the UK Budget, it seems French authorities have searched the Paris flat of IMF boss Christine Lagarde.
The move is part of an investigation into her handling of a 2008 compensation payment of €285m to businessman Bernard Tapie. There are claims that Lagarde, then finance minister, acted illegally in approving the payment. She denies any wrongdoing.
CYPRUS GOVERNMENT SPOKESMAN DENIES REPORTS OF DEAL TO SELL CYPRUS POPULAR BANK  TO RUSSIAN INVESTORS...Confusion over reported Cyprus bank sale...there are reports that Cyprus Popular Bank has been sold to Russian investors, something which has gave a lift to markets and the euro.  However, in this atmosphere of speculation and rumour, it may not be correct.
Merkel regrets Cyprus vote decision and awaits new proposals...Angela Merkel regrets the outcome of last night's vote in the Cypriot parliament, according to snaps on Reuters.
But the German chancellor accepts the decision and now awaits a proposal from the Cypriot government to the Troika. She will look at all the proposals the government makes.
Hammering home the point made by the ECB earlier, she said Cyprus does not have a sustainable banking sector.  Savers in Cyprus with more than €100,000 in the bank should be ready to contribute to any bailout (it was the plan to hit savers with more than €20,000 that scuppered the vote).

Thursday, March 21, 2013


Cyprus took the unprecedented step on Monday of closing its banks until Thursday as officials scrambled to renegotiate the terms of a controversial bailout that threatens to force savers to take a €5.8bn (£5bn) hit to their deposits.
Finance ministers from the 17-country eurozone were holding an emergency video conference call amid recriminations over the aid package, particularly in Moscow, where a spokesman for Vladimir Putin attacked the plan as "unfair, unprofessional and dangerous".
Thousands of Russians have bank accounts in Cyprus, which has styled itself as a tax haven to attract international deposits into a banking system now at least eight times the size of the island's €17bn economy. Russia hinted that a separate but crucial €2.5bn loan to Cyprus could now be in doubt.
On a day of mounting uncertainty about the punitive conditions of the bailout and the impact on the banking sector:
• Britain temporarily withheld pension payments to more than 12,000 citizens who have retired to Cyprus amid concerns about the safety of the banking system. Up to 60,000 British people are thought to be affected by the proposal to penalise bank accounts to secure €10bn of aid from the eurozone.
• A vote on the aid package in the Cyprus parliament was delayed for a second day, until Tuesday, as it became clear that the bailout plan of the newly elected president, Nicos Anastasiades, faced defeat. There were reports on Monday night that he was preparing to tell eurozone ministers that he did have the votes to get the plan through.
• Stock markets fell – the FTSE 100 lost more than 100 points in early trading – before regaining losses amid speculation the raid on savers' cash would be scaled down. On the currency market the euro tumbled to a three-month low.
• European officials raced to defuse criticism that they had imposed the bank levy on a desperate nation, as the German flag was torn from its embassy in Cyprus.
• The US urged a resolution that was "responsible and fair and ensures financial stability".
Banks in Cyprus had been due to close for a normal holiday giving the authorities an extra 24 hours after the bailout was agreed in the early hours of Saturday – but they will not now reopen until Thursday. Demonstrating their anger at the impact on their savings, hundreds of Cypriots cut short traditional family picnics that mark the first Monday of Orthodox lent and gathered at the Nicosia parliament to protest.
Politicians continued talks behind closed doors on what changes could be made to the proposals before the parliament meets on Tuesday afternoon. Anastasiades has warned that an agreement must be reached if Cyprus is to avoid the collapse of one or all of its banks.
UPDATE 1: Cyprus's parliament Tuesday rejected a controversial bank deposit levy—a precondition for receiving a €10 billion bailout—effectively tearing up the four-day old loan deal the country had negotiated with European and international creditors that it needed to stave off default and a looming meltdown in its financial sector.
The stock market’s reaction to the Cyprus banking crisis is appearing to many as a case of wilful denial.

The vote, coming after days of fraught political talks in the Cypriot capital, means that a new deal—if one is possible–will have to be reached in days or Cyprus could face a complete collapse of its banks, an event that many analysts fear could also send the tiny island nation hurtling out of the eurozone.... In a conference call Monday night, euro-zone finance ministers were given "no heads up" on the new rate, a European official said. "They are playing poker." A second official confirmed that ministers and other European officials involved in the bailout talks hadn't been informed about the new tax plan by Nicosia. Apart from sparing small savers with less than €20,000, the draft bills sticks to tax rates that had been agreed Saturday morning at an emergency meeting in Brussels. European officials stressed Monday night that there was no flexibility on the €5.8 billion target. Euro-zone finance ministers did release a statement that allowed Nicosia to treat small savers differently, but stressed that the overall bailout from the euro zone and the IMF couldn't exceed the agreed €10 billion. But in his remarks to lawmakers, Mr. Demetriades said that Cyprus's central bank wasn't prepared for the deal that had been hammered out between euro-zone finance ministers, the European Central Bank and the IMF after a 10-hour meeting that ended early Saturday. "The measure is unprecedented. We didn't expect this development and we were surprised Saturday morning and found out after," he told lawmakers.

Update 2 :The European Central Bank has just released a statement, saying that it remains committed to providing liquidity to Cyprus's banks 'within the existing rules' Here's the statement: The ECB takes note of the decision of the Cypriot parliament and is in contact with its troika partners. The ECB reaffirms its commitment to provide liquidity as needed within the existing rules. There are fears that the ECB could pull the plug on the country's two biggest banks, by terminating the support provided under its Emergency Liquidity Assistance -- on the grounds that they could be insolvent. Cyprus could be gambling that the ECB won't risk turning the liquidity tap off: During Friday's marathon negotiations over the current bailout proposal, ECB executive board member Jörg Asmussen made clear to President Nicos Anastasiades that failure to agree on a deal that weekend would make it impossible for the ECB to provide a further extension of ELA since ECB rules don't allow national central banks to lend to insolvent banks. But any actual decision to withdraw ELA is a matter for the ECB's Governing Council and requires two-thirds of the council's members to vote in favor. 
Update 3 :In fact, there are really only two plausible scenarios: somebody - be it Europe or the IMF - gives Cyprus more money, in which case there is a chance that the crisis can be contained. Or Germany and the other hardline euro zone countries can insist that the deal is non-negotiable. In which case, the banks in Cyprus will go bust, risking widespread turmoil.

Given the precarious euro zone economy and the enfeebled state of European banks, cutting Cyprus a better deal looks like the safer option. The package could be restructured so that only deposits in
excess of €100,000 were taxed, the preferred option of Christine Lagarde at the IMF. Sparing those with savings of less than €100,000 from any pain would require the bigger depositors to pay a 15.5% tax to find the €5.8bn demanded of Cyprus. Alternatively, Europe could
easily find the extra €5.8bn itself.
The problem is that both options will cause political problems. Putin will bridle at suggestions that Russian citizens - who make up a large proportion of the €100,000 depositors - should be singled out. And Merkel could expect an almighty domestic backlash if she backtracked from the tough stance she adopted at the weekend. But the alternative is to let the banks in Cyprus go bust as soon as they are reopened after the extended bank holiday and hope that it really is a “special case”. That looks like an awfully big gamble.
Update, the report that Cyprus's banks might not open until next Tuesday comes from Dow Jones Newswires, which also has information that capital controls might be imposed to prevent cash leaving the country (sorry I don't have more info than that yet)

CONCLUSION : Agreed - it's time for Cyprus to dump the Euro and start printing it's own bank notes. That still leaves the problem of the Euro denominated debt - but that's easy as well - just walk away from it and go back to being a place for cheap holidays and Russian money. The EU will turn nasty - but that's easy too - just leave it and let the EU get on with economically destroying the rest of Southern Europe whilst Cyprus gets back on its feet - Iceland style.

Tuesday, March 19, 2013

Cypriots reacted with shock that turned to panic on Saturday after a 10% one-off levy on savings was forced on them as part of an extraordinary 10bn euro (£8.7bn) bailout agreed in Brussels.
People rushed to banks and queued at cash machines that refused to release cash as resentment quickly set in. The savers, half of whom are thought to be non-resident Russians, will raise almost €6bn thanks to a deal reached by European partners and the International Monetary Fund (IMF). It is the first time a bailout has included such a measure and Cyprus is the fifth country after Greece, the Republic of Ireland, Portugal and Spain to turn to the eurozone for financial help during the region's debt crisis. The move in the eurozone's third smallest economy could have repercussions for financially overstretched bigger economies such as Spain and Italy.
People with less than 100,000 euros in their accounts will have to pay a one-time tax of 6.75%, Eurozone officials said, while those with greater sums will lose 9.9%. Without a rescue, president Nicos Anastasiades said Cyprus would default and threaten to unravel investor confidence in the eurozone. The Cypriot leader, who was elected last month on a promise to tackle the country's debt crisis, will make a statement to the nation on Sunday.
The prospect of savings being so savagely docked sparked terror among the island's resident British community. At the Anglican Church's weekly Saturday thrift shop gathering in Nicosia, Cyprus's war-divided capital, ex-pats expressed alarm with many saying that they had also rushed to ATMs to withdraw money from their accounts. "There's a run on banks. A lot of us are really panicking. The big fear is that there soon won't be cash in ATMs," said Arlene Skillett, a resident in Nicosia. "People are worried that they're automatically going to lose ten present [of their savings] in deposit accounts. Anastasiades won elections saying he wouldn't allow this to happen."

Monday, March 18, 2013

It was always going to be an unusual but memorable moment as Italy's parliament reconvened after the recent inconclusive elections, with members of the maverick party founded by comedian Beppo Grillo taking their places for the first time.
And so it is proving. Southern Europe editor John Hooper writes:Not since the dawn of the Italian Republic after the Second World War, when ex-Communist partisans arrived in force, has there been an opening of parliament anything like today’s.The representatives of the Five Star Movement (M5S) unexpectedly respected the rule that male Italian lawmakers must wear ties (though, in line with the M5S’s enivronmentalist principles, many chose a black one bearing the words “No Coal”). But from the moment that the movement’s deputies entered the Chamber, it was clear they were going to be awkward to deal with.Instead of taking up a position on the left or right of the semi-circle in which the members of the lower house sit, the M5S’s deputies (who prefer to be called “citizens”) ranged themselves around the back.“Neither right nor left, but above (and beyond),” chirped one of their number, Tiziana Ciprini, on her Facebook page.The whole episode reflected the view that the movement’s co-founder, the comedian, Beppe Grillo, put to me in an interview last month: that the M5S cannot be fitted into conventional political categories.It is one of things that worries many Italians about the M5S. Most of the so-called grillini are passionately committed to progressive causes (they eschew the mineral water that is everywhere available in parliament in favour of tap water, for example).  But denying the existence of left and right is a classic sign of populism. And Mussolini did it all the time.

Wednesday, March 13, 2013

Jean Claude Juncker, prime minister of Luxembourg, who chaired a group of Euro-zone finance ministers at the height of the financial crisis, claimed that elections in Italy and Greece brought "national resentments to the surface, which we'd believed had gone away".
He said that he had been appalled by protesters' banners in Greece which showed Angela Merkel, the German chancellor, in Nazi uniform.
Mr Juncker said in an interview with the magazine Der Spiegel: "Anyone who believes that the eternal question of war and peace in Europe is no longer there risks being deeply mistaken.
"The demons have not gone away – they're only sleeping, as the wars in Bosnia and Kosovo showed. I am struck by how much conditions in Europe in 2013 are similar those of 100 years ago."
The way in which some political figures in Germany had been criticised in Greece has left "deep wounds" Mr Juncker said. He said the Italian election was also "excessively hostile to Germany and therefore anti-European". Mr Juncker, who chaired the Euro Group from 2005 until he stepped down in January this year, said that he saw parallels with 1913. "In 1913 many believed that there would be no more war in Europe. The great powers of the continent were so closely inter-twined economically that the view was widespread that they could no longer have military confrontations," he said.
Mr Juncker also claimed that the only way for Europe to continue to wield global influence in future was through being united. The governments of Germany, France and Britain all knew that the only way their voice could be heard internationally was "through the megaphone of the EU," he said.

Tuesday, March 12, 2013

Gold’s price slide has been going on for months, with February marking the fifth in which it fell, the longest run of monthly declines since 1997. Holders of gold know it is volatile, with everything from hints of central bank easing – sending investors to the metal as a protection from inflation – and movement in the dollar, to changing jewellery demand in India, shifting the price. Gold also has a curious status in that it can behave as both a “risk-on” and “risk-off” asset. While investors flocked to buy the metal in the summer of 2011 during the eurozone debt crisis, in still more extreme times of market stress, such as at points during the credit crunch, the price has plunged, as people start selling their gold to cover losses elsewhere. Investors were recently unnerved to see a particular signal at the end of last month, gold’s so-called “death cross”, when the price’s 50-day rolling average drops below its 200-day moving average. Two out of the last three such “death crosses” were followed by marked sell-offs. As sentiment turned more bearish, an eye-catching note from Goldman Sachs grabbed attention. The bank cut its forecast for the gold price this year to $1,600 an ounce from $1,810, and predicted that next year the price will be $1,450.
“The turn in the gold cycle has likely already started,” the bank’s analysts warned, pointing to “a quickly waning conviction in holding gold positions, especially ETFs”. Goldman is not the only one to notice that, Paulson aside, holdings in exchange-traded products backed by gold have been shrinking at a rapid rate. On Thursday, they fell to 2,486.2 tonnes, the lowest since September, according to data from Bloomberg.
The waning enthusiasm for gold among the ETF investors is being treated as particularly significant, as they are seen as long-term “buy and hold” types rather than more speculative investors.
Recent weeks have also seen other investment banks express similar views on the gold price to Goldman, BNP Paribas, Credit Suisse and Citigroup, to name a few of those turning sour.
But there is no consensus. Bank of America Merrill Lynch still expects prices to rise strongly next year to an average of $1,838 an ounce, although it sees prices turning lower in 2015.
At the more extreme end of forecasts, Capital Economics, the UK economics consultancy, says gold will reach a new record of $2,000 later this year, warning that the eurozone will flare up again and the rally in equity markets may run out of steam.
That is not quite as eye-popping a forecast as it might seem, as when the impact of inflation is factored in, the price of gold was considerably higher, at about $2,400 an ounce in “real” terms, in early 1980.
Crucially, Capital does not see the ETF movement as driving the gold price in the future, but rather reflecting what has already happened. If the price rises, investors would soon be heading back in, argues Ross Strachan, Capital’s commodities analyst. “You tend to get people looking at it as 'they are flowing out, that should push the price down’. But to some extent that has already happened,” he notes.  Still, he admits: “There is an inherent difficulty in valuing gold – it’s much trickier than for almost any asset you care to name.” .........Bears and bulls beware.

Friday, March 8, 2013

The taboos are falling one by one.

“We must leave the austerity cage,” he told leaders of his Democrat Party (Pd), responding to Italy’s electoral earthquake by tearing up his pre-election programme. “A change of course is absolutely necessary given that five years of austerity and attacks on workers have pushed up public debt levels across Europe,” he said.
“The vicious circle between belt-tightening and recession is putting representative government at risk and making it impossible to govern. The immediate emergency is the real economy and joblessness,” he said. The pledge puts Mr Bersani on a collision course with the ECB, which is constrained from helping to shore up the Italian bond market unless Rome complies with Europe’s austerity agenda. “Italian voters may have effectively voted away the ECB safety net,” said Christian Schulz from Berenberg Bank. The central bank cannot activate its bond purchase programme (OMT) unless Italy requests a rescue from the EMU bail-out fund, and that in turn requires a vote in Germany’s Bundestag.
“The ECB cannot – and will not want to – do anything to help Italy after the inconclusive election result, even if borrowing costs spiral out of control,” he said.
Mr Bersani’s Democrats (Pd) and its allies control the lower house but failed to win the senate. He is hoping for tacit support on a law-by-law basis from the Five Star Movement of comedian Beppe Grillo. Mr Grillo has responded with a volley of anathemas, calling Mr Bersani a relic from a defunct political order that must be swept away by civic revolution. Yet many of his 163 senators and deputies say the movement should seek common ground with the Pd.
Mr Bersani said Italy should mobilize its EU voting weight to push for an EU-wide change of course. He has natural allies in Paris.
French finance minister Pierre Moscovici warned EMU colleagues on Monday that current policies “risk a loss of social and political confidence across Europe. We must not pile austerity on top of recession”. Mr Moscovici said France would need an extra year to meet its deficit target of 3pc of GDP and called for action to tackle the root of the crisis with an EMU-wide growth strategy.
French officials are deeply alarmed by the relentless upward rise in France’s unemployment rate to 10.6pc, or 26.9pc for youth. President Francois Hollande’s popularity ratings have crashed from 55pc to 30pc since his election in May, the fastest decline ever recorded for a French leader.
Italy, France, and Spain toyed with a Latin bloc alliance last year to confront Germany over EMU’s contractionary policy mix, but the initiative faded.
Mr Hollande pulled back from a showdown with Berlin and ultimately pushed through further fiscal cuts and reforms, while Italy’s Mario Monti was never willing to jeopardise the European Project that he served for ten years as a commissioner.
Critics says Mr Monti, whose Civic Choice list won just 10pc of the vote, went native in Brussels long ago and has been slow to understand the deeper political crisis unfolding in Italy.
The outgoing premier gave them fresh ammunition today, saying that it would be better to hold fresh elections than to see an anti-EU government to take power.
It is unclear whether a second vote would achieve what he intends. The latest snap polls show that Mr Grillo’s support is still rising, jumping from 25pc to 28pc.
Ominously, nostalgia for Fascist leader Benito Mussolini has started to emerge as the post-War order crumbles. Two key figures have praised elements of Fascist rule over the last two days.
A leader of the Five Star Movement professed “fascination” with the Fascist sense of the Italian state and the family, while the deputy state secretary of the economy said Mussolini “governed well until 1935.” (source telegraph)

Tuesday, March 5, 2013

Mired in what economists are calling a "great depression", with its GDP set to contract for a sixth straight year, Greece is projected to see unemployment exceed 30% by the year's end as a growing number of businesses file for bankruptcy. Over 60% of those without work are under 25.
Public-sector firings are among a series of neuralgic points likely to be raised by the troika. Representatives, who indicated they would not be visiting Athens "to renegotiate its rescue package but supervise its economic performance", are also expected to address the thorny issues of progress on privatisations, tax administration reforms and bank recapitalisation.
Paitence is in short supply. Creditors have committed more funds to Greece – at €240bn, the biggest bailout in world history – than any other troubled economy since the tiny nation, revealing the unsustainable level of its public debt, triggered the eurozone crisis in late 2009.
Piling on the pressure ahead of the monitors' visit, the Euro Working Group chief, Thomas Wieser, emphasised that Athens had to keep its side of the deal. "All that was agreed in the bailout plan has must be implemented. These reforms were agreed to make the Greek economy stronger, flexible and more competitive," he told the Greek newspaper Realnews.
Although the IMF has publicly admitted that it seriously underestimated the impact of Greece's recession on its ability to deliver, there are growing concerns over the government's determination to crack down on tax collection – the single biggest drain on the country's economic performance.
A confidential report prepared by the EU and IMF and leaked to the Greek media last week showed that the nation was lagging severely in key revenue targets, with Athens' tax collection mechanism being singled out for particular criticism.
While Greece had managed to rein in public spending – pulling off the biggest fiscal consolidation of any OAED country – tax avoidance, particularly among high earners, remained "astounding", said the report, estimating that at €55bn unpaid tax amounted to nearly 30% of GDP.

Monday, March 4, 2013

Italian officials say the Bank of Italy’s governor Ignazio Visco is front-runner to take over as premier despite warnings that this will be seen as an elitist ploy. It is far from clear whether the Democrats (Pd) in charge of the lower house will back the idea.
The plans amount to a near replica of the outgoing team of Mario Monti, though one greatly weakened by the earthquake upset in the elections a week ago. Almost 57pc of the vote went to groups that vowed to tear up the EU-imposed austerity agenda.
Stefano Fassina, the Pd economics chief, said his party is vehemently opposed to “any form of technocrat government, new or old”, insisting that the election result must be respected. Mr Fassina said 90pc of the country had rejected the Monti agenda and warned that it would be a grave error to try to force through the same reviled plans a second time.
Comedian Beppe Grillo repeated his vow to “bring down the old system” and dismissed the latest talks as cattle market trading by a depraved political class trying to circumvent the will of the people. “I repeat for the umpteenth time, the Five Star Movement will not back any government. It will vote law by law in keeping with its platform,” he said.
“We’re not a political party, we’re a civic revolution. This country is in ruins with two trillion in debts and we have to rebuild it from scratch,” he told a scrum of journalists. In a rhetorical play on the slogans of 1789 and 1917 he exhorted “all citizens” to descend on parliament....Mr Rehn also warned Germany politicians that it would be courting fate to push Cyprus into default and exit from the eurozone in the belief that the island is too small to pose a contagion risk. “Even if you come from a big EU country, you should be aware that every member of the euro zone is systemically relevant,” he told Der Spiegel. Separately, it emerged that the eurozone bail-out fund (ESM) may not be used after all to recapitalise banks, even once the banking super-regulator is in place. Klaus Regling, the fund's chief, said opposition from the creditor states may kill the idea altogether. If so, this will breaches a summit accord in June by EU leaders to deploy the ESM directly to break the “vicious circle” between banks and sovereign states. Failure to implement the deal would be a blow for Ireland and Italy, leaving them shouldering the full burden left from a bank crisis that was partly caused by northern creditors. The International Monetary Fund said it is imperative that the EU upholds the specific pledge made to Ireland in the summit text.
Germany, Austria, Finland, and Holland have all all said they would not let the ESM cover "legacy assets" left from the bubble. They now seem to be resiling from the accord altogether.

Sunday, March 3, 2013

The rate of unemployment in the eurozone rose to a fresh record high in January, official figures show.
The jobless rate in the 17 countries that use the euro rose to 11.9% in January from 11.8% in December, the statistics agency Eurostat said. The highest rate was 27% in Greece, although the most recent figure there was from November, while the lowest rate was 4.9% in Austria.  Eurostat also said eurozone inflation had fallen to 1.8% in February.  The inflation figure was the lowest for two years, putting it in line with the European Central Bank's (ECB) inflation target of below, but close to 2%.
Analysts said that the high unemployment and low figure for inflation would make it more likely that the ECB would cut its interest rates later in the year from the current rate of 0.75%.
"All the data is supporting a rate cut, which we see in the second quarter," said Sarah Hewin from Standard Chartered.
"They could move as early as next week, but there's an element of the ECB wanting to keep its powder dry as we enter an uncertain political situation with Italy and the Cypriot debt question has to be resolved." The highest unemployment rates among countries that have reported their January figures were 26.2% in Spain and 17.6% in Portugal.  Unemployment in the 27 countries that make up the European Union rose to 10.8% in January from 10.7% the previous month.

Thursday, February 28, 2013

The vote in italy - a vot for independence

If you've ever worked and lived in Italy, you'd know that the real reason for the failure in the polls has more to do with vehement dislike of Germany, than the EU in general!
The outgoing leader stuck strictly to austerity rules, viewed (probably correctly) by the electorate as German rules......... and the Italians are not about to let the Germans control them again!
I was surprised to find, when working in Northern Italy, that the (dare I say) hatred of all things German dates back to beyond the World Wars, to the days of the Hapsburgs and beyond. The rank dislike is reciprocated in Germany, where the Germans treat Italian Gastarbeiters like dirt!
The dislike gets in the way of business between the two countries, to the detriment of both. I was, while working there, tasked with getting a fleet of vehicles modified with very precise navigation equipment of German manufacture. It was a relatively simple operation........... My team installed the kit and the German Technicians just needed to fly down from Munchen, to calibrate it all.......... a simple transaction, so one might think.........
HOWEVER! I had to load the entire fleet on transporters and get them shipped, at huge cost, up to the Manufacturer's headquarters in Germany!.......... The reason?........... According to the manufacturer their technicians were TOO AFRAID to travel to Italy! (surprising in view of the huge numbers of German tourists one meets every day in Italy!)..........
Subsequent conversations indicated the refusal to travel was an executive decision............. typical German bad customer service.............
The result, of course, was that, as the project progressed, the German interests were frozen out and it became basically a Nationalistic expression of independence.........

Wednesday, February 27, 2013

EUROPE - The twin policy regimes in East and West stoked the credit bubble, and this in turn disguised what has happening to trade flows. These flows were disguised yet further after 2008 by QE and fiscal buffers, but the hard reality beneath may soon be exposed as these are props are knocked away.
"In a world of deficient demand and excess savings, every country will try to acquire a greater share of global demand by exporting savings," he writes. The "winners" in this will be the deficit states. The "losers" will be the surplus states who cannot retaliate. The lesson of the 1930s is that the creditors are powerless. Prof Pettis argues that China and Germany risk a nasty surprise. America's shale revolution and manufacturing revival may be enough to head off a US-China clash just in time. But Europe has no recovery strategy beyond demand compression. It is a formula for youth job wastage, a demented policy when youth a scarce resource. The region is doomed to decline until the boil of monetary union is lanced. Some will take the Mishkin paper as an admission that QE was a misguided venture. That would be a false conclusion. The West faced a 1931 moment in late 2008. The first round of QE forestalled financial collapse. The second and third rounds of QE have had a diminishing potency, while the risks have risen. It is a shifting calculus. The four years of QE have given us a contained depression and prevented the global strategic order from unravelling. That is not a bad outcome, but the time gained has largely been wasted because few wish to face the awful truth that globalisation itself -- in its current deformed structure -- is the root cause of the whole disaster. ...It will be harder from now on if central banks conclude that their arsenal is spent. We can only pray that their help will not be needed.

Tuesday, February 26, 2013

ECB's purchase of Club Med bond amounts to "monetisation" of public debt in countries shut out of global markets, whatever the claims of Mario Draghi. "We see at least a risk that the eurozone is on a path to become more like Argentina (which of course is why German central bankers are most concerned). The provinces overspend and are always bailed out by the central government. The result is a permanent fiscal imbalance for the central government, which then results in monetization of the debt by the central bank and high inflation," it said. In America, the Fed would face huge pressure to hold onto its bonds rather than crystalize losses as yields rise -- in other words, to recoil from unwinding QE at the proper moment. The authors argue that it would be tantamount to throwing in the towel on inflation, the start of debt monetisation, or "fiscal dominance". Markets would be merciless. Bond vigilantes would soon price in a very different world. Investors have of course been fretting about this for some time. Scott Minerd from Guggenheim Partners thinks the Fed is already trapped and may have to talk up gold to $10,000 an ounce to ensure that its own bullion reserves cover mounting liabilities. What is new is that these worries are surfacing openly in Fed circles. The Mishkin paper almost certainly reflects a strand of thinking at Constitution Avenue, so there may be more than meets the eye in last week's Fed minutes, which rattled bourses across the world with hints of early exit from QE. Mr Bernanke is not going to snatch the punch bowl away just as the US embarks on fiscal tightening this year of 2pc of GDP, one of the most draconian budget squeezes in the last century. But he may have concluded that the Fed is sailing too close to the wind, and must take defensive action soon. Monetarists say this is a specious debate -- arguing that the losses on the Fed balance sheet are an accounting irrelevancy -- but Bernanke is not a monetarist. What matters is what he thinks.
If this is where the Fed is heading, the world is at a critical juncture. The US economy has not yet reached "escape velocity", and in fact shrank in the 4th quarter of 2012. Brussels has slashed its eurozone forecast, expecting a second year of outright contraction in 2013. The triple "puts" of the last eight months -- Bernanke's QE3, Mario Draghi's Club Med bond rescue, and Beijing's credit blitz -- have done wonders for asset markets but have not yet ignited a healthy cycle of world growth. Nor can they easily do do since the East-West trade imbalances that caused the 2008-2009 crisis remain in place.
We know from a body of scholarship that fiscal belt-tightening in countries with a debt above 80pc to 90pc of GDP is painful and typically self-defeating unless offset by loose money. The evidence is before our eyes in Greece, Portugal, and Spain. Tight money has led to self-feeding downward spirals. If bondyields are higher thannominal GDP growth, the compound effects are deadly.
America may soon get a first taste of this, carrying out the epic fiscal squeeze needed to bring its debt trajectory back under control with less and less Fed help. Gross public debt will hit 107pc of GDP by next year, and higher if the recovery falters as pessimists fear. With the fiscal and monetary shock absorbers exhausted -- or deemed to be -- the only recourse left is to claw back stimulus from foreigners, and that may be the next chapter of the global crisis as the Long Slump drags on.
Professor Michael Pettis from Beijing University argues in a new book -- "The Great Rebalancing: Trade, Conflict, and the Perillous Road Ahead" - that the global trauma of the last five years is a trade conflict masquerading as a debt crisis.
There is too much industrial plant in the world, and too little demand to soak up supply, like the 1930s. China is distorting the global system by running investment near 50pc of GDP, and compressing consumption to 35pc. Nothing like this has been seen before in modern times. This has nothing to do with the "Confucian" work ethic or a penchant for stashing away money. Fifty years ago the stereotype was the other way round. Confucians were seen as feckless. In fact, Chinese families never get the money in the first place. The exorbitant Chinese savings rate is due to a structure of taxes, covert subsidies, and banking rules. Variants of this are occuring in many of the surplus trade states. Germany is doing it in a more subtle way within Euroland. The global savings rate is almost 25pc and climbing to fresh records each year. The overstretched deficit states in the Anglo-sphere and Club Med are retrenching but others are not picking up enough of the slack. Germany has tightened fiscal policy to achieve a budget surplus. This is untenable. In the Noughties the $10 trillion reserve accumulation by Asian exporters and petro-powers flooded the global bond market. At the same time, the West offset the deflationary effects of the cheap imports by running negative real interest rates.