The square, one block from Rome’s main train station, was strewn with mattresses, overturned rubbish bins and broken plastic chairs.   Hung on the building was a sheet made into a banner saying: “We are refugees, not terrorists,” in Italian. A small fire burned on the pavement and a sheet hanging from a first-floor window was set alight by squatters inside.  Witnesses who arrived at the square after the clearance operation described a scene of carnage.  “When I arrived at about 9am trash was scattered all over. About 50 people were still in the square, which had been partially closed down to traffic in the meantime. They were sad, frustrated and with no idea where to go,” said Francesco Conte, founder of TerminiTv, an online channel based in Rome’s Termini train station.  About 100 people had occupied the square since Saturday, when most of about 800 squatters were evicted from an adjacent office building they had occupied for about five years.Police said the refugees had refused to accept lodging offered by the city and that the operation was also necessitated by the risk presented by the presence of cooking gas canisters and other flammable materials in the square, which is surrounded by apartment buildings.  Most of the squatters were Eritreans and Ethiopians who had been granted asylum. Many have been in the country for up to a decade. They ran the building as a self-regulating commune that outsiders were not permitted to enter.  The refugees have previously complained that the accommodation offered to them elsewhere is not of a permanent nature, and that moving would result in the community they have established being split up. The area around the square is full of shops owned by the refugees’ compatriots.

NEW YORK — The downdraft on Wall Street intensified Monday as the Dow Jones industrial average – which was briefly down more than 1,000 points -- suffered its second drop of more than 500 points in as many days and the broader Standard & Poor's 500-stock index tumbled into official correction mode for the first time since 2011.  Investors hoping for a market bounce after the Dow's worst week in four years got a vicious plunge instead after the opening bell when the Dow went into freefall and fell 1,089 points in a dive described as a "huge whoosh," by Bespoke Investment Group. The Dow's closing point loss of 588.40 points, or 3.6%, to 15,871.35, was its 8th worse one-day point loss in history and worse daily point decline since Aug 8, 2011.The freefall on Wall Street has now infected every corner of the stock market, with the blue-chip Dow, small-company Russell 2000, large-company S&P 500 and tech-dominated Nasdaq composite all now down more than 10% from their record peaks this year and into full-fledged corrections. In volatile trading, the Dow initially plunged as much as 1,089 points in early trading before almost clawing back to even, only to succumb to a late-day swoon. At its low point, the Dow was in danger of suffering its worst one-day point loss on record -- a 777.68 drop on Sept. 29, 2008.  The Standard & Poor's 500 index was down 77.68 points, or 3.9%, to 1893.21 as it dipped into correction territory — which is defined as a drop of 10% or more. The Nasdaq composite index fell 179.79 points, or 3.8%, to 4526.25. The Dow is now down 13.3% from its high. The S&P 500 is off 11.2%, the Nasdaq is 13.3% below its closing peak and the Russell 200 is down 14.2% from its record.

Market growth means in fact INFLATION !!!!!

"An estimated $4 trillion has been wiped off the value of Chinese equities in just three weeks earlier this year, although they are still higher than they were this time a year ago."  China's stock markets swung wildly on Wednesday as the authorities battled to restore investor confidence.  Shares on China’s main market - the Shanghai Composite - ended the day 1.2pc higher having earlier plunged by as much as 5pc. 

The recovery late in the day was apparently due to state-backed companies gobbling up shares as trading drew to a close.  A turbulent day on the markets reflected concerns that the housing market could be overheating, and that Beijing might stop propping up equity prices. They have been doing so for weeks. Not only the Chinese though, Swiss, UK and USA. There are NO markets anymore; there is NO price discovery anymore and how can you quantify risk in a market that is so distorted. This will not end nicely. They already tried this back in 1929 and they never altered the trend then. If you don't read history you are condemned to repeat it...Remind me what percentage growth is the American economy growing at & how much overseas owned debt does it have & how much are American stocks over-valued by & how much has the dollar been devalued over a similar period of time?...Some experts had been expecting China to boost exports in a bid to shore up growth. Beijing's decision to weaken the Yuan - also known as the renminbi - last week appeared to support this view, as a weaker currency should make China's exports cheaper. However, the Commerce Ministry appeared to quash this theory on Wednesday by saying that China’s exports could continue falling in the months to come. Analysts at Barclays expect that China’s moves will just be the first steps in a larger depreciation of the Yuan, which they expect to fall by 6pc against the dollar by the end of the year. The devaluation added to concerns that the world’s second-largest economy is in a more fragile state than official numbers reveal. Chinese officials are targeting economic growth of 7pc this year, though many China watchers estimate that growth is far more tepid than Beijing’s GDP numbers would suggest. Fears of a “hard landing” for Chinese growth have plagued stocks the world over.

 

Like everything else about Varoufakis, the shirts are just another distraction from the fiduciary malfeasance and outright crimes. Hacking into taxpayer accounts -- for any reason! -- is a crime. I would refuse to live in any country that had such weak banking firewalls, or where a government minister could just spontaneously decide, for whatever reason, to access my confidential and proprietary business information that I shared with the appropriate tax revenue collection agencies!

There is no excuse for hacking government servers, Mr Tsipras, and the fact that you are attempting to defend such crimes is in fact proof of your own complicity. You were willing to go and make outlandish speeches in St Petersburg, to kowtow to war criminal Putin and his derelict government of mass murderers... Of course, by comparison, hacking the personal accounts of Greek citizens would seem like just another day at the office to you!   If you accept Varoufakis's outrageous breach of his oath of office as a "reasonable" method to "protect" Greece from the creditors who have helped you before and upon whom you are relying yet again, then you, too, need to resign, and have your immunity lifted, and face a thorough investigation. Because all these actions represent an Abuse of Power and a shocking disregard for laws.  The extension of 'liquidity' was illegal under the ECB's own rules. Liquidity is a shortage of cash and required those seeking Emergency Liquidity Assistance to provide collateral to obtain it. The problem became not one of liquidity but the insolvency of Greek banks and at that point, by the rules of the ECB ELA should have been terminated and the banks shut.

The ECB bent the rules because it didn't want to be the one to force Greece out of the Euro. Now it is stuck with some 90 billion of ELA and insufficient collateral to cover that 90 billion euros which is why the EU is having to discuss 20 billion or more euros as to recapitalize the Greek banking system as part of a new bailout.  The Greek banks were not illiquid they were busted. Insolvent. Unable to sell assets or use their own capital to honor deposits.

Greece requires to be bailed out...Just like the banks were a few years back...Hundreds of £Billions were dished out and also Q.E. was introduced and indeed will continue, just so the financials continue to operate...Kicking that can down the road. Now ask yourself what's the difference between banks and Greece...Both were broken by miss management and greed. Today however the banks and financials continue on their merry way...richer than ever, whilst the people of Greece (and others) must suffer austerity and unemployment...The divide between the rich in the centers of finance and politics, getting wealthier as their assets and investments go up in value maintained all the while by Q.E. and bail outs, and the rest of societies, grows wider by the day.  Greece meantime...There is an argument here, for Greece just throwing in the towel and defaulting on their debt, returning to the Drachma and say stuff it, we've had enough of this, Let the financials suffer for a change...Once this course of action happens, as sure it will, others will follow and the Euro will then be no more...First to leave will benefit the most...When?, that is the question...One is a loan and the other one is a "Donation" (well supposed to be a loan). Notice under TARP, the US government made profits - from the interest charged and the capital gains when the securities were sold. In contrast to Greece, so far 53.5% of the original loans were written off. Yet, Greece wants more debt write-off.And the same time, it wants Europe to lend it more money, which no doubt a portion will be written off in the future.  If you were the lender, would you lend your OWN MONEY to Greece?!?  As to the issue of reforms - every single country, when bloated must reform - whether the country is the US, Russia or Greece. Remember that unemployment in the US nearly reached 10M at one stage.  The extra-ordinary loans were made, so that companies and countries could carry out the necessary reforms and transition into a new viable and competitive entity (for example GM or Ireland).  Europe and IMF have offered Greece the loans, so it could carry out reforms.  But Greece only wants the money, but "does not" want to carry out reforms.  Which in the end results in Greece and companies within Greece, to remain un-competitive, which results in Greece asking for more "Loans" from Europe and IMF and more "write-offs".

A vicious cycle - no?!?

Did the U.S. government really seal the fate of the U.S. economy back in March 2010, when it passed H.R. 2847? On July 1, 2014, H.R. 2847, better known as HIRE (the Hiring Incentives to Restore Employment Act) goes into effect. On the surface, the bill provides payroll tax breaks and incentives for businesses to hire unemployed workers. But it’s a little-known provision within Bill H.R. 2847 that is causing some financial pundits to predict the end of America. The provision known as FATCA (the Foreign Account Tax Compliance Act) insists foreign banks keep better track of the flow of money owned by U.S. citizens.  FATCA requires banks in other countries to send the IRS personal information (name, address, and account information) about transactions their American customers make. If a bank fails to comply, the U.S. will impose a 30% withholding tax.  The fear is that foreign banks will not want to have to deal with the IRS and instead will choose to take the path of least resistance by avoiding American customers, and by extension, their U.S. dollars altogether. At the same time, FATCA could also be cost-prohibitive for small- and medium-sized foreign banks; meaning it’s cheaper and easier to just divest from U.S.-based assets.  Why would any bank willingly refuse to do business with a U.S. customer? Because there are more financially secure markets elsewhere for foreign banks to invest in: China, Russia, Germany, Australia, France, Canada…the list goes on. How is that possible? After all, the U.S. dollar has been the world currency since World War II, and being the world’s currency means Americans can deal directly with any country with their own currency.In effect, the U.S. doesn’t need to produce anything to create wealth; it can just print more money to get out of debt or create the illusion of liquidity. The same cannot be said for the rest of the world, however, If Germany wants to buy oil from Russia, it has to exchange its currency for U.S. dollars; it can only do this by generating revenue from products and services others want to buy.  Why will the world no longer want to favor the U.S. dollar as the reserve currency? Simple: the Federal Reserve has, with its quantitative easing policy, dumped more than $3.0 trillion into the U.S. economy since 2008. Where did it get the money? It printed it out of thin air. Its simple math: the more there is of something, the less value it has. Not only has the U.S. dollar been devalued, the country has seen its national debt soar. Before the markets crashed in 2008, the U.S. was in debt to the tune of $10.0 trillion; today, the U.S. holds debt of $17.7 trillion! With the U.S. dollar losing favor as the reserve currency, countries will no longer want to hold large quantities of U.S. dollars and foreign businesses will turn their backs on U.S. markets. With fewer people wanting to hold U.S. currency, the U.S. will no longer be able to print its way out of debt.

And with fewer foreign banks willing to take U.S. deposits, Americans, with their fists full of devalued currency, will be unable to exchange it for more stable currencies.  So, will H.R. 2847, once implemented on July 1, 2014, lead to the end of America? No, for many reasons. First, the U.S. is the world’s biggest economy; we produce and consumer more than anyone else. While the U.S. dollar has been devalued, it still holds value compared to other currencies and economies.  The U.S. government is also transparent. Foreign institutions can access our economic data and forecasts and rely on the data; the economic data provided by certain other global powerhouses is not quite as trustworthy or transparent.  Instead of concentrating on July 1, 2014 and H.R. 2847 being the end of America, it might be better to look at what America will look like at the end of 2014.  According to the mainstream media, the U.S. economy is back on track after weathering the biggest financial meltdown since the Great Depression. Wall Street pundits and even the U.S. government point to a number of factors suggesting the U.S. economy is back on solid footing: the five-plus-year bull run on the stock market, the major indices trading at record highs, housing prices having rebounded, and the job market improving.  Unfortunately, those numbers do not tell the full story. The major U.S. indices may indeed be trading at record highs, but the economic foundation holding those stocks up is shaky at best.  Since the beginning of 2013, quarter after quarter, more and more companies on the S&P 500 have revised their earnings guidance lower. To compensate for weak results, companies masked their poor earnings and revenues with cost-cutting measures and near-record stock buyback plans. The unemployment rate is 6.3%, but the underemployment rate is an eye-watering 12.3%. On top of that, 46.1 million, or 14.5% of the country, receive food stamps. And more and more Americans are in debt; according to the most recent data, Americans owe $11.65 trillion in debt. The average credit card debt is $15,191, the average mortgage debt is $154,365, and the average student loan debt is more than $33,000.  What about U.S. housing? Housing prices have risen 25% since the beginning of 2012, but still need to increase more than 20% to reach their pre-recession highs. And the U.S. housing market is too expensive for most first-time home buyers.  In fact, first-time home buyers, the barometer for how well the U.S. economy is doing, accounted for around 16% of new-home purchases in April, down from a range of 25% to 28% between 2001 and 2007. As for existing home sales, first-time buyers made up just 29% of purchases; the 30-year average for first-time homebuyers, and a number economists consider healthy, is 40%. And overall, the homeownership rate in the U.S. is at its lowest levels in almost 20 years.  Bill H.R. 2847 will not be the end of America; on July 1, 2014, America will look identical to the way it does now. But as for America at the end of 2014, that’s another story. The surface data appears really great, but it’s not a true reflection of Main Street. Take a closer, more detailed look at the economic data and you’ll see that the U.S. economy will be much worse on December 31, 2014 than it is today.  To get a handle on debt and raise the standard of living on Main Street, the broader U.S. economy needs to experience sustained growth—and that just isn’t in place yet.

China - British deal = "adios" Euro !!!

China and Britain have reached a three-year deal to swap their currencies when needed, the first such agreement between Beijing and a major developed economy and a move that could help boost the Chinese Yuan outside Asia.... In a statement released late Saturday, the Bank of England said Governor Mervyn King and his counterpart at the People's Bank of China, Zhou Xiaochuan, signed an agreement to set up a three-year swap line with a maximum value of 200 billion Yuan ($32.6 billion). It means that Bank of England could draw on the line with the PBOC when there is a sudden shortage of Yuan funds in the U.K. market—and make the Yuan, also known as renminbi, available to banks under its jurisdiction.  China's central bank has increasingly used such bilateral currency-swap deals in its effort to promote the Yuan in global trade and finance. So far, the PBOC has signed nearly two trillion Yuan worth of currency-swap deals with some 20 countries and regions, including Hong Kong, Thailand, Singapore, New Zealand, Argentina and Malaysia. Most of the pacts so far have been with emerging economies in the Asian-Pacific region and don't include major economies such as the U.S., Japan and those in the euro zone. These currency lines, though rarely tapped, could enhance foreign investors' confidence in trading of the Yuan. An expansion of Yuan trading into London could help China advance its goal of turning the Yuan into an international currency, a key part of its broader push to open up its financial system. Currently, Beijing maintains a tight leash on cross-border fund flows, making it difficult for the Yuan to accumulate overseas. Chinese officials in recent months have increased their rhetoric toward making the Yuan a freer currency, hinting that a plan on Yuan convertibility would be proposed later this year and include steps aimed at allowing freer flows of its currency and ways to let Chinese individuals make overseas investments. Some scholars within China expect the Yuan to become basically convertible as early as 2015, though Chinese officials have never given a timeline for how soon that would occur. The timing would depend on progress in China's efforts to overhaul its creaky financial system and open its capital account—efforts that could be slowed if China's economy sputters or its financial system hits turbulence.  U.K. and European bankers as well as the politicians are counting on the Yuan to help cement London's role as the center for global foreign-exchange trading. This comes as cities such as Singapore, Tokyo, Taipei, Luxembourg and Kuala Lumpur are all exploring the possibility of becoming offshore Yuan trading hubs—a status only the Chinese.

A summit of leaders on Feb. 4 produced no breakthrough, with Germany and France introducing new proposals for boosting competitiveness across the zone, prompting renewed disagreement among states. Another summit is due to be held after March 9 to sustain momentum towards a deal, with the complete package expected to be finalised at another summit on March 24-25 in Brussels. Below are ideas that have been discussed formally or informally and could be included. Some measures face strong opposition from Germany and appear unlikely to make it.

INCREASING THE EFFECTIVE LENDING CAPACITY OF THE EFSF

There is a strong chance of this step being adopted. The nominal lending capacity of the European Financial Stability Facility, the euro zone bailout fund, is 440 billion euros, but because of a system of guarantees to secure a triple-A credit rating, the special purpose vehicle has an effective lending capacity of only around 250 billion euros. The European Commission, France, Germany and others agree that the effective lending capacity should be boosted to the full 440 billion and talks are focusing on how to do that. The idea of raising the EFSF's overall size above 440 billion euros was rejected by euro zone ministers on Jan. 17.

HOW COULD THE EFSF'S CAPACITY BE INCREASED?

Lifting the EFSF's effective capacity could require euro zone states to increase their guarantees, forcing some governments to seek fresh approval from their parliaments. This could be politically tricky in countries such as Germany where public opinion is against bailouts of countries that have been overspending or not kept budgets in check. Berlin has indicated that instead, euro zone countries with a rating below the top notch could inject cash into the EFSF, making up for their lack of a triple-A grade. If the 11 non-AAA countries in the euro zone injected cash, the fund would no longer need cash buffers to secure its rating and could therefore lower its interest rate. But non-AAA countries are not keen to spend cash, so the end-result could be a mix of both options, euro zone sources have indicated.