DAVOS - Hopes that Germany might crumble, and agree to the sort of things that would help resolve the crisis – a bigger firewall, some form of debt Maturalization, bolder central bank intervention – have been further dashed here. Angela Merkel, the German Chancellor, has been as defiant as ever. Of course, any kid with an O level in economics will know that if you lend countries money so that they can buy from you, sooner, or later, you will come unstuck. And the euro and Germany is coming unstuck big time. So much so, the last I heard was that no German banks were lending to any country other than Germany - nice!
Therefore, why Germany is refusing to accept the inevitable outcome of its failed economic practices is beyond any reasonable comprehension. I guess, the only reason could be that, if it agrees the countries can't pay back their debt and the troikas are not that stupid to bailout Germany's debtors so that they can pay their debts to Germany giving it an unfair advantage over us (who are also owed), then Germany itself will have to give one hell of a Barber of Seville haircut to its euro zone debtors - basically all the euro (and non-euro) using EU member states which were all practically bankrupt when they were admitted to the suicide pact called the EU.
The question we have to ask is what happens after Greece defaults, it's never going to be able to pay off it's loans no matter how many times the money markets threaten to break someone's legs. There will come a point where people will turn around and say no and then those put in power by the money markets will be run out of town.It also doesn't make a whole bit of difference if the whole of EuroZone is rated below AAA by Standard and Poor. The crisis is too deep and will be too long lasting for any of the measures now being talked about to effective. I am wondering what will their approach be after Obama is re elected, probably more of the same I expect. As this recession continues into a long term depression I am wondering how long it will take for Joe public to realize they have been had over all the deficit, debt reduction bull. Because any QE here or in the US doesn't kick start the economy but goes into the pockets of the very people who caused the crisis in the first place.

Headlines ...lies and stupid "IDIOTS" like Rehn blowing wind !

• Spanish unemployment reaches 5.3m, or 22.8%, raising the prospect that Spain could ask Brussels for a softening of its deficit targets
• EU commissioner Ollie Rehn says a Greece deal is 'very close' with another meeting of the Greeks and creditors tonight
• A sharp fall in business lending in the eurozone has increased fears of a second credit crunch
• Portuguese bond yields have continued to rise on fears that the indebted country may need a second international bailout

A lot of hot air from the incompetents in Bruxelles - measures amount only to kicking the can down the road : German and French authorities have begun work on a three-pronged strategy behind the scenes amid escalating fears that the eurozone’s sovereign debt crisis is spiralling out of control. Their aim is to build a “firebreak” around Greece, Portugal and Ireland to prevent the crisis spreading to Italy and Spain, countries considered “too big to bail”. According to sources, progress has been made at the G20 meeting in Washington, where global leaders piled pressure on the eurozone to fix its problems before plunging the world back into recession. In a G20 communique issued on Friday, the world’s leading economies set themselves a six-week deadline to resolve the crisis – to unveil a solution by the G20 summit in Cannes on November 4. Sources said the plan would have to be released as a whole, as the elements would not work in isolation. First, Europe’s banks would have to be recapitalised with many tens of billions of euros to reassure markets that a Greek or Portuguese default would not precipitate a systemic financial crisis. The recapitalisation plan would go much further than the €2.5bn (£2.2bn) required by regulators following the European bank stress tests in July and crucially would include the under-pressure French lenders. IT BECOMES CLEARER AND CLEARER - EURO MUST GO ! - along with Merkel, Sarkozy, Berlusconi and the incompetent crowd from Bruxelles !

Mark Pritchard, the secretary of the 1922 committee of Conservative MPs, is the most senior Tory yet to demand a vote on Britain’s membership of the European Union following the eurozone crisis. Writing in The Daily Telegraph, Mr Pritchard says that the EU has become an “occupying force” which is eroding British sovereignty and that the “unquestioning support” of backbenchers is no longer guaranteed. He says the Government should hold a referendum next year on whether Britain should have a “trade only” relationship with the EU, rather than the political union which has evolved “by stealth”. He warns that the Conservatives will see constituents “kick back” if taxpayers are forced to foot the bill for the failure of “unreformed and lazy” eurozone countries to introduce fully-fledged austerity measures. Mr Pritchard is a leading figure in a group of 120 Conservative MPs who are pushing the Prime Minister to set out a “clear plan” for pulling back from Europe.

Eurozone finance ministers rejected a plea from Timothy Geithner, the US Treasury Secretary, to expand the European Financial Stability Fund (ESFS) to tackle the escalating debt crisis in the region. He called for the 17 European countries that use the single currency to commit money to avoid financial system difficulties but rejected suggestions for a financial transaction tax, Austria's finance minister said. Maria Fekter was commenting on an exchange between Mr Geithner and finance ministers including Germany's Wolfgang Schaeuble in Poland on Friday. She said: "He conveyed dramatically that we need to commit money to avoid bringing the system into difficulty ... [but] Schaeuble made him very aware that it was unlikely to be possible to push that onto taxpayers, and especially not if [the burden] is imposed mainly on the triple-A countries." Ms Fekter said: "In these countries, there is a desire for a transaction tax because a transaction tax would use the liquidity which is on the market for stability. He (Geithner) ruled that out." At the meeting in the Polish city of Wroclaw, eurozone countries delayed a decision on whether to grant the next $8bn tranche of bailout funds to Greece until next month. A European Commission team arrived in Athens this week to assess the progress of the austerity drive, and will report back to Brussels. The basis of the team’s findings will dictate whether the funds will be released. Mr Geithner's presence in Wroclaw reflects deep worries in Washington that the scale of euro-zone debt crisis could inflict further woe on America’s struggling economy. “What is very damaging (in Europe) from the outside is not the divisiveness about the broader debate, about strategy, but about the ongoing conflict between governments and the central bank, and you need both to work together to do what is essential to the resolution of any crisis,” he said after the meeting. “Governments and central banks have to take out the catastrophic risks from markets ... (and avoid) loose talk about dismantling the institutions of the euro.” Euro-zone ministers also called for the ratification of the July 21 agreement on upgrading the European Financial Stability Facility (EFSF). The agreement allows for the facility to recapitalize institutions and intervene in the markets. They called for all member states to ratify the agreement by early October.

Staple foods became 20 to 40% more expensive between July 2010 and February 2011, shows the Z.F. index calculated based on prices in Bucharest hypermarkets. ZF selected 15 products whose price it has been following since 2008, once every six months, at the same Bucharest hypermarkets, Carrefour Orhideea and Real Afi Cotroceni. These products were chosen because they are most often to be found in Romanians' purchase basket. (Z.F.)

In the calculation of this index, ZF chose one brand from each category of products, a brand that is well positioned in terms of market share, produced by one of the top-five players in the category. Therefore, one kilo of Băneasa flour costs 2.8 lei in February, 41.4% more than in July 2010. 1 Kilo of Lemarco sugar now costs 4.295 lei, compared with 3.28 lei, an increase of 30.9%. Similarly, the price of Floriol vegetable oil (1 litre) rose over 35%, from 5.11 lei to 6.91 lei. Data from the National Statistics Institute (INS) point to a 10.2% price increase for flour in the July 2010 - January 2011 period. Similarly, the increase amounted to 8.1% for sugar. The only products whose prices fell, of those analysed by ZF, were beer, mineral water, apples, with the decline amounting to 6.1%, 0.1% and 12.4% respectively.

BERLIN - The succession of European Central Bank President Jean-Claude Trichet will not be a topic at this week's Group of 20 meeting and will be dealt with after March, German Finance Minister Wolfgang Schaeuble said on Friday. "We will then see (if there will be a German candidate). The important thing is that we will have a good candidate," Schaeuble added in an interview with German radio channel Deutschlandfunk.BCE,EURO,Dollar,RON,Crisis Agerpres, Mediafax
FRANKFURT - Emergency borrowing from the European Central Bank remained exceptionally elevated for a second straight day on Friday, intensifying speculation that one or more euro zone bank might be facing new funding problems. ECB figures showed banks borrowed more than 16 billion euros in high-cost emergency overnight funding, the highest amount since June 2009 and well above the 1.2 billion euros which banks were taking before the figure first jumped on Thursday. The ECB gives no breakdown of the borrowing figures and declined to comment on Friday when asked for an explanation for the jump. Traders remained unsure whether the spike was due to a serious funding issue or whether a bank had simply made an error earlier in the week by not borrowing enough at the ECB's regular weekly funding handout. If a bank, or number of banks, did not get enough funding, and were unable to make up the difference in open markets, they would be forced to use the ECB's emergency facility until the next ECB tender came around. The next ECB offering is on Tuesday, banks get the money on Wednesday, meaning any change would evident in figures published early on Thursday. "As no bank or banking group from any euro zone country is aggressively seeking money in the interbank market at the moment, it is likely that something went wrong at the main refinancing operation," said one euro zone money market trader. "The bank or banking group needs to tap the ECB for the money whether they like it or not, or they are doing that so as not to appear active on the money market and to thereby be stigmatized," he added

European bank shares were down 1 percent by 1100 GMT while the euro fell against the dollar and other major currencies for much of the morning. Money markets showed little reaction, however. Key euro bank-to-bank lending prices remained on a downward trajectory, a direction traditionally at odds with rising tensions. The theory that the spike was due to human error appeared to be supported by data from the ECB's latest weekly funding operation. Banks borrowed the lowest amount since June at the tender, 19 billion euros less than the previous week and well below expected demand of around 160 billion euros.

However, a monetary source in Italy, speaking on condition of anonymity, told Reuters that the increase in borrowing was not a technical problem and was a sign that money markets were still not functioning correctly and geographically split in the wake of the global financial crisis. The source said the Italian banking system continued to have good access to money markets, while high-level Spanish financial source said the jump was not down to Spanish banks. The borrowing jump added extra complexity to the question of whether the ECB will scale back, or extend, its money market support measures at its next meeting on March 3.

ECB President Jean-Claude Trichet said in a recent interview that the health of money markets had improved, although Belgium's Guy Quaden said this week liquidity support remained necessary. "If the increased use of the marginal borrowing facility is due to new problems in the banking system this would call for an extension of the ECB's liquidity support," said UniCredit analyst Luca Cazzulani. "The ECB knows exactly who is borrowing the money and why they are doing it. If it is due to a mistake then it should not influence their thinking at all." The extra 0.75 percent which banks have to pay for overnight funding from the ECB normally means it is used only as a last resort. The last time before this week that overnight borrowing exceeded 10 billion euros was on June 24, 2009, when it was 28.7 billion euros, the highest ever. This year, emergency overnight borrowing has been above 1 billion euros only twice. Traders said while mistyping the required amount or missing the ECB's tender altogether would be an unlikely mistake, it could happen. "It would be a huge oversight and pretty unlikely but it is possible if a lot of things conspired against you," said one London-based money market trader. "If it is a mistake then someone's boss is not going to be very happy." A number of banks, mainly from the euro zone's most debt-strained countries but also troubled banks in core countries, remain barred from open money markets and almost completely dependent on the ECB for funding.

Romanian tax authority ANAF will refund in January value added tax to companies worth 1.36 billion lei (EUR1=RON4.2621), the highest sum returned so far in a single month, the authority said Wednesday.

Romania To Pay VAT Refunds Worth RON1.36B In January

Of the total refunds, ANAF has already paid Monday RON557 million, and will pay the rest of the sum by the end of the month. Some RON1.21 billion of the total refunds represents compensations.

In the past three years, over 52% of Fondul Poprietatea (FP) shares changed hands, according to data published by the Central Despository, with the value of transactions amounting to over 600 million euros, considering the prices thrown around the market. Transactions with Fondul Proprietatea (FP) shares boomed in the past year, after the appointment of American group Franklin Templeton as fund manager and the fund's Stock Exchange listing became a certainty. Around 30% of the shares changed hands in 2010. The estimated value of transactions, based on average prices thrown around the market, amounts to nearly 2 billion RON = over 460 million euros), accounting for 35% of the overall volume traded on the Stock Exchange. Foreign funds, SIFs (financial investment companies) and local speculators last year loaded their portfolios with Fondul Proprietatea shares, investing tens of millions of euros in the hope that the Stock Exchange listing will bring the price of shares up. For all these investors, the stake of listing Fondul Proprietatea is huge. The prices at which FP shares were traded last year fluctuated between 0.25 RON at the beginning of the year, and highs of around 0.6 RON in September, prior to dividend distribution. The fund's net asset value (NAV) is currently around 1.11 RON, according to FP reports.euro, criza datoriilor de stat, euroscepticismul, monede nationale, renuntarea la euro, salvare euro, zona euro

Real estate developers scheduled for delivery in 2011 at least eight retail projects in Romania totaling a surface of over 230,000 square meters, 17% more than the total area of projects completed in 2009, according to property analysts.

In 2009, developers completed retail projects totaling 195,000 sqm, according to CB Richard Ellis (CBRE) data.

Oradea Shopping City, Uvertura City Mall Botosani, Vitan Outlet Bucharest, Policolor Shopping Center Bucharest and Electroputere Shopping City Craiova are other projects scheduled for completion in 2011. Read more on http://www.mediafax.biz/. (Z.F.)euro, criza datoriilor de stat, euroscepticismul, monede nationale, renuntarea la euro, salvare euro, zona euro

Germany sees no alternative to the Euro

(Reuters) - Germany sees no alternative to the euro and Angela Merkel's government believes the best way to strengthen the currency which has helped make the German economy so competitive is closer policy convergence across Europe.
But with German public support in the balance for rescuing euro partners Greece, Ireland and possibly others, it is a tough message for the domestic audience. This explains the apparently mixed messages emerging from Berlin. Germany voices strong objections to some of the proposed solutions to the euro crisis, such as joint euro zone bonds, and Merkel's insistence on a crisis mechanism from 2013 involving private investors has upset markets.
"But in the end Germany has a vital interest in the survival of the currency union," Dekabank economist Andreas Scheuerle said. While mass-selling daily Bild runs headlines like "How Long Will the Euro Hold Out?" and some pundits suggest a north-south euro divide, the crisis seems to have hardened the German establishment's view that there is no alternative to the single currency. The government, including the sometimes fractious members of Merkel's centre-right coalition, plus the business world and the serious media are at pains to nix any talk of Germany losing its enthusiasm for the euro or returning to the deutschemark. Economy Minister Rainer Bruederle, from the Free Democrats, Merkel's often uneasy coalition partners, said on Thursday reinstating national currencies in the euro area was "not realistic". Merkel repeats that Europe's fate is inextricably tied to the currency shared by 16 countries and her comments on private investors needing to share in sovereign risk from 2013 reflect a belief that the euro will still be around. Currently enjoying a much stronger economic recovery than its partners, Germany may return to pre-crisis growth levels as early as next year, largely thanks to exports. So grumbles about the euro are slapped down with the argument that a revived deutschemark would quickly render German exports too expensive."The mark would be so overvalued against other currencies that our exports would be in trouble," said Andre Schwarz of the exporters' association BGA. "The solution is not to let the euro break up."Agerpres, Mediafax, Romanian Vancouver Sun,Global News, Financial Times,Le Monde,Tribune, ,Wall Street Journal,The Washington Times,Athens News,The New York Times,USA Today

The Irish government stood on the brink of collapse Monday

DUBLIN (Nov. 22) -- The Irish government stood on the brink of collapse Monday, a day after being forced to accept a massive bailout from the European Union and the International Monetary Fund.Irish Prime Minister Brian Cowen said he would call an election for early next year, once Ireland passes an emergency budget and finalizes the bailout.The admission represented a huge political blow to Cowen, who only days ago was denying even the need for a bailout to solve the problems brought on by Irish banks' reckless speculation in overpriced real estate.
Ireland's six banks, five of which are already nationalized or part-owned by the state, would be pruned, merged and possibly sold off."Because of the huge risks they (Irish banks) took earlier this decade, they became a huge risk not only to this state but to the eurozone as a whole," he said.Irish banks invested aggressively in runaway property markets at home and abroad. After the 2008 credit crunch sent property prices into freefall, the government tried to save the banks from bankruptcy by insuring all of their borrowings against default. That unprecedented promise - made to retain investor confidence in the country - cannot be kept without a bailout, the government has finally been forced to concede.Unions warned that overhauling the banks would mean thousands more lost jobs in Ireland, where unemployment has already reached 13.6 percent, the second-highest rate in Europe after Spain.Banca Mondiala,FMI, Guvern,agenda de business, bugetul de stat, economie, revistapresei,romania,antena3.ro,realitatea.net,mediafax,bucuresti,camera de comert

"ID card-based" lending?

Bankers, who during the economic boom period lured clients with consumer loans granted upon proof of ID, have over the past two years been trying to offset the declining demand for large loans through aggressive promotional offers for credit cards, which have become the main growth driver of the retail segment overnight.
Amid the falling sales of traditional loans, could credit cards become the new form of ID card-based loans, given that as small sums are involved clients get such a product more easily?

Economists do not like such an outlook, rather viewing this as a bet on the future that could prove risky.Last year, many banks reported two-digit increases in the number of issued cards and the value of sums approved on such cards, as consumer loan portfolios shrank and housing loans were supported only by the "First Home" scheme.In 2010, card portfolios rose at a slower pace amid the prolonged recession, but promotions offers are still driving sales, even though at a slower pace. Banca Mondiala,FMI, Guvern,agenda de business, bugetul de stat, economie, revista presei,romania,antena3.ro,realitatea.net,mediafax,bucuresti,camera de comert

Statistics

On the Bucharest Stock Exchange there are over 91,700 investors, 2800 fewer than at the beginning of the year, the bulk of whom have shares worth less than 15,000 euros in their portfolios, the cap for full compensation in case of losses generated by the bankruptcy of a brokerage firm.The overall value of portfolios held by Stock Exchange investors has fallen by 94 million RON (22 million euros) in the first nine months of the year to 11.4 billion RON (2.68 billion euros), while the number of investment accounts fell by 2,790 in the first nine months, to 91,721, according to statistics supplied by the Investors Compensation Fund - the institution in charge of compensating investors in case of a broker's bankruptcy.