The Polish electorate is fed-up with Brxelles...

Bronislaw Komorowski, the Polish president, has a fight on his hands to remain in office after coming a surprise second in the first round of voting in Poland’s presidential elections on Sunday, according to exit polls.  Taken after voting stopped at 9pm local time, the polls put Andrzej Duda, candidate from the conservative Law and Justice party, 2.6 per cent ahead of the president with 34.8 per cent. With no candidate securing an outright majority the two men will meet in a fortnight’s time in a run-off vote.   If the result stands, it will come as major surprise.  An affable former anti-communist dissident Mr Komorowski became acting president in April 2010 when as speaker of parliament he was elevated to the office under the terms of the Polish constitution following the death of Lech Kaczynski, then the president, in a plane crash in western Russia. Opinion polls had routinely found the president as the most popular politician in Poland, and polls before Sunday’s vote had put ahead of Mr Duda.  Political commentators in were quick to attribute Sunday’s surprise result to the president’s apparently low-key and complacent election campaign.  Along with Mr Duda, the other big winner on the night was Pawel Kukiz, a former rock star and strident government critic, who won 20.3 per cent of the vote, according to the polls.  The night was a disaster for the left-wing Democratic Left Alliance. Once a dominant force in Polish politics, the party’s candidate Magdalena Ogorek came in with just 2.4 per cent.  

Greece's finance minister has ramped up the political stakes in his country's debt drama, by personally telling President Barack Obama to push eurozone creditors over his country's bail-out crisis. In an 12-minute exchange with the President on the sidelines of an event marking Greek Independence day, Mr Varoufakis is reported to have repeated his desire for the US leader to influence events.   Mr Obama is reported to have responded by urging flexibility from both parties.  

Greece's Leftist government has looked to the White House to play the role of honest broker in protracted negotiations with its international creditors. Following Syriza's election in January, the President called for an end to harmful austerity policies and the introduction of a "growth strategy in order for them to pay off their debts to eliminate some of their deficits.” ...  Hopes of a deal before a meeting of the eurozone's finance ministers on April 24 have rapidly faded as both sides show no signs of bridging their differences over Greece's cash-for-reforms bail-out extension.   "In the absence of a deal in the next few weeks, the government might not be able to avoid default, which – we fear – would likely raise the risk of Grexit," said Reinhard Cluse at UBS.  The situation has become increasingly critical as Greece's public funds dwindle and the government faces a near €1bn IMF bill in the first two weeks of May. IMF managing director Christine Lagarde repeated that she would not countenance any delay in payment to the Fund.  “We will do everything we can so lending to the Fund remains the safest lending route any debtor can adopt. That is my determination” said Ms Lagarde. ...  Unfortunately for the Greeks, this is not Obama's call to make here. The Euro Zone is left to its own faltering accord. Quite sometime ago, Greece was thrown out of the Markets, and there is very little anyone can do to get Greece back in with all of this airing their dirty laudry infighting. Calmer heads did not prevail after the Greeks elected this Syriza government. Austerity and internal deflation have political consequence. The EU wont work with Syriza, but an overwhelming majority of Greeks approve of them. Would not be at all surprised if we see a Grexident soon. Only then will all of the self appointed experts report what really went wrong here, just like with Lehman. Heads will roll after the fact. Not Obama's call to make. His advice? Play nice guys. Geithner shook his head in disbelief at how this matter was handled quite sometime ago as well. Little good anyone can do the Greeks now. This situation calls for Greek self help. No not the Troika's prescription. Sorry to say, there is no way around declaring insolvency, rebooting, and starting over.

Greece could be safe for another few weeks, according to the Times newspaper, if Germany pays back a loan they took out from the Greek Govt during the war. In today's money this was about 10 billion Euros. The loan was fully documented and acknowledged by Germany just 26 days prior to the end of the war. So Tsipras could dig out this document and use it as collateral. Pheww - Greece is saved - maybe!!!   Suddenly, share markets in European and USA have gone up hugely because of this good new of repayment to IMF.   However, it is more dangerous now. According to a report, Greece issue new T-bills to cover the repayment. Then, who has/have bought the new T-bills?

Firstly, these T-bills are at higher rates, like somewhat 3.5% which is much higher than the interest rates by ECB and IMF. So, some US economists are predicting the Greece default will happen just a little bit later. By laymen's saying, the can has been kicked further down the road. However, the can has also become bigger and harder to kick further down next time.  Secondly, if Greece keeps issuing T-bills and borrowing new debts from unknown lenders (like Russian consortia), then the issue is getting more and more nontransparent. This non-transparency may explode without early on notice, like the happening of bankruptcy of the Lehman Brothers Bank in USA back in the end of 2008.  If you are a share trader, be careful.  Funny isn't it? If memory serves correctly the Greek Government have been demanding the return of 1.2 Billion Euros that were inadvertently overpaid by the previous Government and the only answer they have received so far from the ECB has been 'get stuffed'. Default Day arrives and hey presto! the ECB releases 1.2 Billion Euros to keep the Greek Economy out of it's coffin. Seems to me that the ONLY thing the Greeks received yesterday was their OWN money back dressed up as another LOAN....When this lot goes belly up, and it will, when the dust has settled and the TRUTH starts to come out, I think the world is going to be shocked beyond belief at the amount of lying, suffering and skullduggery that will be revealed...Daft ain't 'it.. child's  accounting..makes my grandson look smart. Unchecked decade of capital asset-flight pulling the carpet from under the Greek banks; EZB provides the drip-feed ELA's to counter; what the heck is Lagarde up to ? Give 'em whatever dosh and now "whoa got some back !" Tspiras thought he would bring down the rotten edifice and he's still got a few big chances to do it. Will he really press with the reforms, some fractious constitutional ones ? Doesn't look it. That transformer reform list that Yanis gave to the EU finance committee "Djssel diesel", is probably scrupled up and binned.
The problem is Lagarde, it couldn't get more fictive. It highlights the IMF's mistake of pumping Greece with bailout dosh in 2010. It's going to be mighty hard/impossible for Greece to deal with those massive May June reimbursements with without more assistance from the EZB, and Germany again coming into the fray as the stupid merry go round looses it's centrifuge.

Report UE - The central question in the report is that of forced loans the Nazi occupiers extorted from the Greek central bank beginning in 1941. Should requests for repayment of those loans be classified as reparation demands -- demands that may have been forfeited with the Two-Plus-Four Treaty of 1990? Or is it a genuine loan that must be paid back? The expert commission analyzed contracts and agreements from the time of the occupation as well as receipts, remittance slips and bank statements.  They found that the forced loans do not fit into the category of classical war reparations. The commission calculated the outstanding German "debt" to the Greek central bank and came to a total sum of $12.8 billion as of December 2014, which would amount to about €11 billion.  As such, at issue between Germany and Greece is no longer just the question as to whether the 115 million deutsche marks paid to the Greek government from 1961 onwards for its peoples' suffering during the occupation sufficed as legal compensation for the massacres like those in the villages of Distomo and Kalavrita. Now the key issue is whether the successor to the German Reich, the Federal Republic of Germany, is responsible for paying back loans extorted by the Nazi occupiers. There's some evidence to indicate that this may be the case.  In terms of the amount of the loan debt, the Greek auditors have come to almost the same findings as those of the Nazis' bookkeepers shortly before the end of the war. Hitler's auditors estimated 26 days before the war's end that the "outstanding debt" the Reich owed to Greece at 476 million Reichsmarks.  Auditors in Athens calculated an "open credit line" for the same period of time of around $213 million. They assumed a dollar exchange rate to the Reichsmark of 2:1 and applied an interest escalation clause accepted by the German occupiers that would result in a value of more than €11 billion today.

EU Commission chief Jean-Claude Juncker warned Friday of an alarming lack of progress in talks on Greece's bailout, as Germany raised the spectre of a tumultuous Greek exit from the euro.

Juncker was meeting Alexis Tsipras, the leader of the hard-left Syriza party who came to power in January, just days after Tsipras renewed a demand that powerful Germany repay debts from its Nazi past.  "I am not satisfied by the developments in the recent weeks," Juncker said before talks began with Greece's 40-year-old premier and amid acute concern that Greek coffers could run empty at any moment.  "I don't think we have made sufficient progress, but we will try to push in the direction of a successful conclusion of the issues we have to deal with."  Greece won a four-month extension of its EU-IMF bailout in February -- despite Tsipras initially saying he wanted to abandon austerity and have a completely new arrangement -- but it will not get any of the cash until new reforms are approved by its eurozone partners.  But frustrations with the Greek government are mounting with its 18 fellow eurozone members after Athens this week renewed the claim to Germany for World War II debts seen as outlandish by its partners.  Greece's harshest critic, German Finance Minister Wolfgang Schaeuble, warned that with all the time wasted, a disorderly "Grexident" that could push Athens out of the euro could not be excluded.  "To the extent that Greece is solely responsible and decides what is to happen, and we don't know exactly what Greek leaders are doing, we can't exclude it," Schaeuble told Austrian broadcaster ORF.   A German finance ministry spokeswoman later rowed back on Schaeuble's comments, stressing that "we do not want Greece to leave."

What did Greece do with the money? Put on an Olympics, pay higher pensions, hire more government workers and overpay them ? Even if we admit that Greece had a debt to gdp ratio far in excess of the 60% claimed when they joined it was not 120% or 150+% when they needed their first bailout. Even Ireland and Spain's own banking regulators could have applied the brakes to their housing bubbles by simply raising the down payments to get a mortgage or construction loan. They were also bribed to buy (faulty) German submarines and unreliable metro/trams and much else by German firms like Siemens (which profited mightily by use of slave labor, even going so far as to open a branch in the Ravensbruck concentration camp). The Greeks were also inundated by loans from French and German banks, and the so-called bail out was, in fact, a bail out be the poor, long-suffering European tax-payer, including Greek ones, of those banks by the corrupt Euro-political class.

Eurozone finance ministers have approved reform proposals submitted by Greece as a condition for extending its bailout by four months, officials say.  The Eurogroup said it had agreed to begin national procedures - parliamentary votes in several states to give the deal final approval.   The measures proposed by Greece include combating tax evasion and tackling the smuggling of fuel and tobacco.  The European Commission said earlier they were a "valid starting point".   Eurozone finance ministers - known as the Eurogroup - then held a conference call before giving their backing to the Greek proposals.  "We call on the Greek authorities to further develop and broaden the list of reform measures, based on the current arrangement, in close co-ordination with the institutions," the Eurogroup said in a statement.  The agreement had "averted an immediate crisis", said European Commissioner for Economic Affairs Pierre Moscovici.   "It does not mean we approve those reforms, it means the approach is serious enough for further discussion," he added.  'Lack of clear assurances' .  However, International Monetary Fund (IMF) head Christine Lagarde was quoted as expressing reservations about the reform proposals.  "In some areas like combating tax evasion and corruption I am encouraged by what appears to be a stronger resolve on the part of the new authorities in Athens," she wrote in a letter to the Eurogroup.  "In quite a few areas, however, including perhaps the most important ones, the letter is not conveying clear assurances that the government intends to undertake the reforms envisaged."

Gold Rush ??? -A few years ago annual production was 13,000,0000 ozs,it is now 10,000,000 ozs worldwide,although figures for Russia and China are vague and possibly unreliable.We do know,however,that they do not export in any volume that which they do mine.  I have a friend ,a board member ,of a company ,that produces 1,000,000 ozs per annum.it s no secret that they have enough ore above ground for about two years production,they are ,at the moment,not mining.  Now,onto consumption,prefaced by the admission that I reside in Thailand,and I am speaking as I see the situation here and indeed the surrounding countries of S.E.Asia.  The general population buy gold to keep for weddings and the rainy day syndrome.They do not buy as an investment or for trading,the spread is too great.  The Chinese will,if the coming year is thought to be unfavourable.  India,the largest consumer, placed tax on imports a couple of years ago of  (I believe) 5%.  My question to my self at the time was answered by an Indian who was trying to come to an agreement with the company mentioned above,to no avail of course,when he reminded me of our conversation of sometime before,years in fact,when he predicted that middle class Hindu brides,say five or ten million every year,would swallow world production.  The presumption I now have confirmed to myself is that most markets are manipulated,you and I will be allowed to gamble in shares bonds and propery,because they are our decisions and will be our fault.The underpinning we used to enjoy fifteen years ago ,is no more.Good luck and God bless you all ... $1000 dollars of gold stuffed under the mattress a hundred years ago would be more valuable today than $1000 in cash stuffed under the same mattress, so people saying pieces of paper issued by a central bank are a better bet than gold are clearly talking nonsense, how are those Hapsburg thalers, Reich marks or Czarist rubles doing these days?  But, and it is a huge but, gold only retains its value in a civilized society, it is spectacularly useless when society breaks down a fact about which many gold buyers seem to be completely unaware. How the heck do you think gold coins will save your neck when the Morlocks are coming over the garden fence?  The mere fact of owning gold will mark you out for immediate attack. The first time you go to the market to buy your bag of rice with a gold sovereign is the moment your fate is sealed.  Historically Jews and other persecuted groups kept their wealth in gold as they figured it was their passport when the crisis came, all it meant was that the bad guys knew to strip them naked and steal their clothes and luggage after chasing them out while the peasants ransacked their homes looking for the secret stash.  Think of those caches of gold dug up by archeologists, which we are told were hidden to keep it safe from the Vikings and ask yourself how much use all that gold was to its original owner. 

The Greeks were screwed to save the banks, now the banks are free, they are being screwed to save EU taxpayers and the debt just keeps on growing, how anyone thinks this makes sense I do not know....Grexit is inevitable. The only question is when, and how?  Many imagine Grexit will mean be a return to the Drachma and cheap holidays in Greece and maybe even cheap property to buy in Greece.  The reality will be very different.  You cant wind the clock back to the nineties (some DT journalists think you can!).  Most likely scenario is a semi-orderly/disorderly retreat from the Euro.  Starting this weekend with drastic capital controls to prevent a run on Greek banks next week , in the run up to the 28 Feb deadline.  Followed by either a cut in Govt spending (unlikely) or IOU’s and delayed payments for /salaries /pensions/ contracts from the Greek govt.(more likely)
Reason being the Greek Govt budget is already at -12% at end of last year - they are bankrupt  and this is set to go higher - Greek taxpayers aren’t paying their taxes …they are stuffing their spare Euros in offshore accounts or under the mattress, plus the social spending promised by Syriza– rehiring public employees, pensions at 50, free energy for some (the ones who voted for them).   The introduction of capital transfer controls and IOU’s by Greek Govt will be de facto exit from Euro , although officially Greece wont leave the Euro and cant be kicked out… instead a dual currency economy will exist.   You will still pay for your holiday in Greece this year in Euros… nothing will change for those parts of the Greek economy which are productive and competitive. Likewise real assets like property will keep their Euro value.   A situation much like Cambodia for example – a third world country but with a competitive tourist industry. Tourists pay in Dollars and get dollars from ATM’s , but every time they pay with foreign currency they get their small change in local currency …ending up with a pile of useless local currency at the end of the holiday.
Unproductive parts of the Greek economy – public employees, pensioners, unemployed and the poor will have to use local, depreciating currency on a hand to mouth basis, like all banana republic currencies.  But if you are a Brit- look on the bright side - the depreciation in the Euro , primarily due  to this Greek fiasco, will result in holidays being 10-15% cheaper in2015 , as compared to 2014….

The former head of the US central bank, Alan Greenspan, has predicted that Greece will have to leave the eurozone. He told the BBC he could not see who would be willing to put up more loans to bolster Greece's struggling economy.  Greece wants to re-negotiate its bailout, but Mr Greenspan said "I don't think it will be resolved without Greece leaving the eurozone".  Earlier, UK Chancellor George Osborne said a Greek exit would cause "deep ructions" for Britain.  Mr Greenspan, chairman of the Federal Reserve from 1987 to 2006, said: "I believe [Greece] will eventually leave. I don't think it helps them or the rest of the eurozone - it is just a matter of time before everyone recognises that parting is the best strategy.  The problem is that there there is no way that I can conceive of the euro of continuing, unless and until all of the members of eurozone become politically integrated - actually even just fiscally integrated won't do it."  Following the election in Greece of the anti-austerity Syriza party, Greek ministers have been touring European capitals trying to drum up support for a re-negotiation of its bailout terms.  However, there appears little willingness in Berlin, or at the European Central Bank, to alter the terms of its €240bn (£182bn) rescue by the European Union, ECB, and International Monetary Fund.  "The [bailout] conditions with Greece were generous, beyond all measure,'' German Finance Minister Wolfgang Schaeuble said last week. He saw not justification for relaxing them further. Euro break-up ... Mr Greenspan said: "All the cards are being held by members of the eurozone." He also warned that trying to hold the 19-nation euro bloc together "is putting strain on everybody". He said as well as Greece leaving the eurozone, there was a real risk of a "much bigger break-up" with other southern European countries forced out. Earlier on Sunday, Mr Osborne told the BBC's Andrew Marr Show that the UK was stepping up contingency planning to prepare for a possible Greek exit. "This stand-off between Greece and the eurozone is increasing the risks every day to the British economy," the chancellor said.  A Greek exit from the single currency would create instability in European financial markets and cause "real ructions" in Britain, too, he added.

Syriza swept to power pledging to rebuild Greece on four pillars - restarting the economy, regaining employment, transforming the political system and confronting the humanitarian crisis.

It has pledged to dramatically increase the minimum wage by over £100 a week, which was cut as part of the austerity programme and get 300,000 more people into work.

In a similar way to post-war Germany, Greece also wants Europe to write off most of its £240billion national debt.  The party also wants Germany to repay a loan that the Nazis forced the Bank of Greece to pay during the occupation and pay war reparations.  German Finance Minister Schaeuble has warned Greece over its negotiating tactics, saying the nation and the EU would not "be blackmailed".  In another newspaper interview this morning with Berliner Morgenpost, Chancellor Merkel said: "We - Germany and the other European partners - will now wait and see what concept the new Greek government come to us with."... However she added: "I don't see a further debt haircut". ... And as for demands over war reparations, she said: "This question doesn't arise."

New Greek PM Alexis Tsipras will visit Cyprus, Italy and France next week but there are no plans as yet to visit Germany. As well as scrapping some austerity measures demanded by the troika, such as a privatisation programme, Greece is now trying to negotiate with other EU members over its level of debt.  There are fears though that if Greece refuses to meet its debt demands, it could be forced out of the Eurozone.  Ms Merkel today said she wanted Greece to be successful and acknowledged "many people there have hard times behind them.  "The aim of our policies was and is for Greece to remain a part of the euro community permanently."

The European Central Bank head Mario Draghi is expected to make good on his promise to “do whatever it takes” to save the deflating euro and sagging economy and introduce US-style quantitative easing to the tune of €500 billion in bond purchases. The sovereign bond purchases could inject €550 billion ($650 billion), according to a survey of economist by Bloomberg News. The bank meets Thursday and will make a rate decision announcement at 13:45 CET in Frankfurt, which will be followed by a news conference at 14:30 CET.  A non-standard monetary policy to purchase bonds and asset-backed securities is likely to be announced, and will include sovereign debt purchases, but not gold. It is very similar to the US stimulus scheme to ease the money supply. Declining prices and low growth have brought the EU economy, and its currency, to a sluggish stasis. Record low interest rates of 0.05 percent haven’t boosted the economy, either. This extra cash liquidity measure in the banking system will be instead of the current support program known as “suspending sterilization,” which amounted to about €175 billion in weekly fund extractions from EU banks over the last 4 years. This money won’t disappear, but will stay in the banks, and possibly be leant out, thus stimulating growth.   Germany has been against the stimulus, as it believes it could further agitate highly-indebted EU countries, and the German authorities have argued the bond buying program is illegal. Under EU law it is illegal to finance governments and debt. However, the ECB is allowed to buy government bonds in the secondary market and the move wouldn’t be in violation of any eurozone law. At December’s meeting, the ECB Governing Council said it will reassess the monetary stimulus package “early next year.”

 

....and a lot of BS - since the "FED" pumped trillions of dollars in the Bundesbank in the last 3 years

Germany has balanced its budget for the first time in more than 40 years, and pressed eurozone partners to follow its austere example rather than try to stimulate their stagnant economies with borrowing or central bank money-printing.   Berlin had aimed to achieve the so-called "schwarze Null" (zero deficit) this year, but strong tax revenues and lower debt service costs due to rock-bottom interest rates helped it meet the goal a year early in 2014, the finance ministry said.   It is the first time Germany has balanced its budget since 1969 .  Chancellor Angela Merkel's government has rebuffed calls from EU partners, led by France and Italy, and international organizations such as the IMF and the OECD to spend some of the fiscal windfall on growth-promoting public investment.   Germany's announcement came nine days before the European Central Bank (ECB) may decide to launch large-scale purchases of eurozone government bonds in an effort to boost growth and avert deflation in the 19-nation currency area. The European Commission set out detailed rules on Tuesday for a planned €315bn investment programme over the next three years, involving no new public money in deference to German objections.  Public investment and structural reforms could win limited leeway for countries breaking EU budget rules, it said. That reduces the likelihood of tough penalties on France or Italy, the eurozone's second and third largest economies, when their fiscal plans are reviewed again in March.   Countries that put capital into a proposed European Fund for Strategic Investment would not be penalized if it tips them over the EU's deficit limit of 3pc of gross domestic product. However, those that already have an deficit in excess of the ceiling would win no indulgence.  The mood of self-congratulation in Berlin over the balanced budget made any easing of fiscal policy seem unlikely, even though the German economy is expected to slow this year. 

Far from using the leeway to invest more in creaking public infrastructure or cut taxes to stimulate weak domestic demand, politicians in Ms Merkel's conservative CDU party said the government should now focus on paying down the country's debt.

Brussels is bent on destroying the private sector - apart from the European conglomerates. We will become like Russia - controlled by the State and a few oligarchs in hock to the leaders. The agenda is of course to destroy the independence of the States that make up the EU and what better way, than by destroying their independent businesses.  Hopefully Europe, the sick old man of the global economy, quietly shuffles off into further isolation and less prominence, with a whimper and not a bang. If European history of the last 2 centuries is of any indication however, that may prove to be wishful thinking. These verbose toffs may look effeminate to American eyes, but they have a peculiar genius for slaughtering each other and much worse, dragging every one else into the fray with them...It probably won't play-out quite as bloodily as in the past, but it could all be just as damaging when all is said and done, I'm afraid....If I remember rightly, I read somewhere (probably in the DT) that a senior member of the Saudi government had declared the country's intention to maintain current production even if the price of oil fell to $20 a barrel -- hence, presumably, the headline of this article....Motivation? Well, the high price of oil for the last number of years, driven in large part by the rapidly expanding Chinese economy, has motivated the exploitation of previously unviable sources of oil, as well as the development of shale, and the development of new technology in engine fuel economy. This wasn't a problem as long as the Chinese were prepared to buy whatever oil the world could produce, but now that the Chinese economy's expansion is slowing, they need less oil, which means there is now a glut. Saudi, which can produce it relatively easily and cheaply, has an opportunity to regain market share and put the kibosh on all the new technologies....If the long term average is $60/bbl, why would it drop to $20/bbl this year? $20/bbl in today's money doesn't compare at all with $20/bbl 15 years ago - this is a silly assumption. Similarly, $100/bbl oil price won't cause a revolution in major oil producing countries, $20/bbl risks widespread budget defects and revolution's. The ruler's of Saudi Arabia and their ilk have enough domestic issues to allow a low oil price to add to it. The US will not allow Saudi Arabia to persist with low oil prices indefinitely, they have a shale industry to protect. If the last goodness knows how many years has shown anything, it is that America survives on protectionism and aggression to protect its economy.

...a sign to start stuffing the mattresses...

I still hold out hope that an economic implosion of the Eurozone could lead to the break up of the EU which affords Romania and others an easy low cost and smooth exit without any political upheaval. If such a bounty were to happen it could mark the very lowest point of 100 years of perpetual decline. The eurozone has officially slipped into deflation, after latest figures showed prices in December were 0.2pc lower than a year earlier.   The figure, far short of the European Central Bank's target of just under 2pc, is the latest pointer towards fresh intervention by the bank as it tries to prop up a sluggish economy.   Energy prices slumped 6.3pc compared to a year ago, driven by falling oil prices. The cost of industrial goods and food was flat while services rose 1.2pc. This is the first time the euro area has experienced deflation since 2009.   The ECB will meet on January 22 to consider whether to go beyond its existing stimulus measures and start buying sovereign bonds in a program of quantitative easing.   ECB president Mario Draghi has dropped numerous hints that he hopes to push cash through the eurozone economy in this way, despite grumblings in Germany that such measures are outside the central bank’s mandate. The euro, which reached a fresh nine-year low of $1.1842 before the figures were released, rose slightly after the announcement.   The currency has dropped from a high of $1.39 in May as the economic recovery in the United States diverged from the torpid eurozone.  The inflation figures follow German data on Monday showing that the currency bloc’s biggest member had experienced inflation of just 0.1pc in December, down from 0.5pc in the previous month and short of forecasts of 0.2pc. A purchasing managers’ index for December was published on Tuesday showing continued weak growth in the eurozone economy, with a reading of 51.4. A score of 50 or above denotes growth, but survey compiler Markit said the reading pointed to expansion of just 0.1pc in the final three months of 2014.   Watched from the sidelines of the UK, a fanatically driven religious war and deflationary spiral both coming from different directions to annihilate the entire European Project and re ignite a nationalist / fascist backlash throughout Central and Eastern Europe that engulfs the Continent would undoubtedly be the most exhilarating and awesome piece of history to unfold in 1000 years.   Armed with 24 hour digital media, chilled beers and comfy armchairs it would deliver the most stunning entertainment on a perennial basis as seminal pages of history are written whose importance to the future of Humanity and the map of the earth is of such magnitude that will be taught, debated and analyzed for hundreds, possibly thousands of years into the future.   Every time I dismiss it as just a dream events take it one big step nearer....So, the Eurozone enters a deflationary spiral and the markets? Shows just how disconnected they are from real economic data. Pushing up on a few words of obfuscation from Draghi as opposed to looking at the hard aspects of economics and the ability for major companies to generate profit / return.   If that ain't a sign to start stuffing the mattresses, I don't know what is.

Demonstrators gathered in Brussels to rally againist painful austerity measures and the upcoming TTIP trade deal. Protestors managed to shut down one of the European capital's busiest districts. Tractors rolled into central Brussels Friday as more than a thousand people protested European Union economic policy and a planned free trade deal with the United States. The demonstrations brought together farmers, trade unionists and environmentalists, who burned bales of hay and an effigy of German Chancellor Angela Merkel, long considered the driving force behind Europe's policy of reducing social programs in order to curb government debt. The protest was meant to coincide with the final day of the EU year-end summit, but the talks between European leaders wrapped up a day early. The police cordoned off the whole of Brussels' EU quarter, causing early morning chaos in one of the city's busiest districts.

Turning people in merchandise - "Merry Christmas and Happy Austerity," read one banner the protestors hung outside the European Council building. The D19-20 Alliance, which organized the demonstration, represents not only Belgian organizations but French, Dutch, and German ones as well. People came from all four countries to voice their outrage at "policies that do not work and keep accentuating inequalities," one of the organizers told German news service dpa.
The D19-20 Alliance denounces austerity as a means by which the government makes workers pay for the financial crisis and allows for a roll-back of important social programs forged over generations, like free medical care. The Alliance is worried that the upcoming Transatlantic Trade and Investment Partnership (TTIP), a free trade agreement between the EU and the US, will increase these inequalities and give American businesses too much power over European governments to the detriment of their citizens. Rudy Janssens, a senior official with Belgian socialist union CGSP, said the TTIP will turn people into "merchandise” and medical patients into customers.
At the summit, EU leaders reaffirmed their commitment to signing the TTIP by the end of 2015, ushering in the largest free trade agreement in the world.
es/tj (AFP, dpa)

In an ideal world Europe should do one of two things. Either move toward full political union and effectively ditch the nation state, with a main central EU wide government based in Brussels, major pan european parties that seek a mandate there and from which the ELECTED leaders of the EU are drawn. Just writing it down shows how impossible that is going to be.  Alternatively, Ditch the EU and retain the nation state and national parliaments and abolish the euro. This is enormously difficult and would cause immense short term damage and disruption but has a good chance in the middle term of reaching a situation with autonomous freely trading economies and currencies and one could rely on market mechanisms to restabilise the EU economy. EU states could continue to function as a political semi- entity (shared econ development, shared foreign policy, shared defense) if they wished with the commission coordinating this effort. Hopefully eventually the EU could get back to the dynamic entity that it was prior to the euro.   This view, it seems to me is only somewhat further along the road that the Cameroons want to progress. But the UK will be a be bystander because the tories have been such willful and inconstant EU players. And I don't know why we bother to send anyone from UK.   The reality is that we are going to get some awful Kludge which won't address the underlying issues and will try further to ride roughshod over democracy and inflict yet more austerity onto the unwilling , a road which will lead sooner or later to EU breakup...   It’s funny how history repeats itself. The inconclusive general election in 2010 took place when the economy appeared to be on the mend and against the backdrop of a crisis in the eurozone prompted by Greece. As things stand, we could be in for a repeat performance in May 2015.  Be in no doubt, what’s happening in Europe matters to Britain. The eurozone is perhaps one crisis and one deep recession away from splintering. The more TV pictures of rioting on the streets of Athens or general strikes in Italy between now and the election, the better support for Nigel Farage’s UK Independence party will hold up.  Stronger support for Ukip will encourage the Conservatives to adopt a more Eurosceptic approach, hardening their stance on the concessions required for them to continue supporting Britain’s membership of the EU. Meanwhile, a permanently weak eurozone economy will push Britain’s trade balance into the red. The economic debate in the current parliament has been about sorting out the budget deficit; the debate in the next parliament will also be about sorting out the current account deficit.  Let’s start with Greece, which was where the eurozone crisis began all those years ago. The French statesman Talleyrand once said of the Bourbons that they had learned nothing and forgotten nothing. The same applies to the bunch of incompetents in Brussels, Berlin and Frankfurt responsible for pushing Greece towards economic and political meltdown.

Authorities in France’s second-largest city have come under fire for issuing its homeless with ID cards that detail their health issues.  Human rights groups and government ministers have slammed the “yellow triangle cards”, comparing them to the Nazi-era Star of David that was sewn onto Jewish people’s clothes during the Holocaust.  “This is scandalous, it’s stigmatizing,” Christophe Louis, president of the homeless charity Collectif Morts de la Rue, told The Local.   “Wearing something that shows the whole world what illnesses you have is not only discriminating but it also breaches all medical confidentiality,” he said, adding that the symbolism in the design of the card is outrageous.  “Being identified by either a star or a triangle is horrific,” he said.  French human rights group La Ligue des droits de l’Homme said it was troubled by the resemblance “of this card and the yellow star that the Jews had to wear during World War II.” President François Hollande’s government in Paris has also reacted sharply to the initiative.  “I’m shocked. Forcing homeless people to carry a yellow triangle indicating the illnesses they might have is outrageous. You don’t point the finger at the poorest,” Social Affairs Minister Marisol told French daily Le Parisien in an interview published Thursday.  “You don’t write their illnesses on their clothes. Medical confidentiality, in particular, is a fundamental right. I want this local initiative to be stopped,” she said.  The card, an initiative Marseille's Town Hall and social services, identifies the person with his or her photo, name and date of birth.   It also specifies whether the person has any illnesses or allergies. The front of the card is adorned with a yellow triangle.  In their defence authorities say the purpose is to help health workers quickly come to the aid of a homeless person who has fallen ill or is in need of aid.  Over 100 of the identifications have been distributed already.  On Wednesday, about 100 activists and homeless people protested against the initiative outside the city’s town hall.   For its part Marseille Town Hall has been outraged by the criticism it has endured by issuing “the card that saves lives”.   In a statement given to The Local, one of Marseille’s deputy mayors Xavier Mery said: “I’m appalled by the absurd controversy surrounding this help card distributed by the SAMU (social medical emergency services)   "[The reaction] not only questions the necessity of a scheme for homeless people but also the commitment of the city, the SAMU and volunteers to come to the aid of those who need it the most”.

European stocks tumbled after Mario Draghi, head of the eurozone's central bank, failed to give a concrete sign that it would undertake sovereign quantitative easing following a highly-anticipated policy meeting.  Spain’s IBEX index fell as much as 1.5pc, the FTSE MIB dropped as much as 1.6pc and both Germany’s DAX and London’s FTSE 100 slid 0.4pc after Mr Draghi said the European Central Bank (ECB) would reassess the impact of existing economic stimulus measures “early next year” .  The euro also climbed on signs that Mr Draghi was in no hurry to inject further stimulus. It climbed as high as $1.24, having fleetingly touched a two-year low as the ECB President began to speak.  He said: “Should it become necessary to further address risks of too prolonged a period of low inflation, the Governing Council remains unanimous in its commitment to using additional unconventional instruments within its mandate.”   At the same time, the ECB slashed its forecasts for Eurozone growth. The economy is now expected to grow by 0.8 pc this year, 1pc next year and 1.5pc in 2016.   As expected, the bank did not cut rates, with the main refinancing rate staying at an all-time low of 0.05pc and the deposit rate at -0.2pc. ... In order to drag the Euro Zone out of the economic mire more than 5 billion Euros of QE is required. This is never, never, never going to happen! The most likely outcome for the Euro Zone is a prolonged period of disinflation\deflation. We are going to import Euro Zone deflation, it is already here, visit your local Lidl supermarket and check out the prices.... The press conference ended with Draghi slapping down the idea that a sovereign QE program  would be illegal.  "Not to pursue our mandate would be illegal, he replies."  Hi Ho Hi Ho it's off to court we go!  Further his comments that QE did not even need a majority vote will infuriate AFD and perhaps many more in Germany.  Can't wait for the German court to rule on this after the ECJ return their answer to the German court's question.  Maybe Draghi assumes that QE is ultra vires and is just 'talking the talk' to calm things down until the legal reality come known. After all, his dubious but famous 'do what ever it takes' comment, also awaits the same determination, but no one can deny the fact that his 'talk' saved the EU (or the €) at that time.... Mario has slashed growth predictions to almost to no growth - 0.8% in 2015. The revised down numbers for 2016, 2017 barely matter.   I do not think Mario has any effective measures he can undertake. The till says 'NO SALE'.  TLTRO uptake will be risible in a few days time and in those countries where it is just a giggle, the carry trade will be used to Botox bank balance sheets and not to lend to the private sector, so no consumer demand incentive there.   ABS - is he sure there are any, or enough assets to act as collateral for the balance sheet the ECB has got to have to become a lender of last resort in a non-growth €Z.   Sovereign bonds are almost a joke, especially as, if wrong will accept correction, he has to buy in some form of national proportionality. Germany first, France second, Italy third, Spain (perhaps not too bad) fourth.  More currency. Well he'd better pick the right nations to do it to unless he wants intra-euro capital flows in the shoots of spring.   Mario seems to have no means of exciting any consumer demand left so that export items can be bought or supply chain imports purchased to unblock this incestuous, nigh protectionist, 'single market' trading circle that all 18 highly divergent economies are monolithically, irrespectively and overly locked into because of the misshapen bairn hatched out of Brusstraslux.  I suspect there is an acceptance of a long period of deflation and non-FDI, not that the imperial court in Brusstraslux could care and the only measures we will see are the arraignment of taxpayers savings, pensions and a whole plague of new taxes. 'Cypress' will be the new funding source. Hopefully the last gasp but it will be a very long one.

Everyone came to realize that efforts to deepen Ukraine's ties with the EU had failed. But no one at the time was fully aware of the consequences the failure would have: that it would lead to one of the world's biggest crises since the end of the Cold War; that it would result in the redrawing of European borders; and that it would bring the Continent to the brink of war. It was the moment Europe lost Russia.  For Ukraine, the failure in Vilnius resulted in disaster. Since its independence in 1991, Ukraine has strived to orient itself towards the EU while at the same time taking pains to ensure that those actions don't damage its relations with Moscow. The choice between West and East, which both Brussels and Moscow have forced Kiev to make, has had devastating consequences for the fragile country.  But the impact of that fateful evening in Vilnius goes far beyond Ukraine's borders. Some 25 years after the fall of the Berlin Wall and almost 70 years after the end of World War II, Europe is once again divided. The estrangement between the Russians and the Europeans is growing with Moscow and the West more inimical toward each other today than during the final phase of the Cold War. It's a reality that many in Europe have long sought to ignore. The story of the run-up to Vilnius is one filled with errors in judgment, misunderstandings, failures and blind spots. It is a chronicle of foreign policy failure foretold -- on all sides. Russia underestimated the will of Ukrainians to steer their country toward the EU and was overly confident in its use of its political power over Kiev as a leverage.  For its part, the EU had negotiated a nearly 1,000-page treaty, but officials in Brussels hadn't paid close enough attention to the realities of those power politics. Even in Berlin, officials for too long didn't take Russian concerns -- about the encroachment of NATO and the EU into Eastern Europe -- seriously enough. The idea that Moscow might be prepared to use force to prevent a further expansion of the Western sphere of influence didn't seem to register with anyone.

With the special role it plays and the special responsibility it has for Europe, the meltdown also represented a failure for Germany. Foreign policy has long been considered one of Chancellor Angela Merkel's greatest strengths, but even she ignored the warning signs. Merkel has proven herself over the years to be a deft mediator who can defuse tensions or work out concrete solutions. But crisis management alone is not enough for good foreign policy. Missing in this crisis was a wider view and the ability to recognize a conflict taking shape on the horizon. Instead, officials in Berlin seemed to believe that because nobody wanted conflict, it wouldn't materialize.

Merkel did say at the summit that, "The EU and Germany have to talk to Russia. The Cold War is over." But the insight came too late.