Romanian PM Victor Ponta concedes victory in presidential election to Sibiu mayor Klaus Iohannis

Romanian PM Victor Ponta concedes victory in presidential election to Sibiu mayor Klaus Iohannis

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Romania’s prime minister conceded defeat on Sunday night after a close presidential runoff against an ethnic German Transylvanian mayor. Victor Ponta had been the favorite to win, but was narrowly edged out by Klaus Iohannis, the mayor of the city of Sibiu, who has promised a crackdown on corruption.  Ponta said he had personally congratulated Iohannis. “We are a democratic country,” Ponta said outside the headquarters of his Social Democratic party two hours after polls closed. “The people are always right.”  Ponta called on 25,000 protesters gathered outside his offices to listen to his message in an apparent attempt to defuse tensions encountered by expat Romanians voting abroad.  Some biased exit polls put the results at neck and neck. The official result is expected on Monday, but it looks that Mr. Ponta lost by a margin close 10%.  Out of the almost 6 million expats, only 300,000 Romanians who live overseas were allowed to vote and many casted their votes against the government. There were protests that they had been unable to vote in the election on November 2 that led to the runoff.  “Romanians, you were heroes today,” Iohannis said before Ponta’s concession, calling on authorities to count the vote correctly. “The vote was phenomenal!” He went on to say that voters had come “out of their houses to defend the right to vote” 25 years after the Romanian revolution.  Some Romanians waved toothbrushes in protest at long waits at polling stations abroad. Romanians living overseas had to vote at polling stations in their adopted countries, and thousands grew exasperated when they had to stand in line for hours in cities such as Paris, London, and Munich during the first round. Some were unable to vote. The government said it had improved the voting procedure this time.  Ponta led by 10 percentage points in the original vote, and corruption probes of senior Ponta aides appeared not to have dented the 42-year-old former prosecutor’s chances. Iohannis, 55, has promised an independent justice system if he becomes president. The winner will replace Traian Basescu, who is stepping down after 10 years. In Romania, the president is in charge of foreign policy and defence, and names key prosecutors and the chiefs of intelligence services.

The train drivers' union in Germany has announced a four-day walk-out over pay, which reports say will be the country's longest ever rail strike. The strike, which starts on Wednesday, was called after talks between national operator Deutsche Bahn and the GDL union broke down on Monday.

GDL wants a 5% pay rise for 20,000 drivers and a shorter working week.  If it goes ahead, it will be the sixth round of industrial action to hit Deutsche Bahn since September.  Millions of passengers were hit during a 50-hour strike in October over the dispute.

In a statement, GDL said the strike would take place from 15:00 local time (14:00 GMT) on Wednesday for freight trains and from 02:00 on Thursday for passenger trains. It would not end until 04:00 on Monday.  A major sticking point in negotiations was the GDL union's demand to negotiate on behalf of other train staff, including conductors and restaurant staff.  According to the Associated Press, Deutsche Bahn said it had offered a raise of 5% over 30 months to the drivers but would not accept pay deals for other employees.  But GDL chairman Claus Weselsky said in a statement that the union's "fundamental right" to negotiate on behalf of its members was "in danger and with it the function of unions as such".  The strikes threaten to bring travel chaos to the capital Berlin and the whole of Germany as it prepares to mark the 25th anniversary of the fall of the Berlin Wall at the weekend.  The train drivers' previous strike hit about two-thirds of the rail network.  Germany's government is expected to produce a draft law later this year aimed at stopping small numbers of employees paralysing large parts of the country's infrastructure through strike action.

Source - Guardian - excellent article !!!

If the midterm elections in America were a movie, they’d be a psychological horror fetish flick. A hogtied electorate is approached by two parties, each promising freedom if only the bound electorate will pledge complete loyalty. One glance at the wrong “saviour” and the deal is off. Sadly the twist is that, in the end, neither party frees the captive. Is this analogy over the top? Of course. But so is the fact that working- and middle-class Americans are increasingly hogtied when it comes to wealth and social mobility, the foundations of the American dream. Family wealth for all races and ethnicities, but particularly for blacks and Latinos, has not recovered from the jab/uppercut combination of the Great Recession and the housing crisis. And while social mobility varies by region (America’s south-east is the least socially mobile, and also arguably the most racially segregated), it’s elusive for most working-class and poor Americans of any region or race.  The midterm elections, a bloodbath for the Democratic party, have been interpreted as everything from the revenge of white men (who had high turnout and Republican loyalty) to a singular and specific repudiation of President Obama. Part of me wants to be happy that the Republicans decisively won. After all, anything has to be better than the current legislative gridlock. If the Republicans can quickly and decisively pass legislation then the president can just as quickly assent to or veto it. But on a state and local level, as well as a national one, I see a world of pain for the poor and working class, as well as Latinos, non-whites and gays and lesbians.  Earlier this year the speaker of the House, John Boehner, said: “I think this idea that’s been borne out the last couple of years that, ‘you know, I really don’t have to work … I think I’d just rather sit around.’ This is a very sick idea for our country.” His statement simply doesn’t make sense. For example, in April, the Economic Policy Institute analysed Federal data from Jolts, the Job Openings and Labor Turnover Survey. They found that month there were 4.5 million job openings, but 9.8 million jobseekers, meaning, they emphasised, “that more than half of jobseekers were not going to find a job in April, no matter what they did.”  The implication is very often that these “lazy” people are also black and brown. And some politicians, like Sally Kern, a Republican representative in the Oklahoma state legislature, are all too happy to state so baldly.  Kern said: “We have a high percentage of blacks in prison, and that’s tragic, but are they in prison just because they are black or because they don’t want to study as hard in school?”

On election day, I walked down the street to Brooklyn’s PS161, known as the Crown – an elementary and middle school working to turn itself around. This is a “transitional” neighbourhood, one gentrifying at a blistering pace, with googobs of investment money going to tearing down, for example, the old church between my apartment and the Crown in order to build condominiums.

When I moved here from Manhattan four years ago, I remember seeing virtually no white residents on my block. Now almost every new tenant, and many new homebuyers, are white or Asian, people priced out of gentrified neighbourhoods nearby. Most of the new arrivals don’t have kids, and if they do they do not want to send them to the local schools.

The families who send their kids to the Crown range from poor to middle-class, but like so many places in America – not just black and brown ones, either – public education is viewed more as a necessary evil by financially strapped parents than as a right or privilege.

The cost of private schools in New York City is astronomical. And while this city is an outlier in terms of expense, the conundrum of whether to pay for private education or advocate for better schools, as legislators sit on their hands, is a national crisis.  And then there’s our two-party system, something I blame for a lack of legislative action and choice. I managed to vote for candidates from three different parties, for different reasons, in this midterm. I voted for the Republican challenger to Governor Mario Cuomo, knowing Cuomo would win but not wanting him to feel he had a strong mandate, given his refusal to decisively quash the idea of fracking in the Adirondack watershed upstate. I voted for the Green party for lieutenant governor. And for most other offices, I voted for Democrats.  But it didn’t bring me a particular sense of satisfaction, because I knew my choices were awkward ways of working round a system with limited choice. For all the problems with multiparty democracies – and all the xenophobia we see currently expressed in European elections – I’d prefer a wider range of options. And I’m not alone. People who don’t vote are widely viewed as lazy or selfish. But in a country where a third of people consider themselves political independents, there is a cohort of citizens who are more akin to conscientious objectors than layabouts in the party wars.  The thoughtful outliers include people like Philip McKenzie, a New Yorker who runs the roving, globally minded Influencer Conference. He previously worked as a trader for Goldman Sachs. Now he’s opted out of the finance industry, and, after helping raise money for Obama in 2008, he’s also opted out of a belief in most major-party candidates. He said that Democrats and Republicans “differ around the margins, and they differ in their branding but when it comes to actual policy they tend to fall into a range of moderate/conservative beliefs that I don’t believe represent me”. He’d like to see money and influence peddling removed from the system: “But the agenda is set by corporate interests and money.”  Yes, the country is better off than it was when Obama took office. But as the reality sinks in that we are in an era of long-term low and slow growth, political anxiety and attendant xenophobia are building.  The midterm elections are, I believe, a mixed blessing for both of America’s political parties. But what about the voters? And the families? And the kids in the Crown? Our choices and potential for growth are still artificially limited – and in our hearts we know it.  Farai Chideya is an author and broadcaster, and the Distinguished Writer in Residence at New York University’s Journalism Institute

Last week Mario Draghi, President of the ECB, said that the central bank’s Governing Council would “closely monitor and continuously assess the appropriateness of its monetary policy stance”, noting that this could change if the outlook for inflation worsened.

Luigi Speranza, an analyst at BNP Paribas, said that the survey’s findings signalled “that investors have started to have doubts on the ECB’s resolve or ability to push inflation back”.

He suggested that the ECB's analysis of risks from low inflation must be "flashing amber, if not red".

Prices rose by just 0.4pc in the year to October, edging up from 0.3pc in the preceding month.

The survey "challenges the ECB's credibility and its commitment to achieve its mandate, and as such, increases the pressure for additional monetary policy easing, in the form of full-blown quantitative easing", Mr Speranza said. .. Mr Draghi has previously warned that inflation must not permanently fall below 1pc "and thus into the danger zone".   Analysts also slashed their forecasts for eurozone growth for every year from 2014 to 2016, cutting their estimates for 2015 from 1.5pc to 1.2pc. 

The euro area as a whole may have entered its third technical recession since the financial crisis in the third quarter of this year.  The ECB wrote that "the balance of risks has become more clearly titled to the downside", as respondents noted geopolotical tensions in Ukraine, Russia, and the Middle East as posing risks to the euro area... I have been spouting for a while that surely credibility in the €Z/ECB must be osmosing away and Louie Hope agrees - an Italian working for a French bank, I presume. 'Luigi Speranza, an analyst at BNP Paribas, said that the survey’s findings

signaled “that investors have started to have doubts on the ECB’s resolve or ability to push inflation back”.  He suggested that the ECB's analysis of risks from low inflation must be "flashing amber, if not red"'   But I bet EU Daltonism continues, not because Mario is being obdurate because the arsenal is totally empty apart from 'Cypressing'....And here I was thinking low inflation was good. Silly me, I should know that inflation erodes debt. To savers and those on fixed incomes though its a disaster because it forces interest rates to be low. Thats good for borrowers, who can hike up their indebtedness beyond their ability to pay it back. So at some point in the future the governments can tax the savers to bail out the reckless borowers, who also happen to be the government as well. So thats all right, as this government has given itself the powers to just empty my bank accounts at will, with out having to get any judicial approval or prove I am guilty of anything. A savings tax and Ihvae control over it. 

Draghi, the ECB’s president, said on Thursday that the bank’s governing council was unanimously willing to announce more unconventional measures, signaling the possibility of creating electronic money – or quantitative easing – should a deteriorating economy make it necessary. Speaking in Frankfurt, he said: “Should it become necessary to further address risks of too prolonged a period of low inflation, the governing council is unanimous in its commitment to using additional unconventional instruments within its mandate. “The governing council has tasked ECB staff and the relevant eurosystem committees with ensuring the timely preparation of further measures to be implemented, if needed.”   Eurozone inflation is 0.4%, far short of the central bank’s target of close to 2%.  Draghi added that the ECB balance sheet would continue to expand in the coming months and was likely to reach early 2012 levels, suggesting a further €1tn to be pumped into the economy. Despite announcing no new measures this month, Draghi’s comments were enough to push the euro to a two-year low against the dollar and to cheer investors around Europe, with most of the major European markets, including the FTSE 100, closing up.  After recent reports of a rift between the president and some of the council’s minority over his leadership style, economists said this was a show of unity from Draghi and the ECB governing council.   “Draghi’s press conference was a demonstration of unity and readiness to act at the ECB,” said Christian Schulz, senior economist at Berenberg. “The governing council now closed the ranks and emphasized their easing bias. [It] is clearly getting more enthusiastic about balance sheet expansion and quantitative easing.”  Draghi also played down the idea of a north-south divide emerging among eurozone countries: “Not at all,” he said when asked if there was a split.

IMF economists know there are not enough rich people to fund today’s governments even if 100 percent of the assets of the 1 percent were expropriated. That means that all households with positive net wealth—everyone with retirement savings or home equity—would have their assets plundered under the IMF’s formulation.  Second, such a repudiation of private property will not pay off Western governments’ debts or fund budgets going forward. It will merely “restore debt sustainability,” allowing free-spending sovereigns to keep tapping the bond markets until the next crisis comes along—for which stronger measures will be required, of course.  Third, should politicians fail to muster the courage to engage in this kind of wholesale robbery, the only alternative scenario the IMF posits is public debt repudiation and hyperinflation. Structural reform proposals for the Ponzi-scheme entitlement programs that are bankrupting us are nowhere to be seen.  If ever there were a roadmap for prompting massive capital flight and emigration of productive citizens toward capitalism’s nascent frontiers in Asia, this is it.

It seems Central Banks and the IMF are clueless on how to proceed and a policy going forward. A glaring example of the current mess is one how the implied cost of borrowing for Spain and Italy for five years, which is close to the average maturity of their debt, is now lower than the cost of borrowing for the same period for the US and the UK. We see this when looking at the yield on five-year government bonds, which is 1.33% for Spain, 1.44% for Italy, 1.65% for the US and 2.02% for the United Kingdom. It was not long ago when Spain and Italy were basket cases close to collapse because of legitimate fears of default on the poisonously intertwined debts of their respective banks and governments.  The debts of Spain and Italy are not "made of gold" in fact their economies have massive issues that could fracture the entire euro-zone. If they were to stand alone it is blatantly obvious the risk of default by Spain and Italy is significantly greater than for the UK and US. This makes it seem a bit insane that "investors" are willing to buy the debts of Spain and Italy at a price that makes them appear more creditworthy than the US and UK. This is why the issue of world debt is again creeping to the forefront. Yes, the myth of an economic recovery is flawed and that is reflected in the massive growth of inequality across the world.  The Bank for International Settlements, which is the central bank for central banks, issued a report recently saying world debt levels are too high, and that continuing the current low interest rate policy has too many bad effects. Something needs to be done to normalize monetary policy. Everyone  is making statements about the issue of how to fix our current economic problems. Janet Yellen, Federal Reserve Chair, and Christine Lagarde, managing director or the International Monetary Fund both appear clueless as how to forge a new path forward.   Both these so called economic leaders have it seems long ago abandoned austerity as the answer and thrown under the bus anything that resembles tough love. Getting  back to the main point of this post, how is this debt crisis, and the likely outcome, different from previous crises?  One big difference is the economies of the world have become more intertwined leaving us open to more problems from contagion. Another is that we have tried to put patches on the problems for six years and after printing money at an unbelievable rate we are still unable to achieve a decent rate of growth.   Central banks are responsible for having made credit cheap in recent years because of all the "almost-free' money they've created since the financial crisis of 2007-08. Still it required the reckless lending and investing by financial institutions such as banks and hedge funds to push asset prices up to these high levels. This leads to the risk that asset prices will tumble, at just the wrong inconvenient moment, causing serious harm to these financial institutions and wreaking their ability to finance the economic activity crucial to our prosperity. In many ways it might appear we are back where we started six years ago only this time our base is weaker and the intertwined interest of contagion even greater.