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.

No one in Brussels or other EU capitals is surprised to learn that Jean-Claude Juncker’s Luxembourg was, and is, a tax haven. And no one doubts that the new president of the European commission, a crafty survivor whose political longevity is peerless in Europe, knew enough about the vast tax avoidance schemes practised there, even if he did not bother to master all the fine print.

The question is whether Juncker, a little more than a month into a five-year term as head of the EU executive, can weather the storm and credibly perform a poacher-turned-gamekeeper role of setting up an EU regime to clamp down on tax evasion and avoidance.  There are few leaders in Europe who understand the workings of the EU as well as the former prime minister of Luxembourg. With the exception of Germany’s finance minister, Wolfgang Schäuble, Juncker is the only leader left who took part in the negotiation of the Maastricht treaty more than 20 years ago which dealt with the impact on the EU of German reunification and the process to create the euro.  He has been attending EU summits uninterruptedly for 20 years. No one at the summit table can boast that record. He knows everyone. He has friends everywhere. A fixer, a mediator between France and Germany (needed right now as much as ever); the consummate EU insider, he also knows where the EU’s skeletons are buried.  Asked about the impact of the Luxleaks on Juncker’s credibility and the authority of the new commission, the commission vice-president, Jyrki Katainen, squirmed and left the room. “I trust him,” he told the Guardian. “I’m not in a position to give any advice … We have to focus on what the president has done by himself and not done.”  Last March, the EU’s centre-right leaders, including the paramount leader, Angela Merkel of Germany, met in Dublin and backed Juncker to become the next commission chief after he was unseated last year as Luxembourg’s prime minister.  They will not make life difficult for him now. For them, mayhem at the top of the commission would seriously destabilise an EU desperately trying to come up with policies to drag Europe out of years of crisis, while anti-EU populists give the leaders a hard time across the continent. The consensus on not rocking the Juncker boat was evident in the European parliament last month. The far-right populists, led by Nigel Farage of Britain’s Ukip, Marine Le Pen of France’s Front National and the Five Star movement mavericks of Italy’s Beppe Grillo, tabled a vote of no confidence in Juncker.  Everyone else held their noses. Even Juncker critics on the left refused to back the motion, while the mainstream Christian and social democrats, and liberals all solidly supported the president.  Juncker took the entire 28-strong commission to the parliament, defended himself after the first round of Luxembourg leaks, and walked away unharmed. Besides, in the endless turf wars waged between rival EU institutions in Brussels, the parliament views Juncker as “its” commission chief – it played a key role in getting him the job in the first place – and will not challenge him too severely.  If there is pressure on Juncker, it will come not from the EU political elite, but from the media in the form of further revelations. Officials and diplomats say his fate will hinge on how compelling the evidence against him is. But the competition department of the commission he heads is also investigating Luxembourg on the grounds that some of the “comfort letters”, tax rulings, and avoidance strategies agreed by his then administration amounted to state aid in breach of EU competition rules. The cases of Fiat and Amazon are being investigated, while Skype may have to be added to what seems certain to become a long, and lengthening list.

Juncker insists his position at the head of the commission will not impair the credibility and impartiality of its investigation.  Rather than jeopardise his position, the political elites in Germany and France and elsewhere will exploit the Juncker scandal to push an agenda bringing more transparency to tax arrangements to counter “tax-dumping” between EU governments.

Juncker claims to be a champion of such moves, suggesting either a Damascene conversion to the cause or a calculation that his political future depends on being seen to be a born-again proponent of fair taxation.  For the moment at least, Juncker looks tarnished by the disclosures, but not really in fear for his job. Although he is free to resign, he cannot be removed as an individual. The entire European commission would have to go, felled by a vote of no confidence in the European parliament. This is a remote prospect at the moment. And for this to happen, national leaders, chief among them Merkel, would have to signal that Juncker’s time is up and then press their allies in the parliament into organising the commission’s collapse. No one in Brussels at present is talking in such terms.

 

Clashes have erupted in the capital of Greece during protests marking six years since police shot dead an unarmed teenager.  At least 5,000 demonstrators marched in Athens on Saturday. Some attacked shops and hurled petrol bombs at riot police.  Police officers used tear gas and a water cannon to disperse protesters.  The demonstrators had been marking the anniversary of 15-year-old Alexis Grigoropoulos' death. He was shot by an officer who has since been jailed.  Mr Grigoropoulos' killing on 6 December 2008 sparked violent riots across Greece, with cars being set alight and shops looted in a number of cities.  Clashes have also broken out on previous anniversaries of his death.  On Saturday, anti-establishment protesters attacked banks and damaged shops and bus stops.
At one point, demonstrators looted a clothes shop and set fire to the merchandise in the street, the Associated Press news agency reported.  According to Reuters, police said they detained close to 100 protesters.  Clashes primarily took place in Athen's Exarchia neighborhood, but violence was also reported in Thessaloniki, in northern Greece.   No injuries were reported in either city.
The ECB is already buying asset-backed securities (bundles of bonds) in an attempt to stimulate lending. This of course will not lead to a credit expansion as all it accomplishes is to add to bank reserves and banks do not lend bank reserves to commercial clients, ever.  QE has no measurable impact on aggregate demand and a shortfall in aggregate demand is the problem with the EMU economies. This has been beyond dispute for over 7 years now in some nations and yet nothing has been done to address this shortfall which is manifested in massive unemployment, massive underemployment, increased poverty, social breakdown political instability.
The mindless devotion to monetary policy actions has proven to be ineffective across both time and geography in stimulating economic activity, yet the Troika will not accept reality.
Expansionary fiscal policies directed at employment rich activities such as health care, education, infrastructure and the advancement of the public good is what is called for.

Euro Zone QE will be the last nail in the coffin for the Euro, the single currency will fail. The moment the ECB pulls the QE trigger they will find themselves in a difficult position. The ECB will struggle to unleash the amount of QE required to drag the Euro Zone out of the economic mire and at the same time QE will silently destroy huge amounts of productive capacity.

The net outcome will have a huge impact on the UK economy. We will import deflation, we will be infected by the Euro Zone disaster. Ramping up the valuations of old houses and importing huge numbers of immigrants is not going to save us.  The time has come for the UK to negotiate a gradual exit from the EU. We do not need to be full members, we only need a customs union and harmonisation of laws. As long as we maintain our place at the Council of Europe we will maintain our legal basis to trade with our European neighbors.  The immediate danger for the UK is an economic stall as a result of Euro Zone QE and the rampant super-USD. Take care , don't take on more debt than is absolutely necessary, look at what has happened to the Japanese economy.... Swapping government bonds for reserves actually *removes* money from the economy because the interest normally paid to bondholders would instead go to the ECB and be returned to the states via the ECB bank dividend.

That's why other asset prices go up. There is less income around in general from assets in the currency.  At best QE relieves pressure to cut spending or raise taxes on the governments, and it is actually simple fiscal policy that increases the level of spending and therefore real activity in the economy.  I think ongoing indicative trends in energy sector , particularly oil and gas seem to be corresponding to predictions made by this writer on 2 June 2014 in article - " Stressful times ahead for world economy in 2015 and 2016" - published online at www.astrologyweekly.com. Briefly speaking, the following were mentioned :

(1). The trends are likely to commence from November 2014 and onwards ;comment(2). The commodities likely to be impacted by the trends include " minerals and metals" and " oil and gas".

(3). Regions or countries which could be possibly be impacted by the likely trends have also been mentioned though this is only artistic interpretation and may not be construed as conclusive.

(4). Readers may like to know that such likely trends are suggestive or indicative and not deterministic. There is always a room for reform and improvement through a still better strategic planning and prudence.

(5) I think a further period of one and a half month covering January to mid February next year 2015 could perhaps be a bit disturbing for, among other things, minerals and metals and oil and gas.

BRUSSELS - The entire Belgian airspace is closed on Monday (15 December), as well as high-speed trains from Brussels to London, Paris and Amsterdam and local buses, trams and metro lines, as part of a general strike over public sector cuts.  Schools, government offices and private firms are also likely to be closed on Monday. Garbage will not be picked up and newspapers will not be delivered.

Serious traffic jams are expected around Brussels and Antwerp, with transport trade unions calling on truck drivers to join in and "paralyse the country".   Trade unions already staged a huge march which ended in violent clashes with police a month ago, when the government first announced the plans to save €11 billion over the next five years. The measures include scrapping an automatic indexation of salaries next year and raising the retirement age from 65 to 67 from 2030.

Belgium last month was flagged up together with Italy and France and given time until March to bring its budget in order or face extra scrutiny from the EU commission.

Unlike France, Belgium is sticking to the three-percent budget deficit rule, but its public debt is set to reach 107.8 percent of GDP in 2017, compared to 104.5 percent last year. Under EU rules, countries should keep their public debt below 60 percent of GDP.  In its assessment of the 2015 budget plan, the EU commission said Belgium is expected to boost its competitiveness if it scraps wage indexation, but that it "should reform the full wage-setting system in a structural way".   Belgium's general strike echoes protests in Italy on Friday, where transport was paralysed and schools and hospitals shut down for the day.  Like Belgian trade unions, their Italian counterparts were also protesting announced labour market reforms, which would make it easier for workers to be fired.

Prime Minister Matteo Renzi has come up with a "Jobs Act" that would make it easier to hire and fire, in order to get some of the 43 percent jobless young people into a job.

Italy is also under the EU's scrutiny for failing to reduce its debt burden, with the commission waiting for the labour market reforms to be implemented.

 

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”.

Internationally renowned Russian opera singer Anna Netrebko has donated 1m roubles (£12,000; $19,000) to a theatre in rebel-held eastern Ukraine and posed with a rebel flag. Netrebko said her gift to the Donetsk opera and ballet theatre was "a step to support art where it is needed now".   Russian Channel 5 TV showed her giving the cheque to Oleg Tsarev, a leader of the armed separatists in Donetsk.   Russian government support for the rebels has been denounced by the West.  The famous soprano made her donation in St Petersburg, where she is a star of the Mariinsky Theatre. She said performers in Donetsk were struggling on with their art despite the freezing cold.  Other top names in Russian culture have also voiced support for President Vladimir Putin's stance on Ukraine, notably the government's annexation of Crimea and support for the pro-Russian separatists in Donetsk and Luhansk.  The Russian celebrities backing the Kremlin over Ukraine include variety singer Iosif Kobzon, film director Nikita Mikhalkov, conductor Valery Gergiev and viola virtuoso Yuri Bashmet. ...  The European Union has amended sanctions against Russia’s biggest lenders like Sberbank and VTB on long-term financing, and eased some sanctions on the oil industry. The EU says Russia’s biggest lenders - Sberbank, VTB, Gazprombank, Vnesheconombank and Rosselkhozbank - will now be allowed access to long –term financing should the solvency of their European subsidiaries be at risk.   The announcement released Friday refers to “loans that have a specific and documented objective to provide emergency funding to meet solvency and liquidity criteria for legal persons established in the Union, whose proprietary rights are owned for more than 50 percent by any entity referred to in Annex III [Russian banks – Ed.].” The EU has also specified the terms and conditions on which it can lift the ban on providing equipment for oil exploration.   Its supply is still banned to Russia itself, or the exclusive economic zone and offshore territories. However, EU said it may “grant an authorization where the sale, supply, transfer or export of the items is necessary for the urgent prevention or mitigation of an event likely to have a serious and significant impact on human health and safety or the environment.”  This basically clarifies the position of the latest set of EU sanctions. The notion of “Arctic oil exploration” means the embargo is applied to oil exploration on the offshore Arctic. “Deep water exploration” means any operation extracting oil carried out deeper than 150 meters below the surface.  The sanctions target the finance, energy and defense sectors. In July 2014 the EU issued a “sectoral list” which includes Sberbank, VTB, Gazprombank, Russian Agricultural Bank (Rosselkhozbank) and Vnesheconombank. The lenders were cut off from long-term (over 30 days) international financing.  The EU has banned three Russian energy companies Rosneft, Gazpromneft and Transneft from raising long-term debt on European capital markets. It has also halted services Russia needs to explore oil and gas in the Arctic, deep sea and shale extraction projects.