Madness is in the air. Greece cannot stay in the Euro as it is presently engineered, and the threats and bluster will not change reality. One of the causes of the Second WW was Germany's parlous economic state caused in large measure by the punitive reparations demanded of Germany after the Treaty of Versailles. Countries are not single entities, they are the cultural conglomeration of millions of people with a common identity. When a country is put under duress like this, whether this arises internally or externally, that common identity becomes fractured and the country fails as a working institution. The risks are massive both for the people of Greece and the rest of Europe. Add in the problems in Ukraine, we're seeing some very worrying issues in Europe that desperately need cool heads and an ability to compromise. Instead we see a hardening of rhetoric and attitude and an ever widening gap between reality and reckless idealism... Why is Greece being allowed to use a fund set up, presumably to protect Greek bank depositors, to be used to pay off Greek government debts, pensions and salaries. If a private company diverted money like this they officers of that company would be arrested and put in prison and that is exactly where Klaus Regling deserves to be! Does the EU not have any law at all? A prosecutor to stop funds from being siphoned from one place to be used in another to suit the arbitrary desires of some unelected official?

The people of Europe need to start killing their EU overlords if this is how they are going to operate.

It seems the HFSF fund was set up by the Greek banks (ie before the 2010 EFSF), so it'd need to be protected by a Greek law. As it is though, only a few inches and a hand-grasp separate the central bank from the maw of the state.  The Greek social security funds are a different matter - they have their own funds and trustees. Syriza is trying to get at them, but they're resisting. It seems there's some long-forgotten 60-year old law that technically prevents the funds holding 'surpluses' in a separate bank account outside the Central Bank of Greece for more than 15 days. But if it goes to a higher court instance or needs legislation, that could be overtaken by what Macmillan called 'events dear boy, events!' ie default.  The EZ and ECB are (I was horrified to read) quietly gung-ho about the idea of the Greek unemployed and pensioned being robbed if the money goes to repay ECB/EZ loans. ('That's what all states do...')  This is all so disgusting, I don't think I can watch.

Deşi a tipărit cantităţi uriaşe de bani şi a dat drumul unui nou program imens de relaxare cantitativă, prin care va ajuta statele europene să se împrumute mai ieftin, cumpărând obligaţiuni guvernamentale de peste un trilion de euro, Banca Centrală Europeană este considerată responsabilă pentru „politicile de austeritae” din Europa.  „Principalul motiv al protestelor este faptul că BCE face parte din Troika, iar Troika e responsabilă pentru politicile de austeritate care i-au împins pe atât de mulţi în sărăcie”, a declarat, pentru Reuters, Ulrich Wilken, unul dintre organizatorii “Blockupy”, protescul care se va desfăşura în apropierea noului sediu de 1,3 miliarde de euro al BCE.  Troika include, alături de BCE. Comisia Europeană şi Fondul Monetar Internaţional şi monitorizează ţări precum Grecia şi Cipru care au beneficiat de programe de salvare, inclusiv prin iertarea de datorii. BCE este şi furnizor de finanţare pentru bănci din ţările cu probleme. Ministrul elen de Finanţe, Yanis Varoufakis, a criticat săptămâna trecută politica instituţiei, pe care o consideră “sufocantă”, critic făcută şi de organizatorii protestului.  “Cei de la BCE nu sunt aleşi în mod democratic şi, totuşi. Presează guvernele să acţioneze într+un anume fel tot timpul. Am văzut asta din nou în maniera în care au îngreunat posibilitatea Greciei de a se finanţa după alegeri”, a spus Wilken.  Recent, BCE a încetat să accepte titluri de stat emise de statul elen în schimbul finanţării, când noul govern ales a anunţat că nu va respecta termenii conveniţi iniţial în programul de ajutor. 

The European Central Bank has also taken a tough line with Athens, banning the acceptance on Greek bonds as collateral for its cheap loans. Greece is now asking the ECB to raise the cap on the emergency funding (ELA) it provides to the country's banks as capital has fled the country. The ECB could provide some relief for lenders at an emergency meeting to discuss ELA on Thursday, according to Bloomberg.  Half a billion taken from the HFSF (=the Greek banks' recapitalization fund) won't go far. Greece needs to repay 1.2bn by end March, and still doesn't have enough to pay salaries and pensions. Now they're trying to raid the social security funds, starting with 150m out of the unemployment fund, but meeting resistance from the guy who oversees it. (He realizes he'll never get it back.) Syriza are drawing on an old and tricksy law, but it looks to me as if they may have to pass further legislation to get at that money. OK, they 'only'(!) need 448m to repay the IMF in April - but then 747m in May, 1.5bn in June, 448m in July, plus 2bn ECB, plus 1.3bn EZ central banks repayments, 3bn ECB in August. Tax coffers are e-m-p-t-y.  The FT (apparently firm believers in fairies) think that "by April the left-wing government may have advanced far enough with structural economic reforms to draw down part of a 7.2bn loan tranche being withheld..."

Oh, come on! WTF, FT!

Guys, guys, enough already - it can't be done with a few iphone-wielding students shopping a few tavernas to the tax office.

German Chancellor Angela Merkel recently negotiated a cease-fire in Ukraine with Russian President Vladimir Putin. Within days, Ukrainian troops lost the city of Debaltseve to a new Russian-backed rebel offensive. At the same time, European negotiations on the Greek financial crisis broke down in acrimony. This is the hour of Europe, and it’s a disaster.  And really, it’s the hour of Germany, the West’s crucial player. Led uncertainly by Germany, the European Union’s response to Russia’s aggression was to impose trade sanctions.  By the same token, what’s prolonging the Greek crisis is Germany’s contradictory desire to force Greece to be disciplined so Berlin gets its money back, but also to keep Greece in the euro.  The result of that policy has been to push Greece into a deep depression and put its politics in a headlock. The Greek people broke out by electing Syriza, an idiotic Marxist party which has the sole virtue of believing Greece should be governed from Athens, not Berlin.  German policy in Ukraine has been equally useless. The Germans like to whine—actually a form of bragging—about the sacrifices they have made to impose costs on Russia. This is nonsense.  German exports to Russia in 2013 were under four percent of Berlin’s total, and over the first eight months of 2014, those exports declined by less than 20 percent.  Germany’s sacrifices in cracking down on Russia—which has invaded a sovereign European nation, annexed a chunk of its territory, and shot down a civilian airplane—has cost Berlin about $8 billion, in an economy worth almost $4 trillion.  No wonder Putin thinks the Europeans are pushovers. But it’s worse than that. The point of the cease-fire wasn’t to stop the war in Ukraine. It was to stop the nascent U.S. push to arm Ukraine. As Merkel put it recently, “progress on Ukraine cannot be achieved by more weapons.”  That is more nonsense. Until Ukraine can defend itself, the Russian-backed separatists have no reason to stop fighting. Building up Ukraine’s defensive power will be a long job, but it needs to start now.  The German opposition to arming Ukraine gives Russia a veto on Ukraine’s future: Russia can always threaten to restart the war if Ukraine resists its will.  So Germany, to get its money back, has pushed Greece into an economic collapse so serious that the Greeks believe the answer is Marxism.  At the same time, Germany moans about imposing sanctions on Russia that have cost it one percent of its exports, and it refuses to respond seriously to the fact that Russia is overthrowing a European nation by force of arms.  As the German magazine Der Spiegel put it, Merkel has done “exactly what Germans expect from her: Fight for peace, search for compromise with the Russians, and resist the Americans.”  Every nerve in Germany is straining not to sanction Russia, but to give it a hug and sell it a car. And much of the rest of Europe, frighteningly, has even less backbone than Germany.  Germany is not Europe’s master. But it is Europe’s manager. That management has been disastrous. In Ukraine, people are dying to get into Europe. In Greece, they’re dying to get out of it. In both places, Germany has practiced the worst kind of checkbook diplomacy: draconian and grasping in Greece, narrow-minded and skinflint in Ukraine.  The first “hour of Europe” came during the Balkan Wars of the 1990s, when Bill Clinton’s administration wanted to arm Serbia’s opponents to give them a fighting chance on the ground. The Europeans said no: the result was genocide.  Twenty years later, Europe is fecklessly downplaying catastrophes on its doorstep, narrowly focused on its commercial interests—and concerned above [all] with stopping the Americans.  Originally published in Newsday. 

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."

We all live in a fiat money regime. So what is to stop the Greeks adding €377bn to their Bank of Greece accounts and repaying everyone?  Alternatively create the New Drachma. Valued (by sovereign decree) at par with the euro. And repay with that. I know that the secondary market wouldn't accept that it's valued at par but that's not the point. A sovereign state says their drachma is worth a euro. They give their creditors (except the IMF) lots of them. Lots of red faces and indignation but so what?  Alternatively Greece still has the mandate to print small denomination euro notes. So, provided that they have the paper, print loads and repay in cash. Super Mario would huff and puff and say that they were counterfeit but that would have the whole of Europe worried about their cash....The effect of a default would be extremely serious. Nobody lends money to a government that has just defaulted on existing debts. Rich Greeks have removed their Euros from Greek banks and cannot be forced to bring them back. Greeks in general simply do not pay their taxes. Where can they go now? When they have stripped the pension funds, there will be no pensions. When they leave the Euro, they will print Drachmas which will be devalued continuously until they are worthless. Greeks have mortgages denominated in Euros. The Drachma will be worth a few centimes, if that. I think life will get a lot harder for Greeks before it gets better. = This is false - did anybody hear about Brazil and/or Argentina ??? - these countries periodically file for bankruptcy !!!...Of course the great Europeans especially the "unionists" didn't today's Europeans are just as ill informed as the Americans ! - Well ...We are where we are. Hindsight is invariably quoted by opponents of how things have panned out. There is no doubt that matters could have been better planned from the start or the early days. In which case the whole movement might well never have got off the ground.

I see the EU and Euro as, say, 25% positive. It is a job in progress, not made easier by the ongoing crisis which did NOT started in the US, but in the "world". For whatever reason, there are 28 democratically elected (more or less) national governments who want their countries to stay in the EU with another half-dozen applying for membership (stupid). To date no-one has left. Can they all be wrong?

Clearly there are some who have not realized the new economic tectonic shift in power towards the East.  The U.S. has an unpayable debt of nearly 200 TRILLION dollars, when you include unfunded liabilities.  The western shadow banking system is hiding over a 1000 TRILLION in derivatives, that have zero backing.  The plain truth is that Russia is dependent on sales of a product that will NEVER recover to its old price level.   $60 a barrel is the new norm.  This is a disaster for the Russian economy.  The prosperity it enjoyed in the days of $100+ a barrel are gone forever.
And worse times are coming for Russia as the Little Russian Psychopath persists with his grossly transparent plan to get a secure land route from Russia to Crimea through puppet "republics" in Soutern Ukraine... RBS, which maintains an office in Russia, said in its full-year results that it had “reduced limits to customers affected by [sanctions], including tightening transactional controls to mitigate credit risk while ensuring sanctions compliance”, and that it had placed restrictions on new business in the country. Its net exposure fell by £120m last year to £1.8bn, around half of which is fully hedged. While half of RBS’s loans to the country are to corporates, most of Barclays’ exposure is to the financial sector. The retreats represent a major pull-back for Britain’s banks in Russia, after a pre-crisis investment splurge. In 2008, at the height of the banking boom, Barclays paid £373m for Expobank, before selling it for an undisclosed sum in 2011. In the same year, HSBC closed its retail banking operations in the country, having opened them just two years earlier. Other banks cut funding last year, including the French bank Société Générale, which is one of the largest foreign lenders in the country.