Portugal's opposition party has called for a
renegotiation of the country's EU/IMF bailout package and labeled the government
an "incompetent" one which must be replaced. Socialist leader Antonio Jose
Seguro, presenting a largely symbolic no confidence motion, said his party was
against the spending cuts the government agreed to. He said (as reported by
Reuters): Your government is destroying Portugal and there is only one solution
- to replace the incompetent government. But the prime minister Pedro Passos
Coelho, whose centre-right coalition has a comfortable majority, said the
country had to comply with the programme to guarantee funding, and the
no-confidence vote created a climate of political instability. He said a bailout
renegotiation would lead to a second bailout.... The weaker than expected jobs
data out from the US today could mean analysts are being too optimistic about
Friday's non-farm payroll numbers, suggested James Knightley at ING. He said:
The employment component [of the ISM non-manufacturing survey] dropped to 53.3
from 57.2. Given today’s ADP payrolls survey also showed a slowdown in private
sector hiring to 158,000 from 237,000 in February this perhaps indicates some
downside risk to the consensus forecast of non-farm payrolls rising 198,000 on
Friday. With ongoing concerns about the potential economic impact from
sequestration we suspect that we are going to see a softer period of activity
data. As such we doubt that the Federal Reserve’s quantitative easing plans will
be scaled back before the third quarter of 2013.
Greek business head calls for rethink on
bailout terms - It may count as stating the obvious but the head of Greece's
biggest business group reckons the Cypriot crisis could tip his country into an
even deeper recession this year. He also called for the troika of
international lenders, due in Greece this week, to rethink the bailout programme
by promoting growth measures as well as austerity. From Reuters: "Greece is
directly affected by the Cyprus crisis and based on some estimates this may chop
up to one percentage point off GDP (gross domestic product)," Dimitris
Daskalopoulos, head of the Hellenic Federation of Enterprises (SEB), told
reporters. "With the success of the Greek bailout programme already hanging by
a thread, many signs show the recession is deepening with the prospect of
recovery in 2014 fading," Daskalopoulos said. He said the insistence on
austerity by the eurozone's core to cure the ills of the debt crisis risked
breeding euro scepticism and anti-German sentiment among the suffering countries
of the single currency bloc. "The North must give and the South must change,
otherwise the historic demons of Europe will find again room to act." He said
the protracted economic downturn and fiscal austerity were testing society's
tolerance limits and called on the government and its international lenders to
retool the applied programme with growth measures. "The bell of reforms must
finally ring loudly in Greece," Daskalopoulos said. "We cannot be fighting tooth
and nail against firing a few thousand public sector workers when almost one
million people have lost their jobs in the private sector."
Greek business head calls for rethink on
bailout terms - It may count as stating the obvious but the head of Greece's
biggest business group reckons the Cypriot crisis could tip his country into an
even deeper recession this year. He also called for the troika of
international lenders, due in Greece this week, to rethink the bailout programme
by promoting growth measures as well as austerity. From Reuters: "Greece is
directly affected by the Cyprus crisis and based on some estimates this may chop
up to one percentage point off GDP (gross domestic product)," Dimitris
Daskalopoulos, head of the Hellenic Federation of Enterprises (SEB), told
reporters. "With the success of the Greek bailout programme already hanging by
a thread, many signs show the recession is deepening with the prospect of
recovery in 2014 fading," Daskalopoulos said. He said the insistence on
austerity by the eurozone's core to cure the ills of the debt crisis risked
breeding euro scepticism and anti-German sentiment among the suffering countries
of the single currency bloc. "The North must give and the South must change,
otherwise the historic demons of Europe will find again room to act." He said
the protracted economic downturn and fiscal austerity were testing society's
tolerance limits and called on the government and its international lenders to
retool the applied programme with growth measures. "The bell of reforms must
finally ring loudly in Greece," Daskalopoulos said. "We cannot be fighting tooth
and nail against firing a few thousand public sector workers when almost one
million people have lost their jobs in the private sector."
9 comments:
The Portuguese government warned that a high court decision to strike down some austerity measures will put into question the country's ability to fulfill its €78 billion ($101 billion) international bailout program.
"The court's decision makes it very challenging for the country to fulfill its goals under the bailout and the budget targets it must meet," government spokesman Luis Marques Guedes told reporters after a cabinet meeting that lasted about three hours.
Following the meeting, Prime Minister Pedro Passos Coelho met with President Anibal Cavaco Silva, who issued a short statement giving support to the government.
Please get your facts straight. A EU directive – the EU Recovery and Resolution Directive – allows insured
deposits to be bailed in. In layman’s terms, this means that deposits up to
£85,000 in the UK and up to €100,000 in the Eurozone can be used to cover a failed bank’s losses.
Moreover, the BoE has issued a new report explaining that, in the event of a major bank failure, shareholders and depositors (not the taxpayer) will pay for the bailout.
This story is so important that I will put a link to it www.snouts-in-the-trough.com/a... even though I know the moderator will delete my comment
Remember, when you deposit money in a bank, that money becomes the bank's property - you are lending your money to the bank. If you lend money to someone who goes bankrupt, you lose your money - it's that simple. So, be careful where you deposit your savings
Are Governments that bothered about making people with lots of cash feel completely safe about it? One of the biggest issues at the moment is people & companies are very defensive holding plenty of it rather than investing it.
I'm not sure anyone has ever modelled what would have happened in 2007 if they'd just let everything go kaput and given people what they were legally allowed from banks.
Without wanting to be too controversial it might have narrowed the gap between wealthy and poor, make Governments target things differently eg. themselves.
If market forces can create peoples wealth over decades Id like to see some research whether insuring them is the best thing to do when market forces turn the other way and lower their wealth.
Everyone should bear part of the cost. This will teach, yet again, that there is and should not be a free lunch. It is going to tak emnay years, maybe decades, to destroy the sociast agenda that has led to so much excess.
How much pain above the prest limit is a difficult decision though.
Typical bureaucratic dog droppings from an unelected unrepresentative unaccountable EU overgrandiose moron.
What about the bank shareholders - why shouldn't they be the ones to bail out the bank - they have taken dividends for decades, but as soon as the bank has problems they run for the hills. Every sharehoilder should by law be held personally responsible for a portion of the banks debts in proportion to their shareholding.
Typical of an EU rat to want to steal peoples money to bail out the incompetant and the greedy.
OK, Mr Rehn. Do it. But at the same time let's have a mechanism whereby we can strip the assets from the policymakers, regulators and the directors and top managers of banks that fail. After all, they are supposed to provide the stewardship for investors' and depositors' money as welll as the oversight that prevents behaviour as dangerous asthat which wrecked our economy.
America probably got it right when it let Lehman Brothers fail. Perhaps we and the EU should have done the same here and allowed the stronger, more careful member states and banks lead the recovery.
The sums we would recover from incompetent regulators and business leaders wouldn't amount to a drop in the bucket of a failed bank, but at least the twerps would suffer much the same bitterness as is forced upon the innocent employees of banks who have to lose their jobs and start again.
Perhaps then fools like Blair, Brown, Balls, Turner and the rest wouldn't be so bloody sanguine about their ineptitude and callousness.
The managing director of the International Monetary Fund (IMF) told an audience in China that: "Monetary policies - including unconventional measures - have helped prop up the advanced economies, and in turn, global growth,"
"The reforms just announced by the Bank of Japan are another welcome step in this direction."
The Bank of Japan said this week that it would double the money supply by between 60 trillion yen and 70 trillion yen (£417.6bn to £487bn) a year to push prices higher and achieve a 2pc inflation target at the "earliest possible time."
Ms Lagarde also described Cyprus's €10bn (£8.5bn) bail-out as a "very specific case" and declared that the the euro had a solid future.
"I think the collective political will.... to maintain, defend, protect and enhance the monetary zone and currency zone has been largely underestimated," Ms Lagarde said.
"The euro has a future and has a long-standing one."
Asked specifically about the prospect for further crises, she said: "I don't have a crystal ball.
"My dearest hope is that there is not yet another country down the line that needs to be repaired and that could require support from both the European partners and the IMF."
She added that Cyprus's economy amounted to a mere 0.2 percent of Europe's economy. "I don't mean to be derogatory about this country," she said, noting its status as a member of Europe and of the IMF.
"But it was a very specific case in many respects," she added, citing factors such as the the size of the banking sector relative to the Cyprus economy.
Cyprus's bail-out has prompted speculation that Slovenia could become the fifth of the eurozone's 17 nations to request a full-scale rescue by international lenders.
The Slav-speaking nation, which joined the euro five years ago, is in the depths of its second recession in four years, and is not forecast to return to growth until 2014. A sharp cut to the official GDP forecast to predict a 1.9pc contraction this year further stoked fears the economy is teetering towards collapse.
Olli Rehn, the EU's economic affairs chief, has also suggested that savers with big deposits could suffer a ‘haircut’ under planned European Union laws.
"Cyprus was a special case ... but the upcoming directive assumes that investor and depositor liability will be carried out in case of a bank restructuring or a wind-down," Mr Rehn said this weekend.
"But there is a very clear hierarchy, at first the shareholders, then possibly the unprotected investments and deposits. However, the limit of €100,000 (£85,000) is sacred, deposits smaller than that are always safe."
Mr Rehn was referring to a directive being drafted by the European Commission on bank safety which would set out investor liability in the law of member states.
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