Fears of a new dotcom crash gained momentum on Friday, wiping £20.2bn off the value of the FTSE 100.

The leading index tumbled 1.2pc to 6,561.7 and the mid-cap FTSE 250 slumped 1.6pc to 15,898.37, as British investors grew increasingly concerned about being caught in a tech bubble.   Their anxieties were fuelled by a rout in the American stock markets on Thursday, when the Nasdaq stock exchange, favoured by technology companies, suffered its worst fall since November 2011.  US tech stocks continued their decline on Friday, with shares in Facebook, Google and Twitter all sliding lower.

In London, tech shares were sold-off particularly aggressively. Microchip designers Arm Holdings and Imagination Technologies lost 4.5pc and 5.8pc respectively.

Internet-based companies also fell sharply. Takeaway services group Just Eat, clothing business...

boohoo.com and white goods retailer AO World, which all floated at lofty valuations in recent weeks, were on the back foot. Both Just Eat, off 6.1pc, and AO World, down 4.4pc, fell even further below their flotation prices. Boohoo slipped 7pc to the 50p float level.

Away from tech shares, other companies that were also perceived as being overvalued, such as airline stocks, were under pressure and contributed to the FTSE 100’s biggest one-day fall since March 3 and worst week for a month.  Fears of a bubble reminiscent of the one that preceded the 2000 dotcom crash have grown the past week and also hit markets on Monday.

US markets continued to drop on Friday, with both the Nasdaq and the Dow Jones Industrial Average sliding further.

“The market is very skittish,” David Pavan, a portfolio manager at ClariVest Asset Management, said.

 

 

 

 

 

Francois Hollande will travel to Berlin with leaders for crisis talks on Tuesday after Germany said a Greek sovereign debt restructuring was “out of the question”.  On Monday, the French president met with Jim Yong Kim, head of the World Bank, and IMF chief Christine Lagarde, as well as leaders of the World Trade Organisation and the OECD, to discuss solutions for Greece, including a debt buy-back. The group will talk about the ideas with Ms Merkel on Tuesday.

European markets dropped ahead of the pivotal talks amid worsening bank problems gripped both Greece and Spain. Greek banks plunged almost 16pc after the finance ministry in Athens said that Brussels’ bail-out fund would not recapitalise the banks. The collapsed dragged the Athens exchange down 6.3pc.-- Are the German public finally being told the truth ?"For German finance expert Max Otte, such a debt haircut is nothing but an orderly insolvency and an acknowledgement of bankruptcy. "It's two words meaning the same thing," Otte said, "but there's no denying that Greece is bankrupt." So far, Germany has lent Greece some 80 billion euros by granting emergency credit lines or buying up sovereign debt through the ECB. A 50 percent debt cancellation, then, would leave Germany with a loss of 40 billion euros. It would be the first time that German taxpayers would actually lose money in an attempt to rescue Greece from bankruptcy. "Up until now, Germans have been told that their country was only assuming liability for a certain sum without taxpayers actually facing any costs," said Johann Eekhoff, the director of the Cologne-based Institute for Economic Policy".... 

Enormous growth with cheap money, that's United Europe

That is what we experienced in the last decades of the EU. Regard Spain, it changed, grew and modernised, in rural regions partially medieval,her life with an unmatched velocity never experienced before in history. - And ended in the financial crisis. That was mainly the fault of the socialists, with the coward Zapatero, now fleeing before the voters, and by socialists inbred attitude to waste the money, that others earned. And this horror experience shall now be revived in France with a President to elect who already declared that he would disregard the rules for austerity- and preferably waste German money.
By the way:I just returned from the "total emergency“ in Spain’s most suffering region Catalonia, nearly bankrupt. The restaurants were filled with Spanish families. Enjoying excellent food with pescados, mariscos and bogavantes (lobster) together with cava and one of the favourite cars seems to be the Porsche Cayenne... With the speed at which the level of quoted debt is increasing and far greater than any rate of inflation surely there must be questions on how big the black hole in the finances actually is. If you told me it was a 100 billion today then all of a sudden it lurched to 300 billion any sane person would say "WTF". ... SO SOMEBODY HAS BEEN LYING OR HIDING THE TRUE SCALE OF THE PROBLEM! At that point you can't fix it the size of the problem is not yet determined so honestly now "how big is the problem"??? You will not get a straight answer on this because they would be called out on it tomorrow when it has doubled yet again!....Germany’s ECB board member, said today: “The risk premia of sovereign bonds now reflect not just the insolvency risk of some countries but an exchange rate risk, which should not theoretically exist in a currency union. The markets are pricing in a break-up of the eurozone. Such systemic doubts are not acceptable".
Ahhh, "theoretically"... Well, theories are often very, very wrong indeed. Or were Greece, Ireland, Portugal, now Spain and next Italy all supposed to be declared insolvent as part of the euro "master plan", eh? ...Want some more data for your "theory"?....there, you see..."The Catastrophic State of Italy's Labor Market - September 4, 2012 - Spiegel. Italy's economy remains in freefall. The country is shedding jobs, production rates are abysmal and the infrastructure is appalling. Banca d'Italia, now forecasts a 2 percent drop in GDP this year"

We are constantly told that if we don't all neoliberalize everything, screw the poor to give to the rich and destroy all civilized parts of our society then the clever wizards say that TERRIBLE THINGS will happen. The "markets" and the "euro" and other abstractions will PUNISH US. No mechanisms are ever explained. Funny how much this resembles the wizards and magical shamans of the middle ages saying that God is on their side. If we don't give our tithes to the church then God will punish us, little children. ... One estimate put the cost to the eurozone of Greece making a disorderly exit from the currency at $1tn, 5% of output. This is exactly the kind of economic prediction that I'm talking about. How on Earth can they predict this with any degree of remote accuracy? It's like trying to predict the exact results of every match at the upcoming European Championships. Still, you can be virtually certain about one thing in both the football and the economy. Greece will eventually get knocked out.  ----  THE FACTS ARE :...If Greece decides to leave the euro it'll certainly make sense in the longer term-- the macroeconomic conditionality attached to the euro by the ECB is a 'one size fits all' framework designed to promote the economies of the EU's richer countries, and Greece is never going to derive any benefit from being in the euro. But for now economic catastrophe looms since Greece's current debt is denominated in euros, and the new drachma will involve a swift and drastic devaluation. There is no way Greece can pay its euro debt using the new drachma. The humane solution would be for the richer nations to cancel Greece's debt the moment it leaves the euro. To not do so would be to punish millions of ordinary people who did nothing to cause this crisis.

Outgoing PM Lucas Papademos has warned it would be "disastrous" for Greece to reject the austerity measures, which come as a condition of its bailout cash: Any modification... must be pursued in a spirit of consensus and with the full agreement of European peers. A unilateral rejection of the country's contractual obligations would be disastrous for Greece, leading unavoidably outside the euro and possible outside the European Union....The decisions we take could seal Greece's course for decades. They could lead the country to the fringe, canceling historic national achievements of the last 38 years.

Oh dear, yet more huffing and puffing from Frau Merkel and her toy pig Psycho-Sarko... They talk and try oh so hard to sound as if they know what is going on but fail to face reality each and every time. To say no more "haircuts" is a bit "rich", given how they mugged bond holders only a few weeks ago - can these two be trusted ever again?? ... They miss the point, in my humble opinion - they must have full fiscal union to make the You - Owe work... however, a small problem is that the people (oh no not them again!!!) do not wish to have full fiscal union depriving them of sovereignty...
Alternatively they can accept the grim reality, that Delors little idea born with flaws can never get better and is occupying a vital bed in Intensive Care...Here are the main points of the new treaty include:

1 - Automatic sanctions for breaching deficit ceilings of 3pc of GDP and a requirement for balanced budgets.
2 - Speeding up implementation of the permanent bailout funds, the European Stability Mechanism, to 2012, with the introduction of qualified majority - 85pc - for decisions, instead of unanimity.
3 - No more haircuts for bondholders.
4 - A monthly meeting of euro zone leaders until crisis ends, focusing on growth in Europe.
5 - ECB's role to remain unchanged - will not be lender of last resort - and there will be no eurobonds.

As the two spoke yields on 10-year Italian bonds, which last week were trading at "unsustainable" level above 7pc, slipped below 6pc.

Confidence that European leaders will come up with a credible plan to end the debt crisis at a crucial summit this week also buoyed stock markets. PRESS REACTION : -- Bruno Waterfield, the Telegraph's Brussels Correspondent, tweeted, citing a diplomat: "Looks like Sarko caved on most points, EU 27, automatic sanctions, ECB." -- While Simon Nixon, European editor of the Wall Street Journal's Heard on the Street column, suggested that France was a big winner. -- "Amid all the bluster from Merkozy presser, big winner seems to be Sarkozy (and de Gaulle), losers are Germany and UK."

Could anyone give or sell us a "Survival kit?"

France is being particularly watched on its commitments to cut high deficits as losing its triple-A rating would undermine the euro zone's bailout facility, the European Financial Stability Facility. In the space of less than three months, President Nicolas Sarkozy has responded by crafting two austerity plans to save €19 billion ($25.7 billion) by the end of next year. The second austerity plan came as the government slashed its 2012 growth forecast to gross-domestic-product expansion of 1% from 1.75% previously. Economists are now concerned that austerity could bite significantly into growth. Deutsche Bank analyst Gilles Moec said in a research note Monday that the two austerity packages and the tightening already programmed could take 1.2% off French GDP next year. Moody's noted in its report Monday that the growth outlook and the European debt crisis are "important risk factors" for the French government's finances. Mr. Baroin defended the government's austerity plans, which are mainly centered on tax increases in the short term, including VAT hikes. "These measures will not have a negative impact on growth of the French economy," he said. On a funny note : How about a list of actions eurozone holders can take to lessen the horror when the euro crashes in a disorderly fashion.
1. Buy non-EU currency. Which ones?
2.Buy gold.
3. Buy property rather than have cash in the bank.
4. Stock up on long life essential food supplies, batteries, paper.
5. Ensure at least 6-9 months of regular medications.
Could anyone give (sell) us a "Survival kit?"... Civil unrest anybody?

As he desperately tries to squash a popular rebellion, Libyan ruler Moammar Gaddafi is banking on the loyalty of a close circle of relatives and security officials whose personal fates depend on his survival, according to U.S. officials and analysts. Among them are four of his sons and two longtime spy chiefs accused of directing a series of assassination and terrorist plots during Gaddafi's four decades in power. While numerous Libyan diplomats and government officials have defected or abandoned Gaddafi in recent days, analysts said it is unlikely that his inner core will follow suit.
"The people who are in the bunker with him, they have pretty good reasons for sticking by Gaddafi," said John Hamilton, a Libya expert with Cross Border International, a British publishing and consulting firm that specializes in North Africa. "It's a bit late for the sons to revolt against their father . . . There's really nowhere for the others to turn, either." (W.P)

Mămăliga din Orientul Mijlociu" ("Middle East Polenta") that is the title chosen by Shachar Shaine, the former head of Tuborg Romania, for his speech delivered at the luxury Loft restaurant in Bucharest, held by a businessman closely connected to the beverage industry, Pepe Berciu, on Wednesday night. Shaine, 42, said goodbye to his co-workers, as well as to competitors in a relaxed atmosphere, pointing out that Romania was definitely "the country worth living and investing in". The manager who spent the last six years at the helm of United Romanian Breweries Bereprod (URBB), the bottler of Tuborg and Carlsberg, says he decided to stay in Romania, despite propositions from shareholders for whom he had worked to take over similar businesses in other countries. "I will stay and develop business here," Shaine said without providing further details. He is one of the managers with the longest-standing career in the beer industry, having worked for the same company for the last eleven years. Israeli-born Shaine has repeatedly said he loves Romania and even became a Romanian citizen six months ago.(Z.F.) BCE,ECB,IMF,Germany,France,Euro,currency,forex,investments,bucharest,Romania,cluj,