There is now a growing band of politicians, entrepreneurs and policy strategists who argue that a basic income could potentially hold the solution to some of the big problems of our time. Some of these new converts have alighted upon the basic income as an answer to our fragmenting welfare state. They point to the increasingly precarious nature of today’s labour market for those in low-paid, low-skilled work: growing wage inequality, an increasing number of part-time and temporary jobs, and rogue employers routinely getting away with exploitative practices.

This grim reality collides with an increasingly punitive welfare state. Our welfare system was originally designed as a contributory system of unemployment insurance, in which workers put in during the good times, and took out during temporary periods of unemployment. But a big chunk of welfare spending now goes on permanently supporting people in jobs that don’t pay enough to support their families. As the contributory principle has been eroded, politicians have sought to create a new sense of legitimacy by loading the system with sanctions that dock jobseeker benefits for minor transgressions.

Elderly Germans may have to keep working until the age of 69 if a Bundesbank proposal is adopted.

It says Berlin should consider raising the retirement age to that level by 2060, from around 65 at the moment.  The central bank says that otherwise the country may struggle to honour its pension commitments. It points out that the state pension system is in good financial health at present, but will come under pressure in coming decades. The Bundesbank says that as baby-boomers - those born in the post-World War Two period - retire, there will be fewer younger workers to replace them.. The retirement age for Germans is set to rise gradually to 67 by 2030.  However, the bank believes that from 2050 this increase will not be enough for the German government to keep state pensions at their target level of at least 43% of the average income.  It is therefore proposing pushing the retirement age up to 69.  "Further changes are unavoidable to secure the financial sustainability (of the state pension system)," the Bundesbank said in its monthly report.  But German government spokesman Steffen Seibert said they stood by retirement at 67.  "Retirement at 67 is a sensible and necessary measure given the demographic development in Germany. That's why we will implement it as we agreed - step by step," he added.

It’s an idea whose adherents over the centuries have ranged from socialists to libertarians to far-right mavericks. It was first proposed by Thomas Paine in his 1797 pamphlet, Agrarian Justice, as a system in which at the “age of majority” everyone would receive an equal capital grant, a “basic income” handed over by the state to each and all, no questions asked, to do with what they wanted.

■ A “basic income”, first proposed by Thomas Paine is an income unconditionally granted to all on an individual basis, without any means test or requirement to work.

■ It is paid irrespective of any income from other sources.

■ It is paid without requiring the performance of any work or the willingness to accept a job.

■ Advocates say it will allow people to genuinely choose what sort of employment they take, and to retrain when they wish.

■ Its proponents also claim that a basic income scheme is one of the most simple benefits models, and will reduce all the bureaucracy surrounding the welfare state, making it less complex and much cheaper to administer.

Unemployment is rising in Europe's two largest economies, with a shock jump in Germany and a new record high in France, according to the latest figures.

The number of unemployed people in Germany rose unexpectedly by 24,000 to 2.905 million in May. It was the biggest monthly increase since April 2009, and a long way off economist's expectations of a 15,000 decrease. Economists said the drop could partly be explained by the weather, with a loss of fewer seasonal jobs during a milder than usual winter.Despite the rise in unemployment numbers, the jobless rate was unchanged in May at 6.7%, and Schulz said Germany's labour market "remains on a strong positive trend despite the slight May setback".

Nevertheless i know a whole bunch of academics out of work after graduating. Some for years. And from all fields...economics, law, natural sciences, social sciences. Most of those people graduated with above average marks....

Others i know, even with phDs, are working on short term contracts, low paid and always in fear of not getting the follow-up contract. Meanwhile couples with children, even with both working (academics) cannot afford to build a house for their families, even if their parents did that with only one working and the other stay-at-home. German Jobwunder? Rather for the capital-side...If Juncker gets appointed that number will sky rocket, his plan for the United States of Europe, starve them into submission. The EU learnt nothing form the recent vote they are already holding out the begging bowl for another 3.5 billion to plug a hole in their finances.

The truth about Merkel's 4th. Reich

It's becoming clear how hard is going to be for Frau Merkel to form a new government. The SPD wants the Finance Ministry and will ballot its members on any deal. In the end, though, they're likely to reach an agreement, say media commentators.

The election may have been held eight days ago, but Germany is no closer to forming a government. It could take until December or January, the general secretary of the opposition Social Democrats (SPD), Andrea Nahles, warned on Monday. The SPD, in a canny move to drive up its price for joining a coalition and to secure grass-roots support for a deal, decided at a party conference on Friday that it will ballot its 470,000 members on any agreement. That means they can say in talks, "we can't give in on that point because our members won't back it. That's bad news for Chancellor Angela Merkel, because it will make the talks to form a so-called grand coalition of the two main parties all the more difficult. As if that weren't enough, Bavarian governor Horst Seehofer, an important conservative ally of hers, on Sunday narrowed her negotiating position with some undiplomatic rhetoric before preliminary talks had even begun.

BERLIN - A third of Europeans have no savings at all, while in Spain and Italy half of the population is using up money put aside, a survey carried out by the German pollster TNS on behalf of ING Bank shows. The study was carried out on over 14,000 adults in Austria, Belgium, Czech Republic, France, Germany, Italy, Luxembourg, the Netherlands, Poland, Romania, Slovakia, Spain, Turkey and the UK. The country with the fewest savers was Romania, where almost half (48%) of respondents said they have no savings, while Luxembourg had the most (89%). The evolution of personal savings in the past year showed they decreased among 52 percent of Italians and 47 percent of Spaniards. In Turkey and Great Britain, however, almost half of their citizens were able to set aside more money in the past 12 months. Asked whether they were happy with the state of their savings, Dutch and German were the most happy (47% and 46%), while Czechs, Italians and Spaniards the most unhappy (38% and 36%). Most respondents - over two thirds - said they were not able to spend as much on hobbies, clothes and body care. Education and health were the least touched. On average, there are more Europeans who say they would be able to live from their savings for three months (49%) than those who say they could not (47%).

"Indignados" in Spain

"Que se vayan todos," or "Away with all of them," became one of the slogans chanted by the tens of thousands of "Indignados" in Spain at protests last year. In addition to their eponymous outrage, many had one thing in common: Most were young and viewed themselves as victims of the crisis.

They might have been more specific and instead chanted: "All the old people must go!" This phrase would apply because, in many ways, the euro crisis is also a conflict between generations -- the flush baby boomers in their fifties and sixties are today living prosperously at the expense of young people.

Intergenerational equity -- measured among other things by levels of direct and hidden debts and pension entitlements -- is particularly low in Southern Europe. In a 2011 study of intergenerational equity in 31 countries by the Bertelsmann Foundation, Greece came in last place. Italy, Portugal and Spain didn't do much better, landing in 28th, 24th and 22nd place respectively. Currently, the unequal distribution of income and opportunities is particularly distinct:

The employment market collapse has hit young Europeans much harder than older generations. In Greece and Spain more than half of those under age 25 are unemployed -- twice the rate of older workers. Things are even worse in parts of southern Italy, where youth unemployment has risen above 50 percent. One reason for this situation is unequal employment circumstances. Older Spaniards and Italians, for example, profit from worker protection laws preventing them from getting fired that are quite strong by international comparison. But almost half of young Italians and 60 percent of young Spaniards are on temporary employment contracts and can easily lose their jobs.  The burdens and risks of the euro bailouts are also mainly borne by young people. Ultimately, growing national debts and bailout funds worth billions will be financed through bonds that won't be due for many years to come.

More from the IMF: "The external position of the Euro area as a whole has been close to balance, and only slightly weaker than the estimated value consistent with fundamentals and desirable policies. However, this masked, and continues to mask, substantial divergences across the Euro area primarily financed from within the union, including by major banks with global links. Germany currently has the world’s second largest current account surplus, partly with the rest of the world, while Spain and (to a lesser extent) Italy have deficits. Major estimated external imbalances that are regionally-financed imply a need for substantial real and financial rebalancing within the Euro area as well as a much more modest rebalancing by the bloc with the rest of the world. Unsustainably large intra-Euro area imbalances were part of the global boom-bust cycle, and the failure to resolve the Euro area crisis is causing heightened stresses that are spilling over to other countries". -- Germany is doing OK though, and have done since the Eurozone was created. No wonder Merkel wants to preserve the status quo. The eurozone is on life-support, it won't be long before the apparatus is switched off, but by then millions of people in Spain, Portugal, Ireland, Italy, Greece et al will have had their lives ruined by arrogant, stubborn eurocrats. ..... What's the youth population of Europe? Say, around 100 million people (depending on how you define youth) of which roughly 20 million are unemployed. Now take the quantitative easing (QE: new money printed and issued, a taxpayer liability) amounts given to the banks, and the other forms of money given to them in bank bailouts. £375 billion and counting in the UK. Don't have close to hand, the QE, bank bailout, and other monetary relief sums for the bad debt of banks given to Spain, Italy, Greece, Ireland, and Portugal. Let's take a conservative estimate of a total of £600 billion: divide this by 20 million and you have £30,000 per unemployed youth. The new money printed and issued by European governments if given directly to the public instead of the banks would certainly wipe out unemployment for at least a year or two. That would be even truer for the Non-Euro Countries, forget about the rest of Europe. But we the public are such stupid, apathetic sheep, we play along with this massive misdirection of financial resources by the states, done for the banks, at your cost.

IMF calls on ECB to act --- The International Monetary Fund is pleading with the European Central Bank to do more to fix the eurozone crisis.  In a report released at 2pm, the IMF said the ECB could, and should, do more to prevent the euro unravelling, arguing: The ECB can provide further defences against an escalation of the crisis.

Its recommendations included :

• considering further interest rate cuts• A "sizeable" quantitative easing package, to stimulate the eurozone economy

• giving the ECB full 'lender of last resort' powers

• restarting its Securities Markets Progamme (to buy up peripheral sovereign debt)

Suggestions 2, 3 and 4 are unlikely to be welcomed by stronger members of the eurozone (think Germany, Austria, Finland...) who could also fear that lower interest rates would drive inflation up.

The IMF, though (which expects the eurozone to contract by 0.3% this year) is again insisting that the ECB must do more: These could include policies to support demand in the short run and fend off downside risks to inflation, as well as measures to ensure that monetary transmission, currently impaired by financial stress in some countries.

There are problems with the IMF's suggestions, though. QE would probably drag down the yields on safer bonds (awkward, when some are in negative territory already), while Germany is wedded to the idea that closer fiscal union needs to be arranged before the ECB is granted more powers.

LONDON—The euro zone's financial plumbing is badly backed up—and none of policy makers' efforts to clear it has worked.

That was apparent Friday in fresh data from the Bank of Spain, which said the country's banks borrowed €365 billion ($446.7 billion) from the European Central Bank in June, a new high, accounting for 30% of all the central bank's lending. The Spanish borrowing figure is €50 billion higher than the level in April and is double the figure at the beginning of the year.

The data reflect one of the euro zone's great, unsolved problems

Bailout renegotiation - Greece

In February, European Union and international lenders had imposed strict targets on spending and economic reforms on Greece in return for a 130bn euro ($171bn) rescue package - the country's second such bailout.  But Greece's national wealth has shrunk for five years in a row and unemployment remains high, which adds to the country's benefit costs while reducing government income in terms of tax receipts.   Measures intended to reduce government debt, such as selling off state-run companies and reducing the minimum wage, risk raising the number of jobless and lowering household incomes, further damaging Greek economic growth .  The government fears that the country is increasingly trapped in a vicious cycle of internationally enforced austerity followed by shrinking wealth or recession.

"With this uncontrolled recession, the programme's funding needs are rising. We want this to stop and to start getting out of this dead end," Mr Samaras said.

"This is the subject of our 'renegotiation'."

I've been wondering about Norway; for many the model to emulate. Many of the numbers here come from Norsk Industris Konjunkturrapport 2012. It's an employers' association, so expect a center-right bias. I'd be delighted if a Norwegian were to comment.

Norway's Sovereign Wealth Fund means the country has no insolvency problems. Unemployment is a low 3%. One out of three jobs is in the public sector. The Norwegian oil industry is expected to show a revenue growth of 15% next year, and is hiring. But Norway's traditional export sectors - industry and mining - will grow only 0 to 2%, and are firing people. And these traditional sectors employ about five times as many people as the oil sector.

There is a clear dichotomy in Norway's industry: on the one hand a booming oil sector which keeps the currency strong and wages high; and on the other hand an export-oriented industry which are suffering from the combined effect of the high kronor and high wages.  Surprisingly enough, given the strong sense of crisis in Europe, Norwegian companies actually increased their exports to the EU in 2011 by 12%. Exports increased to all EU countries except the PIGS countries in the south. Norway is not whining demand is weak. Exports to the UK increased +6.2%. Exports to the US dropped -4.3%. These are data for the whole of 2011. 80% of Norwegian exports go to the EU, 2% to China. Being outside the EU, Norway is free to make its own free-trade agreements with China, but China is not interested. Negotiations broke off when Norway gave Liu Xiaobo the Nobel Prize back in 2010. Norway had its banking crisis, following a period of financial deregulation. Small banks began to fail in 1988. The crisis peaked in 1991, and ended in 1994, six years after it began. Just imagine the Guardian running a "Norwegian Banking Crisis Live Blog" six years on end.
What's my take on Norway?

There are two Norways. The oil industry is booming; the export-oriented industry is suffering. The kronor-euro exchange rate is causing discomfort for Norway's export industry.  When a overvaluation of the Swiss franc threatened Swiss exports the Swiss National Bank intervened, and the Swiss franc has been at exactly 1.20 euro since. Of course, this means a large part of Swiss monetary policy is no longer determined in Bern, Switzerland but rather in Frankfurt, Germany. Nevertheless, pegging the franc to the euro is seen by many Swiss as a pragmatic solution.  Norway's future may be Switzerland's past. We may see the Norwegian kronor pegged to the euro sooner than we think. Yes, such a move would be political suicide in the UK. So what?

Romania - New Government ( made of very young inexperienced individuals)

Romania’s new Government, led by Mihai Razvan Ungureanu, received a confidence vote in Parliament Thursday, allowing it to continue reforms pledged by the previous government under a deal with the International Monetary Fund, EU and World Bank. Lawmakers voted 237 to two to instate the new Cabinet. The Cabinet required the confidence vote of at least 232 lawmakers. The opposition did not attend the vote. STRAGE as it may be, the new cabinet is very young, and made of the former communist sibilings...HAVING NO EXPERIENCE IN ADMINISTRATION, or background in runing anything !!!!

Staple foods became 20 to 40% more expensive between July 2010 and February 2011, shows the Z.F. index calculated based on prices in Bucharest hypermarkets. ZF selected 15 products whose price it has been following since 2008, once every six months, at the same Bucharest hypermarkets, Carrefour Orhideea and Real Afi Cotroceni. These products were chosen because they are most often to be found in Romanians' purchase basket. (Z.F.)

In the calculation of this index, ZF chose one brand from each category of products, a brand that is well positioned in terms of market share, produced by one of the top-five players in the category. Therefore, one kilo of Băneasa flour costs 2.8 lei in February, 41.4% more than in July 2010. 1 Kilo of Lemarco sugar now costs 4.295 lei, compared with 3.28 lei, an increase of 30.9%. Similarly, the price of Floriol vegetable oil (1 litre) rose over 35%, from 5.11 lei to 6.91 lei. Data from the National Statistics Institute (INS) point to a 10.2% price increase for flour in the July 2010 - January 2011 period. Similarly, the increase amounted to 8.1% for sugar. The only products whose prices fell, of those analysed by ZF, were beer, mineral water, apples, with the decline amounting to 6.1%, 0.1% and 12.4% respectively.

Real estate developers scheduled for delivery in 2011 at least eight retail projects in Romania totaling a surface of over 230,000 square meters, 17% more than the total area of projects completed in 2009, according to property analysts.

In 2009, developers completed retail projects totaling 195,000 sqm, according to CB Richard Ellis (CBRE) data.

Oradea Shopping City, Uvertura City Mall Botosani, Vitan Outlet Bucharest, Policolor Shopping Center Bucharest and Electroputere Shopping City Craiova are other projects scheduled for completion in 2011. Read more on http://www.mediafax.biz/. (Z.F.)euro, criza datoriilor de stat, euroscepticismul, monede nationale, renuntarea la euro, salvare euro, zona euro

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UniCredit Ţiriac Bank ended the third quarter with 67 million RON (almost 16 million euro) net profit, down 6% compared with the same time last year. Nine months into the year, net profit amounted to 215 million RON (52 million euros), a 15% decline compared with 18% in the first half.Operating revenues exceeded one billion RON (245 million euros) nine months into the year, up 15%, while the credit portfolio rose by 13%, to 13.3 billion RON (3.1 billion euros). Midyear, the lending increase stood at 11%, with the Italian group continuing to apply the strategy designed to boost the loan market share.