The Chinese central bank has warned the country's financial institutions not to trade in bitcoin, saying that the digital currency doesn't have "real meaning" and lacks legal protections.

However, no explicit risk to China's financial system was identified by the bank, and it reiterated that individual citizens were free to use bitcoin provided they were aware that they were taking the risk on themselves. The bank also identified money laundering and other illegal uses of the currency as areas of concern.

Bitcoin has recently achieved a measure of popularity in China, with FiatLeak and other bitcoin trading information sites showing large inflows of the currency through Chinese exchanges.

China Telecom, the largest mobile phone provider in the country, launched a promotion allowing a Samsung phone to be bought with bitcoins, and Baidu, the Chinese Google, is accepting payments for its firewall service in the currency.

But there's also suspicion that a large measure of the bitcoin's Chinese popularity is the result of fringe-legal uses. The currency is perfect for getting around the country's tight capital controls, which prevent rich Chinese citizens from moving too much money overseas. While bitcoin remains unregulated, it is easy for users to buy a large sum in Chinese yuan and sell it in US dollars, evading those regulations. The potential of bitcoin in China is seen as a large part of the reason for the currency's seven-fold increase in price over November, and the news that the Chinese central bank is taking a less-than-welcoming stance to it has sent markets tumbling.

The value of one bitcoin fell by 28% over two hours on Thursday morning, before settling into its more normal pattern of rapid large price swings in both directions.

The warning follows a similar cautionary tone from the Dutch central bank, which noted that there is no central issuer which can held liable for bitcoin, and no deposit guarantee scheme in the event of bitcoin banks failing.

The former head of the Dutch bank even compared the bitcoin bubble to the Netherlands' tulip mania in the 17th century – but pointed out that at least when that bubble burst, investors were left with tulips at the end.

The head of the venerable Deutsche Bank reprimanded like a schoolboy... UUUU

German Finance Minister Wolfgang Schäuble recently gave a German banker the most brutal lesson to date -- delivered in a series of apparently incidental comments. At a press conference last Thursday afternoon, Schäuble launched into one of his notorious lectures on sound fiscal policy in times of crisis.  But then, finally, he had an opportunity to air his frustration over the incorrigible banker caste. A journalist asked Schäuble about his response to recent comments by Deutsche Bank co-CEO Jürgen Fitschen. The previous day, Fitschen had accused Schäuble of irresponsibility and populism, because the finance minister had insinuated that the banks were still bypassing financial industry regulations.

 "I don't know if Herr Fitschen has understood what I mean," Schäuble complacently replied. He also noted that he had only recently reminded the bank executive that the financial crisis had not been caused by politicians. Then, as if he hadn't already sufficiently lambasted one of the country's leading bankers, Schäuble added: "If Herr Fitschen carefully reviews his statement, he will undoubtedly come to the conclusion that he is incorrect in this matter." And Fitschen has undeniably adopted the wrong tone, he said.   The head of the venerable Deutsche Bank reprimanded like a schoolboy? Ouch.  

Schäuble's slap in the face is a warning to Deutsche Bank. The minister's portfolio includes Germany's Federal Financial Supervisory Authority (BaFin). These days, the Bonn-based financial watchdog is conducting far more than the usual number of investigations into Germany's largest bank, and the consequences of these probes -- for the bank and its co-CEOs Fitschen and Anshu Jain -- are ultimately a political issue.

Yves Mersch, the governor of Luxembourg's central bank and a member of the European Central Bank's executive board, has exposed tensions within the ECB over the prospect of quantitative easing.

While the Bank of England and the US Federal Reserve have turned to QE to boost economies, the ECB has refrained, and it is unclear whether it is legally allowed to.

However, the prospect has been raised in recent weeks as the eurozone's stricken southern economies suffer from deflationary pressures. Peter Praet, also on the board, said last month that the ECB could use QE.

In a speech today, Mr Mersch says:

Friedrich August von Hayek [a famous libertarian economist] stressed that only the free market system contains all relevant information and so could guarantee meaningful allocation [of assets]. The "social engineers" who want to plan a society on the drawing board, he accused of the presumption of knowledge

Only in exceptional circumstances may direct purchases of securities by the central bank serve to correct acute market failure. In general, however, it is preferable that market actors determine appropriate pricing.

Northern eurozone economies are far less keen on QE, and the disagreement threatens to open a wound within the eurozone, as Ambrose Evans-Pritchard reported last month.  The ECB's founding mandate is supposed to be monetarist. Now we learn -- as we suspected -- that it is full of closet Hayekians.

Mr Mersch says central banks lack the skill to pick assets and value them correctly. Quoting the Austrian School guru von Hayek, he says that the free market alone has the necessary information, and that it is "social engineering" to interfere with the price system. Central banks should buy assets only in exceptional circumstances to counter stress.

Some would say that If this is the position of the ECB, it is an abdication of traditional monetary policy (dating back to the 19th Century) to use open market operations to counter deflation risks.

Hayek changed his view anyway in the late 1930s, admitting that "nature's cure" was not what he had hoped

A Nobel prize-winning economist will on Thursday withdraw his support for the euro saying it has created a “lost generation” unemployed youngsters and should be broken up.   Sir Christopher Pissarides was once a key proponent of a single currency but will on Thursday accuse the euro of “dividing Europe” and say action is needed to “restore the euro’s credibility in international markets” and the “trust that Europe’s nations once had in each other”, according to the Daily Mail.   Speaking at the London School of Economics, where he teaches, Professor Pissarides will say: “The euro should either be dismantled in an orderly way or the leading members should do the necessary as fast as possible to make it growth and employment-friendly,.   “We will get nowhere plodding along with the current line of ad hoc decision-making and inconsistent debt-relief policies.   “The policies pursued now to steady the euro are costing Europe jobs and they are creating a lost generation of educated young people. This is not what the founding fathers promised.” The Cypriot-British economist, who won the Nobel prize in 2010, is speaking days after Christine Lagarde, the head of the International Monetary Fund, insisted the crisis in the eurozone was not yet over.   The eurozone economy grew by just 0.1 per cent in the third quarter of the year compared with 0.8 per cent in Britain and 0.9 per cent in the US.   Unemployment within the single currency area now stands at 12.1 per cent, meaning more than 19million people are out of work   Some economists argue Europe cannot enact the policies needed to boost growth and create jobs due to the huge variations in economies across the region.   German taxpayers are unwilling to pay out to help crumbling economies such as Greece or Spain while even France now faces financial crisis.   Explaining why he had worked hard to persuade Cyprus to join the currency union in 2008, Professor Pissarides will say: “I was completely sold on the idea.  “Back then, the euro looked like a great idea. But it has now backfired. It is holding back growth and job creation and it is dividing Europe. The present situation is untenable.”   Professor Pissarides, 65, is the regius professor of economics at the LSE and chairman of its new Centre for Macroeconomics. He was knighted in June.(sourse , telegraph.uk)....The simplest way is to describe the EU as a centralizing, top down, all controlling, undemocratic project designed to force compliance and standardization on European peoples in all things in order to serve a New World Order controlled by International Corporates and Financial markets. It Doesn't matter what you want to call the dominant political parties in the EU structure, or what you make of their politicians' claims to be on the Left, whatever that means.
We know that they want to impose mass immigration and destroy national identity - so that makes them anti-nationalist socialists , who tend to be much the same in practice as National Socialists, just without the nationalism- isn't that what we have got? Goldberg's "Liberal Fascism"(borrowed from H.G. Wells) is a useful term which embraces left and right.
It's the outcomes we should concentrate on not what they choose to call themselves.

Greek deflation rate hits new high

Greece has lurched further into deflation, with prices tumbling at the fastest rate recorded as the country's long economic slump continues.

The Greek consumer prices index shrank by 2.9% in November, showing deflation accelerated after October's reading of minus 2.0%.

Prices in Greece have been falling steadily over the last three years, hitting deflation in April for the first time since records began in the 1960s.

This graph tracks Greek CPI (red) against eurozone inflation (blue):

Photograph: ELSTAT

Today's data shows that some retailers have slashed prices drastically, having seen demand slide among customers buffeted by austerity cutbacks and record unemployment.

Clothing and textile prices tumbled by over 11%, according to national statistics body ELSTAT. Household equipment costs were down 3.7% year-on-year, as this chart shows:

Photograph: ELSTAT

Greece's austerity programme has forced wages and pensions down in an attempt to boost competitiveness -- so deflation has not come as a surprise. It could even be taken as a sign that the Troika's plan is having its intended effect.

The damage wrecked on the wider Greek economy rather undermines the argument that deflation's a good thing, though, especially as Athens isn't able to inflate away some of its national debt.

We've also heard confirmation this morning that the Greek economy shank by 3% on a year-on-year basis in Q3, which confirms that the five-year recession is easing. 

Italian third-quarter GDP revised from contraction to stagnation. The Italian economy did not contract in the third quarter of the year, it was merely flat, according to today's revision of the initial estimate.  The GDP figure has been revised from 0.1pc growth to 0.0pc.  This may not sound great, but it is the first quarter that the economy has not contracted since the second quarter of 2011.  Italy is also outgrowing France for the first time in over two years - France shrunk at 0.1pc in the third quarter...

Meanwhile, Christine Lagarde, the managing director of the International Monetary Fund, has warned that long-term prospects for growth in the eurozone look bleak unless politicians act urgently to stoke domestic demand and tackle youth unemployment.  After months of relative calm in financial markets, and with Ireland due to end its painful bailout programme and end its reliance on the IMF this weekend, some European politicians have declared the worst to be over for the 17-member single currency zone.  But speaking at the European Economic and Social Committee in Brussels, Lagarde warned against prematurely declaring an end to the economic crisis.  "Can a crisis really be over when 12% of the labor force is without a job? When unemployment among the youth is in very high double digits, reaching more than 50% in Greece and Spain? And when there is no sign that it is becoming easier for people to pay down their debts?"  She warned that high youth unemployment could jeopardize the economy's ability to grow in the future, by creating a generation of young people without the skills to take their place in the jobs market. "What is at stake is Europe's potential for growth in the future," she said.  "Unemployment at a young age means a lack of on-the-job training, depreciating skills, and possible withdrawal from the labor market. Experience tells us that long spells of unemployment lead to a less productive workforce down the road."  Lagarde called for a raft of reforms, including fixing the battered banking sector, to "jump-start growth", and warned that with monetary policy all but exhausted, and interest rates already close to zero, governments might yet need to resort to a new fiscal stimulus if recovery fails to take hold.  "In the event growth is low for a protracted period of time and monetary policy options are depleted, fiscal policy will need to provide more support to domestic demand," she said.  In a veiled criticism of Germany, which has tended to rely on an export-led growth model, Lagarde suggested that boosting Europe's growth potential will require stoking demand at home, too.  "Most of the demand for European goods and services comes from abroad, not from within, leaving the economy at the mercy of the ups and downs of global trade. European demand for European products remains lackluster."   After The ECB President Mario Draghi unexpectedly announced a cut in interest rates last month to stave off deflation, Lagarde called for the ECB to "keep interest rates low and convince investors that it will do so for as long as is necessary."  The IMF would also like to see a series of labor market reforms, including making it easier for skilled employees to cross Europe's borders in search of work; cutting employment regulation; and shifting the burden of taxation from income on to consumption, in the hope of boosting future job prospects. "There can be no letting up on reforms until growth has recovered sufficiently to arrest the rise in unemployment and debt", Lagarde said.

Agreement among the WTO’s 159 member economies

Ministers meeting in Bali sealed agreement among the WTO’s 159 member economies for the pact, which eases barriers to trade by simplifying customs procedures, limiting agricultural subsidies, and promoting trade with least-developed nations. 

The deal could boost global trade by $1 trillion and create 20 million new jobs, keeps alive the WTO’s broader 12-year marathon Doha Round of trade negotiations designed to reduce international tariff barriers, well ...I've just found out that governments from the United States to Australia and from Canada to the EU are secretly negotiating trade deals that will give global corporations the right to sue our governments and overturn our laws.

Details have leaked out on what is called the Trans Pacific Partnership (TPP) and the Transatlantic Trade & Investment Partnership (TTIP) that will massively expand the power of corporations to sue our governments.

Thousands of corporate lobbyists are helping to write these secret pacts -- but we're not allowed to see them. Governments know that we won't like these corporate power grabs, so they're hoping to keep them under the radar until it's too late to stop them. But if we can raise our voices now, we can expose these corporate charters and kill the deals forever.

Two secret new global pacts- the TTIP and TPP -could massively increase the power of corporations to sue our governments when they pass laws to protect our environment or our health. Unsurprised, its just four companies talking to each other - 8 largest U.S. financial companies (JP Morgan, Wells Fargo, Bank of America, Citigroup, Goldman Sachs, U.S. Bancorp, Bank of New York Mellon and Morgan Stanley) are 100% controlled by 10 shareholders and we have 4 companies always present i...n all decisions: BlackRock, State Street, Vanguard and Fidelity - who control the Federal Reserve. The same “big four” control the vast majority of European companies counted on the stock exchange. These same people run the IMF, the European Central Bank & the World Bank. The 10 largest US financial institutions hold 54% of US total financial assets. 90% of US media is owned by 6 corporations. We will tell you what the news is - the news is what we say it is - it turns out it is not illegal to falsify the news. 37 banks have merged to become just four since 1990. We are speaking of 6, 8 or maybe 12 families who truly dominate the world (perhaps Goldman Sachs, Rockefellers, Loebs Kuh and Lehmans in New York, the Rothschilds of Paris and London, the Warburgs of Hamburg, Paris and Lazards Israel Moses Seifs Rome). With Google accounting for over 65% of all web searches in the US and over 70% market share in most other countries, the top 10 owners of Google’s stock are Fidelity, BlackRock, State Street, Vanguard Group, Capital Research, T. Rowe Price, Capital World, Alliancebernstein, Marsico Capital. This is the world we live in.