Berlin - German Chancellor Angela Merkel has "no memory" of allegedly pressuring Spain on taking a bailout in 2011, her spokesman Steffen Seibert said on Friday (6 December).

Former Spanish Prime Minister Jose Rodriguez Zapatero last week published a book called "The Dilemma" about his last years in office, recalling how Merkel, as well as the heads of the European Central Bank (ECB) and the International Monetary Fund (IMF) approached him during 2010-2011 to ask his country to take a bailout. He says he refused each time.

On Merkel, he gave a detailed account of a 2011 meeting in Cannes, where France was hosting a "G20" meeting of the world's richest countries. "She greeted me pleasantly and almost without any introduction put forward a proposal about which we had not had any indication," Zapatero writes, as translated by Reuters.

"Merkel asked me if I was willing to ask for a preventive credit line of €50 billion from the IMF, while another €85 billion would go to Italy. My response was also direct and clear: 'No'."

Merkel and then French President Nicolas Sarkozy at the same event pressured former Greek leader, George Papandreou, not to hold a referendum on the austerity measures accompanying the second Greek bailout.  Papandreou soon after stepped down, citing extreme pressure from EU leaders to reach a political deal with the opposition on the second rescue package.

Zapatero also resigned a month later, saying he did not want his low approval rating to damage his party in upcoming elections.

In his book, Zapatero also publishes a confidential letter from former ECB chief Jean-Claude Trichet dating back to 5 August 2011.

It outlines a series of reforms which were later implemented by the centre-right Spanish government of Mariano Rajoy.

The ECB at the time helped out Spain, as well as Italy, by buying up "significant" amounts of government bonds. This helped push down Rome and Madrid's borrowing costs, which were soaring not only due to their own economic slump, but also due to contagion from Greece.

While he was in office, Zapatero consistently denied the existence of Trichet's letter.

Asked about the publication of the Trichet letter, ECB chief Mario Draghi on Thursday declined to comment on "internal matters" in Spain.

Back when Draghi was the head of the Italian central bank, he co-signed a similar Trichet letter urging Italy's former leader, Silvio Berlusconi, to make reforms in return for ECB help.

In the end, Spain avoided a full-blown bailout, but did require financial assistance from the eurozone for its troubled banking sector.  Zapatero says that if he had caved in to Merkel and agreed to a state rescue, Spain would be worse off than it is today. 

As for Italy, its then finance minister Giulio Tremonti in 2011 said he could "think of better ways to commit suicide" than agreeing to an EU bailout.

Rome avoided a rescue, but Berlusconi, like Zapatero, stepped down.

Meanwhile, its crushing debt and sluggish economy required cheap loans from the ECB and the promise of unlimited intervention on bond markets if needed.

What's the safest way to do my online banking: over a wired connection, powerline networking or Wi-Fi?

The answer doesn't matter as much as you might think, but asking the question does mean you're approaching your online security in the right state of mind.

Overall, a wired ethernet link is more secure than either Wi-Fi or powerline networking, in which the electrical wires in your home carry Internet data. To compromise an ethernet network, an attacker needs to get into your house and plug in a laptop, while Wi-Fi signals go beyond your home and powerline networks can leak information to adjacent dwellings.

Both Wi-Fi and powerline setups come with encryption options to scramble data flowing over the network; once you switch them on, an attacker would need to know the password to break in. But Wi-Fi's obsolete WEP encryption can easily be defeated — and is still presented as a valid option in routers' setup routines.

Furthermore, if you leave a router on its default administrative password, somebody who connects to your network can also monkey with the router's settings to redirect your traffic to rogue sites. For much the same reason, you shouldn't automatically trust third-party wireless hot spots.

Financial sites use encryption of their own to scramble data flowing to and from your computer — as reported by your browser with a lock icon in its toolbar that, when clicked, should display an info sheet including the bank's name — and that should almost always outweigh the security of your local network.

(A determined attacker could defeat a bank's login security by persuading a user to connect to a router running malware that subverts this encryption, but this seems to have been a theoretical exercise to date.)

Your local network, however, makes up only one part of the "attack surface" of online banking, and it may not be nearly as profitable as two others: your computer and your mind.

If an attacker can get a keylogger on your computer to record your keystrokes, the strength of your bank's encryption and the complexity and novelty of your password won't matter at all — each tap of the keyboard will have already been recorded and transmitted.

That's why it's important to keep up with security updates for both your operating system and your browser (if you haven't disabled Oracle's vulnerability-prone Java Web plug-in, now would be a fine time to do so).

And if an attacker can fool you into typing your username and password into a phony site by sending you a phishing e-mail, your security-fix fastidiousness won't matter either.

You can thwart phishing attacks with the extreme measure of using a separate computer for online banking and nothing else (recommended at a panel on identity theft that I moderated earlier this month) or the lesser step of throwing a Linux LiveCD into your regular PC and booting off that for online banking sessions isolated from your usual software. But it's just a little easier to remember this basic rule: Never log into a bank account by clicking on a link sent in an e-mail.

If you're not sufficiently depressed about the state of financial security online, Target's massive credit-card breach — apparently executed by exploiting the retailer's in-store systems — offers a reminder that many account compromises happen in places we can't control.

And the best way to watch for them is to monitor your account for unusual transactions — which means you should do more online banking, not less.

Many major sites, from Facebook to Google to Microsoft to Yahoo, now allow "two-step verification" to protect users' logins from the loss of a password. That option requires users to vouch for all logins, or only those from strange computers or locations, by typing in a one-time password sent to their phone via text message or to a specialized app like Google Authenticator.

Most financial institutions, however, have yet to tune in to this trend. There's Bank of America's SafePass, CitiBank's identification codes Ally Bank's Security Code, and not much else. But if your bank offers this option — which may require looking around its site — you should enable it right away. And if it doesn't, you might want to ask why.

European Union officials take three times more sick days off work than an average British worker in the private sector, research by The Telegraph suggests.

According to official figures, European Commission officials took an average of 14.6 days off sick last year, with one in seven staff absent for more than 20 days.

By contrast, a survey by the Confederation of British Industry found that British staff working in the private sector took around five sick days a year.

European officials even outstripped Britain's civil servants and public sector staff, who took half as many days off work.

Peter Bone, a prominent Eurosceptic Conservative MP, said the figures were "disgraceful". He said: "I'm appalled at the waste of money. It is unbelievable that they are taking so much time off. However, nobody in truth would notice whether they are there or not. They have no real job, they are just pushing bits of paper around and costing taxpayers billions of pounds." EU officials are well paid, according to British figures, 16 per cent of administrative staff at the commission earn more than 100,000 or £84,000 a year, paid at low "community" tax rates of around 20 per cent.

The high wages comes on top of annual holidays of 24 days as well as seven days off for public holidays, and this year eight "non-working" days out of the office when the Brussels institutions are closed in summer and at Christmas.

Many commission staff are also eligible for a "flexitime" scheme that gives an extra 24 days off work every year for those that put in an extra 45 minutes a day in the office.

The holiday and flexitime allowances meant that in 2010, many EU staff were entitled to 66 days or a quarter of the year off work, without taking time off sick.

A spokesman for the European Commission said: "We don't have high sickness absence rates.

"The standard comparison is percentage of working days lost to sickness. While this varies very slightly from year to year, for the Commission it is generally 3.5 -3.7 per cent." "We find that in fact the commission compares very, even extremely, favourably to national administrations. That is the inconvenient truth."

Angela Merkel’s policies are giving rise to extremist movements in the rest of Europe...

About The World Economy – Efforts to revive growth in the world’s most influential economies – with the exception of the eurozone – are having a beneficial effect worldwide. All of the looming problems for the global economy are political in character.

After 25 years of stagnation, Japan is attempting to reinvigorate its economy by engaging in quantitative easing on an unprecedented scale. It is a risky experiment: faster growth could drive up interest rates, making debt-servicing costs unsustainable. But Prime Minister Shinzo Abe would rather take that risk than condemn Japan to a slow death. And, judging from the public’s enthusiastic support, so would ordinary Japanese.

By contrast, the European Union is heading toward the type of long-lasting stagnation from which Japan is desperate to escape. The stakes are high: Nation-states can survive a lost decade or more; but the EU, an incomplete association of nation-states, could easily be destroyed by it.

The euro’s design – which was modeled on the Deutsche Mark – has a fatal flaw. Creating a common central bank without a common treasury means that government debts are denominated in a currency that no single member country controls, making them subject to the risk of default. As a consequence of the crash of 2008, several member countries became over indebted, and risk eurozone’s division into creditor and debtor countries permanent.

This defect could have been corrected by replacing individual countries’ bonds with Eurobonds. Unfortunately, German Chancellor Angela Merkel, reflecting the radical change that Germans’ attitudes toward European integration have undergone, ruled that out. Prior to reunification, Germany was the main motor of integration; now, weighed down by reunification’s costs, German taxpayers are determined to avoid becoming European debtors’ deep pocket.

After the crash of 2008, Merkel insisted that each country should look after its own financial institutions and government debts should be paid in full. Without realizing it, Germany is repeating the tragic error of the French after World War I. Prime Minister Aristide Briand’s insistence on reparations led to the rise of Hitler; Angela Merkel’s policies are giving rise to extremist movements in the rest of Europe. It is unfortunate that the current arrangements governing the euro are here to stay, because Germany will always do the bare minimum to preserve the common currency and because the markets and the European authorities would punish any other country that challenged these arrangements. Nonetheless, the acute phase of the financial crisis is now over. The European financial authorities have tacitly recognized that austerity is counterproductive and have stopped imposing additional fiscal constraints. This has given the debtor countries some breathing room, and, even in the absence of any growth prospects, financial markets have stabilized. The other great unresolved problem is the absence of proper global governance. The lack of agreement among the United Nations Security Council’s five permanent members is exacerbating humanitarian catastrophes in countries like Syria – not to mention allowing global warming to proceed largely unhindered. But, in contrast to the Chinese conundrum, which will come to a head in the next few years, the absence of global governance may continue indefinitely.

Up against a gathering credit crunch, the Chinese economy will slow to almost stall-speed; the price of Brent crude will sink below $80 a barrel; Germany will slide back into recession; the European Union will remain intact and the internet will begin to Balkanise, leading to a boom in encryption technology but problems for the big global online brands.

’Tis the season for self-indulgent – and mainly futile – crystal ball gazing. What does the future hold for the economy and markets? Normal health and wealth warnings apply.

My big prediction is for $80 oil, from which much of the rest of my outlook for the coming year flows. It’s hard to overstate the significance of a much lower oil price – Brent at, say, $80 a barrel, or perhaps lower still – yet this is a surprisingly likely prospect, the implications of which have been largely missed by mainstream economic forecasters.

But first, there’s the frequently humiliating task of revisiting last year’s predictions.

A year ago, I did a cowardly thing; I hedged my bets, or rather, I wasn’t specific enough to easily pin down. This at least has the merit of enabling me to claim I was more right than wrong, though without any great sense of pride, since I basically hugged the consensus....My own predictions may be just a little darker than the average. I can see the disestablishment of the national church, and St. Paul's made over into a mosque. China, after reabsorbing Taiwan and southern Japan, becomes the world's only superpower. Liberals in America unfurl an all-out campaign against same race marriage. That country will also expand drone attacks to cover Kazakhstan, Nigeria, Switzerland, Ecuador, Pitcairn Island, and Georgia. Wales and Cornwall secede. The offspring of Bulgarian-Romanian-Jamaican liaisons form the new British majority. The "monoritization" of white people in the U.S. will be greeted with euphoria by white people. Advances in inter-species sex will unleash a "new wave" of cinematic expression in France. More than 2 million Germans will die from self-inflicted flagellation. Putin will receive more than 26% of the popular vote in the American off-year elections. Berlusconi wins popular mandate for 6th,7th, and 8th times. Britain adopts waterboarding for persons suspected of incivility. Iceland disappears....Chinese aggression in the East China and West Philippine Sea. Remember this is very likely to be the next major World flashpoint.
China, against, Japan, South Korea, Taiwan, Philippines, Vietnam and Malaysia all embroiled in territory disputes across this vast sea and now with false Chinese air corridors.
Chinese are bullying their near and far neighbors and already stealing Islands belonging to the Philippines and Vietnam to stake claim to the vast oil and natural gas that lies beneath the surface. One single unintended incident could spark a World War. Remember, the US has mutual defense agreements with Japan, South Korea, the Philippines and covertly Vietnam, so any military aggression by China against these countries will mean a military response from the US. Dangerous times ahead,Instead of 80 US oil price you could see 200 US dollars plus, plus....Eh. well,...

The £ $ Yen and €uro will collapse in Q1 or Q2 of 2015 which is why the Police and MOD are being trained for Martial Law. The surviving currencies will be the Renminbi, Ruble and Mark which was minted and printed 5 yrs ago.

Cameron knows what is coming and knows that there will not be a Referendum in 2017. They will be locked into lucrative long term roles in World Government and we will be economic slaves after our wealth has been destroyed.

The collapse will be caused by increasing the overnight interbank lending rate which in turn will collapse derivatives.

Aaron Russo briefly explains what is being done to us here;

https://www.youtube.com/watch?...

France's highest court has approved a 75% tax on high earners that is one of President Francois Hollande's signature policies.

The initial proposal to tax individual incomes was ruled unconstitutional by the Constitutional Council almost exactly one year ago.

But the government modified it to make employers liable for the 75% tax on salaries exceeding 1m euros (£830,000).

The levy will last two years, affecting income earned this year and in 2014.

Football clubs in France went on strike earlier this year over the issue, saying many of France's clubs are financially fragile and say the plans could spark an exodus of top players who are paid huge salaries.

The Qatari-owned Paris Saint-Germain has more than 10 players whose pay exceeds 1m euros, including the Swedish striker Zlatan Ibrahimovic.

There has also been a chorus of protest from businesses and wealthy individuals who have condemned the tax - including film star Gerard Depardieu, who left the country in protest.

Polls suggest a large majority in France back the temporary tax.

Unlike many other countries in Europe, France aims to bring down its huge public deficit by raising taxes as well as some spending cuts.

The highest tax rate in the UK is 45% and is applied to individuals.

For much of Washington, 2014 could not come soon enough. November's mid-term elections represented Barack Obama's last hope of redrawing the US political map and moving on from a year marred by divided government and Congressional stalemate.  

Whether Democrats succeed in their unlikely dream of seizing back control of the House of Representatives or Republicans instead continue to make inroads on their fragile lead in the Senate is another matter, and much depends on whether the White House can first restore public faith in its flagship healthcare reforms by the 31 March enrolment deadline.

Spring will also see Republican leaders under renewed pressure from their Tea Party wing, which is preparing primary challenges against moderates in the Senate that will further constrain any ability to cut deals with Democrats once election fever starts.

Several potential bright spots could lift everyone's spirits, however. A recovering economy may take pressure off America's anaemic job market and shocking social stagnation. US troops should return from Afghanistan – with or without a deal in Kabul to retain a security presence. And progress toward Iranian nuclear detente may give the White House cause to celebrate a rare foreign policy success, even if Congress will still need persuading.

Other challenges looming in 2014 have been postponed by the dysfunction and inertia of 2013. Barack Obama still needs to decide whether to authorise the Keystone energy pipeline, which pits environmentalists against North America's unconventional oil boom; expect tough new climate change controls for power companies instead if he does. And with all three branches of government now proposing reform of the NSA, Obama will finally have to decide before January's state of the union address what to do about America's surveillance state.

For much of 2014, the US Capitol dome will be shrouded in scaffolding for renovations – both real and metaphorical. What emerges next December will say much about the future of American democracy.

Dan Roberts in Washington