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Why Europe Keeps Failing........ merged with "EU Seizes Cypriot Bank Accounts"

The Bread Guy

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Thucydides said:
Greece makes a pretty chilling threat ....
And what'll it cost to keep it from happening?
Greece Nazi occupation: Athens asks Germany for €279bn

The Greek government says Germany owes Greece nearly €279bn (£204bn; $303bn) in war reparations for the Nazi occupation during World War Two.

It is the first time Greece has officially calculated what Germany allegedly owes it for Nazi atrocities and looting during the 1940s.

However, the German government says the issue was resolved legally years ago.

Greece's radical left Syriza government is making the claim while struggling to meet massive debt repayment deadlines.

Reacting to the Greek claim, German Economy Minister Sigmar Gabriel said it was "dumb" to link Greece's bailout by the eurozone with the question of war reparations.

"To be honest I think it's dumb. I think that it doesn't move us forward one millimetre on the question of stabilising Greece," he said ....
 

estoguy

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"To be honest I think it's dumb. I think that it doesn't move us forward one millimetre on the question of stabilising Greece," he said ....

The minister has it bang on. Greece still hasn't figured out how to manage itself.  This is a desperate ploy that will not help them at all.
 

cavalryman

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estoguy said:
"To be honest I think it's dumb. I think that it doesn't move us forward one millimetre on the question of stabilising Greece," he said ....

The minister has it bang on. Greece still hasn't figured out how to manage itself.  This is a desperate ploy that will not help them at all.
I suppose if Greece wants German money while being unable to manage itself, it might be secretly wishing for a resumption of German management  ::)
 

a_majoor

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Looks like reality can't be avoided for too much longer:

http://business.financialpost.com/news/economy/standard-and-poors-downgrades-greece-rating-further-into-junk-status-conditions-have-worsened

Standard and Poor’s downgrades Greece rating further into junk status: ‘Conditions have worsened’
Associated Press | April 15, 2015 1:26 PM ET
More from Associated Press

ATHENS, Greece — The Standard and Poor’s rating agency downgraded Greece’s credit grade further into junk status Wednesday, saying the country’s financial commitments would be unsustainable without “deep economic reform or further relief.”

The agency downgraded Greece to CCC+ from B-, with a negative outlook “given the risk of further worsening in liquidity for the sovereign, the banks, and the economy.”

Greece is in talks with its European creditor states to get the latest loan installment from its bailout program. But the creditors want to see a list of economic reforms first. The two sides are locked on what reforms are suitable.

Amid the uncertainty, investors are getting nervous and there are reports of savers withdrawing money from the banks. Greece’s stock market closed down 1.9 per cent on Wednesday.

S&P said Greece’s solvency hinges increasingly on business, financial, and economic conditions.

“In our view, these conditions have worsened due to the uncertainty stemming from the prolonged negotiations between the almost three-month-old Greek government and its official creditors.”

Official figures released Wednesday show Greece fell well short of its budget deficit reduction targets last year, a development that’s likely to add pressure on the radical left-led government in its talks with the creditors.

Related
Greece makes IMF loan payment despite growing cash crunch
Why Warren Buffett thinks a Greece eurozone exit ‘may not be a bad thing’

The country’s statistical authority said the 2014 deficit was 3.5 per cent of Greece’s annual GDP, considerably higher than the 0.8 per cent forecast. And after stripping out the cost of servicing Greece’s crippling public debt, a modest primary surplus of 0.4 per cent was recorded — short of the 2 per cent target.

Greece’s future is highly uncertain without more rescue loans. It faces big debt repayments next month and a default could cause it to fall out of the euro.

Standard and Poor’s said the country’s “outlook for full-year economic growth is highly uncertain,” adding that it estimated the economy had contracted by nearly 1 per cent during the past six months despite a weaker euro and lower oil prices.

“In our opinion, economic prospects could deteriorate further unless talks between Greece and its creditors conclude soon,” it said.

Greece is unable to tap the international bond market for funds due to sky-high borrowing rates, which reflect a lack of confidence in the country being able to repay its debts.

Authorities are hoping for an agreement with creditors next week, when all 19 finance ministers from the eurozone countries, including Greece’s Yanis Varoufakis, meet on April 24 in the Latvian capital of Riga.

But several European officials have raised doubts about the possibility of a deal then.

Greek Minister of State Alekos Flambouraris said Wednesday that Athens can afford delays of “a week or ten days,” so long as an agreement is eventually struck.

Flambouraris, who is a close adviser to Prime Minister Alexis Tsipras, also claimed that “there is no way” bailout creditors will not budge from their reform demands. He told private Antenna TV that in the case of an impasse Greece could consider a referendum on what to do next.
 

Edward Campbell

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The upcoming UK election is going to be interesting.

The Economist poll of polls shows Labour and the Conservatives in a dead heat with 34 or 35% each while the upstart UKIP has 13% and the Liberal-Democrats, the current coalition partners with the Conservatives, have only 8%. One should, I suspect, assume that some (rather a lot?) of that UKIP support comes from disaffected Conservatives.

Labour does best (38%) with poor, female voters; the Conservatives do best with old (42%), rich (37%), males (34%). Both do well enough (30% each) with young voters. On balance one must think that the Conservatives have a slight edge - older people vote more, so do richer people.

The Financial Times says that the Liberal Democrats platform (manifesto in British parlance) is designed to makes them appealing coalition partners for both the Conservatives and Labour but their likely seat count (30, max) may make them irrelevant. The other party manifestos are pretty standard stuff (although The Economist does note that there are some interesting similarities between the far right UKIP and far left Green Party platforms) with the Conservatives promising some goodies and Labour suggesting it can be somewhat fiscally responsible.

One wonders if Nigel Farage and David Cameron are keen to team up? The Telegraph says, "Yes ... if Cameron holds an EU referendum this year."

It seems to me that a EU referendum campaign ~ never mind the outcome ~ might be what Brussels/Strasbourg need to get their heads out of their arses and consider systemic reform: the multi-tiered notion about which I keep harping.

Some members here are, doubtless, watching this election with more knowledge than I ... comments?
 

Edward Campbell

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Interesting observation on Europe from the Financial Times:

http://www.ft.com/intl/cms/s/0/ab6876ea-e672-11e4-9fa1-00144feab7de.html#axzz3XlHrC2LT

Never in the history of the eurozone has the eurogroup been so united. Never have the institutions formerly known as the troika — the European Commission, the International Monetary Fund and the European Central Bank — had such a common purpose. Whether by design or by accident, the Syriza government led by Alexis Tsipras has achieved more European harmony than a collection of continental choirs singing Ode to Joy. Everyone is deeply frustrated by the antics of Greece.

Mario Draghi may be comfortable with the notion that the eurozone can "deal with a new Greek crisis," but I am far from sure ...
 

Kirkhill

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E.R. Campbell said:
Interesting observation on Europe from the Financial Times:

http://www.ft.com/intl/cms/s/0/ab6876ea-e672-11e4-9fa1-00144feab7de.html#axzz3XlHrC2LT
Mario Draghi may be comfortable with the notion that the eurozone can "deal with a new Greek crisis," but I am far from sure ...

Never have the plutocrats been so united in their contempt for the demos.....
 

Edward Campbell

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Kirkhill said:
Never have the plutocrats been so united in their contempt for the demos.....


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But when the people have decided that they want something (a whole lot of somethings, actually) for nothing, or, at least, that they want someone else to pay for all the somethings ... then what?
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Kirkhill

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to+the+barricades.jpg

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6a00e54f8c25c988340128769dafa5970c-800wi

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to+the+barricades.jpg


Repeat as necessary????
 

a_majoor

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Woud Edward look good on a white horse? I'd trust him far more than about 99% of the current political class.... :nod:
 

Edward Campbell

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The man on the white horse, AKA Ralph Klein, Mike Harris and even Stephen Harper in recent Canadian history can be selected by the people when they know that they have manoeuvred themselves into a too deep hole and when they appreciate that they have to stop digging. But as soon as the Klein/Harris/Harper sort of politician stabilizes the hole the people are most likely to elect ...


greece-election-alexis-tsipras.jpg

Alexis Tsipras, Prime Minister of the Hellenic Republic
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Kirkhill

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content


A nice little allegory from a preferred author of Thucydides....

Birth Of Fire is the story of Garrett Pittston, wrongly convicted of murder. Pittston faces a choice: life in prison, or near-slavery on Mars. Under the appalling conditions imposed by those who run the mines from Earth, Pittston and his fellow workers start a revolution to wrest their freedom from the penal colony. Display advertising in science fiction publications.

Edward - I'm afraid that this is the real, institutional, form of reincarnation.  Rebirth is not a reward for the Buddhists....it is a penance.
 

Edward Campbell

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More on Europe's woes, this time of the right wing variety, in this article which is reproduced under the Fair Dealing provisions of the Copyright Act from The Economist:

http://www.economist.com/news/europe/21648677-le-pen-wars-end-marine-victory-family-feud?fsrc=scn/tw/te/pe/ed/afamilyfeud
the-economist-logo.gif

France’s National Front
A family feud
The Le Pen wars end in a Marine victory

Apr 18th 2015 | PARIS | From the print edition

EVER since Marine Le Pen became leader of the National Front (FN) in 2011, her father, Jean-Marie, has lurked in the background like a piece of unexploded ordnance. He may have stepped back from leading the party that he founded in 1972, but the 86-year-old is honorary president and an FN member of the European Parliament. His next ambition was to stand for election in December to the southern region of Provence-Alpes-Côte d’Azur.

Yet Mr Le Pen’s taste for explosive provocation got the better of him. Earlier this month he repeated a comment made in 1987 that the Nazi gas chambers were a mere “detail” of history. Ms Le Pen, who has tried to detoxify the party’s brand and bury its anti-Semitism and racism, threw a fit. She accused her father of “political suicide” and of imperilling the party’s future. The FN leadership, she said, would no longer back his candidacy. A dynastic psychodrama began, with Mr Le Pen accusing his daughter of “sabotage”. At one point, it looked as if he might be thrown out of his own party and even run against it.

In the end, Mr Le Pen withdrew his candidacy to avoid “dangerously weakening our movement”. He proposed that the party should nominate his granddaughter, Marion Maréchal-Le Pen, one of two FN members of parliament, in his place. Mr Le Pen, his granddaughter said after speaking to him, did not want to make things worse and was even “a bit sorry about the situation”. The immediate upshot was a victory for Ms Le Pen in her bid to transform a far-right, fringe protest movement into a mainstream party ready to govern. Mr Le Pen was all about grumbling and outrage: he never really wanted power. “Jean-Marie Le Pen worried very little about demonstrating that his party was fit to govern,” says Sylvain Crépon, a specialist on the FN at the University of Tours.

His daughter, by contrast, wants to remake the French party-political landscape, establishing the FN as a credible alternative to the ruling Socialists under President François Hollande, and to the centre-right UMP party, ahead of the presidential election in 2017. The party’s recent gains in local and European elections are seen as crucial to building the army she needs for a presidential bid. In the public mind, sidelining Mr Le Pen in such spectacular fashion will have reinforced her transformation.

The interesting dynamic now will be between Ms Le Pen and her niece, Ms Maréchal-Le Pen. The youngest member of the political clan was elected to parliament in 2012 when a 22-year-old law student, and has been close to her grandfather and the FN’s traditional right. They are sceptical of Ms Le Pen’s bid to woo working-class voters with a protectionist, anti-globalisation, big-government line. Mr Le Pen has called the party’s proposal to reduce the retirement age to 60 an “absurdity”.

Yet Ms Maréchal-Le Pen seems a canny operator, who knows she embodies a younger generation little taken by her grandfather’s crowd. She is careful to stress her loyalty to her aunt. “I am clearly in the National Front of Marine Le Pen,” she said this week. Each needs the other. The niece has her base in the south, a traditional FN bastion; the aunt has put down roots in the ex-industrial north. Both seem to have gained from the family feud. Each rose a place in the latest popularity rankings by Ifop, a pollster—with Ms Le Pen just above Mr Hollande, and Ms Maréchal-Le Pen only three places lower.


My sense is that:

    1. The Economist's headline writer should have said "The Le Pen wars end in a Marine victory ... for now". I suspect that Ms Maréchal-Le Pen has the capacity to "unite the (far) right" in France and neuter Ms LePen's
        (Stephen Harper like) shift to the centre; and

    2. Politics in Europe in different from politics in North America. The "hard right" here seems, to me, to be, mostly, grounded in either religion or history (many of the Tea Party people want a return to 18th century politics)
        while politics in Europe has an more ideological component ~ from far left, pure communists to far right fascists. Of course the two streams intersect and even mix, at times, e.g. on race and "foreigners," but, how much was
        there to choose between Enoch Powell and Jean-Marie LePen and, say, George Wallace? But I think the quasi-fascist hard right, in Europe, is growing in strength without much of a religious foundations while I think
        the strength of the right in America is largely religious, even in the Tea Party.

(Canada, by the way, seems to me to be less extreme, less polarized, less religious, less ideological ... less everything than both Europe and America.)
 

Edward Campbell

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Here, reproduced under the Fair Dealing provisions of the Copyright Act from the Globe and Mail, is an interesting analysis of the problem ~ only one real, structural problem Eric Reguly says ~ in the Eurozone:

http://www.theglobeandmail.com/report-on-business/international-business/blame-germany-for-greeces-uphill-euro-zone-struggle/article24116424/
gam-masthead.png

Blame Germany for Greece’s uphill euro zone struggle

ERIC REGULY - EUROPEAN BUREAU CHIEF
ROME — The Globe and Mail

Published Friday, Apr. 24 2015


Greece is running out of cash and is raiding municipal funds to pay its bills, enraging mayors throughout the country. Given Greece’s increasingly dire financial state, you would presume that the game has finally ended. It seems inevitable that Greece will default, crash out of the euro zone, reprint the drachma and, after a suitable period of economic mayhem, pull its act together, as Argentina did after it defaulted more than a decade ago.

Forget it. Greece will get a deal of some sort that will keep it within the euro zone, preserving the notion that the euro is “irreversible,” to use the description beloved by European Central Bank president Mario Draghi. But would that be good news for Greece? On the contrary, it might well doom it to an eternity of misery and hard work that goes nowhere, like Sisyphus, rolling his boulder to the top of the hill, only to have it roll down again.

Blame Germany, Europe’s self-perpetuating economic miracle. Germany is a juggernaut of endless current-account and trade surpluses, which are making it impossible for the euro zone to achieve any balance and symmetry. Those gorgeous (to the Germans) surpluses are making the euro zone’s weaklings – Greece, Spain, Portugal, Italy, even France – do most of the structural and fiscal adjustments. They grind away, getting nowhere, while Germany goes from strength to strength.

There is no doubt that Germany’s love affair with the euro is deep and passionate. Since the common currency was launched as an accounting currency in 1999 (the notes and coins came three years later), German exports, the trade surplus and the current account surplus – the positive difference between a country’s savings and investment – have soared. In 2014, the current account surplus stood at a record 7.4 per cent of gross domestic product, up from 6.7 per cent in 2013, which itself was extremely high.

There’s more. Germany derived 46 per cent of GDP in 2013 from exports. That makes it the global export champion among the industrialized countries. The equivalent figure in China is 26 per cent. In the United States, it’s a mere 13 per cent. As the euro sinks, German exports will grow. A euro valued at $1.60 (U.S.) or more might reflect the true strength of the German economy. Luckily for Germany, the euro now trades a $1.07. If that weren’t gift enough, German sovereign bonds have been the prime beneficiaries of the flight to safety. This week, the yield on German 10-year bonds was 0.1 per cent, down 1.4 percentage points in a year. That’s money for nothing. At the rate the bonds are trending, it won’t be long before the yields turn negative, meaning investors will be paying the German treasury for the privilege of owning its paper.

For the health of the euro zone, Germany would, ideally, save less, invest more, raise wages and let inflation take off. That would stoke up domestic demand and suck in imports from the rest of Europe, poor little Greece included. But that’s not the German style, never has been, never will be. Germans are allergic to inflation. The country spends relatively little on infrastructure. It is only now, begrudgingly, raising wages after a long period of austerity after the reunification of East and West Germany, in which time wage growth went nowhere.

The entire German machine seems geared to surpluses. In a Stratfor note published on April 21, George Friedman, who has written a book on the European crisis called Flashpoints, said: “Comparative advantage assumes [Germany] will want to export those things that it produces most efficiently. It is instead exporting any product that it can export competitively regardless of the relative internal advantage … whatever problem [Greece] has in maximizing its own exports, doing so in an environment where Germany is pursuing all export possibilities that have any advantage decreases Greece’s opportunity to export, thereby creating long-term dysfunction in Greece.”

Indeed, which brings us back to the new Greek crisis, deepening by the minute. Greece owes billions of euros to creditors, from the International Monetary Fund to the owners of Hellenic Railways bonds, in the next few months. It can’t possibly pay the bills without another tanker load of cash from the euro zone countries. But the euro zone countries are demanding extensive economic reforms, many of which Greece’s radical left Syriza government is unable or unwilling to meet.

The negotiations will go to the wire, as they always do, and some “extend and pretend” compromise will be found that will allow Greece to stumble along inside the euro zone, this time with even more debt and austerity. Germany will not allow Greece to leave, even though Germany in no way believes that little, uncompetitive, tax-evading Greece deserves euro zone membership. As Mr. Friedman pointed out, Germany fears a Greek exit because Greece, on its own, would no doubt install tariffs and other barriers designed to shield its economy from ruthless exporters. Germany needs to protect its surplus model, which depends on European free trade. Never mind that guaranteeing the German success model means turning Greece into Sisyphus.


                                                                                                                                                   
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My worry is not about Greeks working harder and harder for less 'return' for their labour; it is that all the weak countries (mainly Greece, Portugal, Spain, Italy and France) will become ripe for far right, fascist political movements and that might spread. (For at least another couple of generations I think that Germany remains fairly safely "inoculated" against political extremes, but even that can change.)
 

George Wallace

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A "man on the street interview" with an Irishman, and a warning to North America:

https://www.facebook.com/LarsHalvorsen19/videos/10151554913397745/
 

Kirkhill

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George Wallace said:
A "man on the street interview" with an Irishman, and a warning to North America:

https://www.facebook.com/LarsHalvorsen19/videos/10151554913397745/

TV put you up to that didn't he?

Defender of the Irish Working Class indeed.

And in other news a series of articles about Military Intelligence, business ethics, bipartisan co-operation and wired wireless systems....
 

Rocky Mountains

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E.R. Campbell said:
it is that all the weak countries (mainly Greece, Portugal, Spain, Italy and France) will become ripe for far right, fascist political movements and that might spread.

Far Right Fascist?? - Note Hitler's direct quote in the attached video.

https://www.youtube.com/watch?v=l1_gqbQcI60

"It's the National Socialist German Worker's Party.  It has Socialist in the F...ing name "
 

Edward Campbell

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Rocky Mountains said:
Far Right Fascist?? - Note Hitler's direct quote in the attached video.

https://www.youtube.com/watch?v=l1_gqbQcI60

"It's the National Socialist German Worker's Party.  It has Socialist in the F...ing name "


There is little, in my opinion, to separate the far left from the far right; both are statist movements which means both want the state to control everything, including the economy, which means both, inevitably, fail. Even the simple left and the simple right fail because governments are unable to manage the enormous complexities of a modern society.

I don't think Hitler, Stalin and Mao were much of anything except megalomaniacs with enormous personal charisma and chutzpah.
 
 

Retired AF Guy

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E.R. Campbell said:
My worry is not about Greeks working harder and harder for less 'return' for their labour; it is that all the weak countries (mainly Greece, Portugal, Spain, Italy and France) will become ripe for far right, fascist political movements and that might spread. (For at least another couple of generations I think that Germany remains fairly safely "inoculated" against political extremes, but even that can change.)

Fifty years ago, three of these countries (Greece, Portugal, Spain) actually were military dictatorships, so your worry is is not that far fetched.
 

Edward Campbell

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So, with 649 of 650 seats decided in the UK election (there's one seat, at Land's End in Cornwall still to report) the Conservatives have 330 seats, a slim, but serviceable majority.

The Conservatives promised a referendum on Europe ...

It is, really, just a tactic, to renegotiate the terms of union, but that means redesigning the whole European edifice to better suit Britain (and several others, I suspect).

In my opinion the EU was badly designed from the very start, by Messers Monnet and Schuman. I am reminded of a quip attributed to Lord (Gen(ret'd)) Hasting (Pug) Ismay, NATO's first secretary general: NATO he explained, was intended "to keep the Reds out, the Yanks in, the Germans down and the French up." That was the common theme in Europe in the 1940s and '50s. Germany, it was agreed, had to be rebuilt and integrated into a modern, peaceful Europe ... but it had to pay. France, inexplicably, given its record in the 1930s and '40s, was to be propped up, again, and made into an (unlikely) great power ~ despite being a strategic hooligan, at best. The earliest steps in European unity, led by Jean Monnet and Robert Schuman, were predicated on these same principles: "keep the Germans down and the French up." It's utter nonsense now, of course: Germany is top dog and France is, as always, part of the problem rather then being part of the solution. But old habits, and French entitlement die hard.

I won't bore you with the layer cake, but it's the better answer to Europe's woes.

Britain's referendum, assuming it happens, may be the catalyst to provoke some rational thought about the EU.
 
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