http://www.zerohedge.com/news/2012-10-08/dutch-prepare-awaken-sleeping-giant-grexit-plans-resume
Submitted by Tyler Durden on 10/08/2012 17:39 -0400
http://hat4uk.wordpress.com/2012/10/08/greek-corruption-second-suicide-as-sdoe-pores-over-lagardes-list/
http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_17724_08/10/2012_465167
( Snipers to guard Merkel , 7,000 police officers - Really ???? )
Massive security for visit by German leader; Greek PM to seek concessions
Prime Minister Antonis Samaras, who visited Merkel in Berlin a few weeks ago, is to receive the German leader at Athens airport and accompany her to the Maximos Mansion, where they will hold talks at around 2 p.m. before addressing the media. Merkel is also to meet President Karolos Papoulias and possibly Samaras’s coalition partners, but not with officials from leftist opposition SYRIZA, which has said it will demonstrate against the government’s austerity drive and the demands of Greece’s creditors.
According to sources, Samaras aims to secure two things from Merkel -- her support for Greece’s efforts and her approval for some “softer” countermeasures to the austerity package being negotiated between the government and the troika that would avert deeper cuts to salaries and pensions.
Security in the capital will be tight. Some 7,000 police officers will be on duty -- many have been transferred from the provinces to bolster the force’s presence in Athens -- with snipers set to guard the hotel where Merkel is to stay and much of the center to be cordoned off. Authorities may resort to the use of water cannons in the event that rallies get out of hand.
http://www.zerohedge.com/news/2012-10-08/double-double-toil-and-trouble
Submitted by Tyler Durden on 10/08/2012 08:26 -0400
and.....
By Nick Malkoutzis
One of the first tasks young Otto von Wittelsbach and his regency council undertook shortly after the Great Powers appointed him king of Greece in 1833 was to try to subdue the people of Mani. Greece’s first head of state, Ioannis Capodistrias, had met his death two years earlier after attempting to bring some of the Maniots into line over their refusal to pay taxes. The newly-arrived Germans launched three military operations involving thousands of Bavarians soldiers marching into the southern Peloponnese. They all proved fruitless as the wily and determined Maniots made best use of their limited resources and inferior numbers.
Then, the council decided on a more nuanced approach. They dispatched a Bavarian diplomat called Max Feder to the area. Feder spoke Greek and had good knowledge of Mani. He travelled the region, sat in village squares and met with locals face to face. Rather than force the Maniots into submission, Weber convinced many of the local kapetans, or clan chiefs, to join a new military unit consisting just of locals that would be responsible for policing their own area. It proved a significant move in bridging the gap between the Maniots unruliness and the emerging establishment. “Kindness and tact succeeded where coercion had been powerless,” wrote Patrick Leigh Fermor in his magnificent book, “Mani”.
and Spain still on slow boil.......
http://www.aljazeera.com/news/europe/2012/10/2012107145037486567.html
http://www.zerohedge.com/news/2012-10-08/overnight-sentiment-european-grumbles-us-semi-closed
Submitted by Tyler Durden on 10/08/2012 06:57 -0400
http://www.telegraph.co.uk/finance/debt-crisis-live/9593233/Debt-crisis-Official-launch-of-ESM-bail-out-fund-live.html
The FTSE 100 is off by 0.7pc, the CAC has slipped by 1.21pc and the DAX is down by 1.32pc.
You've turned our life into hell and the country into a protectorate.
I wouldn't say that there was strong support for it, but there was certainly a feeling that this is an idea that should be explored in more detail.
Both concessions would be a form of debt forgiveness and therefore a direct financial support for the Greek state. That would not be allowed under the law governing the ECB.
My biggest worry is that some crisis-stricken countries do not have the political power to persevere with their painful but effective reform programmes until the end. That would be a catastrophe.
Dutch Prepare To "Awaken Sleeping Giant" As GRExit Plans Resume
On the inaugural day of the much-awaited holy grail of Europe - the ESM - DutchNews.nl reports that Dutch diplomats in Athens have been secretly planning for an eventual Greek exit from the eurozone (along four themes - liquidity, energy, communications, and security). "We have deliberately strictly kept this behind closed doors", a Dutch diplomat told Volkskrant, adding "I do not know who has trumpeted." Among the Dutch companies doing business in Greece are Heineken, Unilever, and Philips as one business owner note that they "send cash back to the Netherlands as soon as possible - holding as little money in Greece as possible." While the foreign affairs ministry would not confirm, the paper cites a diplomat who commented: "we do not want to awaken any sleeping giants." We suspect you just did - sshh!
Via Volkskrant (via Google Translate):
Netherlands Dutch companies in Greece began to prepare for a possible Greek departure from the euro. Dutch diplomats in Athens inventory of the risks, planned emergency measures and shared a few months ago in a confidential meeting with companies.Preparations are sensitive because the Dutch government publicly stressed that Greece should remain in the eurozone. The Greek government is also annoyed speculation about a Greek exit from the eurozone, because the economic recovery more difficult."I do not know who has trumpeted," said a Dutch diplomat. "We have deliberately strictly behind closed doors done. We do not want to wake spirits that are not awakened to be made. " Diplomats organized the meeting because in the run-up to the Greek elections in June at Dutch companies growing unrest arose about a possible departure from the euro. During the meeting shared the companies themselves also information about their precautions.The diplomat: "Everyone was willing to share information provided in strict confidence."Uncertainty Fears of a Greek exit from the eurozone - 'in jargon grexit'- is the last month eased somewhat, because Greece is a government coalition the power that seem prepared to accept some of the cuts and reforms that are demanded by the European Union and the International Monetary Fund. But there remains much uncertainty.
Among the Dutch companies in Greece are multinationals such as Heineken, Unilever and Philips, but also smaller companies such as travel agencies and yacht brokers. Many companies have recently taken steps to limit the damage of a Greek exit from the eurozone limit. Thus, companies have adjusted their computer so they can quickly switch to a new currency. Or they have an appointment with the head office in case of emergency an employee with a suitcase of euros to Athens comes to workers' pay."We demand especially by our customers giving us much faster than before paying," said Tasos Zacharidis, manager of the Greek branch of the Dutch company Den Braven, specializing in adhesives, sealants and foams. 'Self we send our cash as soon as possible to the Netherlands. We ensure that we here in Greece as little money as possible. "What advice the Dutch embassy to the companies has given is not entirely clear. The diplomats had initially hoped to build on what colleagues in Argentina prepared when that country in 2001 and 2002financial crisis. But there was little they could find about. So went the diplomats themselves to work. They copied the emergency measures of the embassy, ??which covers such matters as earthquakes, and they thought themselves after.So they came on four themes: liquidity, energy, communications and security. The editors of the Times, the Ministry of Foreign Affairs requested further information on the opinions and to disclosure of the relevant documents. According to the Department, no information can be provided, because the pieces' also security related aspects. "We never statements about safety," said a spokesman.
http://hat4uk.wordpress.com/2012/10/08/greek-corruption-second-suicide-as-sdoe-pores-over-lagardes-list/
Greek corruption: Second suicide as SDOE pores over Lagarde’s List
But Merkel’s security arrangements overshadow everything as she prepares to visit Athens
Long-suspected of having massively enriched himself at the Greek Ministry of Defence, Vlassis Kambouroglou has found dead in hotel room in Jakarta. Local medical authorities suggest that Kambouroglou committed suicide.
Kambouroglou was alleged to have been aware of – indeed an active participant in – the corrupt Defence Ministry under the PASOK government between 1997 and 2001. At the time, the Ministry was purchasing large consignments of German munitions, aeroplanes and
In addition, Vlassis Kambouroglou had in the best been in the spotlight concerning Russian arms deals under Boris Yeltsin, as well as earning huge profits in cooperation with Arab weapons merchandisers.
Principally, however, Kambouroglou was accused of being party to the bribery and money laundering network involving former Defence Minister Akis Tsochatzopoulos. He was the managing director of Drumilan International, which was involved in the sale of a Russian-made TOR-M1 missile system to Greece. Called to testify before a parliamentary inquiry into the arms deal in 2004, Vlassis Kambouroglou denied that his company made any money from the deal. No charges were brought against him.
Lagarde’s List continues to terrify politicians from Surrey to St Petersburg. Feeling the heat more than most, PASOK leader Evangelos Venizelos is now insisting that he was not informed last year by his predecessor as finance minister Giorgos Papaconstantinou that the latter had been given a list containing the names of almost 2,000 Greeks with large deposits at the Geneva branch of HSBC.
The most onerous task in Athens at the moment would be searching out a single Greek person who thinks the Fat One is telling the truth. But running it a close second is the task of organising security for the visit of Greece’s favourite politician, Angela Merkel. So popular is the Frau Doktor, police have banned all demonstrations in downtown Athens tomorrow (Tuesday). Indeed, all public gatherings or marches will be banned between 9 a.m. and 10 p.m.
There will be no buses or trams running in Athens between 11 a.m. and 4 p.m. Six metro stations – Panepistimio, Syntagma, Evangelismos, Megaro Mousikis, Ambelokipi and Katechaki – will be closed from 10 a.m. onwards. Parking around the German embassy in Athens will be banned from tonight, and barricades will be put up around Parliament. Snipers will also be placed around the hotel where the German delegation will stay.
How ironic it is that such enormous popularity requires EU leaders to be protected from their adoring citizens, he observed – foot placed perhaps to hard on the sarcasm pedal.
http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_17724_08/10/2012_465167
( Snipers to guard Merkel , 7,000 police officers - Really ???? )
Athens on alert for Merkel
Massive security for visit by German leader; Greek PM to seek concessions
Prime Minister Antonis Samaras, who visited Merkel in Berlin a few weeks ago, is to receive the German leader at Athens airport and accompany her to the Maximos Mansion, where they will hold talks at around 2 p.m. before addressing the media. Merkel is also to meet President Karolos Papoulias and possibly Samaras’s coalition partners, but not with officials from leftist opposition SYRIZA, which has said it will demonstrate against the government’s austerity drive and the demands of Greece’s creditors.
According to sources, Samaras aims to secure two things from Merkel -- her support for Greece’s efforts and her approval for some “softer” countermeasures to the austerity package being negotiated between the government and the troika that would avert deeper cuts to salaries and pensions.
Security in the capital will be tight. Some 7,000 police officers will be on duty -- many have been transferred from the provinces to bolster the force’s presence in Athens -- with snipers set to guard the hotel where Merkel is to stay and much of the center to be cordoned off. Authorities may resort to the use of water cannons in the event that rallies get out of hand.
| Rallies in parts of the city center that are to be cordoned off have been banned by police “in the interests of public safety and the city’s socioeconomic life,” a move that provoked rebukes from unionists and from the junior coalition partners, socialist PASOK and Democratic Left. The country’s two largest labor unions, GSEE and ADEDY, who had been planning a rally in Syntagma Square and will be holding a three-hour work stoppage from noon, are likely to stage their rally in a square a few blocks away from Parliament. Public transport will be disrupted with six metro stations -- Syntagma, Panepistimio, Evangelismos, Megaro Mousikis, Ambelokipi and Katehaki -- closed from 10 a.m. There will be no bus or trolley services between 11 a.m. and 4 p.m. and the Proastiakos suburban railway will be suspended between noon and 3 p.m., during which time there will be no metro service between Doukissis Plakentias and Athens International Airport. |
http://www.zerohedge.com/news/2012-10-08/double-double-toil-and-trouble
Double, Double, Toil And Trouble
- default
- European Central Bank
- European Union
- France
- Greece
- International Monetary Fund
- Italy
- None
- Reality
- Recession
- Unemployment
Via Mark J. Grant , author of Out of the Box,
“If I speak, I am condemned. If I stay silent, I am damned!”
As we all await the next, next, next meeting of the European Finance Ministers and our eyes are turned to Spain and what machinations are going to be brought to our attention, I wonder if actual decisions are going to actually be forthcoming. These people “applaud and hail and congratulate” each other on various non-accomplishments and they tap dance on the world’s stage as if each and every problem is not only solved but light years behind them while there are giant dificulties to their forefront that are largely ignored in the continuing attempt to obscure everyone’s field of vision. I remain skeptical however; I can see just fine thank you and it is not the poppy fields of Oz at which I stare.
The giant firewalls that were supposed to protect the Continent failed and failed based upon the premise that I verbalized at the time when Europe and the IMF were trumpeting them as the solution to the problem. They failed not because they were not big enough to keep the speculators at bay but because the speculators were never the central issue. The main issue was the financial health of Spain and Italy and the charade of economies that were bloated by social programs and ledgers that were debased by financial engineering such as the “dynamic provisioning” that was and is used in Spain. I think it can be said with a good measure of certainty that one of the primary reasons that Spain is resisting any bailout is because the Troika would audit their books as part of the process and find what has been hidden for so long. Spain may well be a larger version of Greece where funny money has been the order of the day for a decade and where the fiscal bed sheet that covered up the mess can no longer accommodate the size of the bloated sleeping platform. This is all made worse by a political construct that is particular to Spain where the regional governments have a debt that is roughly equivalent to 50% of the nation and where we find the horsepower region, Catalonia, considering seceding while other regions such as the Basque country are engaging in similar tactics. It must be said that the actual, not made-up, economics in Spain have gotten so bad that unemployment is off the charts and social unrest is on the rise. I think that, in the end, Spain will be forced to the wall and that Europe will do whatever they can to cover-up and obscure the actual size and breadth of the financial crisis in Spain and perhaps we will get a slightly changed version of Rajoy’s “This is a great victory for Europe” speech but it will be even more obnoxious and hollow the next time around.
The situation in Greece is also coming back into play as the Prime Minister said they must have more money by the end of November or they will default. The IMF is calling for the ECB and/or the nations of Europe to take a hit while these two bodies react, as expected, saying they want none of that. So what is it to be; more money for nothing again, more new debt to pay off old debt and a country that is so behind the eight ball that it has sunk into the pocket of poverty with no escape while everyone watched and then tried to fool the world by claiming and continuing to claim that it hasn’t happened. It may be one more gimmick and another round of the shell game but I do not think Ms. Merkel has enough votes to pass more aid for Greece while the Austrians and the Dutch have already made public pronouncements that they will not be funding. Crunch time may yet be forced upon the European Masters of the Universe as the politics at home will not bear anymore loss of their nation’s money. The quite real displeasure that would be felt in each country in Europe that would be attached to the EU taking a hit for the Greek debt may well force a situation where Greece remains in the European Union and receives some sort of debt-in-possession financing while Greece returns to the Drachma as it is more politically acceptable to lay the loss on Greece rather than accepting the consequences of some sort of debt forgiveness. Ms. Merkel may be in Athens playing nicey-nice but she may also be there to set the course and try to influence Greece to accept it. Of course the politicians that she is discussing things with now may not be the people in charge in the coming months as social unrest increases in Greece and anger swells to the surface and bubbles. Say what you like and hope for what you may but Spain and Greece are in real turmoil and unintended consequences bloom with each passing day.
“You are very amiable, no doubt, but you would be charming if you would only depart.”
I also turn my attention to France this morning. France is the next in-line after Spain and Italy. It is all well and good to tax the rich at 75% to support everyone else but there are real consequences to this kind of behavior. First you remove the motivation for success and for risk-taking which is the ability to have a better life. If hard work produces nothing except more taxes then no one wants to play in the sandbox. This level of taxes will also produce more tax-evasion and encourage people to leave the country for greener pastures so that the gross revenues will decrease and Mr. Hollande will have delivered a self-defeating program all in the name of “one for all and all for one” which may function when it is three guys with epees but this kind of dogma never works well in the real world. In fact I would say that the very construction of a European Union, where people can locate with relative ease, exacerbates the problem for France by the use of the very construct that has been invented and put in place. France may well be the next powder keg as the policies of Mr. Hollande implode a country that is already teetering with the European recession that is certainly swinging in wider and wider arcs.
Finally I comment on the ECB. The “unlimited and uncapped” is bound in chains of their own devising. They have pledged to act but only if the European Union acts first and in that very act of contrition they have rendered themselves ineffective. With a Europe that is now more divided than at any time in the past and divided down strict boundaries of those with the money as opposed to those nations without it; the possibility of decisive action by the politicians becomes ever so more remote. In practical terms it would take months and perhaps longer for a bailout of any nation to be crafted and accepted and there will come a time when the markets recognize the reality of the situation and not be focused on the pretty words meant to sop up the uninitiated. The self-imposed conditions of the ECB are just being realized in Europe as some countries are now voicing displeasure with what the ECB has done because the strait-jacket is becoming apparent and the good intentions are now being seen as radiating in a glass jar on the shelf and not meant for any real use as it is dubious that the countries in Europe will ever agree on the political cost of utilizing the precious jar so it will just sit there in stasis. The ploy may have worked for the moment but I suggest that the effect will soon wear away.
“Ah," said the jailer, "do not always brood over what is impossible, or you will be mad in a fortnight.”
and.....
Mrs Merkel goes to Athens. Why?
 |
One of the first tasks young Otto von Wittelsbach and his regency council undertook shortly after the Great Powers appointed him king of Greece in 1833 was to try to subdue the people of Mani. Greece’s first head of state, Ioannis Capodistrias, had met his death two years earlier after attempting to bring some of the Maniots into line over their refusal to pay taxes. The newly-arrived Germans launched three military operations involving thousands of Bavarians soldiers marching into the southern Peloponnese. They all proved fruitless as the wily and determined Maniots made best use of their limited resources and inferior numbers.
Then, the council decided on a more nuanced approach. They dispatched a Bavarian diplomat called Max Feder to the area. Feder spoke Greek and had good knowledge of Mani. He travelled the region, sat in village squares and met with locals face to face. Rather than force the Maniots into submission, Weber convinced many of the local kapetans, or clan chiefs, to join a new military unit consisting just of locals that would be responsible for policing their own area. It proved a significant move in bridging the gap between the Maniots unruliness and the emerging establishment. “Kindness and tact succeeded where coercion had been powerless,” wrote Patrick Leigh Fermor in his magnificent book, “Mani”.
For the last three years, much of Europe – Germany, in particular – has looked upon Greeks as the continent’s Maniots, refusing to pay their share and follow the rules. There have been no military expeditions but a fiscal vice and a flurry of brickbats have been deployed in the attempt to get Greece to conform. Like the Bavarian’s forays, the European’s tactics have not had the desired effect. Today, many Europeans see Greeks as impetuous inhabitants of an outpost into which it is no longer worth venturing or pouring money. Many Greeks now believe Europeans are only intent on subjugating them, while having no interest in their history, culture or painful predicament.
Into this melee, steps Angela Merkel. Until recently, the instigator of several verbal assaults on Greece, the German chancellor now appears to be opting for a diplomatic route. Her surprise trip to Athens on Tuesday looks like an attempt to bridge differences, an effort to try a little kindness and tact. Whether she shares Feder’s success is impossible to predict.
There are many reasons why Merkel’s visit seems too big a risk to take. The main one is that it will create a renewed sense of instability at a time when Greece’s society and political system is already being put through the wringer. The recent general strike, the daily protests, the clash involving protesting shipyard workers at the Defense Ministry, the ugly exchanges in Parliament, the slew of corruption and tax evasion scandals, the disintegration of PASOK and the ascendancy of Golden Dawn have all contributed to the sense that Greece is a country clinging on for dear life.
Tuesday will be an opportunity for some to voice their disapproval and anger about what has happened over the past three years. The country’s two largest unions, ADEDY and GSEE, have called a work stoppage and protest to which the main opposition party, SYRIZA, has given its full backing. It is not clear if Merkel would have followed protocol and met with the leftists but by advocating protest over dialogue, SYRIZA chief Alexis Tsipras blew his chance to put his argument about a Europe of equals to the leader he holds most responsible for undermining this vision. The right-wing Independent Greeks and its leader Panos Kammenos, whose raison d’etre is to criticize Merkel and Germany, have called for a human chain to be formed around the German embassy. Kammenos, the Foghorn Leghorn of Greek politics, surely cannot believe his luck: there is nothing that makes a cartoon character’s eyes spin more than a pantomime villain. Merkel’s visit provides an opportunity for Kammenos to revive his party’s flagging poll ratings.
A tense atmosphere and a heavy police presence on the streets of Athens on Tuesday are a given. Over the last couple of years, these two ingredients have caused dangerous side effects when mixed and shaken vigorously. The potential for Merkel’s trip to turn into a public relations disaster for both sides is real.
No matter how cordial discussions between the German chancellor and Prime Minister Antonis Samaras are behind closed doors, if there is mayhem on the streets, that’s the image that will be shown on TV sets around Europe. Those who feel that the unruly Greeks are not worth saving will have their minds made up by what they see, especially if this includes pictures of German or EU flags being burned or protesters waving placards of Merkel dressed as an SS officer – all of which have happened in isolated cases at previous demonstrations. Domestically, if police or protesters get out of hand and there are injuries or serious damage, greater stress will be placed on the fragile social and political balance.
This begs the question of why Samaras and Merkel think the visit might be a good idea. From Samaras’s side it appears an opportunity to increase his legitimacy both at home and abroad. Presumably there is little the Greek premier can tell his counterpart that he didn’t already say in Berlin a few weeks ago or will have the chance to at the EU leaders’ summit in less than two weeks. Rather, for the New Democracy chief this is the moment that he can truly claim to have completed his political rehabilitation. Ostracized by many European leaders, including those on the center right, due to his opposition to the austerity measures adopted in the first two years of the EU-IMF program, Samaras has been winning over his peers since being elected in June. “He’s the best port we have in this storm,” a European Commission official told the Wall Street Journal last week. The newspaper adds that Merkel’s opinion of Samaras has changed substantially and that she was impressed by the Greek delegation that visited Berlin in August. There was no way Samaras could pass up the opportunity to host Merkel in Athens and prove to his critics at home and abroad that he has travelled the road to redemption.
Into this melee, steps Angela Merkel. Until recently, the instigator of several verbal assaults on Greece, the German chancellor now appears to be opting for a diplomatic route. Her surprise trip to Athens on Tuesday looks like an attempt to bridge differences, an effort to try a little kindness and tact. Whether she shares Feder’s success is impossible to predict.
There are many reasons why Merkel’s visit seems too big a risk to take. The main one is that it will create a renewed sense of instability at a time when Greece’s society and political system is already being put through the wringer. The recent general strike, the daily protests, the clash involving protesting shipyard workers at the Defense Ministry, the ugly exchanges in Parliament, the slew of corruption and tax evasion scandals, the disintegration of PASOK and the ascendancy of Golden Dawn have all contributed to the sense that Greece is a country clinging on for dear life.
Tuesday will be an opportunity for some to voice their disapproval and anger about what has happened over the past three years. The country’s two largest unions, ADEDY and GSEE, have called a work stoppage and protest to which the main opposition party, SYRIZA, has given its full backing. It is not clear if Merkel would have followed protocol and met with the leftists but by advocating protest over dialogue, SYRIZA chief Alexis Tsipras blew his chance to put his argument about a Europe of equals to the leader he holds most responsible for undermining this vision. The right-wing Independent Greeks and its leader Panos Kammenos, whose raison d’etre is to criticize Merkel and Germany, have called for a human chain to be formed around the German embassy. Kammenos, the Foghorn Leghorn of Greek politics, surely cannot believe his luck: there is nothing that makes a cartoon character’s eyes spin more than a pantomime villain. Merkel’s visit provides an opportunity for Kammenos to revive his party’s flagging poll ratings.
A tense atmosphere and a heavy police presence on the streets of Athens on Tuesday are a given. Over the last couple of years, these two ingredients have caused dangerous side effects when mixed and shaken vigorously. The potential for Merkel’s trip to turn into a public relations disaster for both sides is real.
No matter how cordial discussions between the German chancellor and Prime Minister Antonis Samaras are behind closed doors, if there is mayhem on the streets, that’s the image that will be shown on TV sets around Europe. Those who feel that the unruly Greeks are not worth saving will have their minds made up by what they see, especially if this includes pictures of German or EU flags being burned or protesters waving placards of Merkel dressed as an SS officer – all of which have happened in isolated cases at previous demonstrations. Domestically, if police or protesters get out of hand and there are injuries or serious damage, greater stress will be placed on the fragile social and political balance.
This begs the question of why Samaras and Merkel think the visit might be a good idea. From Samaras’s side it appears an opportunity to increase his legitimacy both at home and abroad. Presumably there is little the Greek premier can tell his counterpart that he didn’t already say in Berlin a few weeks ago or will have the chance to at the EU leaders’ summit in less than two weeks. Rather, for the New Democracy chief this is the moment that he can truly claim to have completed his political rehabilitation. Ostracized by many European leaders, including those on the center right, due to his opposition to the austerity measures adopted in the first two years of the EU-IMF program, Samaras has been winning over his peers since being elected in June. “He’s the best port we have in this storm,” a European Commission official told the Wall Street Journal last week. The newspaper adds that Merkel’s opinion of Samaras has changed substantially and that she was impressed by the Greek delegation that visited Berlin in August. There was no way Samaras could pass up the opportunity to host Merkel in Athens and prove to his critics at home and abroad that he has travelled the road to redemption.
For Merkel, the purpose of Tuesday’s visit seem a little more practical. All the indications are that over the last few weeks she has ditched her equivocal position on Greek euro membership for a clear line in favour of keeping Greece in. This position is at odds with the views of some members of her party and government.
It was impossible to miss, for instance, the contrast between statements on Greece last week by Merkel’s spokesperson Steffen Seibert and her Finance Minister Wolfgang Schaeuble, who is much more sceptical about supporting Greece. «All of the countries which are in a program, except Greece, which is in a particularly difficult situation... have made remarkable progress,» said Schaueble on Thursday. A day later, Seibert told the press: «We see that the reform efforts have increased under the Samaras government and we want to support that.» By visiting Greece, Merkel is sending a clear message to her colleagues that backing its continued membership of the eurozone is now the party and government line. It is an invitation to doubters to back her or keep quiet.
With the countdown to next year’s federal elections underway, Merkel is also hoping for a piece of one-upmanship on the Christian Democratic Union’s main rivals, the Social Democratic Party, which has been highly critical of the way the chancellor has handled the Greek problem and has maintained a much clearer position throughout the crisis in favour of Greece remaining in the eurozone. It is probably not a coincidence that Merkel’s visit comes only days after the SPD, which trails the CDU by almost 10 percentage points in the polls, named former finance minister Peer Steinbrueck as its candidate to run against the chancellor. In one of his first interviews after winning the nomination, Steinbrueck told Die Welt newspaper that Greece should be given more time to complete its fiscal consolidation. “We cannot tighten the screws any further,” he said. “And the chancellor must finally tell the German people the truth: Greece will not be able to borrow money on the capital markets in the coming seven or eight years. We will have to help it until then,» he added.
The prospect of Germany having to help Greece for many more years is another reason behind Merkel’s visit. It has become increasingly clear over the last few weeks that a potentially unbridgeable gap is developing between the International Monetary Fund and the eurozone over how to proceed with the Greek crisis. The IMF is insisting that an official sector debt restructuring be incorporated into the Greek program but many of the Europeans do not want to contemplate such a move at this stage. For Germany’s politicians in particular, the prospect of having to explain to a domestic audience which has largely negative view of Greece that there is a need to write off part of what it owes to its eurozone partners and the European Central Bank is anathema, especially now the election jostling has started.
This means the eurozone is nearing a make-or-break moment with respect to Greece. A failure to put restructuring on the table now will lead to the IMF extracting itself from the Greek program. Although it contributes a relatively small part of the bailout, its withdrawal would change the dynamics of the process and put extra pressure on the Europeans. As the main paymaster, the onus would be on Germany to assume a decisive role. This means having a clear idea of what it wants to achieve and what needs to be done to achieve it. Settling the Greek issue is the first step in this process.
Decisions about an extension to Greece’s fiscal adjustment period, a second restructuring, the role of the European Stability Mechanism in tackling Greece’s runway debt and how a possible Greek financing gap might be bridged are among those that must be taken in the coming months. As has been the case throughout the past three years, Germany’s leanings on these issues will act as the eurozone’s metronome. Somewhere in this process, Greece and its partners have to arrive at a formula that gives it a chance of economic survival. The current path does not, instead it has led to both sides straying dangerously far from the common interest they have to embrace in order to make things work. Merkel and Samaras need to walk away from Tuesday’s meeting and subsequent ones over the next few weeks having abandoned the impression that either side is being forced into an unacceptable compromise. Coercion simply won’t work. Just ask the Maniots.
It was impossible to miss, for instance, the contrast between statements on Greece last week by Merkel’s spokesperson Steffen Seibert and her Finance Minister Wolfgang Schaeuble, who is much more sceptical about supporting Greece. «All of the countries which are in a program, except Greece, which is in a particularly difficult situation... have made remarkable progress,» said Schaueble on Thursday. A day later, Seibert told the press: «We see that the reform efforts have increased under the Samaras government and we want to support that.» By visiting Greece, Merkel is sending a clear message to her colleagues that backing its continued membership of the eurozone is now the party and government line. It is an invitation to doubters to back her or keep quiet.
With the countdown to next year’s federal elections underway, Merkel is also hoping for a piece of one-upmanship on the Christian Democratic Union’s main rivals, the Social Democratic Party, which has been highly critical of the way the chancellor has handled the Greek problem and has maintained a much clearer position throughout the crisis in favour of Greece remaining in the eurozone. It is probably not a coincidence that Merkel’s visit comes only days after the SPD, which trails the CDU by almost 10 percentage points in the polls, named former finance minister Peer Steinbrueck as its candidate to run against the chancellor. In one of his first interviews after winning the nomination, Steinbrueck told Die Welt newspaper that Greece should be given more time to complete its fiscal consolidation. “We cannot tighten the screws any further,” he said. “And the chancellor must finally tell the German people the truth: Greece will not be able to borrow money on the capital markets in the coming seven or eight years. We will have to help it until then,» he added.
The prospect of Germany having to help Greece for many more years is another reason behind Merkel’s visit. It has become increasingly clear over the last few weeks that a potentially unbridgeable gap is developing between the International Monetary Fund and the eurozone over how to proceed with the Greek crisis. The IMF is insisting that an official sector debt restructuring be incorporated into the Greek program but many of the Europeans do not want to contemplate such a move at this stage. For Germany’s politicians in particular, the prospect of having to explain to a domestic audience which has largely negative view of Greece that there is a need to write off part of what it owes to its eurozone partners and the European Central Bank is anathema, especially now the election jostling has started.
This means the eurozone is nearing a make-or-break moment with respect to Greece. A failure to put restructuring on the table now will lead to the IMF extracting itself from the Greek program. Although it contributes a relatively small part of the bailout, its withdrawal would change the dynamics of the process and put extra pressure on the Europeans. As the main paymaster, the onus would be on Germany to assume a decisive role. This means having a clear idea of what it wants to achieve and what needs to be done to achieve it. Settling the Greek issue is the first step in this process.
Decisions about an extension to Greece’s fiscal adjustment period, a second restructuring, the role of the European Stability Mechanism in tackling Greece’s runway debt and how a possible Greek financing gap might be bridged are among those that must be taken in the coming months. As has been the case throughout the past three years, Germany’s leanings on these issues will act as the eurozone’s metronome. Somewhere in this process, Greece and its partners have to arrive at a formula that gives it a chance of economic survival. The current path does not, instead it has led to both sides straying dangerously far from the common interest they have to embrace in order to make things work. Merkel and Samaras need to walk away from Tuesday’s meeting and subsequent ones over the next few weeks having abandoned the impression that either side is being forced into an unacceptable compromise. Coercion simply won’t work. Just ask the Maniots.
| [Kathimerini English Edition] |
and Spain still on slow boil.......
http://www.aljazeera.com/news/europe/2012/10/2012107145037486567.html
| Spain hit by new wave of street protests | |||
Thousands in several cities decry tough austerity measures, creating headache for ruling party facing local elections.
Last Modified: 07 Oct 2012 18:57
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| Thousands of protesters have marched across Spanish cities to decry tough austerity measures as the protest movement gains momentum, with signs it could culminate in a general strike in November.
Sunday's march is the latest in a series of protests staged by hundreds of thousands of Spaniards almost on a daily basis over the past few months.
The protests have presented the centre-right government with a headache as it is due to hold regional elections. Spanish labour unions said they would call a general strike if the government did not hold a referendum on unpopular spending cuts. Prime Minister Mariano Rajoy unveiled $16.9bn in additional savings in a tough budget last month. "It's up to the government whether there's a general strike or not. If they were going to hold a referendum things would be completely different," said Ignacio Fernandez Toxo, leader of Spain's biggest union, Comisiones Obreras. The organisation told the Reuters news agency last week a strike could be held on November 14. Spain is on the brink of being crippled by the euro zone economic crisis amid expectations that the government will soon seek European aid to keep its borrowing costs under control. 'Losing everything' "It's shameful - we're losing everything," said Carmen Lopez, a department store worker at Sunday's protest in the capital Madrid. "Pensions, salaries, public healthcare and education. They're taking everything." Some 60,000 people attended the union-organised march in the centre of Madrid. "How can there be peace without bread?" and "Their plunder, my crisis", placards read. "I'm a teacher and they've really cut back in education - there are fewer resources, fewer teachers and more students," said Agustin Moreno, who teaches in the Madrid neighbourhood of Vallecas.
Protesters wore colours of various unions, and many were clad in T-shirts saying "I used to have social and labour rights". "They're taking away help for people who are unemployed, just at the time when people most need the help," said primary school teacher Francisca Valverde.
and.....
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http://www.zerohedge.com/news/2012-10-08/overnight-sentiment-european-grumbles-us-semi-closed
Overnight Sentiment: European Grumbles With US Semi-Closed
- Australian Dollar
- Beige Book
- Bond
- China
- CPI
- European Central Bank
- Federal Reserve
- France
- Germany
- Greece
- headlines
- International Monetary Fund
- Italy
- Janet Yellen
- Japan
- Jim Reid
- Joe Biden
- KIM
- Money Supply
- Reuters
- Sovereign Risk
- Sovereign Risk
- Trade Balance
- Wells Fargo
- World Bank
- World Economic Outlook
Usually on semi-US holidays such as today, when bonds are closed but equities left to the whims of vacuum tubes, equities do their mysterious ramp and never look back. So far today, however, this has failed to happen with futures at lows, driven by a noticeably weak EURUSD, which has traded down nearly 100 pips from the Friday late day ramp close, currently at 1.2940. It is unclear what has spooked the Euro so far, although all signs point to, as they did 2 months ago, the Spanish lack of willingness to throw in the towel and demand a bailout, thus easing conditions for everyone else if not for Spain PM Rajoy. Today's main event will be European finance ministers meeting in Luxembourg to discuss the recent Spanish economic transformation efforts as well as an attempt to accelerate banking cooperation and implement a banking regulator - something which is needed for the ESM to monetize bank debt, and something which Germany has been firmly against from day one. Additionally, a day ahead of Merkel's visit to German (where she will be protected by 6-7,000 cops), the ministers are likely to make a positive statement on Greece’s progress toward austerity targets, according to European viceroy Olli Rehn said. In other overnight news, German Industrial Production saw a -0.5% decline, which was modestly better than the -0.6% expected. Over in Asia, China reopened from its 1 week Golden Week hibernation with the SHCOMP down -0.56% to 20.76.42 following a small bounce in the China HSBC Services PMI to 54.3 from 52 in August, and with average house prices rising for a 4th month in a row, and even more repo operations by the PBOC, the result is that the market's ungrounded hopium for an immediate PBOC liquidity injection was taken away pushing regional markets lower.
The tentative schedule for today's Eurogroup meeting is as follows (BST):
- 1100 - ESM arrivals
- 1400 - ESM round-table meeting, Eurogroup arrivals
- 1515 - ESM press conference
- 1600 - Eurogroup meeting
- 2100 - Eurogroup press conference
And even as the ESM is formally launched today, don't expect Spain to fund its nearly €10 billion ESM contribution now or at any time in the future. It won't, but Germany better: after all someone has to prefund all those hundreds of billions of Spanish 2013 bond auctions.
Summarizing the other key events is DB's Jim Reid:
We won't have a lot of new information this week as we have the usual post-payroll data lull. Indeed we start the week with the US bond market closed for
Columbus Day today and Japan also closed. The US equity market will still be open though but volumes are unlikely to be high.
Columbus Day today and Japan also closed. The US equity market will still be open though but volumes are unlikely to be high.
One of the big events of the week stateside is likely to be the start of Q3 earnings as Alcoa again kicks-off proceedings on Tuesday (after market). As usual it will be a slow start though with just 10 S&P500 firms reporting this week. JPM and Wells Fargo will get things started for the Financials sector on Friday and also note that FedEx's outlook and investor meeting are on Wednesday as the company outlines its cost cutting plans. Consensus expects S&P 500 Q3 EPS to fall 2.3%qoq, which would mark the first quarterly decline in eleven quarters. However analysts expect Q4 to be positive (DB expects +6%yoy), and therefore the guidance will probably be as important as Q3 numbers for which weakness has already been priced in.
In Europe, the 2-day ECOFIN meeting begins today in Luxembourg where Spain and Greece will be on the agenda. No major decisions are expected at the meeting which will largely lay the groundwork for the European Council meeting on Oct 18th-19th. Also in Luxembourg today, Eurogroup President Juncker has convened an inaugural meeting for ESM Board Governors. On Tuesday, Angela Merkel will meet with Greek officials in her first visit to Athens since 2007.
Although Merkel’s visit is likely to be marred by protests with Greece’s largest unions calling for a work stoppage so that members can take part in rallies coinciding with the Chancellor’s meetings with the Greek President and PM. Draghi will appear before the European Parliament’s Economy Committee in Brussels on the same day. Spain’s PM Rajoy is scheduled to meet the French President Hollande in Paris on Wednesday while the Bundesbank's Weidmann is expected to speak at the Bundesbank Cash Symposium in Frankfurt on Wednesday.
The urgency to this week's European meetings will likely be low as Spain finished the week on a high after Reuters said that the ECB would buy large volumes of sovereign bonds for a period of one to two months once its OMT programme is activated, citing senior central bank sources. The news helped Spanish 10yr bond yields rally 22bp on the day, closing at a two week low of 5.686%. Indeed, Spanish (+1.8%) and Italian (+2.4%) equities outperformed in the day, driving a 1.8% gain in the Euro Stoxx 600.
Despite this, European headlines over the last few days were not encouraging. German manufacturing orders fell 1.3%mom in August (vs -0.5% expected). According to our German economists, the order data corroborates the message provided by recent PMI and other confidence surveys: the German manufacturing sector is decelerating, with little signs of an imminent rebound. There were also reports of further delays to Greece’s negotiations with the troika. The kathimerini suggests that discussions could last another two weeks, which would push proceedings past the European Council meetings on Oct18th-19th. Spain's Canarias region said it would seek EUR757m ($989 million) in aid from the central government, which will make it the sixth Spanish region to tap the central government's EUR18bn liquidity fund. On the subject of bailouts, Cyprus' government will aim to finalise a bailout by Oct 20th, with the majority of funds going to recapitalise banks. The size of the bailout is estimated to be between EU12bn to 13bn (WSJ). Meanwhile tensions remain high in South Africa as Anglo American Platinum fired 12000 striking workers, driving the USDZAR to selloff 3% on Friday.
Overnight markets are weaker with the Hang Seng and KOSPI down 0.7% and 0.6% respectively. Chinese equities have opened 0.7% weaker after their week-long holiday. The Australian dollar is also trading lower overnight (-0.25%), reaching its lowest level since mid-July. The AUDUSD cross has declined in 8 out of the last 10 days. On a more positive note, China’s HSBC Services PMI printed at 54.3, rebounding 2.3pts off August’s lows and contrasting with the official services PMI which showed a sharp monthly deterioration in September.
Moving onto more of the week ahead, G7 Finance Ministers will meet in Tokyo on Thursday. A senior US treasury official said on Friday that the focus will be on what each country can do to boost growth. Indeed it will be an eventful week in Tokyo with the IMF/World Bank meetings running until Sunday. Seminars on topics including sovereign risk and financial stability will be hosted by the IMF on Wednesday and speakers include U.S. Federal Reserve Vice Chairman Janet Yellen, European Central Bank Vice President Vitor Constancio, Bank of Italy Governor Ignazio Visco and Bank of France Governor Christian Noyer. This will be followed by another round of IMF seminars on implementing growth on Saturday with a speaker list that includes Christine Lagarde, World Bank President Jim Yong Kim and People’s Bank of China Deputy Governor Yi Gang. The IMF will also release its World Economic Outlook and Fiscal Monitor on Tuesday and their Global Financial Stability report on Wednesday.
The data focus in the US will be on the trade balance and the UofMichigan confidence survey on Friday. The Fed’s Beige book is due out mid-week. On the political front, the Vice Presidential debate between Joe Biden and Paul Ryan takes place on Thursday. As far as European data is concerned, industrial production and CPI data throughout the week are perhaps the most notable releases. In China, credit and money supply data are due through the week and September’s trade data is due on Saturday. Meanwhile over in Japan, August machine orders data are released on Thursday.
Turning to the day ahead, it should be a relatively quiet start, particularly with the Japanese and US holidays today. Germany’s IP and trade numbers will be the main economic data points but the ECOFIN meetings will likely be the main source of headlines today.
http://www.telegraph.co.uk/finance/debt-crisis-live/9593233/Debt-crisis-Official-launch-of-ESM-bail-out-fund-live.html
12.03 We mentioned the fresh OECD data earlier, which we've now crunched into a graph showing that the UK appears to be in a much healthier state than Europe as a whole.
11.24 There's fresh data from the OECD today which shows that most of the world's major economies will slow in the coming months - except Brazil and the UK. China is also showing signs of stabilising, it says. We'll bring you more on that soon.
11.18 There have been anti-austerity protests in front of the EU's headquarters in Athens this morning. Many of the images coming through so far show pensioners making up a large portion of the crowd, angry about their income being eroded by severe austerity cuts in recent months.
10.43 European markets have dipped further into the red in the lead-up to the eurozone finance ministers' meeting in Luxembourg.
The FTSE 100 is off by 0.7pc, the CAC has slipped by 1.21pc and the DAX is down by 1.32pc.
10.09 Eurozone sentiment has risen for the second straight month in October. Sentix says its index tracking investor sentiment strengthened to -22.2 from September's -23.2.
09.31 Protesters occupied an energy company data centre in Athens yesterday, over plans to impose a property tax that would be tagged-on to electricity bills, reports Reuters. Today 18 electricity workers will be charged with breaching the peace, incluing Nikos Fotopoulos, the leader of Greece's powerful GENOP union. The union issued a statement, including a message for the government:
You've turned our life into hell and the country into a protectorate.
08.02 Time for a quick look-ahead at what's coming up. Later today we have a meeting of eurozone finance ministers in Luxembourg. TomorrowAngela Merkel will travel to Athens for talks with the debt-laden state's government; the troika is still there, investigating whether the country has done enough to secure the next €31bn of bail-out cash.
07.48 An interesting report from Reuters says that a single eurozone budget is encountering less opposition than expected.
One anonymous diplomat said that the issue was raised at a private dinner last week, attended by the EU ambassadors of several northern European countries, including Britain, Denmark, the Netherlands and Finland:
I wouldn't say that there was strong support for it, but there was certainly a feeling that this is an idea that should be explored in more detail.
07.40 Greece can't have more time to repay its debt to the ECB because it would be "illogical", board member Joerg Asmussen says. There will be no extension or cut in interest rates:
Both concessions would be a form of debt forgiveness and therefore a direct financial support for the Greek state. That would not be allowed under the law governing the ECB.
07.35 It's already been a familiar part of the eurozone crisis vocabulary for months, but today is the official launch of the European Stability Mechanism (ESM), the permanent bail-out fund which offers a €500bn pot of cash to be used to shore-up the finances of troubled nations.
Today the ESM's board will meet for the first time, but the head of the fund, Klaus Regling, has already spoken to the Rheinische Post and warned that some of the eurozone's states may not be able to complete vital reforms:
My biggest worry is that some crisis-stricken countries do not have the political power to persevere with their painful but effective reform programmes until the end. That would be a catastrophe.
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