http://www.france24.com/en/20121216-depardieu-tax-belgium-french-passport-ayrault-journal-dimanche

Angry after being "insulted" by the French prime minister for his plans to move to Belgium for tax purposes, actor Gérard Depardieu said in an open letter on Sunday that he will be handing in his French passport and his social security card.

By FRANCE 2 / Katerina VITTOZZI (video)
FRANCE 24 (text)

After coming under fire from the French prime minister for choosing exile in Belgium for tax purposes, actor Gérard Depardieu said on Sunday that he would be handing in his passport and his social security card after being "insulted" by members of the government.

Last week French Prime Minister Jean-Marc Ayrault called Depardieu’s decision to quit France “pathetic” and unpatriotic at a time when many French people are being asked to pay higher taxes to reduce the country’s debt.
In an open letter to the weekly Journal du Dimanche, Depardieu accused France’s Socialist government of punishing “success, creativity and talent”.
The actor, best known to English-speaking audiences for his role in the 1990 film Green Card, said he had paid €145 million in taxes since starting work at age 14 as a printer.
“In 2012 I paid 85 percent tax on my income, while I employ 80 people,” he wrote. “I’m not complaining, and neither am I bragging, but I refuse to accept being called pathetic. I’m sending you (Ayrault) back my passport and my social security card, which I’ve never used."
"You call me pathetic; I call that pathetic," Depardieu wrote.
Depardieu said the reaction to his leaving France was particularly severe. “People more illustrious than me have gone into [tax] exile," he said. "Of all those that have left, none have been insulted as I have.”
No wealth tax in Belgium

FRANCE-BELGIUM

Actor Depardieu bids ‘adieu’ to France to avoid taxes

Dépardieu put his Paris mansion up for sale last week, reportedly for €50 million, and has bought a property in the Belgian village of Néchin near the French border.

The 63-year-old multimillionaire’s decision to leave France comes three months after Bernard Arnault, chief executive of luxury retailer LVMH and France's richest man, caused an uproar by seeking to establish residency in Belgium -- a move he said was not for tax reasons.
Belgian residents do not pay wealth tax, which in France is levied on those with assets over €1.3 million, and they do not have to pay capital gains tax on share sales.
In Europe, taxes are paid according to the rules of the country where the tax payer resides. By moving to Belgium, Depardieu will not be obliged to file a tax return to the French authorities, even if he retains his French citizenship.

FRANCE

Tax exile Depardieu puts Paris mansion up for sale

Not all creative talent is leaving France, however. On Sunday renowned French novelist Michel Houellebecq, who has lived in Ireland since 2000, announced that he was coming back to France, but stressed that he wasn’t doing so “to make any kind of point”.
The author of "Plateforme" and "Atomised" told AFP that he had now mastered the English language and wanted to return to a French-speaking environment.
“If I chose France rather than another French-speaking country it is for entirely personal reasons,” he wrote. “Yes, money is important, but it’s not the most important thing there is.”

and.....

http://www.france24.com/en/20121213-france-french-irrational-mittal-montebourg-steel-florange

Steel tycoon Mittal hits out at ‘irrational’ French minister

Steel tycoon Lakshmi Mittal spoke of his shock on Thursday at being told he was “not welcome in France” by a French minister. Mittal said a government threat to nationalise his steel plant would have been a “giant leap backwards” for France.

By Ben MCPARTLAND (text)

Global steel giant Lakshmi Mittal expressed his surprise on Thursday at his treatment at the hands of an “irrational” French government minister who had told him his company was no longer welcome in France.

Last month France’s outspoken minister for industrial recovery, Arnaud Montebourg, attacked Mittal over his company’s controversial decision to close two blast furnaces in Florange, eastern France, with the loss of around 630 jobs.

Montebourg, known for being a loose cannon, slammed ArcelorMittal for not respecting France and said it was “no longer welcome" in the country.

MONTEBOURG THE MODEL

ON THE BLOGS

‘Very sexy’ French minister poses in bizarre photo shoot

Speaking for the first time since Montebourg’s outburst, Mittal - Britain’s richest man - told French daily Le Figaro he was taken aback by the venom of the attack, which was all the more surprising given his significant investments in France.

“Of course I was shocked, by these words, even saddened. I would never have expected to hear something so irrational from a minister,” he said.

“ArcelorMittal has 20,000 employees in France. This country represents 35 percent of our steel production in Europe and we have invested two billion euros in France since 2006.”

Nationalisation a ‘backward leap’

After Montebourg’s broadside, tensions mounted further when French President François Hollande appeared to tempt Mittal towards the exit door when he dangled the threat of nationalising the whole of ArcelorMittal’s Florange plant if it pursued its plan to cut jobs.

The rest of the site contains more profitable facilities that Mittal wanted to keep.

ArcelorMittal, which insists the blast furnaces are uneconomical, responded by floating its own threat, suggesting nationalisation would cast doubt on the future of all its operations in France.

Although the two sides reached a last-ditch deal, which for now has staved off the threat of nationalisation, Mittal was still stunned that a government takeover had ever been evoked.

“It was not just me, the whole world was surprised,” he said. “If a country like France, the fifth biggest economy in the world talks about natonalisation in this day and age, that’s a huge leap backwards.

"These kind of threats will make an investor maybe think twice before putting his money in France."

Business leader and head of employers’ union Medef, Maurence Parisot echoed Mittal’s words on Thursday, saying nationalisation would have been a ‘disaster’ for France and its image in the eyes of investors.

Mittal told Le Figaro, however, that he did not get the impression during the “tough” talks that France’s president was too keen on the nationalisation option.

“No threats are necessary”

Under the deal struck between the two sides the two blast furnaces would be closed with ArcelorMittal agreeing not to proceed with forced job cuts and promising to invest 180 million euros in the plant.

The deal, however, was not received well by trade unions and those on the left, who have little faith that Mittal will stick to the agreement.

"Mittal has never kept his promises in the past," said French Ecology Minister Delphine Batho while Edouard Martin, a spokesman for the CFDT union at the Florange plant said: "We don't trust Mittal at all. We have the feeling we have once again been betrayed."

But Mittal, who described the deal with the French government as "fair", promised to stick to his side of the bargain.

“No threats are necessary for us to keep our promises and the government is always welcome to check,” he said.

On Thursday union leaders are set to meet representatives from ArcelorMittal to hear their solution for the future of the Florange site.

and....

http://www.testosteronepit.com/home/2012/12/10/the-socialist-heart-of-france-spits-out-its-first-victim.html

France Spits out its first Victim

MONDAY, DECEMBER 10, 2012 AT 6:40PM

A new report released by Insee details the inexorable rise of official poverty in France. By the end of 2010, it engulfed 8.6 million people, 5.4% more than in 2009, and 16.7% more than in 2004. The poverty rate jumped to 14.1%, the highest since 1997. For children (under 18), the poverty rate hit 19.6%, for young adults (18 to 25 years old), it was a grizzly 22.5%!

More extreme forms of poverty increased rapidly. Poverty was defined as earning less than 60% of the median income in 2010. But those earning less than 50% of the median income rose to 4.755 million people, 22% more than in 2004.

The report noted that “the standard of living has been sliding or stagnating for practically all categories of the population except the wealthiest.” Overall, it dropped 0.5% in constant euros in 2010. But for the lower 30%, it dropped between 1.3% and 1.6%, while it increased1.3% for the top 5%. “Most of the indicators show a progression of inequalities,” the report underlines dryly.

Blame the current unemployment fiasco? Nope, the report says. In 2010, unemployment had been improving as the economy recovered from the financial crisis. Future poverty reports—those for 2011 and 2012—will reflect the pernicious effects of the rise in unemployment that started in mid-2011. And there is no letup in sight.

On Monday, the government reported that the number of temporary workers—an indicator of changes in demand for labor—had plunged 3.5% in October and is now down 13.9% from prior year. A collapse that nearly mirrors the debacle of the financial crisis. But this time around, it started falling from a much lower point than it did in 2008.

The disappearance of jobs, as France skids deeper into its economic crisis, is already putting its mark on poverty: 48% of the people consider themselves either living in poverty or on the way to living in it.

The survey set the tone for the National Conference of the Fight against Poverty and Exclusion this Monday and Tuesday. In a sign that the government was taking poverty seriously, President François Hollande himself would kick it off. Prime Minister Jean-Marc Ayrault would close it. It would be packed with ministers, representatives of anti-poverty associations, and even people who live in poverty. All under the motto, “Imagine the social policies of the 21st century” [read.... The Alarming “Sense of Pauperization” in France].

But the government’s display of its Socialist heart is already stalling. Hollande had a scheduling conflict. Instead of getting tangled up in a dicey effort that would call for programs the government wouldn’t have the money to pay for, he decided to hobnob, andhold hands, with German Chancellor Angela Merkel in Oslo, Norway, during the Nobel Peace Prize ceremony. It didn’t go unnoticed.

And the tip of the spear of the Socialist left wing, Industry Minister Arnaud Montebourg?

In October he’d pleaded flamboyantly that the “made in France” be given preference and that a dose of protectionism be instituted at the European level to stem France’s deindustrialization and protect its car makers from Korean imports [Shooting From The Hip And Hitting Consumers]. Then he’d stirred up a raucous debate with his threat to nationalize ArcelorMittal’s old steel plant at Florange [Nationalizations Take Off In France].

That tip of the spear? Broken off! While in Brussels on Monday to beg the free traders in the EU to impose his industrial vision on the land, he was asked about the ArcelorMittal plant—Ayrault having swept his threat off the table. “I let Prime Minister Ayrault sort things out at Florange,” he said, “That’s his job now.”

Montebourg has been shunted aside. After he got the cold shoulder from the same free traders who’d shot down his plea for protection against Korean imports, he mused, “For 30 years, consumers made the law in Europe, and the result is a disaster. As for me, I defend the producers.” He claimed that the EU was the only entity that didn’t “defend itself against unfair competition”—purposefully forgetting that the EU has a trade surplus with the rest of the world, though France has a trade deficit.

“We’ve become the idiots of the global village,” he added. But hardly anyone was listening to the Socialist firebrand. He has become irrelevant in an unpopular government that is desperately trying to swing the other way.

Fearing their own economic principles, economists and politicians drive Europe into perhaps decades of austerity, transfers from north to south, worsening imbalances, and uncertainty. Uncertainty, however, is the worst thing for business leaders and the European economy. Read.... He Who Says “No” To Austerity And Global Imbalances Must Say “Yes” To The Northern Euro

http://www.zerohedge.com/news/2012-12-18/berlusconi-italy-may-be-forced-leave-eurozone-and-return-lira.

Berlusconi: "Italy May Be Forced To Leave The Eurozone And Return To The Lira"

Submitted by Tyler Durden on 12/18/2012 19:10 -0500

Reminding the world of just the kind of truthiness that got him sacked originally by that other Italian, the Ex-Goldmanite Mario Draghi, back in November 2011, and which the world has to look forward to when Silvio Berlusconi returns to power some time in 2013, even if not as PM (a position he currently has a snowball's chance in hell of regaining based on currentpolitical polls), Reuters informs us that the Italian, who certainly has not read the Goldman book on status quo perpetuation, just said the unimaginable: the truth. To wit: "If Germany doesn't accept that the ECB must be a real central bank, if interest rates don't come down, we will be forced to leave the euro and return to our own currency in order to be competitive." Berlusconi said in comments reported by Italian news agencies Ansa and Agi. The 76-year-old media tycoon has made similar remarks in the past about the possibility of Italy, or even Germany, leaving the euro, but has often at least partially rectified them later." Not this time. Now with Germany and the Buba folding like a broken chair, Silvio is coming back and knows he can demand anything and everything, and Germany has no choice but to accept, Merkel reelection in a few months be damned.

Perhaps the former PM who recently got engaged to this 28 year old girl who obviously loves him for his personality has read our little primer on what happens in a Europe in which external devaluation (i.e., FX) is not a possibility, and where another 30-50% drop in PIIGS salaries would be neccesary to restore competitiveness. That, or a return to the Lira of course. And Berlusconi has seen that in the duel between Greece and Germany so far the former (and specifically its creditors) have gotten all the advantage. It is only a matter of time before he parlays that negotiating approach to Italy as well, and in the process destabilizes whatever artificial balance the ECB may have created.

Spanish Bad Loans At New Record, Deteriorate At Fastest Pace Since June

Submitted by Tyler Durden on 12/18/2012 08:20 -0500

Bad Bank

None

Reality

For the green-shoot-minded, last month's albeit record high Spanish bank loan delinquencies was occurring as its first derivative was slowing. Well dash those hopes as this month sees bad loans not only rise to record highs (above 11% for the first time in history) but the pace of this drastic deterioration accelerated at the fastest pace since June. We are sure somewhere a Spanish finance minister is eschewing the 2nd or 3rd derivative as an indication that the worst is over but reality is that as FROB proudly notes the number of banks who have invested in its bad bank - in a strange and twistedly ironic reacharound whereby the bad banks themselves (all domestic, no foreign, Santander 16% stake!)are buying up the assets of the nation's bad banks - the sheer size and scale of this level of bad loan and deterioration (double in two years) is far beyond anything the sovereign's bad bank is prepared for. Of course, none of that matters as Draghi's magical OMT remains the ultimate backstop to any reality emerging. Spain - getting worse, faster.

http://www.zerohedge.com/contributed/2012-12-18/cyprus-dog-didnt-biteyet

Cyprus: The Dog that Didn't Bite...Yet

Submitted by Marc To Market on 12/18/2012 05:09 -0500

Capital Markets

default

Greece

Gross Domestic Product

International Monetary Fund

PIMCO

Unemployment

Last week Eurogroup head Juncker warned that the situation tiny Cyprus was more worrisome than Greece. While this seemed to be an exercise in hyperbole, sure enough Monday, a Cyprus official was quoted on the news wires warning of an imminent default.

Hang on. Didn't Cyprus reach a memorandum of understanding with the Troika ? Indeed, it did. However, it will take some time to deliver the funds.

Essentially and in principle, there was an agreement on aid in the neighborhood of 17.5 bln euros. This is for the bank recap (roughly 10 bln euros) and for funding the government for three years (7.5 bln euros). An audit of the banks is needed to ascertain their condition and determine the recapitalization needs. PIMCO recently conducted a preliminary audit for the government but the results have not been released. A full audit is expected in mid-January.

As was evident in the recent negotiations with Greece, there are fissures within the Troika. The IMF is reportedly concerned that if Cyprus borrows the funds for the bank recapitalization it could push Cyprus' debt to unsustainable levels. This in turn, would prevent the IMF from participating in an aid facility for it.

In the mean time Cyprus has salaries to pay and other obligations. Hence the threat of selective default. Just as officials and traders were winding things down for the year, this seemed to throw a monkey wrench into the budding holiday mood. EMU had survived a challenging year, didn't it?

The threat of default was meant to persuade state-run organizations in Cyprus to loan the government funds for three months as a sort of bridge loan until the aid flows. The government has been locked out of the capital markets for more than a year. It promised to pay back the loan with interest.

The government raised funds from the Cyprus Telecommunications Authority and the Electricity Authority. Reports suggest it was also seeking borrow from the Port Authority. By late Monday, Finance Minister Shiarly claimed the government's short-term financing needs have been met.

This course may be sufficient if the bank audit can be completed in time for the Eurogroup meeting on January 21. Yet Cyprus is a great example of the a banking system that is too big to save. Consider that at the end of last year, the IMF figures suggest Cyprus' bank assets were 152 bln euros, or 8.3x GDP. Assets of commercial banks with Cypriot parents was 92 bl euros or 5x GDP. These Cypriot banks had 29 bln euro exposure to Greece of 1.6x GDP.

The private sector losses in the restructuring of Greece's debt was the prick that popped the bubble. Cypriot banks were forced to seek state aid. The needs overwhelm the government, whose debt is already three-quarters of GDP and rising.

Another complication is that Cyprus goes to the polls in February. The Christofias government lost the confidence of the people. During its five year-term unemployment has risen from below 4% to 10%. The debt/GDP ratio has increased by half. The government that the Troika is negotiating is not truly representative of the Cypriot people.

This analysis suggests that although Cyprus has found a way to fund itself for the time being, problems are lurking around the corner and will likely come to head in Q1 13.

And from Greece..... how can any plan for Greece work with 31 percent unemployment......

http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_18/12/2012_475091

Jobless rate to hover around 30 pct by 2014

Unemployment in Greece will climb to 29.3 percent in 2013 and 31 percent in 2014, the German institute of macroeconomic forecasts IfW Kiel predicted on Tuesday.
The German institute’s economists also forecast the economic contraction to come to 4 percent next year and spill over into 2014 at a 1 percent rate, against a European Commission prediction for 0.6 percent growth in 2014.
In its revision of the Greek streamlining program, published in Brussels on Monday, the Commission had also been more optimistic in its estimates for the jobless rate, putting it at 24 percent for 2013 (from 23.6 percent in 2012) and 22.2 percent in 2014.
By contrast, using International Labor Office (ILO) methodology, the IfW Kiel economists expect the unemployment rate to come in at 24.6 percent at end-2012 before soaring to 29.3 percent in 2013 – higher even than Spain’s 27.9 percent rate. A rise in employment usually trails the economic growth rate by at least six months.
The IfW forecast mirrors that of the Labor Institute of the General Confederation of Greek Labor, which expects unemployment to top 30 percent next year.
IfW also sees inflation in Greece reaching 1.1 percent this year and turning into deflation of 0.6 percent in 2013.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_18/12/2012_475087

PPC customers in for a shock

Hundreds of Public Power Corporation clients protested inside and outside the company’s headquarters in central Athens on Tuesday as PPC chief Arthouros Zervos told Parliament that the rate hikes the corporation is proposing for 2013 amount to ‘only 15 euros per month per household.’
This signifies an additional 30 euros per bill (issued every two months) for households, even for those with low power consumption.
Zervos argued that this rate hike had been among the country’s obligations from the first bailout agreement in May 2010, but that governments since had failed to implement the measure.
This means that the increase – which will range from 14 to 49 percent, depending on the level of consumption – will have to come within just six months, before the July 2013 deadline, as agreed by Athens.
The PPC proposal for the rate hike has been submitted to the Regulatory Authority for Energy, which in turn has forwarded it to the Energy Ministry.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_18/12/2012_475067

Verdict on property tax due Friday

The Supreme Court is expected to issue a verdict on Friday as to whether the Finance Ministry has the right to levy a special property tax – a key measure to raise state revenues – via electricity bills.
A lower court had ruled the practice illegal earlier this month following a lawsuit filed by the INKA consumer group. That decision was appealed on Tuesday at the Supreme Court by the Greek state and the management of the state-owned Public Power Corporation (PPC).
During Tuesday’s hearing, the appellants cited reasons of national interest as well as precedent, given that Greek governments have used electricity bills to collect other levies, such as the fee for ERT state television, for decades.
Meanwhile, consumer groups on Tuesday appealed a first instance court decision, demanding that PPC restore the power supply of property owners that have failed to pay the emergency tax, also known as “haratsi.” The organizations also want to stop PPC from passing the names of those who still owe taxes to other state departments.
The Supreme Court ruling on Friday is not expected to be the final word on the issue as a fresh trial is set to start in March.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_17/12/2012_474889

Timetable of prior actions for next tranches is set out

Courts, political instability, recession and vested interests worry creditors

Drug prices will have to be reduced, using the three lowest prices in the European Union per medicine as a yardstick, in order for the March bailout tranche of 2.8 billion euros to be disbursed.

By Sotiris Nikas and Nikos Chrysoloras
The long-awaited report by the European Commission and the European Central Bank on Greece’s economy, issued on Monday in Brussels, describes the prior actions required for 14.8 billion euros in bailout installments to be disbursed by March. However, it also warns of four risks to the bailout program, stressing that any failure would immediately entail fresh austerity measures.
The prior actions required for January are the passage of the tax reform bill through Parliament and an increase in electricity rates. These measures will allow for the disbursement of 9.2 billion euros, out of which 7.2 billion will go toward the recapitalization of banks.
February should see the revision of the midterm fiscal plan and the setting of ceilings on spending for general government entities, particularly local authorities and hospitals, for the next three years. That will see the release of another 2.8 billion.
In March, the government will have to complete its report on human resources at its ministries, which will determine the number of unnecessary staff and the figure of those departing per quarter up until end-2014. Pharmaceutical prices will also have to come down for the next tranche of 2.8 billion euros to arrive in Athens.
European authorities are worried however that legal interventions might hamper some of the measures, as in the case of the special property tax paid via electricity bills, which would demand the introduction of other measures to fill the gap. Other possible obstacles to the program include political instability, a greater-than-forecast recession and the insufficient implementation of reforms in areas which would involve a clash with vested interests.
The state’s reduced ability to enforce the reforms agreed upon is one of the problems cited by the Commission’s Task Force in a different report also presented on Monday. That also identifies the problems of extensive tax evasion and a lack of cash flow.
A senior Commission official admitted on Monday that the measures already agreed on for the reduction of the Greek debt are going to bring it down to 128 percent of gross domestic product in 2020, to secure its decline to 124 percent in 2020 and below 110 percent in 2022. The official added that more measures that have not been specified will have to be taken, but that the eurozone has committed itself to promoting them should this be required. It was through this guarantee that the International Monetary Fund has agreed to tone down its hard stance and allow for the disbursement of the bailout installment.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_17/12/2012_474884

Government seeks next targets

With part of bailout tranche paid, coalition turns to next goals on its agenda

Greece on Monday received 34.3 billion euros from its lenders, the first installment of more than 50 billion due over the next few months, but the government’s focus had already moved to tasks that need to be fulfilled in the coming weeks to keep the country’s lenders happy.

The arrival of the loan tranche will allow the government to begin the final phase of bank recapitalization and to begin paying off state arrears of some 9 billion euros, but Prime Minister Antonis Samaras attempted to send a message that the government could not rest.

He met in Athens with the local representatives of 13 multinational companies in a bid to encourage them to invest more in Greece either by moving part of their production here or working with Greek companies. Samaras also asked the businessmen to tell him what steps the government could take to make the environment more investor-friendly.

“I have been in the business for more than 30 years and this is the first time a prime minister has asked to meet with us,” one of the entrepreneurs who took part in the meeting told Kathimerini on condition of anonymity, adding, “It is a very positive move.”

Samaras is this evening due to host his coalition partners, Evangelos Venizelos of PASOK and Fotis Kouvelis of Democratic Left, to discuss the government’s next moves. Despite completing the “prior actions” the troika demanded to disburse more funding, the coalition must now implement these measures, while also looking to prevent further damage to social cohesion.

A survey conducted by Metron Analysis over the last 12 months and presented to the European Parliament on Monday indicated that 67 percent of Greeks expect things to worsen in the future. A third of households said they are finding it difficult to make ends meet, while 41 percent of young people are thinking about emigrating.

Also today, Finance Minister Yannis Stournaras is expecting to hear whether the Supreme Court will accept his appeal against a first instance court ruling preventing the emergency property tax from being levied via electricity bills. The tax is vital for revenues and Stournaras wants to avoid changing the method of collection.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_18/12/2012_474949

Greece to suspend most home repossessions until end of 2013

Greece will extend by another year the moratorium on home repossessions for debts up to 200,000 euros, according to legislation submitted to Parliament on Monday.

Until the end of 2013, banks will not be able to seize the homes of customers if they are their main property - regardless of how much is owed - or if the amount owed is less than 200,000 euros.

Non-performing loans at the end of September stood at 52 billion euros, which was 22.5 percent of all loans – a rise of 7.5 percentage points from the end of 2011. More than 15 billion euros of these loans are mortgages.

The legislative act submitted by the government also foresees individuals and businesses renting commercial properties being able to terminate their contract by paying one month’s rent to the landlord.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_18/12/2012_474942

Municipal workers' strike causes trash problems in Athens, Thessaloniki

Athens and Thessaloniki are facing problems with trash that is amassing on their streets due to an ongoing strike by municipal workers.
Their union, POE-OTA, is protesting efforts to place hundreds of local government employees in a labor mobility scheme that could lead to them losing their jobs after 12 months.
Their protest was due to end on Tuesday but POE-OTA is joining a broader civil servants’ 24-hour strike on Wednesday, when the union will decide whether to extend its protest.
Thessaloniki faces a problems in its suburbs, where trash has piled up due to the month-long protest but the city center is in a better condition as participation in the strike by workers has been low.

Catharsis Ours

Tuesday, December 18, 2012