Britain’s new prime minister, David Cameron, traveled to Paris on Thursday to meet with President Nicolas Sarkozy before going to Germany to meet with Chancellor Angela Merkel on Friday. Mr. Cameron, leader of a party known for its aversion to closer European integration, planned to devote his first overseas trip since coming to power last week to smoothing ties with Continental Europe.
For more: World Briefing - Europe - France - Cameron Travels to Meet Sarkozy and Merkel - NYTimes.com
5/21/10
Europe set to hit debt-ridden nations in the pocket
Crisis-hit European finance ministers took their first steps on Friday towards punishing countries that don't honour the rules on keeping national debts and deficits down, including cash penalties.
However, on the same day that the German parliament approved its share of a near trillion-dollar (750-billion-euro) eurozone rescue package, running to about 150 billion euros, ministers showed no appetite for a bid by Berlin to force heavily-indebted partners into bankruptcy.
The first meeting of a new 'task force' convened by EU president Herman Van Rompuy also left the difficult question of possible treaty changes required to craft a tough new regime of 'economic governance' across the 27-nation European Union on the back burner.
For the complete report: AFP: Europe set to hit debt-ridden nations in the pocket
However, on the same day that the German parliament approved its share of a near trillion-dollar (750-billion-euro) eurozone rescue package, running to about 150 billion euros, ministers showed no appetite for a bid by Berlin to force heavily-indebted partners into bankruptcy.The first meeting of a new 'task force' convened by EU president Herman Van Rompuy also left the difficult question of possible treaty changes required to craft a tough new regime of 'economic governance' across the 27-nation European Union on the back burner.
For the complete report: AFP: Europe set to hit debt-ridden nations in the pocket
Sweden first and Finland second most competitive EU economy
“Sweden remained the most competitive economy in the European Union, followed by Finland and Denmark, according to the World Economic Forum study.
Those three Nordic nations ranked above the Netherlands, Luxembourg and Germany in the analysis, which is based on indicators such as economic and productivity growth, research and development spending, and unemployment.
The Nordic countries ‘are the strongest European performers in the area of innovation, attributable to their companies’ aggressiveness in adopting new technologies and their level of spending on R&D,’ according to the study. It also cited ‘the high degree of collaboration between universities and the private-sector in research’ in these nations...”
For more: Finland second most competitive EU economyFinancial Regulation: US Senate passes biggest, regulatory changes since the Great Depression
On Thursday, the US Senate plucked up its courage and passed its version of the controversial financial reform package. It is bold, brave and risky, but then again, tough times demand tough solutions.This Senate vote means Congress is now poised to pass a broad expansion of government oversight of the increasingly complex (and increasingly murky) banking industry and financial markets. The legislation is designed to put measures in place to prevent a repeat of the 2008 financial meltdown. In addition, it simultaneously reshapes the varied roles of numerous federal agencies, and vastly empowers the Federal Reserve Bank, in an attempt to predict and contain future debacles – especially since the current regimen didn’t see that most recent crisis coming, until it hit.
Note EU-Digest: Another step in the right direction and a plus for President Obama
For more: The Daily Maverick :: US Senate passes biggest, baddest regulatory changes since the Great Depression
5/20/10
British coalition gov't, London mayor on collision course over banking reforms
London's mayor looks set for collision course with the country's newly-elected coalition government, following disagreements on major policy items, according to London government website on Wednesday.
Mayor Boris Johnson, who is a former schoolfriend of the new Prime Minister David Cameron and also a leading member of Cameron' s Conservative party, put himself on collision course with Cameron 's new coalition government on Monday when he spoke out strongly against its policy on banks and banking.
London is Europe's financial capital, and is one of the world's leading financial cities. The finance sector accounts for 9 percent of Britain's gross domestic product. The coalition government said it will hold an inquiry into the future of banking in the country, to report next year.
For more: British coalition gov't, London mayor on collision course over banking reforms
Mayor Boris Johnson, who is a former schoolfriend of the new Prime Minister David Cameron and also a leading member of Cameron' s Conservative party, put himself on collision course with Cameron 's new coalition government on Monday when he spoke out strongly against its policy on banks and banking.
London is Europe's financial capital, and is one of the world's leading financial cities. The finance sector accounts for 9 percent of Britain's gross domestic product. The coalition government said it will hold an inquiry into the future of banking in the country, to report next year.
For more: British coalition gov't, London mayor on collision course over banking reforms
Germany's Merkel calls for tougher finance regulation
Hosting an international conference, Germany's Chancellor Angela Merkel pushed for much stricter regulation of international markets which she said must be the "benchmark" within Europe and that all governments must act together in showing greater budget discipline.
The meeting comes ahead of next month's G20 summit in Canada. Germany wants tougher regulation of financial markets and strict penalties for EU nations running high debts.Germany is calling for a global tax on financial transactions to help cover the cost of the crisis.At the conference in Berlin, Mrs Merkel called on all countries at the G20 summit to take action together - even if they had not suffered problems in their own economy.
The meeting comes ahead of next month's G20 summit in Canada. Germany wants tougher regulation of financial markets and strict penalties for EU nations running high debts.Germany is calling for a global tax on financial transactions to help cover the cost of the crisis.At the conference in Berlin, Mrs Merkel called on all countries at the G20 summit to take action together - even if they had not suffered problems in their own economy.
"If we are to have a global order and global governance we need to have an understanding for each other," she said.
For more: BBC News - Germany's Merkel calls for tougher finance regulationHave the Immoral Actions of Central Bankers Precipitated the Decline of the West?
"There is accumulating evidence that the Washington - Wall Street moral hazard experiment has gone disastrously wrong, and that just like any other accidental discharge of a deadly virus, the moral hazard virus is now loose and swiftly propagating throughout society. By so blatantly colluding with Wall Street, Washington has lost all moral authority, and the people now have only one place to turn: themselves.
An ethic of, "If they can do it, so can I," is spreading, as people realize that fabric of American society has been shredded and replaced by a free-for-all mentality whereby everyone must fend for oneself in order to survive. If this is so, it is a serious game changer for America. Evidence of the spread of moral hazard is noticeable everywhere. Despite government reports that the economy contracted only 1% last quarter and is now stabilizing, 13% of all home mortgages were either delinquent or in foreclosure in the second quarter, 2009, an all-time record. Credit card write-offs hover near 10%, also a record. Automobile, home equity and personal loan defaults are at or near record levels. Fiscal year 2009 federal personal tax receipts have declined 22% and corporate receipts have plunged by 57%, even though the economy has supposedly declined by only a fraction of that amount."
We have written that the current situation is analogous to the days of the Gutenberg press: Finally, people could read the Bible and see priestly untruth. Today, of course, the West's establishment religion is monetary. Think about it. Are we so wrong? The mainstream media prints the every utterance of the central banking class with breathless reverence. The miens of these bankers are often ascetic; they are portrayed as good family men, patriotic and responsible. They are priests with a vocabulary all their own - as incomprehensible, nearly, as Latin. Their expensive, bespoke, business suits are a uniform akin to investments. The gorgeous conference rooms in which they convene may be regarded as grave vestibules. Utterances, revealed in "minutes," have the resonance of commandments from on high. Regulators, media mavens and politicians are acolytes, expressing hosannas as they wish."
And so it begins. You have seen the essential immorality of the system. You have felt it deep in the gut, just the way they did once they began to read Bibles (courtesy of the Gutenberg press) 500 years ago and began realizing that the Roman Catholic Church was profoundly immoral - that its entire ethic (you can buy your way into heaven) was built on a kind of lie. Just as society is today. It's not just the culture of the West, or its promotions, or even its social organization that is finished. You CANNOT, as a society, witness a couple of guys pull a trillion out of their back pockets without feeling, well ... snookered. And after feeling snookered, something else begins to percolate. "Hey," you say, "wait a minute. I sit here with my debts and my job and my house in foreclosure and this guy - THIS GUY - throws around trillions? Wait a minute. WHEN DO I GET MINE!"
For more: Have the Immoral Actions of Central Bankers Precipitated the Decline of the West?
An ethic of, "If they can do it, so can I," is spreading, as people realize that fabric of American society has been shredded and replaced by a free-for-all mentality whereby everyone must fend for oneself in order to survive. If this is so, it is a serious game changer for America. Evidence of the spread of moral hazard is noticeable everywhere. Despite government reports that the economy contracted only 1% last quarter and is now stabilizing, 13% of all home mortgages were either delinquent or in foreclosure in the second quarter, 2009, an all-time record. Credit card write-offs hover near 10%, also a record. Automobile, home equity and personal loan defaults are at or near record levels. Fiscal year 2009 federal personal tax receipts have declined 22% and corporate receipts have plunged by 57%, even though the economy has supposedly declined by only a fraction of that amount."
We have written that the current situation is analogous to the days of the Gutenberg press: Finally, people could read the Bible and see priestly untruth. Today, of course, the West's establishment religion is monetary. Think about it. Are we so wrong? The mainstream media prints the every utterance of the central banking class with breathless reverence. The miens of these bankers are often ascetic; they are portrayed as good family men, patriotic and responsible. They are priests with a vocabulary all their own - as incomprehensible, nearly, as Latin. Their expensive, bespoke, business suits are a uniform akin to investments. The gorgeous conference rooms in which they convene may be regarded as grave vestibules. Utterances, revealed in "minutes," have the resonance of commandments from on high. Regulators, media mavens and politicians are acolytes, expressing hosannas as they wish."
And so it begins. You have seen the essential immorality of the system. You have felt it deep in the gut, just the way they did once they began to read Bibles (courtesy of the Gutenberg press) 500 years ago and began realizing that the Roman Catholic Church was profoundly immoral - that its entire ethic (you can buy your way into heaven) was built on a kind of lie. Just as society is today. It's not just the culture of the West, or its promotions, or even its social organization that is finished. You CANNOT, as a society, witness a couple of guys pull a trillion out of their back pockets without feeling, well ... snookered. And after feeling snookered, something else begins to percolate. "Hey," you say, "wait a minute. I sit here with my debts and my job and my house in foreclosure and this guy - THIS GUY - throws around trillions? Wait a minute. WHEN DO I GET MINE!"
After all, the Reformation, ultimately, was a moral reaction. Human beings, among other things, live within various ethical environments. When these are shown to be false, there is trouble brewing. We've written this over and over, that the old financial order, based on central banking, is basically finished.
For more: Have the Immoral Actions of Central Bankers Precipitated the Decline of the West?
5/19/10
Euro rebounds as Germany slaps a ban on naked short-selling
The euro rallied to stand at $1.24.1 this evening.
Germany's securities market regulator overnight slapped a ban on naked short-selling in the shares of 10 financial institutions and euro zone government bonds, a move it hoped would put an end to severe fluctuations.
For more: RTÉ Business: Euro rebounds after hitting four-year low
Germany's securities market regulator overnight slapped a ban on naked short-selling in the shares of 10 financial institutions and euro zone government bonds, a move it hoped would put an end to severe fluctuations.
Naked short-selling occurs when investors sell securities they do not own and have not even borrowed, hoping to be able to buy them back later at a lower price, thereby earning a profit. In regular short-selling, the trader borrows the security before selling it.
Aircraft Industry: Airbus Sees A380 Re-orders In 2010
“I expect repeat orders from existing customers,” says Airbus CEO Tom Enders, while not ruling out new customers coming on board. Enders spoke on the sidelines of the first A380 delivery to Lufthansa. Lufthansa is the only new airline to start using the aircraft this year; Korean Air, the next customer, is to follow in May 2010.
A380 order discussions have picked up markedly, says an Airbus official. Delivery slots are limited in the immediate future, however. One or two delivery slots may be available in 2013, although Airbus says 2014 is really the first year meaningful numbers could be delivered that aren’t already committed to customers.
For more: Airbus Sees A380 Re-orders In 2010 | AVIATION WEEK
'New Culture of Stability': Germany Forges Ahead on Reforming the Euro
The offensive now seems to have started in earnest. On Tuesday, European Union finance ministers announced efforts to both rein in hedge funds operating in Europe and to introduce a tax on financial transactions. Overnight, the German financial services regulator BaFin slapped a ban on certain types of short selling. For more: 'New Culture of Stability': Germany Forges Ahead on Reforming the Euro - SPIEGEL ONLINE - News - International
ECB Nowotny:No Inflation Danger In EMU For Foreseeable Future | iMarketNews.com
ECB Governing Council member Ewald Nowotny said Monday that he sees no inflation danger in the Eurozone for the foreseeable future, and added that the real problem is weak economic growth.
Speaking at a conference in Berlin, the Austrian central bank governor said he was astonished that there was, especially in Germany, "so much hysteria" about inflation risks.
"[Inflation] is really not the problem we have," Nowotny said. "We have a problem of too-slow growth, unfortunately, but we do not have in the foreseeable future a problem of inflation."
For more: ECB Nowotny:No Inflation Danger In EMU For Foreseeable Future | iMarketNews.comEU: by putting their financial act together ahead of Britain and US EMU is getting ahead of the curve
The Eurozone recovery continues at a modest pace, driven largely by trade with the more dynamic emerging market economies, which is expected to be boosted by the substantial recent decline of the euro's exchange rate, according to the European Central Bank's quarterly forecast survey published Thursday. In addition, a weaker euro should allow the EMU economies to export more to the dynamic emerging markets.
The ECB forecasters' survey showed that unemployment expectations were revised down 0.2 percentage point for 2010 and 2011 to 10.3%. The long-term forecast for 2014 shows unemployment easing to 8.5%, down slightly from the previous forecast of 8.6%.
ECB Forecasters Survey: EMU Recovery Continuing But Modest | iMarketNews.com
The ECB forecasters' survey showed that unemployment expectations were revised down 0.2 percentage point for 2010 and 2011 to 10.3%. The long-term forecast for 2014 shows unemployment easing to 8.5%, down slightly from the previous forecast of 8.6%.
ECB Forecasters Survey: EMU Recovery Continuing But Modest | iMarketNews.com
Kurdish Iraq: An Emerging Success - by Max Boot
Iraq has improved immeasurably since the dark days of 2006 when hundreds were being killed every day by al Qaeda bombs and Sadrist death squads in Baghdad. But terrorist bombs continue to go off intermittently, and lingering instability and ineptitude still block economic development. Indeed, the political situation has recently taken a turn for the worse, with Iraq’s political parties at a stalemate in their quest to form a new government more than two months after parliamentary elections were held.
Driving down Baghdad’s dingy streets, as I did recently as part of a delegation from the Council on Foreign Relations, one is sometimes tempted to despair. What chance is there, the visitor may reasonably wonder, that the capital of this oil-rich country will ever be truly peaceful, not to mention as luxurious as Doha, Dubai, or other boom towns to the south on the Persian Gulf?
A short trip north to the Kurdish region, where 4.5 million of Iraq’s 30 million people live, offers a different, more hopeful perspective. Known as the Kurdish Regional Government, or KRG, this area feels as safe as it gets in the Middle East. Terrorist attacks aren’t a concern. Americans can wander around without body armor or bodyguards-even if they’re in uniform. Don’t try it in Baghdad. That’s a tribute to the effectiveness of the Kurdish intelligence service, the Asayesh, and to their peshmerga troops (“those who face death”). It also has something to do with Kurdish attitudes toward the United States. There is none of the lingering resentment that is still prevalent in the rest of Iraq; Kurds are among the most pro-American people on the planet. They regularly and profusely thank American visitors for liberating them from Saddam Hussein’s murderous regime-not something one often hears from Iraqi Arabs.
There are also many sights in Erbil that you don’t see in the rest of Iraq. They include a spanking new airport that puts dinosaurs like New York’s Kennedy Airport to shame, and new shopping malls, banks, stores, homes, and hotels that would not be out of place in Europe. Erbil, the capital of the KRG, seems a world away from the rest of Iraq even though it is located only 50 miles from Mosul, the most violent city in the entire country and the only one where Al Qaeda in Iraq remains a major threat. Almost all of the development has occurred in the last few years, filling once-empty fields with modern buildings.
For more: Kurdish Iraq: An Emerging Success - CBS News
Driving down Baghdad’s dingy streets, as I did recently as part of a delegation from the Council on Foreign Relations, one is sometimes tempted to despair. What chance is there, the visitor may reasonably wonder, that the capital of this oil-rich country will ever be truly peaceful, not to mention as luxurious as Doha, Dubai, or other boom towns to the south on the Persian Gulf?
A short trip north to the Kurdish region, where 4.5 million of Iraq’s 30 million people live, offers a different, more hopeful perspective. Known as the Kurdish Regional Government, or KRG, this area feels as safe as it gets in the Middle East. Terrorist attacks aren’t a concern. Americans can wander around without body armor or bodyguards-even if they’re in uniform. Don’t try it in Baghdad. That’s a tribute to the effectiveness of the Kurdish intelligence service, the Asayesh, and to their peshmerga troops (“those who face death”). It also has something to do with Kurdish attitudes toward the United States. There is none of the lingering resentment that is still prevalent in the rest of Iraq; Kurds are among the most pro-American people on the planet. They regularly and profusely thank American visitors for liberating them from Saddam Hussein’s murderous regime-not something one often hears from Iraqi Arabs.
There are also many sights in Erbil that you don’t see in the rest of Iraq. They include a spanking new airport that puts dinosaurs like New York’s Kennedy Airport to shame, and new shopping malls, banks, stores, homes, and hotels that would not be out of place in Europe. Erbil, the capital of the KRG, seems a world away from the rest of Iraq even though it is located only 50 miles from Mosul, the most violent city in the entire country and the only one where Al Qaeda in Iraq remains a major threat. Almost all of the development has occurred in the last few years, filling once-empty fields with modern buildings.
For more: Kurdish Iraq: An Emerging Success - CBS News
5/18/10
EU Lawmakers Ok Rules For Hedge Funds,Private Equity - by Mathew Dalton
Lawmakers at the European Parliament Monday night approved new rules for hedge funds and private-equity firms, rejecting complaints that the legislation could unduly restrict European investors from using offshore funds.
The legislation passed 33-11 at the parliament's key Economic and Monetary Affairs committee. European Union finance ministers at the European Council are expected to approve their version of the legislation Tuesday night, kicking off what will likely be months of talks between the council, the parliament and the European Commission, the EU's executive arm, over a final version that will become law.
The parliament's legislation will require funds to register with European authorities. Fund managers that use borrowed money, or leverage, will have to file plans with the authorities setting limits on how much leverage they can use, and a new EU regulator would have the power to cap leverage at funds that pose "systemic" risks.
Most controversially, the legislation would effectively black-list some nations: European investors would be forbidden from sending their money to funds based in countries that lack adequate financial regulation.
EU-Digest: finally - Bravo !
5/17/10
Brain-controlled exoskeletons advance with MindWalker - by Emmet Cole
A team of European experts is working on a mind-controlled robotic exoskeleton that could enable people currently confined to wheelchairs to walk again and also help astronauts rehabilitate to Earth gravity after prolonged periods in the weightlessness of space. f perfected, MindWalker will enable people with spinal chord injuries to achieve mobility by sidestepping their spinal chord as a communications pathway to their lower limbs. And, instead of having to rely on wheelchairs or walking frames to get around, they will be supported by an exoskeleton specially designed for everyday use.
Meanwhile, astronauts returning from prolonged space trips -- trips that can cause severe bone deterioration and muscle loss -- could use the system on their return to Earth to speed up their readjustment to Earth gravity.
For more: Brain-controlled exoskeletons advance with MindWalkerAnd Now, An Actual Bull Case For The Euro
So, why might the euro stabilize and possibly rally?
Mike O'Rourke at BTIG lays out some potentially bullish facts -- most notable is the fact that the anti-euro trade is getting ridiculously crowded.
Mike O'Rourke at BTIG lays out some potentially bullish facts -- most notable is the fact that the anti-euro trade is getting ridiculously crowded.
This all sets up for a showdown this week. It is highly likely that policymakers on both sides of the Atlantic will want to drill home the point that they were serious about the package announced a week ago. If the ECB can continue to sustain the improvements in sovereign yields, the next battle ground will likely be the Euro currency. If stability is established there, it will also have a calming effect on other markets. Speculative short futures on the Euro have risen to record levels and are close to double the previous peak registered in 2008 (see chart 1). In addition, Euro speculator longs as a percentage of positions are essentially at all time lows and hedger longs are as a percentage of positions are at all time highs.
Greece mulls taking action against US banks
Greece is considering taking legal action against US investment banks that might have contributed to the country's debt crisis, Prime Minister George Papandreou said.
In the days leading up to the May 10 announcement of a loan package worth almost US$1 trillion to halt the spread of Greece's fiscal woes, European Union regulators were examining whether speculators manipulated the prices of bonds and equities and contributed to the crisis.
The Committee of European Securities Regulators said on May 7 that it was investigating 'exceptional volatility' in the markets and would work with other regulators, including the US Securities and Exchange Commission, as part of a coordinated clampdown.
For more: Greece mulls taking action against US banks - May 17, 2010US Economy: Sen. Jeff Merkley: It's Time to End Risky Gambling on Wall Street
When historians look back at the financial crisis of 2008 and the Great Recession that followed, they will fix their blame, in part, on the invention of complicated financial products that hid massive risks and spread them throughout the economy. They will record how Wall Street chased short-term gains at the expense of functioning markets, long-term economic stability and the well-being of the financial institutions themselves.
For more: Sen. Jeff Merkley: It's Time to End Risky Gambling on Wall Street
For more: Sen. Jeff Merkley: It's Time to End Risky Gambling on Wall Street
Trichet supports tougher economic surveillance in EU
ECB Bank president Jean-Claude Trichet has backed tougher economic surveillance as finance ministers prepare to debate demands from the European Commission to open their budgets in Brussels before they do so in parliament.
Amid renewed pressure on the euro, the ministers gather this evening for key meetings on the sovereign debt crisis in the single currency area.
As Greece prepares to draw down some €8.5 billion in emergency EU aid to repay a debt due on Wednesday, confrontation also looms over British resistance to new rules to regulate hedge funds.
With newly installed British chancellor George Osborne preparing to attend his first EU meeting since taking office last week, informed sources said yesterday that Spain’s presidency of the EU intended to proceed with plans for a vote on the new regulations.
For more: Trichet supports tougher economic surveillance in EU - The Irish Times - Mon, May 17, 2010U.S, U.K. show true colors by supporting hedge funds and opposing new EU Hedge Fund Rules Set for Vote in EU Parliament
A European Parliament committee may approve a proposal tonight to force hedge funds outside the EU to agree to transparency standards in exchange for a so-called passport to market to investors in the 27-nation bloc.
EU finance ministers are scheduled to vote tomorrow in Brussels on a version of the rules that would require funds to register separately in each country. Both proposals have been opposed by the United States and the United Kingdom. Spain, which holds the EU’s rotating presidency, said last week it would push ahead with the legislation without U.K. support. Spain, which holds the EU’s rotating presidency, said last week it would push ahead with the legislation without U.K. support.
For more: Hedge Fund Rules Opposed by U.S, U.K. Are Set for Votes in EU - BusinessWeek
EU finance ministers are scheduled to vote tomorrow in Brussels on a version of the rules that would require funds to register separately in each country. Both proposals have been opposed by the United States and the United Kingdom. Spain, which holds the EU’s rotating presidency, said last week it would push ahead with the legislation without U.K. support. Spain, which holds the EU’s rotating presidency, said last week it would push ahead with the legislation without U.K. support.
Hedge funds and private equity firms are under the scrutiny of lawmakers worldwide, who say they are partly to blame for the financial crisis. Then U.K. Prime Minister Gordon Brown warned in March that the EU rules may threaten the UK’s pre- eminence in the financial services industry.
“France and Germany have decided to use majority voting in the council to outvote the U.K.,” said Simon Gleeson, a regulatory lawyer at Clifford Chance LLP in London. “You generally don’t outvote member states on areas they have a particular interest in. If the finance ministers do decide to go ahead with it, then there’s not a thing the U.K. can do.”
Note EU-Digest: Its high time something gets done to shed some light on the practices of these financial con-artists. Regardless of the US and British arguments against the proposed EU rules, there is no need whatsoever to protect the Hedge Funds from public scrutiny. What is also alarming is that during the past months the Anglo Saxon financial community, their Media Network and the "Wall Street Casino Operators" have systematically undermined the integrity of the EMU and the its common currency the euro.
For more: Hedge Fund Rules Opposed by U.S, U.K. Are Set for Votes in EU - BusinessWeek
Subscribe to:
Posts (Atom)