The proposed Investment Tax

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Home»Finance»News by Sector»Banks and FinanceGerman and Italian banks should move to UK if FTT introduced, says Boris Johnson
Boris Johnson has called on major European banks to consider relocating their headquarters to London if Europe goes ahead with plans to implement a financial transaction tax.

The Mayor of London said that banks across the Eurozone were likely to flock to the UK if the European Union went ahead with the new charge, which would tax trading by financial institutions. Photo: PA
By Harry Wilson, Banking Editor
9:18PM BST 22 Jul 2013
100 Comments
The Mayor of London said that banks across the Eurozone were likely to flock to the UK if the European Union went ahead with the new charge, which would tax trading by financial institutions.

"I would advise German, Italian and Spanish banks to move their HQs here to London so that they can escape the tax on their operations around the world and as for the French, they are already here," said Mr Johnson.

The Mayor has been a critic of the measure, which has also been challenged by the British government.

Industry estimates suggest the tax could raise more than £10bn, however banks have warned that it will lead to higher trading costs for customers and less liquid markets.

Among the biggest losers could be pensioners, who will face higher charges on their funds, costing them hundreds of pounds in lost income.

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Supporters of the tax have countered that the funds raised could be used to help developing countries and support domestic welfare programmes.

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EconomyTrade and industry

Automotive Industry: ‘EU states outraged by German government’



26 July 2013

Presseurop
Süddeutsche Zeitung
Süddeutsche Zeitung, 26 July 2013

The German government, opposing a draft regulation to limit car CO2 emissions, is on the lookout for allies to help it change the legislation, reports Süddeutsche Zeitung.

The daily underlines that Berlin already managed to arrange a postponement of a vote on the text at the European Council on June 26.

Germany is seeking to protect its automotive sector, which is a large manufacturer of big saloon cars, as the industry fears the mechanisms due to be put in place to manage the transition to greener vehicles is unsatisfactory.

The postponement of the vote was widely criticised by several diplomats who point out that "it is the first time that a deal, which has been negotiated by the European Parliament, the Commission and its partners, has been questioned in this way," reports the daily quoting the officials.

[Badboy]

Have you been on the Pop again Badboy??? 

NO,THIS WAS FROM A TWEET.

[Panda]

Have you been on the Pop again Badboy??? 

NO,THIS WAS FROM A TWEET.

I meant your use of emoticons. LOL

[Badboy]

Have you been on the Pop again Badboy??? 

NO,THIS WAS FROM A TWEET.

I meant your use of emoticons. LOL

I HAVE SIMPLY INCREASED MY USE OF EMOTICONS
                                       

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Euro Jobless Rate Seen at Record Even as Recession Ends

By Jana Randow - Jul 30, 2013 12:01 AM GM


..

Euro-region unemployment probably stayed at a record high in June even as the economy emerged from the longest recession since the single currency’s creation, economists said.

The jobless rate remained at 12.2 percent last month, according to the median of 36 forecasts in a Bloomberg News survey. That would match the result for May, which was the highest since records began. Eurostat, the European Union’s Luxembourg-based statistics office, will publish the data tomorrow at 11 a.m.

The 17-nation euro economy is showing signs of emerging from its recession and resuming growth after manufacturing output unexpectedly expanded in July for the first time in two years and German business confidence improved for a third month. Unemployment will still continue to rise in the coming quarters, according to a separate survey.

“There is scope for a further moderate increase in the unemployment rate, because unemployment lags behind growth by one to two quarters,” said Marco Valli, chief euro-zone economist at UniCredit Global Research in Milan. “Given the economy is already stabilizing and will resume modest growth in the third quarter, we may see some stabilization in unemployment toward the end of the year.”

Car Market

Daimler AG, the world’s third-largest maker of luxury vehicles, forecast significant gains in second-half earnings on July 24 as the western European auto market bottoms out and new models spur demand. At the same time, Michelin & Cie, Europe’s largest tiremaker, said on June 10 that it would end production of heavy-truck tires at a factory in Joue-les-Tours, about 250 kilometers (155 miles) southwest of Paris, by the end of 2015. About 730 of the plant’s 930 employees will lose their jobs.

Volkswagen’s Seat unit said last week it reached an agreement with unions in Spain to cut working hours in order to adjust output to market conditions without firing staff. The automobile maker said workers may avoid pay cuts if they opt for training entitling them to unemployment benefits.

Spanish unemployment dropped in the second quarter for the first time since 2011. That’s lending support to Prime Minister Mariano Rajoy’s prediction of an economic recovery later this year. At 26.3 percent, the rate is still among the highest in the euro area.

By contrast, unemployment in Germany, the region’s largest economy, unexpectedly declined in June, keeping the jobless rate close to a two-decade low.

Return to Growth

In the euro area, unemployment will keep rising to 12.4 percent in the fourth quarter and average 12.3 percent next year, according to the Bloomberg monthly survey of economists. The economy, which has contracted for a record six quarters, probably stagnated in the three months through June and will return to growth this quarter, the survey shows.

European Central Bank President Mario Draghi is banking on a recovery “later in the year and in 2014,” according to his July 4 policy statement. He pledged to keep interest rates low for an extended period of time amid low inflation, a subdued economic outlook and “weaker and weaker” credit flows.

The Frankfurt-based institution in June predicted the economy will contract 0.6 percent this year before growing 1.1 percent next. The Governing Council will convene in Frankfurt on Aug. 1 for its monthly policy meeting.

“I still have a fairly pessimistic view,” said Anatoli Annenkov, senior economist at Societe Generale SA in London. “Unemployment will take some time to recover. Germany is doing very well, but we still have big numbers in southern Europe.”

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Home»Finance»EconomicsTop Fed economist slams 'incoherent' ECB
The US Federal Reserve has launched a blistering attack on the European Central Bank, calling for quantitative easing across the board to lift the eurozone fully out of its slump.

The Fed called for direct action to buy 'bundles' of small business loans, as well as 'packages of government debt' across EMU states Photo: Reuters
By Ambrose Evans-Pritchard
7:34PM BST 01 Aug 2013
97 Comments
In a rare breach of central bank etiquette, a paper by the Richmond Fed said the ECB is hamstrung by institutional problems and acts on the mistaken premise that excess debt is the cause of the eurozone crisis when the real cause is the collapse of growth, which has, in turn, spawned a debt crisis that could have been avoided.

“The ECB lacks a coherent strategy for creating the monetary base required to sustain the money creation necessary for a growing economy,” said the paper, written in July by Robert Hetzel, the bank’s senior economist.

It called for direct action to buy “bundles” of small business loans, as well as “packages of government debt” across EMU states, including German Bunds. “The ECB will have to be clear that surplus countries will experience inflation above 2pc for extended periods of time,” and must be prepared to “explain to the German public” that this is desirable.

“Most important, the ECB needs to start by recognising that Europe’s problems are more than structural. It needs to stop using monetary policy as a lever for achieving structural changes and to end its contractionary policy.”

While the paper reflects the views of the author, there is no doubt that many Fed officials feel the same way.

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The ECB brushed aside the advice on Thursday, leaving the main policy rate at 0.5pc. The decision to sit tight comes despite shrinking liquidity in the eurozone and a credit shock imported from the US, and amounts to “passive” tightening.

Mario Draghi, the ECB president, said there were signs of returning confidence after six quarters of recession, pointing to “gradual recovery in economic activity in the remaining part of the year and in 2014”.

The ECB has so far resisted calls from the International Monetary Fund and the OECD for more stimulus to ensure that recovery reaches “escape velocity”.

Long-term borrowing costs have jumped by more than 60 basis points across the eurozone since the Fed shifted gears in May and began to signal an early end to QE, aggravating the credit crunch across southern Europe.

The IMF warned last week that the tapering of bond purchases by the Fed risks reigniting the EMU debt crisis. “Recovery remains elusive,” it said.

The ECB has so far tried to counter the Fed shock by adopting a new policy of “forward guidance” and promising to keep rates low for a long time, but words alone have had little effect. Mr Draghi said the rise in yields is “unwarranted” and will be watched closely, a hint of future rate cuts if trouble persists, but it is unclear whether the German-led bloc of hawks in the ECB’s Governing Council is willing to go that far.

He may have undercut the dovish message by playing down any danger of deflation, describing the negative inflation rates in Spain, Greece and Cyprus (stripping out tax rises) as “one-off effects” or welcome adjustments in prices. “We don’t see self-fulfilling expectations of broad-based price decreases in any euro area country,” he said.

Jacques Cailloux from Nomura said the biggest worry is repayment of €1 trillion in bank loans under the ECB’s long-term lending programme. The banks have handed back roughly 60pc of the money, effectively draining liquidity from the financial system. While this is a healthy sign in one sense, it has automatically forced up borrowing costs such as EONIA rates.

“The ECB should be cutting rates to zero to offset this. We have had some improvement in confidence, and localised credit easing in some countries has helped, but it is a very open question whether this is a sustainable recovery,” he said.

The eurozone’s broad M3 money has been flat since October, far short of the ECB’s 4.5pc growth target. Business credit contracted at an accelerating rate of 1.6pc in June. Retail sales fell in both Germany and France in June, while the latest WDMA reading for Germany machinery orders showed a 7.6pc fall in foreign orders.

Optimists have homed in on the spate of good news from PMI confidence surveys, including the latest rise in the eurozone manufacturing PMI to a two-year high of 50.3. Even Italy has jumped above the “boom-bust” line of 50 as Rome pays off €40bn in arrears to contractors, a back-door form of stimulus.

Neil Mellor from BNY Mellon said the jump in PMI indices can be misleading after a long slump. “You have to take these with a pinch of salt. Europe is bumping along the bottom and there is nothing in sight to kick-start growth momentum. At the end of the day, yields in Italy are 4.4pc and nominal GDP is contracting, and that means debt dynamics are still unsustainable,” he said.

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Let rationality prevail’



2 August 2013

Presseurop
La Repubblica, Il Giornale, Corriere della Sera, La Stampa

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Struggling with Silvio. The judiciary (left) conquer President Giorgio Napolitano, PM Enrico Letta and Daniela Santanchè, an MP close to Berlusconi.
Vauro

The former prime minister exhausted the appeals process and was finally – definitively – sentenced for the first time on August 1, for tax fraud. But he may yet avoid a ban from public office, leading Italian newspapers to wonder how long his personal fate will loom over the country’s politics.

Italy’s Supreme Court has upheld the sentence of former prime minister Silvio Berlusconi to four years in jail for tax fraud on August 1, rejecting his appeal against the verdict of the two lower courts on the Mediaset case. The sentence will be commuted under an amnesty for minor offences committed before 2006 to one year to be served through community service or house arrest. The judges also ordered that the earlier decision to ban Berlusconi from public office for five years should be reviewed by a Milan court.


For “Berlusconi, the conviction is final”, headlines La Repubblica. For the daily, this sentence shows that "the civil law and the separation of powers are still in force in Italy" and it confirms the "everyone is really equal in front of the law”. In an editorial entitled "The consequences of the truth", the newspaper’s editor-in-chief argues that –


To arrive to this result - get full justice - it took 10 years of investigation, six years of trial with the route repeatedly blocked by judiciary 'monsters' created by premier Berlusconi’s own hands to help the prosecuted Berlusconi, undermining the code and the procedures and to form new ones in his own image and likeness.


In a video message released soon after the sentence, Il Cavaliere proclaims his innocence, attacks the judiciary and assures the public he will not retreat from politics but will instead reform his original political party, Forza Italia. Berlusconi’s attack is supported by his family’s newspaper, Il Giornale, which headlines that “Berlusconi, it is not over”. In a video editorial, editor Alessandro Sallusti says that


The problem is political, the problem is that the judiciary wanted to eliminate the leader of the main Italian political party. [...] We are witnessing a political sentence, of a political murder, that doesn’t concern only Silvio Berlusconi, but all those millions of Italians who have supported Berlusconi and the PdL for many years and don’t want to hand the country over to the Left.


“Berlusconi condemned: but remains in the game”, headlines Il Corriere della Sera. In the newspaper argues that –


Berlusconi's sentence cannot be considered a 'private' matter. It is on the contrary a public and political fact at top levels. It will certainly produce political consequences. For instance it will force the PdL to face the reality of its crippled leadership. […] The government's destiny is uncertain. The only way to dampen the deadly blow suffered by the Italian political system would be to follow the invitation of the head of State and to accept the reality, to trace a line in the sand, turn the page and start again.


What should be avoided now is that the country pays the bill, writes La Stampa, under the headline: “Berlusconi condemned: I don’t leave”. The newspaper notes in its editorial that for once Italians should let “rationality prevail” and ask themselves if –


we can try to get out of the crisis into which we have sunk or if we should embark on a new season of shouting, blood-letting, and electoral campaigning. […] The Court of Cassation put end, it always does, to a series of judicial twists and turns. And it certainly doesn't have to be the beginning of our end.

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Shale Gas: Brussels douses hopes of a “revolution”



28 March 2013

Presseurop
Het Financieele Dagblad


"The shale gas revolution is not feasible," headlines Dutch financial daily Het Financieele Dagblad, following the March 27 meeting of European Union environment and climate ministers.

According to the newspaper, EU Commissioner for Climate, Connie Hedegaard, and the Commissioner for Energy, Günther Oettinger, sought to dampen the enthusiasm of some member states that aim to exploit shale gas reserves, which are thought to be considerable in Europe.

Shale Gas: Brussels douses hopes of a “revolution”



28 March 2013

Presseurop
Het Financieele Dagblad


"The shale gas revolution is not feasible," headlines Dutch financial daily Het Financieele Dagblad, following the March 27 meeting of European Union environment and climate ministers.

According to the newspaper, EU Commissioner for Climate, Connie Hedegaard, and the Commissioner for Energy, Günther Oettinger, sought to dampen the enthusiasm of some member states that aim to exploit shale gas reserves, which are thought to be considerable in Europe.

While some countries such as France and Belgium have imposed a moratorium, others such as the United Kingdom and Poland have already begun exploratory drilling. The newspaper notes that the EU Commission plans to establish a political framework, at the latest by the end of the year, which will regulate shale gas extraction in those member states wishing to take advantage of their reserves.

Shale gas extraction is "controversial" because of its negative environmental impact, explains the newspaper, which goes on to quote Commissioner Hedegaard, who says —


We should not fool ourselves. This is not going to be as cheap as in the US. [...] We don't have the same wide open spaces. We pay more attention to what local people think.

In addition, compared with the United States, where the price of gas is five times cheaper, Europe has stricter environmental legislation and the geological formations are different, which is why —


experts, including, among others, the International Energy Agency, have advised the EU against relying solely on shale gas.

Shale gas extraction is "controversial" because of its negative environmental impact, explains the newspaper, which goes on to quote Commissioner Hedegaard, who says —


We should not fool ourselves. This is not going to be as cheap as in the US. [...] We don't have the same wide open spaces. We pay more attention to what local people think.

In addition, compared with the United States, where the price of gas is five times cheaper, Europe has stricter environmental legislation and the geological formations are different, which is why —


experts, including, among others, the International Energy Agency, have advised the EU against relying solely on shale gas.

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German 'wise man' says Italy, Spain could face downturn as severe as Greece

02/01/2013


Italy, Portugal and Spain could face economic downturns as severe as that of Greece within a year as the combination of austerity and recession exacerbate Europe’s sovereign debt crisis, Peter Bofinger, economist and member of the German Council of Economic Experts, told RBS.




German 'wise man' says Italy, Spain could face downturn as severe as Greece (PDF 183.4 KB)




Bofinger said struggling European economies had been smothered by "wrong policies" forcing them to narrow fiscal deficits to qualify for European Union bailout funds. In the past three years, Greece, Ireland, Portugal, Spain and Cyprus have all slashed spending and increased taxes to meet targets for external aid. Such restrictive fiscal rules mean the situation will "get worse before it gets better", Bofinger said.

"In my view, these pro-cyclical policies are putting Europe on a downward spiral that is not only affecting peripheral countries, but more and more affecting core countries," Bofinger said at a meeting with RBS clients in the German industrial city of Dusseldorf. "We should stop austerity measures until the countries reach the bottom of the economic cycle; until we can see they are back on a growth path. Only then should we talk about consolidation but not under the current conditions."

The euro area contracted 0.1 per cent in the third quarter of 2012 from the previous three months, succumbing to recession for the second time in four years. Italy's gross domestic product fell 0.2 per cent in the same period and the Spanish economy shrank 0.3 per cent, while Portugal completed its second year in recession.

Greece contracted for a 17th straight quarter in the three months to September, with unemployment at 25.1 per cent. By the end of this year, Greek output will have dropped by a fifth since it entered its recession in 2008.

Bofinger said the region is likely to experience a prolonged period of contraction and that this would spill over to countries such as France that had so far proved resilient to the region's sovereign debt crisis.

French unemployment rose to a 13-year high of 10.2 per cent in the second quarter as the economy shrank for the first quarter since 2009, before rebounding. Germany, which sells about 60 per cent of its goods and services to European Union countries, could fall into negative territory in the fourth quarter and into 2013, Bofinger said.

Bofinger said the decision by European Union budget enforcer Olli Rehn in November that Spain will not need further spending cuts and tax increases even though it will miss its deficit targets is an encouraging sign that fiscal policy may take a new direction. However, he believes that any changes will come too slowly to help struggling eurozone countries return to economic growth.

"The recession makes the situation of the banks worse, the situation of government financing worse and, in my view, it doesn't contribute to better competitiveness," Bofinger said. "Some economists believe that we have to go through short-term pain for long-term gain, but in such a recession a lot of production potential is also destroyed."

Disclaimer

The statements and opinions expressed in this article are solely the views of Peter Bofinger speaking at an RBS Insight Event in Dusseldorf on November 13 2012 and do not necessarily represent the views of the Royal Bank of Scotland

The contents of this document are indicative and are subject to change without notice. This document is intended for your sole use on the basis that before entering into this, and/or any related transaction, you will ensure that you fully understand the potential risks and return of this, and/or any related transaction and determine it is appropriate for you given your objectives, experience, financial and operational resources, and other relevant circumstances. You should consult with such advisers as you deem necessary to assist you in making these determinations. The Royal Bank of Scotland plc, The Royal Bank of Scotland N.V or an affiliated entity ("RBS") will not act and has not acted as your legal, tax, regulatory, accounting or investment adviser or owe any fiduciary duties to you in connection with this, and/or any related transaction and no reliance may be placed on RBS for investment advice or recommendations of any sort. RBS makes no representations or warranties with respect to the information and disclaims all liability for any use you or your advisers make of the contents of this document. However this shall not restrict, exclude or limit any duty or liability to any person under any applicable laws or regulations of any jurisdiction which may not lawfully be disclaimed. RBS and its affiliates, connected companies, employees or clients may have an interest in financial instruments of the type described in this document and/or in related financial instruments. Such interest may include dealing in, trading, holding, or acting as market-makers in such instruments and may include providing banking, credit and other financial services to any company or issuer of securities or financial instruments referred to here.

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Francois Hollande: France will not help David Cameron with EU reforms
David Cameron has been privately told by the French president that his country will not go out of its way to help him win key “reforms” of the European Union ahead of a referendum on UK membership.

David Cameron and French President Francois Hollande talk at the end of their meeting in Washington. Photo: REUTERS
By Patrick Hennessy, and Harriet Alexander
10:00PM BST 03 Aug 2013
327 Comments
Francois Hollande has warned the Prime Minister that France will not agree to concessions being made by the rest of the EU just to help his own domestic “agenda,” The Sunday Telegraph has learned.

Mr Hollande’s tough stance, spelled out privately in the “margins” of official meetings in Paris, Brussels, Northern Ireland and elsewhere - is an opening play in a high-stakes game of diplomatic poker.

Nevertheless, it represents a big obstacle for Mr Cameron to overcome as he plots his EU strategy for the next few years.

After coming under pressure from Conservative Eurosceptics, Mr Cameron pledged an “in/out” referendum by the end of 2017, following a major drive to reform the EU which would see the terms of Britain’s membership renegotiated and powers returned to the UK from Brussels.

The Prime Minister is understood to be counting on the help of Angela Merkel, the German Chancellor, to push reforms through but any opposition from France, one of the EU’s key power players, will make the process considerably harder, if not impossible.

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According to high-level French sources, Mr Hollande has also privately warned Mr Cameron he is taking a major “risk” in promising an “in/out” referendum because this could easily backfire and result in Britain voting to leave the union, an outcome which would almost certainly force the Prime Minister’s resignation.

In public, Mr Hollande has suggested the two countries have disagreements on the future of the EU but has stressed the need to find “common ground”.

His private interventions will be of much greater concern to senior figures at No10 and represent the first major signal from an EU head of government that Mr Cameron’s strategy faces extremely serious challenges.

The Sunday Telegraph has learned that Mr Hollande, a socialist, who was elected president last year, has drawn comparisons of Mr Cameron’s move with the effort by Jacques Chirac to win approval through a referendum in France for the proposed EU constitution in 2005.

Mr Chirac, a Gaullist, thought he would win the vote after initial opinion polls showed the French public was two to one in favour. There was no constitutional necessity to hold a referendum, which could have been ratified in France with a parliamentary vote.

In the end, however, voters both in France and Denmark voted 'no’ in referendums, causing the constitution to be abandoned. Most of its proposed measures came in through the Lisbon Treaty in 2009.

A highly placed French source said: “Referendums are major gambles which can backfire, as they did with Chirac and the constitution. Francois Hollande has warned David Cameron in private about the risks he is taking here.

“We do not want the UK to leave the EU. We understand the reasons why you are not in the eurozone or part of Schengen [the agreement allowing most EU citizens to cross national borders without passport checks], but the UK actually outside the EU is unthinkable.

“We know why Cameron is promising to campaign for change - he has to because of his problems with his own party and his domestic agenda. But Francois Hollande has made it clear to him that France will not agree to anything that does not suit France’s interests.”

Mr Hollande, like other EU leaders, fears that if Mr Cameron is not able to offer the British public credible evidence that he has secured a package of reforms and the repatriation of significant powers, voters will opt to leave the EU in a referendum.

The French president’s warnings can, however, be interpreted merely the opening hands of the high-stakes poker game, involving countries both inside and outside the EU, which will last right up until a referendum takes place.

Last month Japan warned Britain it must stay in the union, suggesting tens of thousands of jobs would otherwise be lost because the UK would be outside the single market and that companies investing in Britain and exporting the to the EU would have to pay tariffs.

Tokyo delivered its warning in a submission to the Foreign Office’s current review of the “balance of competences” between Britain and the UK, sections of which have already been published.

Mr Cameron’s strategy has helped win round the broad base of Tory Eurosceptics, a grouping which has staged a series of big Commons rebellions over Europe since the formation of the coalition in 2010.

Conservative MPs have also been encouraged by Tory ministers throwing their weight behind a bill introduced by James Wharton, a backbencher, to enshrine the referendum pledge in law.

However, the issue is causing renewed strains for the coalition, with Nick Clegg accusing Mr Cameron of a “retreat” over Europe which is damaging Britain’s “bulldog” spirit.

The Deputy Prime Minister said at a Westminster news conference last week: “You don’t reform in my view by stamping your foot and saying 'unless we get something back we’re going to leave altogether.”

Figures last week showed Britain’s net contribution to the EU went up by nearly 13 per cent last year. The gap between what the country paid to Brussels and what it received went up to £12.23billion in 2012 from £10.83billion in 2011 - the lowest “return” for the UK in 10 years.

Mr Cameron’s relationship with Mr Hollande, while perfectly civil, is not thought to be as close as was the case between the Prime Minister and Nicolas Sarkozy, Mr Hollande’s predecessor.

At a joint news conference with Mr Cameron in Paris in May, the president underlined the different approaches towards the EU taken by the two countries, declaring: “We are also determined to press forward with Europe, each in our own way, but with the same idea of flexibility and freedom.

“France is in favour of further integration of the eurozone: I’ve made proposals. The United Kingdom is developing a more original position which David Cameron will uphold. But what matters is for us to be able to find common ground on every essential issue.”

Chris Heaton-Harris, the Conservative backbench and co-founder of the Fresh Start Group of Eurosceptic MPs, said: “As President Hollande fights for the French interest in the EU, it is right that our Prime Minister fights for British interests.

“France is in the Eurozone and her needs are diverging from ours. Now is exactly the right time to renegotiate a better settlement for the UK in the EU and if the French don’t like it - well, c’est la vie.”

[Badboy]

READ A TWEET TODAY ABOUT SOMEONE GOING TO GREECE,SOME MONEY HAS BEEN SPEND ON NEW MOTORWAY.
IN THE MANI AREA,PEOPLE HARDLY NOTICE THE CRISIS.
THE MESSAGE IS COME TO GREECE,YOU ARE WELCOME.

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Good for Greece Badboy .!!1 There are those who say the crisis has been handled badly and the austerity measures too strict when the world is in recession. It is rumoured that Ireland, Italy, Spain and Cyprus are also in dire straits and vulnerable.

[Badboy]

THERE WERE ALSO LOTS OF NEW CAFES/RESTAURANTS,ENTRERPEURISM(SP?) SEEMS TO BE THE NEW NORM IN GREECE.
SOUNDS AS IF THE GREEKS COULD TEACH US A FEW THING ABOUT GETTING ON WITH THINGS.

[Panda]

THERE WERE ALSO LOTS OF NEW CAFES/RESTAURANTS,ENTRERPEURISM(SP?) SEEMS TO BE THE NEW NORM IN GREECE.
SOUNDS AS IF THE GREEKS COULD TEACH US A FEW THING ABOUT GETTING ON WITH THINGS.

Don't forget it is the Tourist Season in Greece, which is still a popular Country to visit. Unemployment is still very high.

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Greek crisis: Brussels too optimistic over recovery



5 August 2013

Presseurop
Eleftherotypia
Eleftherotypia, 5 August 2013

"The troika's 10 mistakes and the 3+1 contradictions of the European Commission in designing the bailout," headlines the Sunday edition of Greek daily Eleftherotypia. The article is meant to respond to the barbed criticism by international creditors regarding delays in the implementation of reforms to Greece's economy demanded in exchange for providing financial aid.

Among the "mistakes" committed by the troika of the European Central Bank, the European Union and the International Monetary Fund, the paper reports they –


favoured the bailout, not of Greek banks, but of French and German ones; [...] relied on the discredited political class and rejected the new emerging political force, Syriza; [...] put the cart before the horse (austerity without reform); and underestimated the depth of the recession, which caused wage misery and the destruction of the middle class – the spinal cord of social cohesion in Greece – [and] recapitalised the banks without requiring them to clean up their balance sheets.

As for the Commission's "contradictions" Eleftherotypia notes in particular that in a recent report on economic forecasts for 2014, Brussels mentions a "significant improvement in the country's economic climate". Yet, says the paper, the presumed optimism of the Greeks is not sufficient to kick-start the economy, and adds that


the index of confidence in the economy fell in June and July, [bank] deposits are not rising while the stock market is attempting to rally after a sharp decline in May-June and is now at the same level as at the beginning of the year, meanwhile the rate for 10-year Treasury bonds remains at about 10 per cent.

In conclusion, says Eleftherotypia, to consider the rise in May tourism income as a springboard for recovery is a way of ignoring the reality that the remainder of the economy that is suffering from austerity measures. In fact, stresses, the paper,


the Greek bailout only works if the whole of Europe is reformed.

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Corruption in Europe: Dark days for democracy

The day Silvio Berlusconi was convicted in Italy of tax evasion, Spanish PM Mariano Rajoy was forced make a speech before parliament over claims he received under-the-counter bonus payments. These affairs are poisoning the continent's political life, writes Le Monde.

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IMF to Disburse 1.7 Billion Euros to Greece After Loan Review

By Sandrine Rastello - Jul 29, 2013 9:25 PM GMT+0100.
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The International Monetary Fund’s board approved the release of 1.72 billion euros ($2.3 billion) to Greece (GDBR10), helping replenish the country’s coffers through German elections in September that will help set the course of Europe’s crisis response.

“The Greek authorities have continued to make commendable progress in reducing fiscal and external imbalances,” IMF Managing Director Christine Lagarde said in a statement today. “However, progress on institutional and structural reforms, in the public sector and beyond, has still not been commensurate with the problems facing Greece. Greater reform efforts remain key to an economic recovery and lasting growth.”

Greece received IMF approval three days after obtaining the release of 2.5 billion euros from euro-area governments under their joint rescue package. One of the conditions was to push forward with a plan to put 4,200 state employees on notice for dismissal, which the Greek Parliament adopted last week.

With Greek 10-year bond yields six times Germany’s almost four years after the European debt crisis flared in Athens, the country is still relying on its international creditors. Greece’s financial fate has also become entwined with German politics, as Chancellor Angela Merkel campaigns for a third term on the promise that Germany won’t write off any of the loans made to Greece since the debt crisis broke.

That contrasts with repeated warnings by the IMF, which has said Greece’s debt level remains a risk to its recovery and suggested last month that the country may require faster debt relief from its European creditors.

Greek Debt

The Greek debt burden is almost double the average of the 17-nation euro area, according to the European Union’s statistics office on July 22. First-quarter debt stood at 160.5 percent of gross domestic product.

Lagarde today reiterated that support from Europe to reduce Greece’s debt to “substantially below 110 percent of GDP by 2022” is welcome.

“Their continued commitment to provide adequate financial support to Greece during the life of the program and beyond until the country has regained market assess, provided that Greece complies fully with the program, remains essential,” Lagarde said.

Separately, the fund insists on seeing a 12-month guarantee of Greece’s financing in order to continue with its own lending, and a 3.8 billion-euro gap is expected in 2014. In a report it released last month, the fund pointed out 4.6 billion euros of yet-to-be identified financing for the bailout.

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Europe’s Immigration challenge (3/5):
Britain is slamming its doors on the world


13 August 2013
Financial Times London

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On the placard: “Down with Europe and immigrants”. The observers: “When all is said and done, they sound like us.”
Patrick Chappatte

A champion of the liberal, open international system is redefining itself as a resentful victim.

Philip Stephens

Stop the world. Britain wants to jump off. The 2012 Olympics were a glorious celebration of diversity. London presented itself as an unrivalled global hub. The local heroes of the games – athletes such as Mo Farah and Jessica Ennis – testified to a new, expansive view of Britishness. That was then.

A year on, the nation’s politics echo to the sound of doors slamming shut. The message to foreigners is depressingly simple: stay away. David Cameron’s Conservatives promise a referendum that could lead to Britain breaking off engagement with Europe. There was a time when these Tory sceptics presented a choice: give up Europe and look to the world. No longer. The barricades are being thrown up against all and sundry. Tourists, students, business executives – all are would-be illegal immigrants.

The message? Illegal immigrants should “go home or face arrest”

The other day, the Home Office, the department responsible for border controls, gave a glimpse of the nasty populism driving government policy. Trucks with billboards were deployed to London’s ethnically diverse areas. The message? Illegal immigrants should “go home or face arrest”. The Liberal Democrats, the junior party in Mr Cameron’s coalition, protested that the initiative was stupid and offensive. Unmoved, the prime minister’s office said the campaign might well go nationwide.

The Home Office also plans to require visitors from “high risk” countries to pay a £3,000 cash bond to enter Britain. The aim, so it says, is to deter “overstaying” and to recover costs if visitors require healthcare. The countries chosen are India, Nigeria, Kenya, Pakistan, Sri Lanka and Bangladesh. It has not escaped their attention that predominantly “white” nations such as the US, Canada, Australia and New Zealand are exempt.

Closer to home, the government is promising to restrict the access of Romanians and Bulgarians. Nationals from these EU states gain free movement across the union when transitional restrictions expire next year. Britain’s tabloid press is already full of horror stories about hordes of “benefit tourists”. Never mind that migrants are less likely to claim welfare than Brits.

[Badboy]

IT IS BEING SAID THAT GREECE MIGHT NEED ANOTHER BAILOUT OR TWO BY END OF YEAR.

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IT IS BEING SAID THAT GREECE MIGHT NEED ANOTHER BAILOUT OR TWO BY END OF YEAR.

I wouldn't be surprised Badboy but doubt the Bundesbank would lend any more money, the IMF is critical of Christine LaGarde bailing out so many EU Countries and it might prove easier to let Greece default.

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In Berlin, bitcoins readily replace the euro



22 August 2013
Linkiesta Milan

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A pub front in Berlin, in April 2013
Sean Gallup/Getty Images

More stores in the German capital are accepting bitcoin payments, the cyber currency until recently used primarily for online purchases. Its success lies in disgruntlement with conventional banks due to the crisis but also due to genuine financial advantages.

Laura Lucchini | Valerio Bassan

Graefekiez, Berlin, August 2013. As it does every Tuesday, the canal echoes with the tell-tale sounds of the Turkish market. Berliners ambling between the stalls succumb to irresistible last-minute offers. Mikaela buys a kilo of fish – "€3" announces a placard – and pays in cash, from hand to hand. No receipt, no cash register. The transaction leaves no visible trace, other than the bag full of glistening fish that Mikaela takes with her.

Two hundred metres further south, in the same district, Brand treats himself to a latte macchiato at Floor’s Café. When it comes time to pay, he pulls out his smartphone, takes a picture of the quick response code (QR code) that appears on the screen, types in a code, clicks "OK", and leaves. He has left no trace of payment – or not much. A software application has transferred money from his on-line account to the café's and the transaction appears in the blockchain – a ledger which records the transactions in chronological order. Brand, 32, did not need a credit card or a bank account. The transaction data is kept secure by the blockchain, protected by rigorous encryption codes that bar anyone from accessing or modifying the amount, the provenance or the destination.

This is the bitcoin miracle, the cryptocurrency that is flourishing here, in Berlin-Kreuzberg. Nearly 25 shops – most of them cafés, but also hotels, restaurants, small electronics firms and office supply stores – accept this virtual currency launched in 2009 by an anonymous hacker known as Satoshi Nakamoto.

The exchange rate of the cryptocurrency is currently very high with one bitcoin worth €78

The exchange rate of the cryptocurrency is currently very high with one bitcoin worth €78, that means a coffee costs only 0.02 bitcoins. On paper at least, it can be used to purchase anything – housing, cars, computers or clothes. Although it fulfils all the criteria to be considered a currency, as was recently recognised by Texas judge Amos Mazzant, the bitcoin is nonetheless free of all control by governments or central banks. This is starting to raise concerns, especially because its use is becoming more and more widespread.

Currency of the future?

Sitting on his white Vespa in front of Floor's, Brand explains briefly how the bitcoin system works. According to him, it is a responsible choice such as buying an environmentally-sustainable product rather than a polluting low-cost one. With his smartphone in his right hand, he opens the EasyWallet application – he then just needs to take a photo of the QR code in the café, insert the amount required, click on OK and the payment is made. "I pay in bitcoins at least two times per day, for lunch and for a coffee. I don't know if the bitcoin is the currency of the future, but it will certainly be those currencies that rely on internet-based technology that will dominate. Perhaps there will be several but I have the impression that it is an inevitable change," he says.

Florentina Martens is the owner of Floor's Café. Of Dutch origin, the 26-year-old former student at Berlin's art school launched her small food service enterprise and wholeheartedly supports the bitcoin. For her, it all started when she was a waitress in a nearby bar that allowed the use of the alternative currency. "At first, it almost bothered me, I didn't fully understand how it worked and when someone wanted to pay in bitcoins, I got flustered," she says. Later, when she decided to open her own café, she was convinced by her neighbours, obtained some information on the system and decided to accept payments in a currency that a short time before she had considered a chore. Some software and a QR code, that is all the client needs. For now, Florentina has not converted her bitcoins into euros. Everything she earns in bitcoins, she spends for herself in the neighbourhood.

At first clients wanting to pay in bitcoins were rare. But today she has some everyday that use it to pay for a coffee, a slice of cake or a sandwich. "They are not 'nerds' sporting glasses and ponytails. And there are as many men as women, most of them young with alternative life-styles," she says. For her, as with most of the other "bitcoiners" interviewed by Linkiesta, the primary motivation is a disgruntlement with private banks and with the monetary policies of central banks in general, which came to maturation during the crisis. Because it is "decentralised", the alternative currency, as well as being trendy, is seen as closer to the consumer,

It is no accident that this experiment is taking place in Graefekiez

It is no accident that this experiment is taking place in Graefekiez, a district of modest size, with an atmosphere and an economic structure all of its own. The story begins at Room77, "a restaurant on the fringes of capitalism," which, in early 2012, offered its clients "warm beer, cold women and fast food served in slow motion," according to a sign on the door. The owner, Joerg Platze, a German of American origin (his father was a Texan), became a kind of evangelistic booster for the cyber currency. It is thanks to him that a large part of the shop-keepers in the district today use "We accept bitcoin" stickers. "For me, it is first and foremost a practical question: it is very quick and more economical," he argues. Unlike a credit card, for example, the transaction generates no fees. Joerg Platze managed to convince other tradespeople, such as an old electrician, a neighbour of Room77, who installed the software last week and has just posted the bitcoin sticker on his door. Although none of his customers have yet asked to pay in bitcoins, he will be prepared when they do.

Decentralised currency

A hotel school graduate and formerly employed in the food service industry, 41-year-old Cassandra Wintgens is the owner of the "Lekkerurlaub" guesthouse. The bitcoin system fits in with her concept of alternative hotels, consisting of affordable rooms, organic food, Wifi access and using a currency that does not transit through a bank. "Our first guest arrived in May. He told us that he had read that it was possible to pay in bitcoins and it was for that reason that he booked a room with us," she says. A single room costs 0.52 bitcoins, or €40 while a double costs 0.85 bitcoins or €65. The guesthouse's invoices already provide for payments in bitcoins. These will have to be converted into euros at the end of the year for inclusion on her tax form, as her accountant has explained.

Far from the heavenly situation in Graefekiez, reality seems a bit different. The cyber currency is already present on the financial markets but the absence of a central bank to monitor it makes the exchange rate highly volatile – a situation which is as frightening to some as it is attractive to the adventurous investor. Phylax is a German financial consulting firm that offers its clients technological assistance. In recent years, it has specialised in the bitcoin payment system. "We began to get interested in bitcoins two years ago and we found that it was an interesting experiment. We were won over by the idea of a decentralised currency, without a central bank of reference, where each one is involved in the process of creating a new currency," explains Phylax CEO Fridhelm Schmitt. At the time, the bitcoin was worth €2 and Phylax saw the potential – the company bought bitcoins for €8-10 and sold them all for between €45-85. The volatile nature of the exchange rate triggered the sale.

It may be that people confuse scam with risk

According to calculations made by Phylax, a "reasonable" rate would currently be €45 per bitcoin. "I understand all the concerns that this experiment raises. It is true that one can lose huge amounts of money today with the bitcoin [by speculating on the financial markets]. But it is not a scam, it is a real currency. It may be that people confuse scam with risk, which is a characteristic of the market," Schmitt argues. The main risk, he says, is that "someday" it will be counterfeited, but adds, "Many studies are currently examining this scenario, but today, counterfeiting is impossible.

On the web
Original article at Linkiesta it
Huffington Post article fr


Taxation

Bitcoins to be taxed in Germany

"The news has been a bombshell in the alternative scene," announces the Huffington Post following the recognition by Germany of the bitcoin cryptocurrency as an official currency.

“Will Greece receive the next tranche of aid in bitcoins instead of euros?" the site asks. The decision, it explains, is due to "the massive increase in its value" and not to "a sudden burst of flexibility on the part of German monetary policymakers." Indeed, “official currency” is tantamount to “taxable”


So far, transactions in bitcoins have escaped the tax man. [From now on] the gains coming from a sale in bitcoins will be hit by a 25 per cent tax on profits. [...] Companies will have to integrate a VAT rate on all their dealings in bitcoins.

The Huffington Post adds that this means –


this alternative currency, so dear to hackers, will lose some of its rebellious stamp...

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EUROPEAN Union officials sparked anger yesterday over plans to ban packs of 10 cigarettes.



By: Martyn Brown
Published: Mon, August 26, 2013









0Comments


Nigel Farage: Least well off will be affected

Menthol and “slim” cigarettes also face being outlawed by Brussels in an attempt to make smoking less attractive to young people.

The controversial diktat puts the EU on a collision course with governments across the continent, millions of smokers and business leaders, many of who are backing the Daily Express crusade to get Britain out of the EU.

Cigarette firms argue it will force smokers on to the black market and cost the Treasury in lost tax revenue.

Japan Tobacco International, owner of Silk Cut and Benson & Hedges, said more than 50 per cent of cigarette pack sales in the UK will be hit by the proposed legislation, aimed at reducing the 700,000 deaths across Europe each year from tobacco-related illnesses.

Paul Williams, head of corporate affairs at JTI UK, warned that Britain risks “sleepwalking” into a situation where Europe will impose legislation “even more severe” than the Government’s plans for plain packaging, which were abandoned last month.

New rules on cigarette sales will be debated by the European Parliament on September 10 and could begin as early as 2016.

Cigarette firms say ban will force smokers on to the black market


This is part of a wrong-headed drive that will penalise the legal pleasures of the least well off

Nigel Farage

European legislators propose to outlaw the sale of cigarettes in packs of 10, which account for 38 per cent of packs sold in the UK.

Menthol and “slim” cigarettes would also be banned, while leaf tobacco would only be available in larger packs of at least 40 grammes. Currently, 92.2 per cent of leaf tobacco sold in the UK is in smaller packs of 25g and 12.5g. E-cigarettes would also be subject to stricter rules.

Ukip leader Nigel Farage said: “This is part of a wrong-headed drive that will penalise the legal pleasures of the least well off. The net result will be an increase in sub-standard counterfeit and smuggled tobacco, which will have obvious negative health outcomes. Let alone a deliberate reduction in personal freedom, that is a matter of course from Brussels.”

The directive could also cost the Treasury £800million in lost revenue.

Ronan Batty, EU regulatory affairs manager at British American Tobacco, warned: “There’s an enormous risk.

“Just take menthol, if almost a million smokers [in the UK] wake up one morning and they can no longer buy their preferred product in the shop, there’s a massive opportunity created for criminals and illegal traders to step in and meet the demand that the legal market can no longer supply.”

A spokesman for Philip Morris International, owner of the Marlboro brand, said the directive “prohibits products that account for 10 per cent of the EU cigarette market, despite the fact that there is no credible scientific evidence that these products are more harmful than others”.

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Britain to be roped into EU rescue aid for Greece
The European Commission is planning use of EU budget funds for the next rescue of Greece, roping Britain into future responsibility for shoring up the eurozone currency structure.

The Greek daily Kathimerini said Athens and Brussels are negotiating the use of EU structural funds that draw on the collective EU budget, co-funded by the British taxpayer and other non-euro states. Photo: EPA
By Ambrose Evans-Pritchard
8:00PM BST 25 Aug 2013
156 Comments
Günther Oettinger, Germany's EU commissioner, said on Sunday that a third package worth over €10bn will be needed in 2014 and will partly come in the form of direct help rather than a debt haircut for existing creditors.

The Greek daily Kathimerini said Athens and Brussels are negotiating the use of EU structural funds that draw on the collective EU budget, co-funded by the British taxpayer and other non-euro states.

Most of the rescue aid so far for Greece, Portugal, Cyprus, and Spain's banking system has come from the eurozone's rescue machinery, outside the EU treaty structure. Britain has provided bilateral aid to Ireland, and is involved in EMU debt rescue policies through the International Monetary Fund, but has otherwise stood aloof.

Use of EU budget funds appears not to be targeted against the British government but would have the effect of drawing Britain into the morass, compelled to spend scarce resources perpetuating an EMU policy that many view as deeply misguided. It would also set a precedent that may be extended to Portugal if it need fresh help, and possibly larger countries if Europe's recovery falters.

The Greek crisis has become a hot theme in Germany's elections, with opposition leaders accusing Chancellor Angela Merkel of hoodwinking the nation about the true costs of holding the euro together.

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Mrs Merkel said on Sunday said that extra help for Greece might be needed in 2014 but said another debt restructuring is out of the question. "I warn emphatically against further debt haircuts. It could set off a domino effect and once again shatter investor confidence in the eurozone," she said

Analysts said the claims are a smokescreen to disguise the real concern that further debt relief in Greece must come from the EMU bail-out funds, inflicting losses on taxpayers in creditor states for the first time. This would require a line-item in Germany's budget and cause a storm in the Bundestag.

Professor Bernd Lucke. leader of Germany's anti-euro party AfD, was attacked by Left-wing radicals over the weekend, one carrying a knife. Prof Lucke said the assault smacked of the "Weimar Republic" where political disputes were settled by "storm troopers" on the streets.

Manfred Güllner, head of the polling group Forsa, said AfD may soon may soon break out above its 2pc to 3pc support level, crossing the 5pc line needed to win seats next month. This would scramble the elections and create an anti-euro voice in German politics that could scarcely be ignored.

"For a long time I thought they had no chance, but I am not so sure any longer. A lot of people out there, speaking very loudly, who say they think they're are being expropriated by the state. This need watching very closely," he said.

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Finland Limps Down Road to Euro Treaty Failure

By Kasper Viita - 2013-08-26T09:27:11Z.
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Finland is sliding down a recession-greased slope and risks building up more debt than euro-zone members are allowed to have.

As early as 2015, Finland “won’t really have the means” to keep debt below the 60 percent threshold of gross domestic product allowed in the euro area, according to Pasi Holm, managing director at Helsinki-based PTT Research Institute.





Enlarge image









Pedestrians pass a giant smartphone in the window display of a Nokia Oyj store in Helsinki. The recession Finland sank into last year will continue through 2013, according to a Bloomberg survey of 11 economists. Photographer: Henrik Kettunen/Bloomberg
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“Economic growth would help, but there’s none to be seen,” Holm said in an interview.

The recession Finland sank into last year will continue through 2013, according to a Bloomberg survey of 11 economists. The development threatens to deplete government revenue and make it more difficult for the nation to live up to Europe’s budget rules, Holm said. Prime Minister Jyrki Katainen, who says Finland’s AAA is at risk, is meeting with lawmakers and industry groups today to design a roadmap out of the country’s economic and fiscal plight.

“If adequate structural reforms aren’t made and if we don’t get a wage deal that improves our competitiveness, then we are running a great risk of losing our credit rating,” Katainen said on a radio channel of the national broadcaster YLE yesterday. “That would mean that government debt yields would begin to rise.”

Katainen’s six-party coalition said on Friday the 2013 budget deficit will be 1.2 billion euros ($1.6 billion) wider than previously estimated, at 9 billion euros, as Finland’s economic contraction cuts into government income.

Negative Returns

The yield on Finland’s benchmark 10-year bond rose two basis points on Friday to 2.21 percent, its highest in at least a year. Finnish government debt longer than one year has delivered investors a 2.7 percent loss this year, according to Bloomberg/EFFAS indexes. By contrast, bonds sold by the government of Spain yielded a positive return of 7.8 percent in the same period. Finland’s 10-year yield traded at about 2.2 percent as of 12:14 p.m. in Helsinki today.

“We need specified structural reforms with schedules that are committed to,” Holm said.

The Treaty on European Union, also known as the Maastricht Treaty after the Dutch town it was signed in, outlined the criteria that prospective and existing euro members are supposed to fulfill. The treaty requires governments to keep deficits within 3 percent of GDP and debt below a 60 percent threshold.

“These limits are important psychologically, they act as alarm bells to credit rating companies and others,” Holm said.

Failed Austerity

Finland has been one of the few nations to comply with the Maastricht rules, even when its economy contracted more than 8 percent in 2009. It’s the only remaining euro member to receive a stable AAA grade from the three major ratings companies. Katainen has said any policy steps he takes will be designed to safeguard the nation’s top credit rating.

“Finland has lost competitiveness for a long time,” Katainen said today. “Recognizing the facts must lead to corrective action. Time won’t solve our problems.”

The finance ministry said in June its debt-to-GDP ratio will grow to 59.9 percent in 2015 from 57.1 percent this year. The average debt ratio in the euro area increased to 92.2 percent in the first quarter, Eurostat said on July 22.

Finland’s failed attempts at austerity are to blame for its debt growth, according to Timo Tyrvaeinen, chief economist at Aktia Bank Oyj. The Nordic nation, which has struggled to rebound from the decline of flagship companies such as Nokia Oyj (NOK1V) as well as its paper industry, will “undoubtedly” breach the 60 percent debt ceiling at some point, he said.

‘Hung Up’

“Katainen’s government has perhaps hung up too much on the thought that a AAA rating can only be preserved by cutting spending and increasing tax revenue,” Tyrvaeinen said by phone. “Should our government announce that they’ve learned from austerity and chosen a different path, the Anglo-American market could well applaud such acumen.”

Katainen’s government will this month look into reform proposals backed by Finance Minister Jutta Urpilainen, who has pledged to strike an accord on a structural overhaul of the economy by the end of the year.

“It’s impossible for me to think that no significant decisions would be made,” Tyrvaeinen said. “In order to keep the markets’ confidence, we need the structural reforms.”
==================================

This is serious, Finland was considered solvent and is yet more evidence of the Euro being unfit for purpose.

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