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by In Wales (inwales aaat eurotrib.com) on Thu May 10th, 2012 at 05:32:57 PM EST
Greece takes 'first step' towards forming government - GREECE - FRANCE 24

AP - Hopes rose slightly Thursday that Greece could end its post-electoral deadlock without having to hold new elections, as international partners warned that Athens must stick to its hugely unpopular austerity program or abandon the euro.

Socialist leader Evangelos Venizelos, who received the presidential mandate to try and form a government after two other party chiefs failed, said a meeting Thursday with a left-wing potential kingmaker had proved encouraging.

by In Wales (inwales aaat eurotrib.com) on Thu May 10th, 2012 at 05:40:21 PM EST
[ Parent ]
Sarkozy allies mull risky entente with far right - FRANCE - FRANCE 24
Faced with the likelihood of losing its majority in next month's parliamentary elections, France's centre-right Union for a Popular Movement (UMP) is being forced to do some soul-searching. Still stinging from defeat in Sunday's presidential poll, many UMP lawmakers will likely have to make a difficult choice between honouring the established tradition of blocking the far-right in elections and the threat of losing their seats in parliament.
by In Wales (inwales aaat eurotrib.com) on Thu May 10th, 2012 at 05:41:19 PM EST
[ Parent ]
Just for German banks, not including the Greek indirect bailout.

Any ideas?

by rootless2 on Thu May 10th, 2012 at 08:40:42 PM EST
[ Parent ]
Keyword: SoFFin.

guaranteed to evoke a violent reaction from police is to challenge their right to "define the situation." --- David Graeber citing Marc Cooper
by Migeru (migeru at eurotrib dot com) on Fri May 11th, 2012 at 02:08:16 AM EST
[ Parent ]
The last SoFFin numbers:

guarantees: 11,2 billion

capital:   19,8 billion

http://www.fmsa.de/de/fmsa/soffin/instrumente/massnahmen-aktuell/index.html

But that isn't everything. I already mentioned the states and the rescue of IKB pre SoFFin did cost 10 billion.

A lot is unknown yet. FMS Wertmanagement, the bad bank of HRE, is listed here with only 3 billion. It is sure the losses of the bad bank will be higher, but of course nobody knows how much higher.

by IM on Fri May 11th, 2012 at 03:34:39 AM EST
[ Parent ]
Difficult. To SoFFin on the federal level you have to add the recapitalization of the state banks by the states: North-Rhine Westphalia and WestLB, Hamburg and Schleswig-Holstein and HSH Nordbank, Bavaria and BayernLB, Baden-Württemberg and LBBW.

The Bundesbank said in April 2011:

>This sharp rise in debt reflects extensive measures to stabilise the financial market of €241 billion chiefly in connection with the FMS Wertmanagement resolution agency (HRE) and the First Winding-Up Agency (WestLB). According to the current provisional figures, the cumulative impact of financial market support measures on the debt level since 2008 amounts to €335 billion, or 13.4% of GDP. Growth in debt contrasts with the assumption of extensive risk assets. Assuming the assets can be realised over time, this will result in a decline in the future debt level.<

http://www.bundesbank.de/download/presse/pressenotizen/2011/20110413.maastricht.en.php  

And in April 2012:

>The financial and government debt crisis had mixed direct effects on the debt level last year: while the scaling back of financial market support measures - in particular, the repayment of capital assistance - caused the debt level to fall by €17 billion on balance, debt rose by €14 billion due to assistance loans to euro-area countries. According to provisional figures, the cumulative impact of financial market support measures on the debt level since 2008 amounts to €291 billion, or 11 ½% of GDP. Support measures in connection with the sovereign debt crisis in the euro area accounted for a total of approximately €20 billion, or 0.8% of GDP, of this. The increase in debt was accompanied, for the most part, by an increase in financial assets as defined in the national accounts, such as credit claims. A future realisation of risk assets or repayment of assistance loans will result in a decline in the debt level.<

http://www.bundesbank.de/download/presse/pressenotizen/2012/20120417.maastricht_schuldenstand.en.php

So, 291 billion or 11,5% of gdp.

by IM on Fri May 11th, 2012 at 03:18:27 AM EST
[ Parent ]
Brussels sees Spain missing budget targets | EurActiv

Spain is set to miss its deficit reduction targets this year and next unless it takes new measures, the European Commission will forecast on Friday (11 May), but Madrid insists the targets will be met, Spanish and EU officials said.

The EU's executive arm will announce on Friday its economic forecasts for the 27 countries in the European Union for this year and next, including growth, budget deficit and debt rates.

Spain's borrowing costs have soared on investor concerns that the government may have to bail out the banking sector. Madrid has promised to reduce the public deficit to 5.3 percent of gross domestic product (GDP) this year from 8.5 percent in 2011, and to 3 percent in 2013.

However, the Commission will say that unless policies change, Spain will have a budget shortfall of 6.0 percent this year and just short of 4 percent in 2013, two EU officials said.

by afew (afew(a in a circle)eurotrib_dot_com) on Fri May 11th, 2012 at 01:11:31 AM EST
[ Parent ]
It's not like the Spanish government didn't say the targets should be higher, to much tearing of robes and pulling of hairs.

guaranteed to evoke a violent reaction from police is to challenge their right to "define the situation." --- David Graeber citing Marc Cooper
by Migeru (migeru at eurotrib dot com) on Fri May 11th, 2012 at 01:59:41 AM EST
[ Parent ]
Merkel rejects putting growth before reforms | EurActiv

German Chancellor Angela Merkel is opposing economic stimulus policies that rely on new debt, amid calls to relax austerity measures from centre-left opponents in Germany and some European leaders.

In a speech on Thursday the German Chancellor told the lower house of the parliament, the Bundestag, that reducing debt and encouraging growth were "twin pillars" in European policy instead of other alternative ways.

"Growth through structural reforms is sensible, important and necessary. Growth on credit would just push us right back to the beginning of the crisis, and that is why we should not and will not do it," Merkel said.

by afew (afew(a in a circle)eurotrib_dot_com) on Fri May 11th, 2012 at 01:12:12 AM EST
[ Parent ]
What structural reforms? There's none of that in the recipes applied on Greece or Portugal.

You might find me At The Edge Of Time.
by Luis de Sousa (luis[dot]a[dot]de[dot]sousa[at]gmail[dot]com) on Fri May 11th, 2012 at 03:23:41 AM EST
[ Parent ]
Destroying the social model is "structural reform" to these sociopaths.

guaranteed to evoke a violent reaction from police is to challenge their right to "define the situation." --- David Graeber citing Marc Cooper
by Migeru (migeru at eurotrib dot com) on Fri May 11th, 2012 at 03:33:21 AM EST
[ Parent ]
U.N. Warns of Social Fall-Out from Spain's Austerity Plan - IPS ipsnews.net
GENEVA, May 10, 2012 (IPS) - An expert body of the United Nations has warned the Spanish government that the severe budget cutbacks it is applying must not undermine its commitment to upholding the economic, social and cultural rights of the country's people.

Austerity measures imposed by the government of centre-right Prime Minister Mariano Rajoy could have "a negative and disproportionate impact on the enjoyment of those rights," said the United Nations Committee on Economic, Social and Cultural Rights (CESCR).

Committee Chairperson Ariranga Govindasamy Pillay, a native of Mauritius, said these concerns will definitely appear in the final conclusions of its review of Spain's compliance with the provisions of the International Covenant on Economic, Social and Cultural Rights, to be released on May 18.

The Committee, made up of 18 independent experts from different regions of the world, monitors observance of the Covenant by the 160 states that have ratified it since its adoption in 1966 and its entry into force in 1976.
by afew (afew(a in a circle)eurotrib_dot_com) on Fri May 11th, 2012 at 01:22:44 AM EST
[ Parent ]
Eurointelligence Daily Briefing: Venizelos may just pull it off
Pasok leader is in a desperate last-ditch attempt to form a government of national unity with New Democracy and the small Democratic Left; that would establish Fotis Kouvelis, leader of the pro-euro, anti-austerity DL, as the kingmaker in Greek politics; Kouvelis wants a government that stays in office until 2014; the push for a unity government comes as the latest polls give the hard-left Syriza party a large lead over all the other parties; but platform of a new unity government would still include "disengagement" from the EU-IMF memorandum; Alexis Tsipras, Syriza leader, toned down his demands from rejection to re-examination of the memorandum; Bankia's auditors discovered another black hole, relating to tax credits of €2.5bn, which may need to be charged against equity; the governing PP has embarked on a blame game campaign to deflect attention from its own role in the collapse of Bankia; among those under attack from the government is the chief of Spain's central bank; the European Commission is ready to grant Spain an extra year to meet the deficit target,  but demands a number of quid-pro-quos, including an external supervision of the bank restructuring process;the German government is expected the highest tax revenues in the country history, due to falling unemployment and rising wages; Angela Merkel categorically rules out any debt financed growth measures; Francois Hollande wants to impose his tax on the rich as of June; Daniel Cohn-Bendi[t] warns of a return of military dictatorship in Greece; Germany's Bild is freaking out over the Bundesbank's acknowledgement that German inflation may temporarily exceed the eurozone average; Samuel Brittan, meanwhile, proposes a nominal GDP target (for the umpteenth time), this time as an alternative to austerity.


guaranteed to evoke a violent reaction from police is to challenge their right to "define the situation." --- David Graeber citing Marc Cooper
by Migeru (migeru at eurotrib dot com) on Fri May 11th, 2012 at 03:38:17 AM EST
[ Parent ]
Eurointelligence:
Another black hole for Bankia

Ooops, they found another hole of €2.5bn in the accounts of Bankia. As El Pais reports this morning, Bankia's auditors noted that Bankia booked estimated future tax credits  as a real assets to the tune of €2.5bn. But to save these taxes, Bankia would need to achieve a certain level of savings, which the auditors do not think as realistic. The auditor said without these savings, the money will have to be charged against equity of BFA, Bankia's holding company. The meaning of all of this is that Bankia will need more equity capital on top what is being pledged by the Spanish government. The new CEO said he would present a restructuring plan for the bank by the end of June.

The blame game starts in Spain

The Spanish government spent most of the day yesterday trying to blame somebody else for failure of Bankia, according to El Pais. Not a word of criticism of Rodrigo Rato, the former IMF chief who led Bankia into a state of near-bankruptcy, but instead the PP criticises Miguel Angel Ferandez Ordonez, the central bank chief, for having forced Caja Madrid to merge with Bancaja and several other smaller cajas in 2010. (The situation is, of course, very different. Bankia was essentially controlled by the PP, who has been appointing most of its council members. Passing the blame onto other is absurd in this case, and it shows the mindset of what has turned out to be one of the most incompetent governments in the eurozone. In a few months, Rayoy managed to mess up an ECB nomination, trigger a bond market attack because he postponed his budget until after the Andalusia election, and now mismanages the Bankia situation.)

See last night's open thread.
Spain is playing hard to get

We cited an El Pais story yesterday, according to which the EU Commission was ready to grant Spain an extra year to get the deficit down to 3%. The FT has more details of this story this morning. The offer includes a quid-pro-quo,  an independent audit of the restructuring plan for its banks. The Commission also wants to strengthen fiscal control of the autonomous regions. The article says the Spanish government was divided, as some members feared that such a delay would be perceived in markets as evidence of creeping fiscal indiscipline.  The FT quoted an EU official as saying: "I do not understand the Spanish government as wanting an additional year." The paper said it was likely that Spain would accept the key demand of external supervision of the restructuring of the banking sector.



guaranteed to evoke a violent reaction from police is to challenge their right to "define the situation." --- David Graeber citing Marc Cooper
by Migeru (migeru at eurotrib dot com) on Fri May 11th, 2012 at 04:10:59 AM EST
[ Parent ]
Daniel Cohn-Bendi[t] warns of a return of military dictatorship in Greece;

Soooo, threatening a bank run wasn't enough. How about threatening a return of military dictatorship? You see, it always comes down to a use of force if you ... etc.

The good news ... it's only a life sentence. You eventually leave this planet of idiots.

by THE Twank (yatta blah blah @ blah.com) on Fri May 11th, 2012 at 08:21:38 AM EST
[ Parent ]
It's been going on for 2 years.

Only, 2 years ago Daniel Cohn bendit was telling Barroso he was insane.

How the mighty have fallen.

guaranteed to evoke a violent reaction from police is to challenge their right to "define the situation." --- David Graeber citing Marc Cooper

by Migeru (migeru at eurotrib dot com) on Fri May 11th, 2012 at 08:55:06 AM EST
[ Parent ]




"We can all be prosperous but we can't all be rich." Ian Welsh
by melo (melometa4(at)gmail.com) on Fri May 11th, 2012 at 10:30:34 AM EST
[ Parent ]
the pols are all scrambling to find ways to discredit beppe, but some are reluctantly admitting he has a plan for the country, while they obviously don't. (other than the tired tropes that are being proven moronic as we speak).

next step, pretend they were going to do something like that, eventually, and meanwhile finagle ways to adopt the policies (as few as possible, natch) and keep power for themselves.

beppe's taking no prisoners, on a righteous roll, ranting like a stevedore about the absurd reality the casta live in, while the poor people are pressed like grapes, losing all the social benefits their fathers and grandfathers fought and died for after the desolation of fascism.

he really is very funny, and his rage palpable. he is the only political figure who's offering anything untried before, and people are turning out in droves to hear him speak.

last night on 'servizio pubblico' a great talkshow with michele santoro, they had di pietro's sister concetta filmed offering her advice to the government which, summed up, was basically, if you're driving towards a wall, remember that's what reverse gear was designed for.

she was pure italian contadina soul, just perfect in her wisdom and down-home simplicity. tremonti was on for the whole show and after she spoke, said he'd take her advice and turn a new page in his thinking.

having a 'come to concetta' moment, after stoutly defending his track record as economic minister with bunga man, to derisory audience reaction.

if beppe gets his way italy will exit the euro before becoming greece 2.0.

pretty much everyone who can afford one has an audi already, so auf wiedersehen barroso, merkel and buba, the germans can come back and buy their wine in deutchmarks again.

fuck the euro.

"We can all be prosperous but we can't all be rich." Ian Welsh

by melo (melometa4(at)gmail.com) on Fri May 11th, 2012 at 10:58:52 AM EST
[ Parent ]
Fuck the Euro, damn right.

The Hun is always either at your throat or at your feet. Winston Churchill
by redstar on Fri May 11th, 2012 at 11:31:10 AM EST
[ Parent ]
the last time Germany imposed austerity on the rest of us (via a combination of high interest rates the Buba set and the requirements of convergence for the single currency) we ended up with an overly strong franc, which was called the franc fort (something the socialists of the day thought was a good thing...and I wonder if the underlying thinking among the PS elites has really changed all that much).

Of course, Francfort is in Germany.

The Hun is always either at your throat or at your feet. Winston Churchill

by redstar on Fri May 11th, 2012 at 11:33:27 AM EST
[ Parent ]

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