Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
by afew (afew(a in a circle)eurotrib_dot_com) on Sat Feb 13th, 2010 at 10:45:32 AM EST
New tax bombshell: 20% VAT - Times Online

A rise in VAT is looming whichever party wins the general election, as Labour and the Conservatives draw up plans to balance Britain's books.

Alistair Darling and George Osborne, the Shadow Chancellor, are both considering raising VAT to as high as 20 per cent -- the European average -- from the current rate of 17.5 per cent, The Times has learnt.

Doing so would raise an extra £13 billion a year at a time when financial markets are searching for signs that whoever takes power is serious about tackling Britain's £178 billion deficit.

Though Labour and the Tories have denied having any current plans to increase VAT, neither will rule it out and The Times understands a rise in the tax is being considered by both parties.

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Feb 13th, 2010 at 12:01:58 PM EST
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Conservatives deny considering plan to hike VAT to 20 percent | Top News | Reuters

LONDON (Reuters) - The Conservative Party, favourite to win a national election to be held this year, rejected a newspaper report on Saturday which said it was considering raising the sales tax VAT to as high as 20 percent.

"We have absolutely no plans to increase VAT," a party spokesman told Reuters, without giving any further details.

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Feb 13th, 2010 at 12:50:25 PM EST
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Raising taxes on consumption hits the poor the hardest (relatively speaking). I guess that is why such a tax hike is considered more serious then raising taxes on high incomes or wealth.

This is not to say that there should be no taxes on consumption, only that the damage to the poor should be offset with raised subsidies and lowered income taxes on the lowest incomes. Such a package would then land the tax burden on the middle and rich segments who can better afford it, but I guess that would be unserious.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Sun Feb 14th, 2010 at 07:19:15 AM EST
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But didn't you know that the tax system is an unfair attack on the middle classes? get with the program!

Any idiot can face a crisis - it's day to day living that wears you out.
by ceebs (ceebs (at) eurotrib (dot) com) on Sun Feb 14th, 2010 at 09:14:07 AM EST
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BBC News - Greek PM Papandreou calls EU response 'timid'

Greek Prime Minister George Papandreou has criticised the European Union's response to the country's financial crisis as timid and too slow.

Mr Papandreou told cabinet members at a televised meeting in Athens that the EU lacked coordination and undermined Greece's credibility.

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Feb 13th, 2010 at 12:30:20 PM EST
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Treasuries Tumble on Supply, Europe's Pledge to Support Greece - Bloomberg.com

Feb. 13 (Bloomberg) -- Treasuries fell, with 10-year notes dropping for the first week this year, as the government sold a record-tying $81 billion in notes and bonds and Europe's pledge to aid Greece dulled the haven appeal of U.S. debt.

Ten- and 30-year yields rose the most in seven weeks as sales of the securities drew lower-than-average demand. The European Union said it was prepared to take action to support Greece, while leaving open how it might respond to a fresh wave of speculative attacks against member nations that are also struggling to cut deficits. U.S. consumer prices rose in January, a report is forecast to show next week.

"With all of the issues the EU had with the PIGS, one would think we would see a continued flight to quality," said Thomas L. di Galoma, head of U.S. rates trading at Guggenheim Partners LLC, a New York-based brokerage for institutional investors. He used an abbreviation for Portugal, Ireland, Greece and Spain.

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Feb 13th, 2010 at 12:42:12 PM EST
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Eurozone in need of better management | Reuters

ROME (Reuters) - The fragility of the euro zone economy and public finances underline the need to extend and strengthen euro-wide economic management, European Central Bank Governing Council Member Mario Draghi said on Saturday.

"The euro is solid," Draghi told a gathering of market operators in Naples," but he called on the EU to extend and reform its economic structures "with the same vigour it devoted over the years to consolidating government budgets."

Draghi said investors will buy new securities issued by Greece, whose debt crisis has roiled markets in recent weeks, so long as the government "adjusts its budget with determination, with careful monitoring by the European Commission and the ECB."

More broadly, he said all governments should spell out how they plan to rein in budget deficits and debt levels which surged during the recession of 2008 and the first half of 2009.

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Feb 13th, 2010 at 12:51:32 PM EST
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POLITICO's daily debate with policymakers and opinion shapers - The Arena | POLITICO.COM

Next week dozens of honchos around Washington are going to be gathering to try to devise ways to ensure that ordinary working people pay for their incompetent management of the economy. This effort will pass under the guise of "fiscal responsibility."

The basic story of course is quite simple. Geniuses like Ben Bernanke, Alan Greenspan and the rest of the country's top economists and policymakers somehow either could not see an $8 trillion housing bubble or just thought it was cute.

Any idiot can face a crisis - it's day to day living that wears you out.
by ceebs (ceebs (at) eurotrib (dot) com) on Sat Feb 13th, 2010 at 06:58:09 PM EST
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Exclusive: The Bank Of England Engaged In Flagrant Gold Manipulation In The Interwar Period Via The New York Fed   Zero Hedge

An article written by University of Tennessee professor John R Garrett, "Monetary Policy and Expectations: Market-Control Techniques and the Bank of England, 1925-1931", which describes in exquisite detail the gold falsification measures undertaken by the Bank of England in the interwar period in order to impact interest rates in a favorable direction, performed with the full criminal complicity of the Federal Reserve Bank of New York, may mean paranoid "gold bugs" could soon be forever absolved of their "tin hat" wearing status as outright gold, and other data, manipulation by a major central bank is now proven beyond doubt. The implications regarding the possibility of comparable deceitful and treasonous acts by modern central bankers are staggering.

   The Bank of England depleted its open-market portfolio by secretly sterilizing large gold inflows. Thereafter interest rates were influenced by manipulating reported gold flows.... A gold flow falsification was over two-thirds as effective as an open-market operation.

Falsifying critical gold data worked for Britain 70 years ago. Is it working now too? And is the BOE alone, or is Bernanke taking advantage of the Bank of England's experience? To be sure, the world was different with the Gold Standard the bedrock of monetary policy. Yet are the similarities between then and now not greater than the differences? With the shadow economy exposed as hinging on the investing community's desire to go with the prevailing "valuation" lie (a reason why the shadow economy in broad terms will take many years to return, if ever) the core asset is and always will be gold.

And yet the main question remains: why did the Bank of England openly and flagrantly manipulate critical data? Why did it mislead the citizens of the country it was supposed to serve? And if this happened in the past is it happening now? Is this the reason why the Federal Reserve is so opposed to exposing itself to public scrutiny and audits? If the BOE was engaging in outright fraud in the 1925-1931 period, why would today be any different?

Garett's mesmerizing report, published in the September 1995 issue of Monetary Policy and Expectations, has oddly not received much if any public notice, with not a single mention of the article or its implication in either the blogosphere or the mainstream arena. This is very unusual as Garret's disclosures would lend vast credence to not just gold bugs' claims that there is blatant (ongoing) gold data manipulation, but that Central Banks regularly engage in outright deception when it comes to achieving desired monetary policy results. To wit:

   Montagu Norman, the Governor of the Bank of England... engaged in a large-scale deception that greatly over-stated the size of the effective open-market portfolio, understated the size of the gold stock, and misstated the size and even the direction of gold flows

Not only that, but Garrett provides a direct link between secret gold market operations by the BOE and accumulation of US Treasuries: a critical concept not just in interwar Britain but more so currently, when faced with the need to finance trillions in budget deficits, the market is poised to decline by 25%+ should the US government experience a failed auction. Oh, and guess who was complicit in the BOE deception, and was used by the British central bank as a trading conduit? Why, the Federal Reserve Bank of New York, of which Tim Geithner was president from 2003 to 2009.

   Norman sold pound-denominated securities to sterilize the additional bank reserves created by the gold inflow. He simultaneously sold gold for dollars, lowering the Bank's reported gold stock, and bought U.S. Treasury bills with the proceeds. He also had all transactions carried out on the New York market by the New York Federal Reserve Bank so that they could not be traced to the Bank of England. ...  The U.S. Treasury bills were comingled with pound-denominated "other securities" in the Bank's published open-market portfolio and were assumed by the markets to have been pound-denominated securities. In one stroke the gold inflow and the decline in the open-market portfolio were hidden. Bank Rate was kept at a very high level given the abysmal state of the economy, well over the level that would have prevailed under the Bank of England's prewar reaction function.

Yes, the bold is all Tyler's. Can't really blame him for getting a little excited about finding this paper. How in the Hell did it ever get published? And then languish unread and un-commented for nigh on to fifteen years?

John R. Garrett must be another heterodox economist. No one in Mainstream Economics would devote their time to economic history, especially a topic as radioactive as this. Might be worth a phone call. I have never been to Chattanooga. Should be beautiful in April or May. Perhaps there are more of these guys out there than I dared to hope.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun Feb 14th, 2010 at 01:00:56 AM EST
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Lies, lies, whisper more of those sweet nothing lies in my ear. Anything it takes to keep my, uhm, portfolio up. Happy Valentine's Day.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun Feb 14th, 2010 at 01:05:40 AM EST
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