Posts Tagged ‘European Debt Crisis’

LinkSwarm for October 24, 2016

Monday, October 24th, 2016

The latest Clinton Corruption update pushed the LinkSwarm to Monday:

  • National Review published Victor Davis Hanson’s endorsement of Donald Trump. And the moon became as blood…
  • Trump leading in poll that has best track record over last three elections.”

    The poll with the best track record over the last three presidential elections gave Donald Trump a 2-percentage-point edge over Hillary Clinton on Saturday.

    The Investor’s Business Daily/TIPP tracking poll has Trump with 42.1 percent and Clinton at 39.7 percent.

  • Thoughts on #NeverTrump: “They are putting a great volume of energy into bringing about a disaster, for which they will not take any ownership.”
  • No one trusts the media anymore. “Only one in nine Americans believes that Hillary Clinton is ‘honest and trustworthy.’ They don’t trust the media’s cover-up of her misdeeds, and the cover-up of the cover-up of the cover-up.” (Hat tip: Director Blue.)
  • Why I Now Feel Compelled To Vote For Trump“:

    More than anything, I can’t sit idly by and allow these perpetrators of fraud to celebrate and leak tears of joy like they did when they helped elect Barack Obama in 2008. I have to know I weighed in not only in writing but in the voting booth. The media needs to be destroyed. And although voting for Trump won’t do it, it’s something. Essentially, I am voting for Trump because of the people who don’t want me to, and I believe I must register my disgust with Hillary Clinton.

    (Hat tip: Director Blue.)

  • And speaking of media bias, the Rolling Stone campus rape hoax case goes to trial. (Hat tip: Ace of Spades HQ.)
  • Here’s a New Yorker piece on the failure of the Euro. It provides a good, but incomplete, overview of the Euro’s failure (nowhere does it note that Europe’s cradle-to-grave welfare state is unsustainable, and it fails to note that none of the nations practicing “austerity” in southern Europe have cut outlays to match receipts). And the myopic policy prescription offered is, of course, more central planning. But there are some good bits. Like this:

    The U.S. unemployment rate hit ten per cent for a single month in 2009 and is now below five per cent; the eurozone unemployment rate hit ten per cent around the same time, and is still in double digits. In some European countries, youth unemployment is more than forty per cent. America’s economy is bigger than it was when the crisis hit. The eurozone’s is smaller. To take just one example, Italy, the third-largest economy in the eurozone, has a per-capita G.D.P. that’s lower than it was at the end of the last century.

    Also this:

    Stiglitz observes that if the countries that committed to the single currency in 1992 had known what they know now, and if people had had the chance to vote on the proposal, “it is hard to see how they could have supported it.” That’s a hell of an indictment.

  • Hey, remember how we were told California’s assisted suicide law would only apply to terminally ill people who wanted to die? Now insurance companies are enouraging suicide rather than pay for life-extending drug treatments.
  • Even The New York Times figures out that new gun laws wouldn’t prevent most mass shootings.
  • Russia is conducting nuclear survival drills. (WSJ hoops apply.) Good thing we have Nobel Peace Prize winner Obama running things rather than that warmonger Bush… (Hat tip: Stephen Green at Instapundit.)
  • College isn’t for everyone:

    But if you’re not sure yet what you want to do, then take time to decide before you spend $30,000, $50,000, or $100,000 you don’t have for something you don’t need. In the meantime, start working. You’ll probably only find low-paying, hard-working jobs at first, but guess what? If you go to college, you’ll be working those same jobs when you get out, only you’ll be four years older and fifty grand poorer.

  • Scientists at the Oak Ridge National Laboratory in Tennessee have discovered a chemical reaction to turn CO2 into ethanol. Better idea than corn subsidies…
  • The Large Hadron Collider “nightmare scenario has come true:

    For the last ten years you’ve been told that the LHC must see some new physics besides the Higgs because otherwise nature isn’t “natural” – a technical term invented to describe the degree of numerical coincidence of a theory. I’ve been laughed at when I explained that I don’t buy into naturalness because it’s a philosophical criterion, not a scientific one. But on that matter I got the last laugh: Nature, it turns out, doesn’t like to be told what’s presumably natural.

  • Hamilton County, Tennessee doesn’t monitor parole tracking devices outside business hours. A good thing people never commit parole violations nights and weekends… (Hat tip: Fark.)
  • This just in: Democratic Representative Shelia Jackson Lee is still an idiot.
  • AT&T trying to buy Time Warner. I’ve got a bad feeling about this…
  • Internet-connected CCTV cameras made by Chinese firm Hangzhou Xiongmai Technology seemed to make up the heart of the botnet used in Friday’s DDoS attack.
  • Yuan hits all time low against the dollar.
  • Microsoft Surface sucks.
  • Texas is goat country.
  • LinkSwarm for October 14, 2016

    Friday, October 14th, 2016

    This year…

  • Rasmussen has Trump ahead.
  • Italy’s economy is a mile high house of cards.
  • Citigroup, parent of Citibank, had a huge role in staffing and shaping the agenda of Obama’s first term.
  • Cracked on the country/city divide fueling Trump’s rise.
  • Wisconsin Senate candidate Russ Feingold admits that he and Hillary Clinton want to disarm Americans.
  • Competitive shooter stopped Minnesota mall jihad rampage. (Hat tip: KR Training.)
  • Social Justice Warriors hate women’s magazines.
  • Peak New Hampshire.
  • Lawyers file fake lawsuits against fake plaintiffs to obtain fake judgements to take down real comments off the Internet, then pressure Google to deindex the offending article, all evidently at the behest of a “reputation management” firm. Presumably The King in Yellow is not involved…
  • Scandal claims another Andrew Cuomo advisor. (Hat tip: Instapundit.)
  • “Liberalism has lost the loyalty of the downtrodden that once, with admittedly mixed motives, it set out to help. That’s a loss it’s unlikely to survive.”
  • Library addition: Nine William F. Buckley, Jr. non-fiction books, seven signed.
  • Shorter than usual, for Reasons.

    Have a nice weekend.

    What’s Happening to Italy’s Banking System?

    Wednesday, July 6th, 2016

    Yesterday’s Brexit roundup mentioned that Italian banks account for nearly half the bad loans for the entire Eurozone.

    Italy is now the heads-on favorite as the most likely instigator of the next global economic crisis. Some analysts are calling it a perfect storm:

    Italy’s bank bailout fund might not be enough to beat back the Brexit. More key Italian financial services firms are under pressure and face the potential need to raise capital, leaving Italian government officials and its banking system trying to steer clear of a crisis.

    As Italian bank bonds and share prices are seeing their value slammed in the face of rising uncertainty, banks with substantial bad loans are facing greater pressure, with rates around the world slipping into negative territory.

    And, of course, they’re blaming Brexit rather than all the myriad problems with the EU that caused the Brexit.

    Italy’s bank bailout fund might not be enough to beat back the Brexit. More key Italian financial services firms are under pressure and face the potential need to raise capital, leaving Italian government officials and its banking system trying to steer clear of a crisis.

    As Italian bank bonds and share prices are seeing their value slammed in the face of rising uncertainty, banks with substantial bad loans are facing greater pressure, with rates around the world slipping into negative territory. It’s an anxiety some in Italy and throughout the European Union may have been hoping would be eased by the Brexit vote last month — but then the U.K. referendum delivered the opposite outcome from the one they had sought.

    “Market volatility following the U.K.’s EU referendum result hit the Italian bank sector particularly hard because it is one of Europe’s weakest,” Fitch Ratings analysts said in a July 4 report. “Asset quality pressure is a main driver for the negative outlooks on several large and medium-sized Italian banks.”

    The Brexit vote, which calls for the United Kingdom to abandon a European Union that has careened for years from one crisis to another, could hasten weak Italian banks’ downfall. It was widely expected that European and U.K. banks will suffer the brunt of the vote in late June, and while British banks have been hard hit by the news — which brings with it tremendous regulatory uncertainty — EU banks have suffered as well.

    Many banks in Italy, including its largest, UniCredit SpA, have seen share prices pounded; its stock is down more than 60 percent so far this year. A staffer at UniCredit could not provide comment when contacted.

    Already, Italian officials and executives appear to be pulling out all the stops to stave off banking sector contagion. The lingering question for banks is whether they can continue to support lending operations at a time when creditors face potential losses and as some of the country’s leading financial services firms could be subject to shotgun M&A marriages by regulators.

    Italian financial services firms earlier this year established a multi-billion dollar fund called Atlante to buy non-performing bank loans. But the fund, which is in the 4-billion euro to 6-billion euro range ($4.43 billion to $6.65 billion), one analyst said, is far too small to cover all the non-performing loans held by major Italian banks. However, the fund could still be leveraged in order to support loan purchases.

    “The authorities need to get banks to remove a large portion of soured loans from their books so they can loan more,” said Julien Jarmoszko, senior research manager at S&P Global Market Intelligence. “If investors fear more Italian banks, this will raise their cost of capital and reduce lending as a result.”

    Look for some sort of holding action for temporary recapitalization (including a “bail in” or some sort of ECB scheme) to let all the insiders dump their bad debts onto the European taxpayer, which was the real point of prolonging the Greek farce.

    More news on that front:

  • Atlante already took control of Veneto Banca after “a €1bn capital increase demanded by EU bank regulators attracted zero interest.” And Atlante may have to tap pension funs for further recapitalization.
  • Italy has also banned short-selling of imploding Banca Monte dei Paschi di Siena SpA. That’s never a good sign, and it never works for long.
  • “It’s bad – non-performing bank loans have risen to 18%. At 10%, most banks are technically bankrupt. That’s the percentage of capital and pledged deposits they have against bad loans. Our pledged deposits, not theirs. At 18%, they’re no longer “technically” bankrupt. They ARE bankrupt! Greece still has bad or non-performing bank loans of 34%, Ireland 19% and Portugal 12%. And we haven’t seen the next serious financial crisis yet.”
  • And bank bailouts could hit Italian sovereign debt right in the bond ratings. “Italian ratings are already at BBB- for S&P, though we must also add that DBRS still ranks the country at AL. Still, if these ratings start to come under pressure from the agencies, this could lead to speculation that Italy may eventually fall out of the investment grade bucket. This would have a major impact – in the first place in terms of the eligibility of Italian bonds for the PSPP.” That’s the European Central Bank’s public sector purchase program.
  • Of course, when push comes to shove, we’re likely to see all sorts of banking rules get thrown out the window…

    Brexit Update for July 5, 2016

    Tuesday, July 5th, 2016

    While the reverberations from the Brexit vote are still being heard, here are a few interesting pieces you might have missed:

  • Nigel Farage resigns as head of UKIP. Hey, he fulfilled his victory conditions! What else has he got left to prove?
  • The elites still haven’t gotten over their defeat:

    As several commentators, from Megan McArdle in The Atlantic to Rupert Darwall in National Review, have noticed, many liberal journalists, representing elites throughout the advanced world, have reacted with indignation to the fact that 52 percent of U.K. voters (many without degrees) have rejected the EU system of supranational government of which the elites approve. Naturally, these journalistic spokesmen argue, the common people could not possibly have good reasons for such an act of multinational vandalism. So they must be inspired by, er, racism, xenophobia, fear of globalization, and related other thought-crimes.

    That account doubtless condenses and oversimplifies the elites’ response to the Brexit shock, which is just one small skirmish in a new class war in advanced societies between geographically mobile, liberal, skilled, high-earning professionals and more rooted, communitarian, particularist, and patriotic citizens (or what British journalist David Goodhart calls “nowhere” people and “somewhere” people). “Nowhere” people simply didn’t grasp the outlook of “somewhere people” in the referendum, not seeing that many decent people who voted for Brexit had such respectable anxieties as loss of community or, one step up, the transformation of their country as motives for casting their votes. So the elites thought the worst. They were still making the same mistake in their television and columnar explanations of the result on Friday morning. But what was remarkable was the Darwall-McArdle thesis that in other countries the elites reacted to the Brexit shock as if personally or spiritually affronted in their own lives. Alarmed, they asked: Why weren’t we told that they might vote for Brexit?

    It’s a hard question to answer.

    One aspect of it, however, is ideologically fascinating. Among the central arguments of those favoring Brexit was that the Brussels system was dangerously undemocratic and that British voters and MPs had lost the power to propose, amend, or repeal failed or oppressive laws. This was a passionate concern among English people who had grown up in a self-governing democracy, who may have fought for it in wars, and who simply couldn’t understand why the loss of their democratic rights didn’t worry their opponents. Yet again and again liberal journalists treated this passionate belief as either abstract or a cover for more primitive emotions and bigotries. Democracy as such was rarely given weight in Remain or liberal debates on the cost/benefit analysis of Brexit. They treat multinational political institutions as such unalloyed goods that it would be impolite to raise questions about such defects as a democratic deficit. Has the knowledge class/meritocracy/cognitive elite/nowhere people/etc., etc. developed not only an intellectual snobbery towards the rest of society, but even an impatient, dismissive contempt for democracy that cannot be openly avowed but that does influence its other political attitudes?

  • “Bigotry! Nativism! Racism! That’s what elites in Britain, Europe and here have been howling, explanations for why 52 percent of a higher-than-general-election turnout of British voters voted for their nation to leave the European Union. But there is plenty of bigotry, condescension and snobbery in the accusations and the people making them. And it’s incoherent to claim, as some do, that it’s undemocratic for voters to decide. That amounts to saying that ordinary people should be content to be ruled by their betters.” (Hat tip: Director Blue.)
  • “I think it’s shocking and appalling to assume because I voted to leave the EU that I’m racist.”
  • Even countries that aren’t contemplating leaving the EU (like France) are demanding changes to EU policies…and threatening to simply stop obeying them. There’s also this tidbit: “Italy’s banks are saddled with 360 billion euros ($401.18 billion) in bad loans.”
  • More on the same subject. “In Italy, 17% of banks’ loans are sour. That is nearly 10 times the level in the U.S., where, even at the worst of the 2008-09 financial crisis, it was only 5%. Among publicly traded banks in the eurozone, Italian lenders account for nearly half of total bad loans.”
  • If the UK can leave the EU. why can’t we leave the UN?
  • London Banker Bonuses Set to Shrivel as Brexit Hits Dealmaking.” My heart bleeds…
  • And what is the UK leaving behind? “EU bans claim that water can prevent dehydration.” Finally someone with the guts to stand up to Big Dihydrogen Monoxide! (Hat tip: Daddy Warpig’s Twitter feed.)
  • “Greece, EU/IMF lenders resume talks over bailout reforms”

    Monday, April 25th, 2016

    That’s an actual headline today. I throw in “today” because that same headline could have been run just about any time over the past five years, because Greece is endlessly willing to talk as long as they keep getting bailout money.

    The one thing they have proven absolutely unwilling to do is actually implement reforms, at least any reforms that would involve the government spending less money than it takes in. Instead they’ll ask for more debt write-downs, write-offs and haircuts for lenders rather than stop spending other people’s money.

    And I could have written the preceding paragraph any time over the last five years or so as well…

    Downside to Bankrupting Your Nation?

    Monday, November 30th, 2015

    So go ahead, bankrupt your nation to keep your failing welfare state afloat a little longer! What’s the worst that could happen?

    Well, how about turning your daughters into prostitutes to survive?

    Young Greek women are selling sex for the price of a sandwich as six years of painful austerity* have pushed the European country to the financial brink, a new study showed Friday.

    The study, which compiled data on more than 17,000 sex workers operating in Greece, found that Greek women now dominate the country’s prostitution industry, replacing Eastern European women, and that the sex on sale in Greece is some of the cheapest on offer in Europe.

    “Some women just do it for a cheese pie, or a sandwich they need to eat because they are hungry,” Gregory Laxos, a sociology professor at the Panteion University in Athens, told the London Times newspaper. “Others [do it] to pay taxes, bills, for urgent expenses or a quick [drug] fix.”

    Correction: It wasn’t “six years of painful austerity” that brought hem to this pass, it was six years of avoiding painful austerity, and refusing to cut government outlays until they matched receipts, that turned all of Greece into Whore Island.

    (Hat tip: Ann Althouse.)

    Greek Update: Tsipras Out, New Party Formed, Snap Elections Coming, Debt Payment Made

    Friday, August 21st, 2015

    “Prime Minister Alexis Tsipras resigned on Thursday, hoping to strengthen his hold on power in snap elections after seven months in office in which he fought Greece’s creditors for a better bailout deal but had to cave in.”

    Turns out promising free ice cream, only to deliver expensive rotted cabbage, wasn’t popular with Greek voters.

    Nor were his actions popular with members of his own party, 25 of whom have broken off to form the new National Unity Party, who will evidently return to the “demand free ice cream and insist others pay for it” strategy Tsipras abandoned in the face of the sinister force know as reality.

    On the plus side, Greece just used it’s new bailout fund to make a debt payment to the European Central Bank for the last batch of money it borrowed to prop up its unsustainable welfare state.

    We’re in that happy honeymoon period after Greece gets more money and before Eurocrats are shocked, shocked that Greece’s economy is still a festering pile of fail that all those and promised economic reforms haven’t actually been implemented.

    Give it another six to nine months…

    Greece: Dispatches from the Boned

    Thursday, August 13th, 2015

    So I haven’t done a Greek update in a while, since after Greece caved into the inevitable (Newsflash: broke people generally do not have leverage over those lending them money), it was all over but the shouting. Now that Greece and its creditors supposedly have a third bailout deal inked, and Greece settles into its clearly defined misery, let’s take a look at exceptionally bankrupt Greece these days, shall we?

  • Via Zero Hedge comes former Greek finance minister Yanis Varoufakis’ detailed review of the bailout agreement. It’s a mixture of self-serving lies (trying to distance his own Syriza party from the horrific economic mess they made acutely worse) and brutal truths (about just how screwed Greece is by the agreement).
  • Speaking of Varoufakis, it looks like he’s going to be up on hacking charges…for preparing emergency plans to float the drachma.
  • Oh: He also says the latest bailout deal won’t work. He’s not wrong…
  • Greece’s economy miraculously grew in the second quarter. But that was before the full effects of the crisis were reflected…
  • Greece’s tax revenues have collapsed.
  • Greece’s manufacturing sector fell off a cliff in July. Funny how that happens when your banks are closed and you can’t pay for goods.
  • Greece faces two years of recession. That part’s probably true. But that primary budget surplus? Yeah, not so much.
  • “Greece’s banks just made the mistake of being banks in Greece.”
  • After all that? Greece still isn’t fixed.
  • To add a cherry on top, Greece’s refugee crisis continues to grow. Because it’s still safer to live in bankrupt Greece than the Middle East…
  • Not Just Greece

    Wednesday, July 22nd, 2015

    Via ZeroHedge comes renewed information of a point I’ve hit home again and again: Thogh Greece is an extreme outlier on unsustainable welfare state spending in Europe, it’s also the canary in the coal mine, as toxic debt continues to rise all across Europe, with several countries exceeding a debt-to-GDP ratios of over 100%, including “Greece (168.8%), Italy (135.1%) and Portugal (129.6%).” Post-bailout (and bail-in) Cyprus is still over 100% as well, as is Ireland, though Eurostat didn’t have Irish DGP numbers, though supposedly the ratio should be trending down. And Spain and France are hovering just under 100%.

    To my mind the great mystery is how Belgium’s debt-to-GDP ratio now tops 111% with such a fat cushion of Brussels Eurocrats to sit on.

    The problem is not Greece’s only. The problem is that the western liberal welfare state, as currently constituted, is economically and demographically unsustainable.

    I’m sure I’ve driven this point home to regular readers of this blog, but I’ll continue driving it home until our leadership class is actually willing to do something about it…

    Fragments of a Greek State

    Tuesday, July 14th, 2015

    The self-inflicted destruction of Greece has been accomplished, but they’re still going to be picking up the pieces for years, if not decades. And there’s no guarantee the heavy manners Germany and the troika are imposing will actually be enough to rescue it.

    So, enjoy a random collection of Greek headlines, since I don’t quite have time to pen a piece on The Greater Meaning Of It All:

  • So Greece is going to get bailed out (again), but the actual mechanisms, and who will do the bailing, are far from clear.
  • And Greece needs $25 billion just to get through August.
  • “In the End, Greece’s War on Debt Is A Morality Problem. A majority of Greeks simply do not believe debt must always be repaid.” And how did that idea work out for them? (Hat tip: Ed Driscoll at Instapundit.)
  • Stratfor says that the Greek referendum backed Germany into a corner, and forced them to come down twice as hard. “The leading power of Europe will not underwrite defaulting debtors. It will demand political submission for what help is given. This is not a message that will be lost in Europe, whatever the anti-Greek feeling is now.”
  • Former Greek finance minister Yanis Varoufakis is not at all happy, saying the agreement makes Greece a “vassal of the Eurogroup.” Hey Yanis: You and the rest of the Greek ruling class are the one who baked the gypsy pie with your reckless spending to prop up your bloated welfare state. You’re just upset that Greeks, not Germans, are the ones having to eat it…
  • Greece may even have to sell some islands and ruins.
  • How Germany Beat Greece In Liar’s Poker.” By having all the cards and not being hopelessly in debt, perhaps? More:

    Many observers are wondering how the left-populist renegades of Greece’s Syriza party, which rose to power in January on the promise of delivering relief from austerity and renewed its mandate with a massive victory in the July 5 referendum, managed to negotiate a bailout deal on Monday that is substantially worse than what was available to Greece before Syriza took office.

    That would be because they were idiots who lied to voters about what they could accomplish.

  • Actual Time headline: “Why European Leaders Don’t Believe Greece’s Promises to Change.” Uh, because they’re not morons?