Euro crisis: Just when you thought you were out…

Signs, perhaps, that the markets remain less than convinced about last week’s eurozone leaders’ agreement on debt.

Yesterday Italy was forced to pay more to borrow than just one month ago.

Credit agency Moody’s has warned it may downgrade Spain’s rating.  All three credit agencies have a negative outlook on the country’s rating as the Spanish prime minister Jose Zapatero calls an early general election.

And, in Cyprus, where the credit rating was downgraded by 2 points on Wednesday by Moody’s, President Demetris Christofias refuses to stand down after demanding the mass resignation of his cabinet [free reg may be required].

Cyprus has been buffeted by its banks’ involvement in neighbouring Greece, as well as an explosion at a naval base a fortnight ago that killed 13 and wiped out a power station that supplied more than half the country’s electricity.

That accident has led to rolling power cuts in the midst of a scorching summer and is expected to knock the economy back to flat growth this year just as it was emerging from recession. It could also add at least €200m ($286m) to the island’s 2011 financing needs, according to government estimates, at a time when the broader eurozone debt crisis has closed its access to financial markets.

Meanwhile the euro remains under pressure in the financial markets even with the political wrangling in Washington.

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  • al

    On the issue of Spain I was talking to a few Catalans today in Barcelona and their take on the early election is that it’s the right thing to do. However, a change in party will be almost inevitable and may bring brief joy to the people but it won’t drag them out of the hole they’re rapidly sinking into. They’re screwed but they’re quite happy to give the government a good boot out the door before launching into attacks on the new government.

  • DC

    Moody’s warned it might down grade Spain…blah blah blah…..try America first of all.

    Meanwhile back in the real word away from markets and ‘financial experts’, Nicholas Watt of the Guardian writes:

    “The rich run a global system that allows them to accumulate capital and pay the lowest possible price for labour. The freedom that results applies only to them. The many simply have to work harder, in conditions that grow ever more insecure, to enrich the few. Democratic politics, which purports to enrich the many, is actually in the pocket of those bankers, media barons and other moguls who run and own everything.”

    If this seems a tad leftie even for Miliband then, yes, you’ve guessed it – they are not his words. The new leftie in our midst is none other than Charles Moore, the former editor of the Daily Telegraph.

    Moore’s column on Saturday opened with these words:

    ‘It has taken me more than 30 years as a journalist to ask myself this question, but this week I find that I must: is the Left right after all? You see, one of the great arguments of the Left is that what the Right calls “the free market” is actually a set-up.’

    So Margaret Thatcher’s official biographer gave the most telling illustration of how the phone hacking scandal is re-shaping British politics. This is what he wrote:

    ‘The Left was right that the power of Rupert Murdoch had become an anti-social force. The Right (in which, for these purposes, one must include the New Labour of Tony Blair and Gordon Brown) was too slow to see this, partly because it confused populism and democracy. One of Mr Murdoch’s biggest arguments for getting what he wanted in the expansion of his multi-media empire was the backing of “our readers”. But the News of the World and the Sun went out of the way in recent years to give their readers far too little information to form political judgments. His papers were tools for his power, not for that of his readers. When they learnt at last the methods by which the News of the World operated, they withdrew their support.’

  • Drumlins Rock

    Meanwhile in…..Nicholas Watt of the Guardian writes: “the rich… blah blah blah..”

    What ever happened to the good old “mixed economy” this left right rubbish is just ego trips and once again prove the old theory if you go far enough either way the two merge in totalitarianism.

    Last weeks deal was good, but still merely buys some more time, it even gives Ireland a very faint hope of not defaulting. However the odds are still leaning towards some sort of crash, with the propping up of the second tier economies not happening quick enough, this is going to be a long winter for many.

  • DC

    I think – Drumlins – the argument is that there isn’t any Left-wing debate to stabilise out the Right at the moment.

    Which is why things have got into such a mess.

    Improvements in standards of living and quality of life have arguably been as a result of new technology and cheap labour and imports from China as a result of it switching over to capitalism, than on reflection any domestic policy success of the Right and its ideology.

    The hands-off, markets-know-best approach has been tried and found wanting in practice.

    Hence the reason why cash machines almost stopped working and banks froze up after the credit crunch.

    So, last week’s deal wasn’t good – it would have been good if a statement containing something along these lines had been released instead:

    ‘Western democracies and governments have decided together to freeze the assets of wealthy bankers and will in unison take back a proportion of the bonuses that they received during the bogus years – socially useless years – of cheap and easy credit, as these bonuses were all an illusion obtained through financial incompetence and miscalculation. These bonuses will be returned to the banks that they have left bankrupt and will be used in part to recapitalise and to offset taxpayer liability.’

    Your statement re it being good is part and parcel of centre-right mainstream thinking – unable to think outside the box because you’re well and truly hemmed in after years of Murdoch Media and Thatcherism.

  • Alias

    7 out of the 17 of eurozone member states are now publically verging on bankrupcy – Greece, Spain, Portugal, Ireland, Italy, Belgium, and Cyprus – but the europhiles will still tell you that the common cause isn’t the euro and that a catastrophic failure rate for 41% is a great success!

  • DC

    From Russia Today:

    ‘Gerald Celente from the US-based Trends Journal says the political elite will not recognize simple solutions to curb America’s deficit. ­”The country is going bankrupt — just look at the numbers. The numbers do not lie — politicians lie,” nails Celente.

    The bigger picture includes the long-predicted devaluation of the dollar, says the forecaster, recalling that gold gained $US 115 an ounce last month alone. And against that background the talks about deficit reduction do not mention the most obvious measures like cutting the military budget or slashing foreign aid, which topped $US 57 billion a year.’

    ‘How about companies like General Electric that made $US 14 billion last year, paying no taxes?” says Celente, who is sure there is plenty of room to turn the deficit situation around and clean up the economy. “We do not have a representative form of government, we have a government that represents only the very powerful and the very rich and that is all this is about — letting them keeping their perks.’

    Same goes for Europe, the EU elite are in the pockets of the banks.

  • Take a read at the much bigger picture here…..

    So whenever Marty and Peter and the boys and girls of the approving Assembly next speak of higher and new rates and taxes and closure or curtailment of public services, you will know that they are not the voice and mighty arm of the people but puppets of foreign rapacious business interests who care not a jot about you and yours.

    That would then render them more as traitors to the very people they profess to represent, and whose pockets they have their hands in, feeding their very comfortable and not very taxing new fangled lifestyles pretending to be caring leaders of the many ignorant communities which intermingle so badly because of atrocious government education on how life works with the control of money.

    Which public department in Stormont/NI would be responsible for providing funds, or refusing to provide funds, to private organisations and/or global businesses contracting to provide such a vital new public edutainment service?

    Please advise, so that representation can be made, and you can be advised as to developments and decisions which are made on your behalf, via this and other open and virtually free channels of communication.

    Time for some novel action [with Lodes of HyperRadioProActive IT from other Private Pirate and Alien Sources/IntelAIgent Kernels with SMART* SCADA** CoredDNetworks for Digital Control of EMPowering Structures and Virtual Advanced IntelAIgent Operating Systems***], methinks, for there is diddly squat in the SMARTer Edutainment Field being provided to the masses from the public sector and their military and paramilitary counterparts and the black economy and any traditionally discontented and unsatisfyingly ineffectual underground movements and youth cultures.

    And for all you limited thinkers stuck in ruts bounded by adhering to the traditional and conventional rules and regulations and laws specifically designed to so confine your thinking to accept the status quo rather than create a greater futures model which provides for and delivers everyone’s needs, here are the * keys

    * Self-Monitoring, Analysis and Reporting Technology
    ** Supervisory Control and Data Acquisition.

    Smart probing questions are always most welcome and a vital and challenging part of any grand solution. Smart ass comments though are always part of the problem, which denies you solutions, and it is a grand job to keep those unsaid and to yourself because they can so easily identify one as being without great thoughts to share ….. and in some cases would confirm a view, which one would be actively reinforcing, that one is more than just a bit of an idiot.

    PS ..I wonder if it is standard, default NI Government policy NOT to acknowledge receipt of, nor to reply to communications/requests/proposals/messages sent to likes of addresses they have supplied, presumably for the purposes of smarter communication, for such a dereliction of service has been my experience when exercising the likes of peter.robinson and martin.mcguinness and nigel.dodds etc etc @niassembly dot gov dot uk

    One would almost think that they deliberately avoid putting pen to paper/words to email, for fear of having their thoughts widely known, which is something of a scam and a scandal and a disgrace when true, for one mustn’t forget that they are being paid and pay themselves obscenely handsomely for it, their thoughts, from the public purse, and therefore the people are quite rightly entitled to hear their views and decisions.

    So, who in the Assembly claims responsibility for dealing with ….. well I suppose all of the above would be introducing SMARTer Programs in New Real Virtual Governance Matters. There is a Novel Active Proposal for them to consider and rule upon.