ESM PARTICIPATION: China protest too much, speak forked tongue

To shake hands, you need to be empty-handed

Europe’s Three Big Days get off to a damp start

Wen Jaibao last night more or less blew a raspberry at Angela Merkel’s personal plea for help with the eurozone debt crisis, but this morning the State’s chief bollocks transmitter The People’s Daily went out of its way to say that China doesn’t have ‘designs on’ Europe of an asset or infrastructural nature. In fact, the paper said this so many times, one has to smell a rat. Here’s an extract:

‘China has no intention of “buying up” Europe and any help Beijing offers will be for purely economic reasons.  China’s interests lie in selflessly helping Europe. China has no appetite or ability to ‘buy up Europe’ or ‘control Europe’ as some European commentators have said. China will not to link helping Europe in the debt crisis with issues such as the EU recognising China as a market economy or the EU’s arms embargo on China.’

Hmm. Of course – when given the chance – China didn’t buy Greek bonds; instead, it bought Paraeus Harbour. Watch what the buggers do, and ignore what they say.

But even what they say this time seems to be coming out differently depending on who you talk to.

Lou Jiwei, the head of China’s $410 billion sovereign wealth fund, China Investment Corp (CIC), said that European government bonds were not ideal for long-term investors such as the fund. Instead, he said, the CIC would look at infrastructure and real industrial projects that could help a recovery. Sounds a bit like buying up Europe to me, but what do I know? Mr Lou is on the fringes of the politburo, but he also works in the real world.

I admire the Chinese culture, and I always have: the Chinese are thrifty, bright, hardworking and justly proud of what they’ve achieved. But this is Beijing we’re talking to here: a bunch of ageing Communists who regard even the weather as a relative Truth. The Useful Idiots will believe the Chinese People’s Daily. Not many others will.

But as luck would have it, two Useless Idiots will be in Beijing for a ‘summit’ tomorrow. This ‘key meeting’ will bring together Premier Wen and President Hu Jintao with European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy. I have little doubt that the meeting will be spun by Brussels into a roaring success and a guarantee of funding, but it will turn out to be completely airy tosh – again.

You can see the timing on this one coming. The next day, the EU FinMinCom* decides whether it will graciously bestow its approval of a Greek austerity package that is rapidly destroying the country’s economy, as well as saving on street lighting by using burning buildings as a dual warmth/light alternative energy form.

It’ll be interesting to see where we are by Wednesday evening, but until then (unless something genuinely newsworthy happens) I’m going to ignore the Greek necrophilia fest. It’s a waste of time and money, and a fundamentally unfair attempt by scared eurotwerps to bully a sovereign State into starving its citizens. The Greeks are not of the driven snow either, but the folks doing this to them are mad, cynical and ruthless – depending on what particular things they’re dealing with on any given day.

*Fin Min Com is the EU finance ministers’ forum, not an obscure Chinese official.

77 thoughts on “ESM PARTICIPATION: China protest too much, speak forked tongue

  1. Whilst you have no sympathy for the Germans who have to pay for the Greek bailouts, consider the after effects of a default on Greece.

    The Greeks for reasons best known to Greeks are overspending by €2bn a day. Were the money for that excess to stop overnight, it won’t be the Germans that are forcing the Greeks into starvation. Remember that the Greeks have been squirreling their dosh in places like Zürich and London whilst the Greek government watches this exodus with a degree of puzzlement but naturally zero action.

    Not at least whilst the easy money from Germany continues to roll in …

    This is not just about Germans wanting Greeks to act with a degree of fiscal restraint or for Greek citizens to stand up for their rights by paying their due taxes (= acting like a German/being a good little German). After all, if the Greeks did pay taxes, they might have less of a fiscal deficit, and fewer demands on those who do pay their taxes.

    What do the Greeks want? More money from Germany, or more money from China? What is certain is that Merkel doesn’t need Chinese money for Germany, because her Mittelstand do that for her when they sell their wares over there.

    • The German people don’t know much of what is going on in Greece, they are not told too much – and so they do what they are told.
      The latest bailout will be good money thrown after bad. Money down a black hole, intended to keep the Fascist Socialist Dream alive – the EURO.
      It would have been better spent protecting the next dominoes in line, Portugal and Spain.
      The Germans have been found out again. They are in waiting for Bankruptcy, and will need special symathetic fostering again, not for the first time in the last 100 years.
      Greek will be free by the end of this year. Free and happy.
      What will be very revealing, and the most interesting catalyst, is what the FRENCH people think.

      • @Yvette

        Whatever you think of the Euro or the Germans, there are facts that remain pertinent for the Greeks. Default is an option of course – and it is only fear that stops the Germans et al from allowing it. The CDSs are not such a problem – but their derivatives are, and the CLNs (which are not regulated by the ISDA).

        “Greek will be free by the end of this year. Free and happy.” – yes, they will be free and happy. Only now with no money coming in to bail out their spending habits, what happens then? They will be free, but will they be happy when their pensions are suddenly worth 40% less – and food 25% more? Not to mention their wages? Sure, 60,000 businesses have closed in the last year or so in Greece – but what would happen after the default and Greeks have no money to spend whatsoever? Not even on imported Porsches that Germans themselves cannot afford.

        As to Germans being good and doing as they are told. Take a peek at what happened over the weekend with the protests against internet surveillance etc. In Britain, land of the free, and worthy holders of the title of “democrats”, there were eight protests nationwide. Whilst in Germany, who do as they are told, not informed and have a poor record of democracy, there were close on sixty. But of course, Germany’s population is far larger than Britain’s – and of course, with democrats like Cameron in charge and unfettered journalism from The Sun and what was The News of the World, the British don’t need to protest do they?

        Oh, and what do the French think? Do they want to live by their own means and stop receiving handouts from Germany? I think with their being a proud independent nation, the French should at least be able to do that – just like the British, but then to achieve that, the British print their own, don’t they? It makes a mockery of sensible finances.

      • @Yvette

        What facts do you want? That the French have a thriving economy?

        France’s budget deficit will be cut by 20 percent in 2012 from 113 billion euros ($156 billion) this year, Fillon said.

        http://www.businessweek.com/news/2011-11-07/france-to-lower-deficit-with-rigorous-2012-budget-fillon-says.html

        It is not only me that speaks of France’s problems. Please, before raising your voice, present some reality, please.

        As to Greece:

        Now here is the million-dollar-question: why should foreign tax payers come up with the money to cover Greek government expenditures which money Greek tax payers are not prepared to come up with?

        klauskastner.blogspot.com

      • YOU MISSED THE POINT – AGAIN!!
        FRENCH POLITICAL RESULT = THE WILL OF THE FRENCH PEOPLE WHICH MATTERS TO THE GERMAN MASTER RACE AND AFFECTS THE OUTCOME OF THE EURO. DOH……!!!!!!!!
        I won’t argue with you again on this.
        Result: 1 – NIL to me.

      • @Yvette

        you can shout as loud as you like and still make no sense to me. Are you suggesting that France has a democracy? I think you forget that Germany has one too. However, I will leave you to enjoy it since you do not wish to inform me of what you are on about.

    • @Gemz,

      Thomas Jefferson;

      Banking institutions are more dangerous to our liberties than standing armies.
      ——————————————————————————————-

      I can’t understand why anyone needs Chinese money, the ECB appear to be quite capable of producing virtually unlimited quantities of the stuff for any bank that requires it to stay solvent and apparently from what this article says about banks profiteering from the availability of cheap ECB money, quite a few banks that don’t.

      http://www.bloomberg.com/news/2012-02-13/draghi-158b-free-lunch-boosts-bank-profits.html

      ——————————————————————————————-

      • @Rui

        I agree with you. What is more, I am very cross about this state of affairs. The ECB is taking the BoE route of “well, we’ll float our boat in champagne until the money is worthless”. Germany and Holland have seen their incomes eroded enough without the ECB eroding it more.

        I am all for sound economics, but the BoE seems to have missed out on the basics. The banks in the mean time are having a ball.

    • @Gemz

      No one is forcing Germany to pay money to the Greeks.Merkel is
      choosing to do so because she and the other europrat leaders are
      power crazed and too arrogant to admit that they have cocked-up
      big time. Germany want’s to dominate Europe through the eurozone.
      Let them pay the price for their power grab.

      • @laurence
        if that is what you believe. Fine.

        The problem to me seems more about frail banks than about Greece. Perhaps that is why the French show no interest.

    • Gemz:

      “Whilst you have no sympathy for the Germans who have to pay for the Greek bailouts……..”

      Germans only have to pay for the MAJORITY of the Greek bailout because, GERMANS, i.e. Schauble and Merkel, are obliging them to. No Greek politician or citizen can FORCE any German taxpayer to pay any bailout money. GERMAN elites are making this CHOICE because it suits their own private IMPERIALIST euro dream, not out of any sympathy for the plight of Greek citizens. You’d do well to remember that fact.

      Also: “Not at least whilst the easy money from Germany continues to roll in …”

      I would be of the opinion that the recipients of the recently announced 22% reduction in the MINIMUM WAGE, the unemployed, homeless or other ordinary poor souls in Greece would beg to differ with you on the “easy” part of that statement.

      • @Dermot

        the reduction in the minimum wage that you mention MAY – MAY allow Greece to revive its economy that has become very uncompetitive in the last ten years. It is the sort of decline in real terms that the Germans themselves have seen over the last years.

        Whatever else, the Greeks themselves have become used to a lifestyle that outstrips their earnings by some considerable margin. What is more, if they don’t want to pay for this, and make an outright default, they will still need to find €2 000 000 000 000 a month from somewhere to keep things going even as they stand. To my mind this is a little more complex than the Greeks simply walking away from their responsibilities, or not wanting support from those who do pay their taxes.

        In short, they are in a nasty corner, whatever they do and whatever you say.

    • The wealthy Greeks that you do see in Geneva or London are the one who has developed international business based in offshores. I am not denying the fact that some citizens are avoid tax regime and this is not acceptable. In fact that Dr Wolfgang Schlauble asked 2bn euro from UBS and at least 500 million from CS cause of wealthy German tax evasion makes you think that the problem is global and not specific to a country.
      Additionally I was also wondering why Greece had so much expenses, a) is it because stringent EU laws forcing weaker economies to develop e.g. Green financial intensive project otherwise they would be fine? b) forcing them politically to invest on defence by rich countries? Then they lend to weaker economies cash, being invested on their own technologies , meaning they are double winners and now they wonder why the system is exploding? etc….. . And, do you really believe that the Germans want to ” save the Greeks” or rather save their own banking system and pension funds? I am not happy with the current European financial situation and I strongly believe that some reforms should be made in Greece to start with a strong taxation control. But beyond that we should not forget that the only country which was profiting from the euro is Germany by boosting their target sales with a competitive currency. Also if my memory is good the first buyer of Porsche Cayenne were the Greeks so again contributing to the German GDP.
      Last but not the last, Germany owes 575 bn euros to Greece (Jacques Delpla) which will certainly bring Greece out of default.

      Finally, as human beings we should work on solutions and propose ideas how to develop growth and prosperity around us instead of criticising and impose stick austerity measures which does not make sense when an economy is falling into a recession.

  2. The simple solution is to sell Greece to China-:)

    Germany gets rid of a financial disaster, China gets a European ‘colony’, and holiday resort, and the Greeks get a new nation in charge who won’t be sqeamish, about making them pay up…

    Win-Win all round…

    Apart from the tax evading Greeks of course, but since when did their views matter?

  3. ‘The Greeks’ – who are they? Rich people who are in with the crowd, steal the money, collude with the EU and are the ones who masterminded the entry into the EU, middle class people who survive as best they can and see their businesses and livelihoods wrecked but have relatively little say on what goes on in government or the EU, and the poor who have even less behind them, even less influence, and now have whopping taxes put on their electricity bills. Do not tar them all with the same brush. And feel very, very ashamed if you ever supported the Euro or indeed the European Union. Hearing Germans being self righteous is a nauseating.

    • @Phoebe

      I think you are being a little hard on the Germans – after all, give them the same consideration that you give the Greeks.

      Remember also that your government (presuming that you are British) has avoided any problems that Spain or Greece have by simply printing fantastically large sums of money – all for the British citizen. Sorry: that should read the British banks. Is that due to the EU or the Bank of England? After all, if the Bank of England did what the British government asked it to, you would have interest rates at around 5% to keep inflation down. It would solve a lot of problems – but create many more.

      Whilst you feel disgruntled at the Germans, they are the only ones around here that have anything close to a sensible economy. Remember that the Greeks might not be in hock to the banks if they had respected their own government and paid their due taxes.

      • @Gemz:
        “…if the Bank of England did what the British government asked it to, you would have interest rates at around 5% to keep inflation down.”

        I know what you’re saying, but the government asked the BoE (or told it or went along with a BoE proposal) to introduce zirp. Control of inflation was pushed down to 2nd priority by mutual agreement whatever is said in public about BoE independence.

      • @BT

        whatever else, either your democratically elected government – or the non-democratically elected staff of the BoE – are not doing the electorate any favours. Yet all fingers are pointed at Nasty Germany …

    • @Phoebe M.

      I totally agree with your statement that the actual real citizens of the country be it Greece, France, Germany, the U.K. etc,etc, having little or no influence on the course of action the so called political elite of their respective countries take, the political elite get voted in and then totally ignore any pre-election promises, referendums etc,etc, the countries unelected bureaucratic elite are already there hovering in the wings waiting to pull the politicians strings in the direction that the bureaucrats think will suit their needs the best.
      I honestly don’t know what the answer is because when the people do rise up an sweep away the status quo, the revolutionary euphoria and zeal is inevitably followed by a new vested interest bureaucracy of one form or another, quite often infiltrated and manipulated by elements of the old guard.
      To answer one of your other points, this is one of your colluding Greeks, the current Prime Minister Lukas Papademos, now negotiating (telling the gullible what they want to hear) another bailout package with the E.U., he was among the team that negotiated Greek entry to the euro zone back in 2000 so he is obviously a clever political survivor and has had plenty of practice at taking the brain dead E.U. negotiators to the cleaners.

    • “And feel very, very ashamed if you ever supported the Euro or indeed the European Union. Hearing Germans being self righteous is a nauseating.”

      Phoebe, do me a favour – please be a little more precise in your admonitions! “The Germans”, as you disparagingly refer to them, do not, never did and never will want the Euro – it was foisted on them chiefly by the idiot Kohl and his lap-dog Waigel, who themselves were under pressure from both Mitterrand and, to a lesser extent, Gorbachov.

      I can assure you that if Murksel & Co were to say “We are returning to the DM and at the same time reviewing our relationship with the EU”, there would be nothing but street parties for days on end over here! Would you like to join us if that happy day ever arrives?

      But “the Germans” can’t! As Schäuble has said on several occasions, “Germany is not a sovereign state.” If your German language skills are up to it, do a Google search with the terms ‘Die Jahrhundertlüge” and “Holger Fröhner” – so far as I know it hasn’t been translated into English as yet. Whatever, the publication is now in its 6th revision. On page 11 of the 6th revision there is a copy of this letter, which I have translated from the German for you:

      “Event: Secret treaty concluded on 21.05.1949

      Here: Loss of copy 4

      Dear Minister,

      Copy No. 4 of the secret treaty between the Allied powers and the provisional government of West Germany on 21.05.1949 has definitively gone missing.

      The secret treaty reveals inter alia:

      – Control by the allied forces over German newspaper and broadcast media until 2099

      – The so called “Chancellor file,” that is, the document which every Chancellor of Germany has to sign on the orders of the Allies before taking the oath of office

      – as well as the seizure of the gold reserves of the Federal Republic by the Allies.

      In so far as copy No. 4 of the secret treaty should come into the wrong hands, I strongly recommend verification of the authenticiy.

      Yours faithfully

      Dr. Rickermann
      Minister of State”

      If I have deciphered the scribble on it correctly, this was a hot potato around 14.8.83! So what do we have here. The Germans will first have a “free press” at the end of this century. I too often wondered why the incoming Chancellor first goes to Washington, London, Paris & Moscow before being sworn in. As for the gold reserves – I do believe they are held in the NY Fed, not in Germany.

      This year it is 67 years since WWII ended – and still no peace treaty!

      • @VJ:
        Words fail me at describing how astonishing that is. Am I to understand that the German electorate do not generally know about this treaty?

      • @VJ

        thanks for this: it was not known to me that the free west was censoring German news media. I would have thought they won the war for freedom, not censorship.

        @BT
        with Viking Jack around, I doubt it will be quiet for long … remember also that several tens of thousands turned out against the internet censorship on Saturday in Germany, compared to three in the UK (okay, there may have been a few more than that … )

      • @ BT & VJ

        I too was gobsmacked when I first read it. The snippet above about a lost document is only one surprise amongst a great many. The publication itself is some 156 pages long and, in parts, is rather heavy going – a lot of legalese! But the arguments are supported and illustrated with lots of TV screen shots, newspaper and magazine articles, official papers etc, etc. It is a classic example for John’s dictum “Don’t listen to what they say, instead, watch what they do!”

        So, what is the name of the capital of Germany. Are you really, really sure –

        “Declaration of the letter of the Three Powers dated 8 June 1990 on the abolition of its reservations, particularly in the letter of authorisation to the Basic Law of 12 May 1949 in regard to the direct election of representatives to the Bundestag in Berlin, and their full vote in the Bundestag and the Bundesrat.

        Dated: 12. June 1990
        (…)
        The position of the Allies, “that the connections between the Western sectors of Berlin and the Federal Republic of Germany are maintained and developed, whereby you are to take into account, that these Sectors as before are not a component (a constituent part) of the Federal Republic of Germany and are not governed by it,” remains unchanged.
        (…)

        Comment
        Even in 1990, the Allies continued to insist that Berlin is not a part of the “Federal Republic of Germany”! In other words, even today Berlin is still regarded as extraterritorial?”

        So, Germany is getting flak from all directions about it’s dealings/statements in regard to Greece and other EU countries. But, is it really the Germans, or could it possibly be one or more puppet-masters?

        To BT, we can safely assume that the majority of the German populace are not aware that this document is in existence. I only stumbled across it whilst following a link from DMN.

      • @VJ

        a very interesting statement about Berlin.

        What I would like to ask is this: if Berlin are the puppets in this scenario – why is it that the British and American electorates are not more vocal? After all the Allies won the war for “freedom” and not to enslave, didn’t they? All those proud British and Americans who died fighting, and they were fighting for this???

        Or am I missing something?

      • @VJ:
        Fascinating. If the pols in Berlin are not their own masters and Berlin is not a part of the FRG, it would be interesting to know what the lines of communication are to give regular orders. Does Merkel have a secret room she disappears into each day to receive her next set of orders via a TV screen?, something along the lines of Big Brother! Or perhaps she has a small receiver embedded in her skull and receives orders that way.
        hhmmm.

      • @Gemz:
        I think you can also safely assume that us British serfs know nothing about this arrangement with the FRG.

      • @BT

        I think it is time you started telling a few that they are not serfs but members of an electorate.

        Then the likes of Cameron might wake up from their Eton-fuelled dreams!

      • To Gemz & BT

        Another interesting bit in regard to Berlin: unfortunately it’s difficult to read in parts (printed, then scanned and then .pdf-ed), but it is certainly the from original official document:

        “Federal Law Gazette. Volume 1990. Part? (unreadable!)
        No. 36 – The day of issue: Bonn, 2 October 1990
        Agreement to settle certain questions relating to Berlin
        (…)
        Article 2

        All rights and obligations that have been constituted or determined through legislative, judicial, or administrative measures of the Allied authorities in or in relation to Berlin or because of such measures, are and remain in every respect in force as per German law, regardless of whether they have been constituted or determined in concordance with other laws. These rights and obligations are subject without discrimination to the same future legislative, judicial or administrative action as similar rights and obligations constituted or determined under German law
        (…)
        Took place (? – actual word illegible) at Bonn on 25th September 1990

        For the Government of the Federal Republic of Germany
        Lautenschlager
        For the Government of the French Republic
        Boidevaix
        For the Government of the United States of America
        Vernon A. Walters
        For the Government of the United Kingdom of Great Britain and Northern Ireland
        Christopher Mallaby

        Comment
        Where is then the alleged sovereignty, when all Allied decisions stand incontestable over all other rights?!”

        I must concur with Wolfie Schäuble, Germany is not sovereign! If this is finally accepted by all and sundry, then we need to ask who might be pushing Germany to make itself so unpopular with everyone? It will most certainly be an involuntary action on their part.

        The conspiracy theorists can go to town now, but I think we already know who it might very well be. The big bucks question is then, why?

      • @VJ:
        I don’t know the German mindset too well but if this sort of secret treaty existed (it certainly seems to be secret and hidden from the German electorate) in Britain and it suddenly became public knowledge that our elected government was in fact a puppet of other powers and its policies were subject to any sort of approval by them, it would blow our political system apart.
        In fact there are treaties between Britain and the US and others which impose obligations on our successive governments, but not AFAIK on the scale of Berlin and Germany’s obligations to the Allied powers.

        It’s difficult to know how deeply that treaty goes in day-to-day policy making but at face value it certainly seems that Germany is not a sovereign nation since 1945.

    • @Phoebe M “And feel very, very ashamed if you ever supported the Euro or indeed the European Union.”

      Utopias have a way of blowing up in your face.

  4. “Hmm. Of course – when given the chance – China didn’t buy Greek bonds; instead, it bought Paraeus Harbour. Watch what the buggers do, and ignore what they say.”

    John, are you sure the Chinks have bought Piraeus harbour, as in buying a dog? All links in English –

    http://www.spiegel.de/international/europe/0,1518,797751,00.html

    This from : http: //www.balcanicaucaso.org/eng/Regions-and-countries/Greece/Is-Greece-going-to-be-saved-by-China-95583

    “Piraeus, a Chinese port

    Does China see Greece as a foothold in the Eurozone, where Beijing wants to increase its influence?

    Actually, the Chinese dragon has already landed on the Greek coasts: it has “swallowed” the father of all ports, the Piraeus in Athens, which ranks first in Europe and third in the world for number of passengers. The Piraeus is also the largest port in the eastern Mediterranean basin for container handling.

    In November 2009 (when the Socialist Party’s Papandreou already led the government), two out of the three maxi-jetties, including freight handling, was leased for 35 years to the Chinese company Cosco. In short: the Chinese can decide which goods can and can not reach Greece. As a result, Piraeus port workers called a strike that lasted for months.

    The whole Greek market is bubbling: Eastern containers will allow shops and supermarkets to be filled with made-in-China cheap junk, and induce bankruptcy for local sellers of local products. The Chinese invasion raised significant concern, but this is not the end of the story: the straw which broke the camel’s back was the announcement of a short visit by “Mr.Cosco” at the end of 2009. Wei Jiafu (who loves referring to himself as “Captain Wei”) stated: “Give me the port of Piraeus to invest in the cruising sector and I will get out of all the other European ports!”

    It sounds like good business, but it is not: the inhabitants of Pireus still remember the mooring of the super cruise liner “Splendida” in January 2010: the 28-story vessel is as long as the Eiffel Tower. The Greek hoped that crowds of tourists would get off the ship to visit Athens and go shopping, but most passengers remained on board and enjoyed the landscape from the ship’s restaurant. You can say goodbye to business.
    Another seven Chinese companies are already working in Greece in order to prepare their invasion of the complete Balkan area.”

    From here: http: //greece.greekreporter.com/2012/01/16/privatisation-of-ports-stalled/

    “Meanwhile, news has leaked that China Ocean Shipping Company (COSCO), a Chinese global shipping giant, which expressed serious interest in the port of Piraeus and which wants to protect the considerable work that it has done there, is still waiting for a VAT reimbursement of nearly 32 million euros from the Greek government for investments it has already made. The issue has become a point of contention with Beijing, Chinese Ambassador to Athens Du Qiwen recently admitted, while speaking about COSCO’s problems due to Greece’s incredibly slow bureaucracy.”

    and

    “The deadline for early elections in the spring is complicating the situation further. If needed, a few days ago Piraeus Port Authority chairman Giorgios Anomeritis said that 51% of the company will continue to be held by the state.”

  5. ZeroHedge has been saying for a few days now that the 2nd Greek bailout has risen from €130 billion to €210 billion, making the total bailout so far €320 billion: http://www.zerohedge.com/news/cost-combined-greek-bailout-just-rose-%E2%82%AC320-billion-secured-debt-or-136-greek-gdp

    I know MSM have casually mentioned an increase of €15 billion to €145 billion but I’m puzzled where the other €65 billion has crept in from.
    ZH referred to the higher sum again last night in its post “Greek Parliament Passes Latest Austerity Vote”.

    Anybody understand the figures?

    • @BT;
      From what I have read it is down to the fact that Greece’s economy is shrinking at an exponential rate, it’s imposible to get a grip on it, hence as the delays keet occuring so the shortfall is dramatically increasing.

      • Yeah, that could be the explanation. I note Sky News once again referred to the 2nd bailout being for €130 billion about an hour ago.

    • Blimey, there are only 11 million Grecians and they want 320 million quid, or say 550 billion dollars or about fifty thousand bucks each. Then what? Are we to assume they will then adopt fiscal sanity when fiscal insanity has proved so rewarding? Default looks cheaper all the time.

      • Simple! Faced with this crises, the Greek Govt solution has been to make ever more agreements with the Troika to reduce spending and bring the books into balance (aka ever more austerity). But implementation of spending cuts has been a different matter, as we have seen…

  6. Could I please have a ‘hands-up’ from anyone here who believes that Greece can meet the obligations passed in their parliament today?

    • @Harold

      Greeks are spending €2bn more than they earn every month without any payments for the money they have already borrowed!

      They are in a nasty corner. They can vote for it now, and get on with it – or simply stop having anything at all when the money stops. These are not my choices: German and Dutch taxpayers have done this gradually over the last ten years – and what were the French, Greeks and British up to?

    • @HR;
      Of course they can’t and the Germans know it but, with the next tranche the can will be kicked down the road a bit further and, who knows? The Magic Fairy might turn up….

      • And, of course, it means the Greek default will be delayed until after the French election. An early default would seal Sarko’s fate for sure and Merkel would then have to face Hollande, something she must dread.

      • @ OAH

        I wouldn’t be oversure about Hollande winning! If Marine Le Pen manages to get the required 500 endorsements it’s anybody’s guess what the outcome may be. Some weeks ago I posted a link to a French report (in English) where many Jews in France have indicated that they are going to vote for Le Pen and not Sarkozy (and in Belgium, also for Vlaams Blok). You can have one guess what their main concern is! And then comes this –

        http://www.tabletmag.com/scroll/66437/is-marine-a-different-animal/

        As we know, Sarko is most definitely not popular – in fact, Marine is hot on his heels in the polls. The fun number would be if she beats Sarko in the preliminaries and it comes to a duel between her and Hollande. It’s barely imaginable that any great number of UMP voters will vote for Hollande – but with her anti-Islamic, anti-EU and anti-Euro rhetoric, she just might manage to bag enough of them for a victory for herself.

        Then, I think, we just might see some real bitch fights!

  7. Barroso and Von Rompuy. What a great comic double act to send to China.
    Will the Chinese love them like they did Norman Wisdom?After all I’m sure
    they must now regard the poor Eurpoean’s as the underdog.

    • Right now Hollande leads Sarko 60/40 in the second round but sarko hasn’t declared yet and started his dirty tricks (except against Mme Le Pen).
      if Le Pen is allowed to stand (yes, I said that correctly!) it is just possible she can knock the slimeball out in the first round and then Hollande is in like Flynn. I don’t doubt that Hollande will be housetrained like all the other Euro muppets in double quick time but there may be a few interesting days before the denouement.

  8. This is a lively Monday morning!China may have a large sovereign wealth fund to invest,but the FT’s front page headline,’Beijing to roll over provinces’loan terms’, accurately describes the HUGE imbalances inside the Chinese economy.As for the dear old UK,do not be suckered by this morning’s market bounce, rampant inflation is on the way,and as Gemz correctly pointed out,we need base at 5 percent,but MarK is a commie from King’s, and is going to succeed in his plan to ruin the UK ,once and for all.

    • @William

      are you suggesting that communists have infiltrated the very heart of British civilization? Mind you, if they are anything like the crowd on Turl St. few would have the insight to notice the difference.

    • There won’t be enough demand for rampant inflation unless oil skies.
      Market bounce is all about job losses and QE.
      End March sell by dates.

  9. Barroso and Van Rompuy remind me of a grey and rather sinister version of Laurel and Hardy (and equally un-funny)

    Could we persuade the Chinese to keep them?

  10. Just back from one of my regular business trips to China — where, of course, “The Slog” is not available !
    Certainly the Chinese are in a buying mood. I offered a joint venture to one company who replied by offering to buy the UK company instead. The construction boom may be dampened by the government but plenty of cash is available for investment.

  11. Chinese buying is all directed by the state. Just had a Chinese investment in the Philippines fall through because they got orders not to invest further there but concentrate on Cambodia and Vietnam. Appeared the Philippines was being stroppy over the Spratley’s and negotiating to give refuelling rights to the US Naval and Air Forces which are seen as part of the US’ encircling of China policy.

  12. Gemz: “Whatever else, the Greeks themselves have become used to a lifestyle that outstrips their earnings by some considerable margin”

    Agreed.

    “In short, they are in a nasty corner, whatever they do and whatever you say.”

    Agreed.

    However, my original point still stands, and I note you have’t actually addressed it. And that is, no Greek, be they politician, civil servant, nor ordinary citizen is FORCING German taxpayers to pay for their bailouts…………..

    “…………. for the Germans who have to pay for the Greek bailouts,…..”

    Most of the forcing, from my viewpoint anyway, is coming from German taxpayers’ own leaders, Merkel and Schauble, to name but two. And I stand my my assertion that the bailout is not being “forced” on German taxpayers by German Political leaders out of any love for Greek people.

    It is, on the most part, German politicians, from Helmet Kohl to Merkel to Schauble that have created a situation whereby Greek fiscal mismanagement has gone from being a problem solely for the Greek people to a German taxpayer’s headache. Why do you think they have gone to such efforts to arrive at this juncture Gemz?

    • @Dermot

      The Germans have not “created a situation” in Greece or anywhere else. In the last 15 years China has moved from being a small(ish) economy to being the second largest. The sheer scale of production has changed the economic landscape completely. In the mean time, the USA defaulted on $6 trillion of its debts – that is 20x Greece’s debt (okay, 18x now!). That was one big shock to the Western World. What we are seeing is the fall-out of this default.

      Greece was in no fit state in the 1990s, let alone the noughties. Quite what their leaders were thinking of in not implementing reforms back then leaves me wholly baffled. Whilst Greece was paying its bills with cheap loans, the USA and UK were paying theirs by printing money on the cheap, something that your children and grandchildren will be paying for. Just to keep your economy afloat for a year or two!

      Greece has become uncompetitive in a sharply competitive world – and it is getting more competitive not less. Those countries that have wasted the last ten years and have slipped behind must at least try to catch up, or see a dramatic loss in living standards as they fail to borrow more – or see the effects of QE kick in. In the case of the UK it is already affecting millions of pensioners in that their savings are returning almost nothing, when they should be returning 3-4% with a base rate of 5%.

      Dermot: this is not a one-way argument; it is certainly not a “plan” by a gang of ineffectual leaders in Berlin or Moscow or Washington. This is structural in the West as a whole. We cannot go on borrowing if there is nothing to borrow against. Greece is finding this out the hard way.

      • Gemz, I accept all of what you’re saying, and you are obviously knowledgeable, more so than me, but my original point was a counter to your statement that Germans have to pay for the Greek profligacy, and by implication it was the Greek people, that were forcing this situation on to German taxpayers ….”Whilst you have no sympathy for the Germans who have to pay for the Greek bailouts”.

        And I’m not daft enough to try argue against the fiscal sins of the Greek political classes, and senior civil servants that ran Greece for the last 20 years or so. My point was simply that no one in Greece is forcing any German taxpayer to fund their bailout, simply because no one in Greece CAN force a German taxpayer to fund their bailout. That power, and therefore blame lies with German political leaders. And as I said earlier, they are certainly not doing so out of love or sympathy for ordinary Greek people.

        My own view is that Greece should default. Torched lenders would learn an overdue lesson in real capitalism and the important of adequately weighing up risk, and Greece and it’s citizens would learn the true consequences of living beyond their national means for so long, and would be more wary, one would assume, of allowing any future administration of such excesses in future. I don’t think German taxpayers should be on the hook for ANY bailouts outside of Germany. I’m sure you probably agree with me on that point at least.

      • @Dermot

        thanks for that – have you read what Klaus Kastner has said about all this? http://klauskastner.blogspot.com He has a lot of insights which are readable and valuable. I have learned a great deal from reading his thoughts.

        As to the bailouts, to my mind Merkel is terrified of a default ruining Europe’s banks. Germany’s are probably okay – but if a couple of Spanish ones go, it is an endgame because then some Italian, British and French ones will go – dominoes. It is a very real possibility. The problem is that in stopping the rot with Greece, Germany is walking into a situation where it cannot pay the bills itself, so we are back to square one.

        If Merkel has had any sense, she will have insulated her banks and told Sarkozy and the rest to do the same with theirs. If they haven’t done it by now, it is too late. Given that Basel III is pretty pathetic – and many Europen banks don’t even meet these standards given proper accounting methods … and then there is London with all its off-balance sheet stuff that the UK government allows (a real nightmare scenario!).

        As far as I am concerned, as long as my taxes are used to make or support a job in Greece that is fine. If it is only to pay off some banker that really should have been watching his business, that is another matter altogether – and in that respect I concur with you totally. With one detail: prop up a bank for the same reason, they provide the wherewithal for a country’s economy to function. But they must be the tail that is wagged – they have wagged governments for too long.

        BTW I am only knowledgeable because it is my money they are throwing away ;-) ;-) ;-)

  13. Not my own work….

    This is the simplest and probably the most sensible explanation ever to see the light of day.

    (With apologies to Eurozone recipients)

    Baldrick: “What I want to know sir, is before there was a Euro there were lots of different types of money that different people used. And now there’s only one type of money that the foreign people use. And what I want to know is, how did we get from one state of affairs to the other state of affairs”

    Blackadder: “Baldrick. Do you mean, how did the Euro start?”

    Baldrick: “Yes sir”

    Blackadder: “Well, you see Baldrick, back in the 1980’s there were many different countries all running their own finances and using different types of money.
    On one side you had the major economies of France , Belgium, Holland and Germany , and on the other, the weaker nations of Spain , Greece, Ireland , Italy and Portugal .
    They got together and decided that it would be much easier for everyone if they could all use the same money, have one Central Bank, and belong to one large club where everyone would be happy. This meant that there could never be a situation whereby financial meltdown would lead to social unrest, wars and crises”.

    Baldrick: “But this is sort of a crisis, isn’t it sir”.

    Blackadder: “That’s right Baldrick. You see, there was only one slight flaw with the plan”.

    Baldrick: “What was that then sir?”

    Blackadder: “It was bollocks”

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