Some of the mountains appear to be coming to Mohamet, aka Charles Dallara in Paris. As I write (two French sources concur) a broad spectrum of Greece’s private creditors is holding a meeting. This rainbow represents, perhaps, the Delegates at the Court of Dallara.

Dallara, head negotiator on behalf of the International Institute of Finance (IIF) left Athens over the weekend to answer the urgent call of a Chicken MacMuffin at the MacDo on the Champs-Elysees after the last round of talks proved inconclusive. He has pleaded for a quick resolution before time runs out, but has not as yet declared whether he will be pitching in with any compromises in order to help that process. The smart money this afternoon, however, is saying that he will.

“The goal is to complete the talks, even within the week,” said Greek government spokesman Pantelis Kapsis, “We are now in the most delicate phase of the negotiations to complete the debt swap. It is clear that what happens in the coming days will affect the country’s course for years.”

I have been reading, and listening to, these various tragi-comic pronouncements by the Greek government for weeks now. They feel to me like the introductions made by arch narrators of ancient Athenian plays. The only problem is that we have been in a delicate place where history-changing completions might or might not rule the infinite future for what seems like, well, an infinite amount of time. But to be fair,  the drive to drag these talks round in circles forever is still being led by Queen Christine of the Imfonite Gods, who once more added to the inscrutability of proceedings today by telling media hacks in Paris that, “The bigger the private effort, the smaller the participation of public creditors will need to be. If the level demanded of private investors isn’t reached, then public creditors will have to step in too.” La Reine Garde said it wasn’t for her to decide which official creditors should shoulder any additional burden – a statement greeted with huge relief in Berlin, Frankfurt, Brussels, Athens, Washington and New York.

Over in Davos meanwhile, Die Fuhrerine Merkel has told her audience that yes, we all dare to be more European, despite the fact that the being European-daring thing has rendered many of us penniless. But the eurozone problems, she adds, “started in America” which, I must confess, I hadn’t realised until now was a paid-up member: I really must try and keep up.

Slightly more than a few kilometres away in Lisbon, other things with no provenance at all in the US were going badly wrong: Portugal’s borrowing costs leapt to new euro highs on Wednesday, as the markets worried aka factored in the certainty that Lisbon will also eventually default on its debt commitments.

When I say ‘new euro highs’  here, what I mean is sort of Everests compared to previous Matterhorns. Just clock these figures: Portuguese three-year bond yields soared over 19%, while its 10-year bonds jumped over 15%, and five-year bonds just failed to hit 19%.

Unsurprisingly, Portuguese credit default swaps rose to 1,326 basis points – a cost of $1.33m to insure $10m of bonds annually over five years. These figures are what we credit dealers call “unsustainable”.

But Angela Merkel told her Davos devotees to hold firm: firewalls, she told them, are not the answer. “What we in Germany don’t want  is a situation in which we promise something we can’t back up in the end because if Germany… promises something that can’t be kept if markets attack it hard, then Europe is really vulnerable.”

Ach so: Deutschland fuhre Europe. Naturlich. Oh how Angela Merkel gives herself away every time she speaks.



  1. ‘The market is always right’, like ‘the Rothshilds got rich by selling too soon’,or ‘buy on a strike’.One day, politicians may realise that the market is an unbiased view of the world.


  2. Charles D. will deliver. Always has, he is a courtier at the seat of power and seeks to fill the shoes of the now retired Bill Rhodes.


  3. @William

    “The market is an unbiased view of the world” is fine in as far as it goes as a statement save that the markets are shortsighted to the point of near-blindness, which leads me to wonder how much value to place on such “unbiasedness”.

    They have as much foresight as a mole has in the middle of a busy road.


  4. Gemz ,please get real,which would you prefer,the markets,which is free choice expressed by millions, or a politician purporting to represent .Which one is unbiased,the market or the politician?


  5. @Gemz The markets also have a knack of exposing bullshitters and lets be honest they don’t come any bigger then the arrogant (and often unelected) Bilderbergers running the corrupt European Union. Pride comes before a fall and their bankrupt empire is going to break apart just like the old Soviet Union. The markets all know what’s coming and will have their day.


  6. I love the phrase “the markets” when its said with a sense of nobility. Its a betting shop on a par with any bookies only they have stocks instead of horses.

    Rest assured the markets will hold the EU responsible for its hubris but the part they have played in the impending shitstorm cant be ignored.

    Their elevation of the culture of reward without results and out-of-control speculative risk is a fine supporting act to the EUs arrogance and stupidity.


  7. In for the time being. Thye will leave at a more opportune time for M. Sarkozy and Frau Merkel’s reelection bids.


  8. The arrogance of DAVOS is ,well,
    Mind boggling.
    They fool themselves that they are the solution.
    When in fact they are the problem.


  9. @Mark

    The markets do have a propensity for spotting bullsh**tters, but as in the case of the EU, they seem always to spot it when it is too late. Like Greece: it was a problem in 1998, 2001 and only spotted in 2007-8. Way, way too late to be effective against the euro.

    In short, they were taken in by your Bilderbergers just as everyone else was.


  10. @William

    Dutch politicians, thankyou.

    The markets can be steered too easily, and since their motive is nothing but profit, are thereby not acting in a democratic manner. See my response above.

    I will remind you that three Dutch politicians were found guilty of offences that were not even considered culpable in the UK. Three UK politicians are in prison for massive fraud. Dutch politicians are paid to do a job: they see that as sufficient reccompence in doing a job in a democratic society.

    I am truly sorry for the Brits, it is also one reason I left.


  11. @Chris

    Thankyou. See my post above; my firm belief is that had the markets acted with insight and diligence they would have uncovered the faults in the eurozone at the time when it was proper to do so: in 2001-2. The effect would have been salutory and would have arraigned much of the damage.

    That they did not means to me that they were – and are – part of the problem.


  12. The fortunate news is that they’ll have their crash as well. Amazing how what is supposed to be an intelligent system operated by intelligent people is perpetually unable to learn from the past.

    They are all welcome to their fate because of it.


  13. Bankruptcy ever more likely
    Greece is apparently being abandoned

    Merkel admits failure of the Greek rescue for the first time

    Angela Merkel declares the rescue efforts for Greece as not being crowned with success. Neither the Greeks nor the international community has been in a position to stabilise the country.

    In an interview with the Guardian and five other European newspapers, Angela Merkel has acknowledged for the first time that, despite the bailout-billions, the stabilising of the situation in Greece has not succeeded.

    The Guardian quoted Merkel with the words: “Greece, a special case where, despite all the efforts that have been made, neither the Greeks themselves nor the international community have yet managed to stabilise the situation.”

    This admission could be the overture for the state bankruptcy of Greece. After all, up to now Merkel has always maintained that, with the help of the EU, Greece could be saved.

    In the interview Merkel strictly rejected further financial help: “There is be no point in promising more and more money without tackling the causes of the crisis. In view of all the billions in financial assistance and rescue packages, we Germans also need to watch that we don’t run out of steam. After all, our capacities aren’t infinite, and overstretching ourselves wouldn’t help us or the EU as a whole.”

    Merkel’s solution to the crisis is the United States of Europe (more here).

    http ://

    and, if your computer is sturdy enough –

    http ://

    If anyone is in need of a giggle, try this photo:

    http ://

    “The faces of the “Arabian Spring”

    “Three are already asleep, three are gazing around with a bored expression, one is reading a booklet, another typing into his phone, one beard longer than the other – Islam has apparently arrived in the Egyptian parliament.”


  14. It seems to me that Greece has been abandoned for at least 2 months, but the questions remain as to who takes what hit, when it happens (both the official default and the euro exit) and who avoids the blame, the latter being the biggest question. Of course Portugal must now follow, and who can bet against Spain and Italy any more. Unless Germany runs first – that is far from impossible.


  15. @Chris

    Well again, this “crash” is indeed part of the problem. Their crash is our economic problem and loss of pensions. It is not an academic hypothesis that can be popped with an imaginary needle (though much of the hypothecation certainly is) – a market crash will bring the lot down. Good and bad.


  16. @Bonny

    that is why I stick around. The likes of you are part of the problem, when such informative and insightful remarks are made. It is after all how the corruption in UK politics has been allowed to develop unhindered. People just say “STFU” and then ask what the question was.


  17. @VJ

    I think Bonny (below) would fit very well into a parliament as lively as that shown on Pi News! Talk about being active and forceful politicians.



    “Blocco TIR

    Damage estimated to run into hundreds of millions of euros

    Italian strike: Fruit and vegetables in short supply in Rome

    The strike by Italian truck drivers continued on Wednesday. In many towns there were shortages of fruit and vegetables. Petrol is also scarce. In smaller towns the garbage collectors cannot turn up. Citizens are being asked to store the garbage at home. In Rome, fishermen gathered together, there were violent clashes with police.

    Published: 25.01.12, 16:31 | Updated: 25.01.12, 19:03 |

    The road blockades in Italy continue. True, the interior minister Anna Maria Cancellieri and Premier Monti had called the right to strike as inviolable (here), but the consequences of the strike spreading. Following the production stops for many companies because of interrupted supplies (more here), the truck blockades are now showing additional effects. Many cities are reporting initial shortages of food and petrol. Food prices are rising and public transport coming to a halt.

    Wearing life jackets and carrying large banners proclaiming “European Community – we are sinking”, this morning hundreds of fishermen joined the protests against the rise in fuel prices. They came from all over Italy, travelling to Rome to gather in front of the Chamber of Deputies. Some of the demonstrators set off firecrackers. There were numerous violent confrontations with the police, which caused some casualties. The fishing industry has been complaining for some time about additional costs due to EU regulations.

    Starting tomorrow, the situation could worsen: the unions have called for a general strike on 26 January. Except for some regional trains, rail traffic is also to be stopped. Significant disruptions are also expected in air traffic. Whatever, the Roman airports should be connected with the centre by an emergency service. Observers also believe that the general strike will reduce the traffic density, because many Italians will have to spend one days forced holiday at home (just like the workers at Fiat – here).

    As a result of the blockades on the Italian motorways, food and fuel can no longer be delivered to many places, reports the daily newspaper Corriere della Sera. Already at the start the authorities had feared the protests could get out of control (more here). Amazingly, however, no precautional measures were taken. Due to lack of fuel, public transport and municipal services are being affected – in some areas, the use of school buses has been put on hold. In the town of Casoria, the mayor has already called on the population to collect their waste at home, because the garbage collection service cannot move because of a lack of fuel.

    In many cities the shelves of supermarkets remain empty. Exports to Germany are already also affected (more here). On Tuesday in Rome, 70 percent less fruit and vegetables were delivered. The shortages have already led to a sharp rise in food prices. In Sicily, the prices had already been raised by 10 to 15 percent. One kilogram of zucchini had already reached € 6.50, reported the daily newspaper Il Messaggero. Given these price dimensions, the National Association of Farmers Coldiretti has decided to hand over fruit and vegetables free of charge to pensioners and families. Naples has reported above all a shortage of dairy products. The trade association Confcommercio says that there is thus far no shortage of essential foodstuffs.”

    So much for “Just-In-Time” production, where everything is stored in trucks on the motorways – the management buzz-word of the late 80’s. I can well imagine some management types may rethink that policy when the dust finally settles – if it ever does!

    To bang on again about what the MSM is, respectively is not, reporting – this comment:

    “It’s really interesting. With an occasional retch I’ve just worked my way through the dumbed-down press and found not one mention of the strike in Italy. It seems to me that this whole so-called press is required to write only that which serves the dark men. Half a country is lying prostrate, and it is not being reported. Really, things must be close to collapse.”


  19. Oh dear, as both of my fully functioning brain cells have blown a fuse, I shall retire to my shed to hibernate. Can someone wake me in April, unless I’ve already been woken by the sound of something going CRASH.


  20. “Gemz
    January 25, 2012 at 11:07 pm

    that is why I stick around. The likes of you are part of the problem, when such informative and insightful remarks are made. It is after all how the corruption in UK politics has been allowed to develop unhindered. People just say “STFU” and then ask what the question was.”

    Well said Jemz


  21. @ Gemz

    I made my first acquaintace with “Bonny” a couple of days ago. Nuff said!

    As for banishing her to the Egyptian parliament, going on the assumption of course that “Bonny” is a female name, would that be allowed by them? Plus, if it is, as a female is only worth half as much as a man under Islamic law (or is it a quarter?), we’d have to clone her to get the same voting power. That could be too much to bear.

    Instead, perhaps we could matchmake her to one of the parliamentarians shown in the piccy, how about the youngish looking chap at bottom left. For the initial rendezvous we could also tog her up in the Islamic version of “Victoria’s Secrets” – goatskin bra, donkeyskin suspender belt and camelhair stockings. All in the interests of multi-culti.

    Or do you think the pamphlet reader and/or telephonist could be more to her taste?


  22. Gemz

    When the Euro was formed in 1999 the markets did warn it was flawed and would break apart eventually in a financial crises. I can clearly remember George Soros saying exactly that. He could not predict exactly when or the circumstances it would break apart but he categorically stated it wasn’t going to be sustainable in the long run. This was the man who in 1992 walked away with 10 billion pounds in his back pocket after the collapse of the Euro’s forerunner the ERM when that also broke apart. The stupid European politicians learnt nothing from that debacle and decided to repeat it on a much much bigger scale. As the old saying goes “if you do what you always did, you will get what you always got.”

    As for Greece in the greater scheme of what’s coming its really just a side show to keep the world entertained until the main event arrives.


  23. There’s enough diesel around for the fishermen to go to Rome from all over the country. Me thinks they do protest too much. Does anyone think there is not a long term problem with the oil supply? Of course I know the price is mostly tax throughout Europe, but indirect taxes are much easier to collect than the direct kind in places like, well, everywhere in Europe. Some places are well known for their vast expertise in non payment of income taxes. Italy is only one of them. Nobody likes taxes (I have just filed mine so I’m feeling a bit bruised) but then everyone likes their welfare states. And incremental borrowing is out of fashion, or at least it should be.


  24. On Tuesday in Rome, 70 percent less fruit and vegetables were delivered…..

    My my the ‘five a day’ dictators in the UK must be gnashing their teeth and coughing up bile (and particulate of lung). Soon demanding taxpayer funded air travel to the closed Italian Airports to ensure compliance with the fit regime…. after all how can they insist that we all adhere to a mediterranean dietry regime here when the damn Iti’s ain’t complying with their commandments in order to live forever in a life of drudgery….. Their all gunna diiiiiiie !……. Sometime.


  25. @Mark

    so why did the markets then do nothing? Saying something is fine. The problem with this is the problem with everything that is said: it is only said.

    Doing what you say is quite another matter altogether.


  26. @Someguy

    you need a life, pom. There will always be differing views in a democracy – which is something long forgotten in British politics. It is possibly why nobody likes British politicians in Britain. (Take a look at what JW says about them!)


  27. John – it has to be said – your growing popularity is lowering the tone of the discussion.

    Look if you don’t want to read when Gemz has to say….. just skip it and save the rest of us from having to skip your inane comments. Or reply with reasoned (or comical if so required) arguments. No one asks you to agree – we just ask for reasoned thoughful or entertaining or even enlightening comment.

    It is a Blog for grown ups ! (excepting my goodly self of course !)


  28. @Alice

    I have opinions. That they are not in line with what most people think here does not make them any more or any less right. It does make them uncomfortable for some people.

    If you have something to say about my comment that is sensible, that is fine and I might learn something from you.

    Just saying that I am opinionated tells me that you have nothing of real value to bring to the conversation.


  29. @Tony

    They have gathered here for inspiration and leadership. The hall is full with people pressed at the back and more waiting outside . The podium is bedecked with the colours of the leading party. The leader has his speech notes in his hand, he rises from his seat to the applause of those massed in the hall.

    The noise abates slowly and the lights are dimmed leaving the leader in a single spotlight.

    The hall is quiet and the audience awaits with baited breath the words of those who have important things to say to them.


    The audience look at each other and there is a general murmur of discontent. Is Tony really the great leader they travelled so far to listen to?


  30. @VJ

    to be honest any of them would be capable of boring her so rigid that she might take up an evening course just to get out of the house. She might have something useful to contribute as well.

    In short, a brilliant idea, Jack.


  31. As with everything here, if it is wrong construct a reasoned argument as to why (you think it is) and post it then we can all continue to debate the matter or descend into Hairy dog stories


  32. William

    If the ‘market is always right’ as you state (a la efficient market theory) then what purpose would there be in buying any share? As they would all be accurately priced with no present chance of profit and all future potential fully priced in?

    Market bias is where the speculators are (HFTraders, day traders et al) make their profit/losses.

    To every seller there is (or hopefully there is except in fast markets) there is a buyer with equal and opposite views and expectations.

    As Yogi Berra was purported to have stated ‘in theory, practice and theory are the same. But in practice ….

    You once touted that you granted put options on Barclays shares at 180 pence for 31 pence. I am sure you remember the ‘unbiased market’ then promptly went into a bear squeeze (how is this unbiased?) to the effect that within a handful of weeks Barclays as you know was trading at 135 pence.

    It is worth rereading Keynes’ observation on markets and their propensity to remain irrational for longer periods than investors can remain solvent.

    Touting ‘unbiased markets’ as a truism does the unwary no favours whatsoever and is demonstrably a myth.


  33. @RV – thanks. Yes that one worked.

    Should add that I am suitably distressed by the report though not surprised. these thieves never surprise me any more… though I won’t be surprised either when they get whats coming to them……


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