Greece: ‘Ouzo crisis’ escalates into global margin call as confidence ebbs

For the third time in 18 months the global financial system risks spinning out of control unless political leaders take immediate and radical action.

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A driver stands near parked trucks on the road leading to the Kulata border crossing between Bulgaria and Greece. The roadblock was set up by farmes protesting higher taxes.

Flow data shows an abrupt withdrawal of German and Asian capital from Club Med debt markets. The EU’s refusal to offer Greece anything beyond stern words and a one-month deadline for harsher austerity – while admirable in one sense – is to misjudge how fast confidence is ebbing. Greece’s drama has already metastasised into a wider systemic crisis. The world risks a replay of the Lehman collapse if this runs unchecked, this time involving sovereign dominoes.

Barclays Capital says the net external liabilities of Greece are 87pc of GDP, or €208bn (£182bn). Spain is worse at 91pc (€950bn), and Portugal worse yet at 108pc (€177bn); Ireland is 68pc (€123bn), Italy is 23pc, (€347bn). Add East Europe’s bubble and foreign debts top €2 trillion.

The scale matches America’s sub-prime/Alt-A adventure and assorted CDOs and SIVS of the Greenspan fling. The parallels are closer than Europe cares to admit. Just as Benelux funds and German Landesbanken bought subprime debt for high yield with AAA gloss, they bought Spanish Cedulas because these too had a safe gloss – even though Spain’s property boom broke world records. They thought EMU had eliminated risk: it merely switched exchange risk into credit risk.

A fat chunk of Club Med debt has to be rolled over soon. Capital Economics said the share of state debt maturing this year is even higher in Spain (17pc) than in Greece (12pc), though Spain’s Achilles’ Heel is mortgage debt.

The risk is the EMU version of Mexico’s Tequila crisis or Asia’s crisis in 1998. This Ouzo crisis is coming to a head just as tougher bank rules cause German lenders to restrict loans, and it touches on the most neuralgic issue of our day: that governments themselves are running low. Britain, France, Japan, and the US are all vulnerable. All must retrench. The great “reflation trade” of 2009 is over.

Read moreGreece: ‘Ouzo crisis’ escalates into global margin call as confidence ebbs

Prof. Russell Roberts Testifies Before House Committee: ‘I Want My Country Back!’

Russell Roberts is a professor of economics at George Mason University and former Director of the Center for Experiential Learning at Washington University in St. Louis.

Roberts is a regular commentator on business and economics for National Public Radio’s Morning Edition, and has written for the New York Times and the Wall Street Journal.

Professor Roberts focuses on communicating economics to non-economists, and to that end is the host of the award-winning podcast EconTalk and blogs at Cafe Hayek with Donald J. Boudreaux.

Read moreProf. Russell Roberts Testifies Before House Committee: ‘I Want My Country Back!’

Poland: Priest checks fingerprints for mass attendance

WARSAW (Reuters) – A Polish priest has installed an electronic reader in his church for schoolchildren to leave their fingerprints in order to monitor their attendance at mass, the Gazeta Wyborcza daily said on Friday.

Oddly Enough

The pupils will mark their fingerprints every time they go to church over three years and if they attend 200 masses they will be freed from the obligation of having to pass an exam prior to their confirmation, the paper said.

The pupils in the southern town of Gryfow Slaski told the daily they liked the idea and also the priest, Grzegorz Sowa, who invented it.

“This is comfortable. We don’t have to stand in a line to get the priest’s signature (confirming our presence at the mass) in our confirmation notebooks,” said one pupil, who gave her name as Karolina.

Read morePoland: Priest checks fingerprints for mass attendance

Secret Summit of Top Central Bankers in Australia

* World’s top bankers fly in
* To meet at secret location
* Trouble on the horizon

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The high-powered gathering coincides with a fresh meltdown on world sharemarkets (AP)

THE world’s top central bankers began arriving in Australia yesterday as renewed fears about the strength of the global economic recovery gripped world share markets.

Representatives from 24 central banks and monetary authorities including the US Federal Reserve and European Central Bank landed in Sydney to meet tomorrow at a secret location, the Herald Sun reports.

Organised by the Bank for International Settlements last year, the two-day talks are shrouded in secrecy with high-level security believed to have been invoked by law enforcement agencies.

Speculation that the chairman of the US Federal Reserve, Dr Ben Bernanke, would make an appearance could not be confirmed last night.

The event will be dominated by Asian delegations and is expected to include governors of the Peoples Bank of China, the Bank of Japan and the Reserve Bank of India.

The arrival of the high-powered gathering coincided with a fresh meltdown on world sharemarkets, sparked by renewed concerns about global growth and sovereign debt.

Fears countries including Greece, Portugal, Spain and Dubai could default on debt repayments combined with disappointing US jobs data to spook investors.

Read moreSecret Summit of Top Central Bankers in Australia

BAE Systems admits guilty to “defrauding the US”, fined $400m over Saudi payments

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BAE Systems (formerly British Aerospace) is Europe’s largest arms exporter

Where is the outrage?

“BAE’s settlement means that it has not been banned from bidding for government contracts in the US and UK.”

Pay $400m and everything is OK? Business as usual?

Maybe BAE has now bought everybody with prostitutes, sports cars etc.:

BAE System’s Dirty Dealings (CorpWatch)

BAE accused of arms deal slush fund (Guardian)

Or BAE is now too important for the New World Order:

Big Brother: UK Police Plan to Use Military-Style Spy Drones (Guardian)


BAE Systems has agreed to pay a $400m (£257m) fine after admitting to “defrauding the US” over the sale of fighter planes to Saudi Arabia and Eastern Europe.

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The sanction came as the UK ended its six-year investigation of the company over allegations of bribery, and dropped charges of conspiracy to corrupt brought last week against an Austrian count accused of being a BAE agent.

The settlement will be seen as a victory for the US authorities, but an embarrassing climbdown for the UK’s Serious Fraud Office (SFO) – which in 2006 was forced by the Government to drop its investigation into BAE in Saudi Arabia.

BAE is charged with conspiracy to “knowingly and wilfully impede” the authorities by making certain false, inaccurate and incomplete statements in relation to compliance with anti-corruption standards, thereby “defrauding the US”.

In a court filing, the US Department of Justice (DoJ) claims that BAE transferred more than £10m and $9m to Swiss bank accounts controlled by an agent with a high probability that a payment would go to a Saudi Arabian official in a position of influence.

It also claims that in the Czech Republic and Hungary, BAE paid more than £19m to an agent to secure leases of Gripen fighter jets, despite a high probability that part of the payments “would be used in the tender process to favour” the company.

The document also says that BAE “took steps to conceal its relationships [with intermediaries] and undisclosed payments to them” by using offshore shell vehicles.

The DoJ estimates that BAE gained more than $200m from various false statements to the US government from 2000 onwards.

Yesterday, Dick Olver, BAE’s chairman, sought to draw a line under the long-running investigation, indicating the company would plead guilty and apologise for past shortcomings. “None of these counts relate to corruption, bribery or conspiracy to corrupt,” he added.

BAE’s settlement means that it has not been banned from bidding for government contracts in the US and UK.

Read moreBAE Systems admits guilty to “defrauding the US”, fined $400m over Saudi payments

China to Impose Dumping Penalties on US Chicken

Feb. 5 (Bloomberg) — China, the largest market for U.S. chicken, will impose anti-dumping duties of as much as 105.4 percent on imports of American poultry products, threatening to deepen a trade rift.

Importers of U.S. broiler-chicken products will be required to pay after an investigation showed they had caused “material damage” to local suppliers by selling at below-market prices, the Ministry of Commerce said in a statement on its Web site, citing a preliminary ruling. The duties are effective Feb. 13.

The ruling may further strain trade relations between the U.S. and China, which began its investigation in September, two weeks after the U.S. imposed tariffs on Chinese tire shipments. Ties have soured over proposed U.S. arms sales to Taiwan and President Barack Obama’s plan to meet the Dalai Lama this month.

“This is probably a result of political tension, although a trade war between the two economies is unlikely,” said Li Qiang, a managing director of Shanghai JC Intelligence Co. China consumed almost 800,000 metric tons of U.S. chicken in 2008, valued at $722 million, according to the USA Poultry & Egg Export Council.

China’s chicken probe also was a response to a decision by Congress that effectively bans imports of cooked poultry, James Sumner, the president of the poultry export council, said on Sept. 14.

Read moreChina to Impose Dumping Penalties on US Chicken

Fears Rise of Euro Government Default, Euro And Stock Markets Slump

See also:

Trichet Says Greece, ‘All Countries’ Must Meet EU Deficit Rules (BusinessWeek)

Germany Warns of ‘Fatal’ Eurozone Crisis, Funds Flee Greece (Telegraph):

Germany has triggered a near-panic flight from southern European debt markets by warning that there will be no EU bail-outs, even though it fears the region’s economic crisis has turned dangerous and could prove “fatal” for the entire eurozone.


euro

Financial markets swooned Thursday amid rising fears of a government debt default in Europe, highlighting the seriousness of the challenges facing the euro currency as fiscally challenged countries like Greece, Portugal and Spain dig themselves out of debt.

After a brief respite early this week, the cost of insuring against default the debt of euro-zone members with large budget deficits jumped late Wednesday and rattled investors more broadly on Thursday.

While Greece and Portugal have felt investors’ fire in recent days, now even larger economies like Spain are starting to come under pressure from worries about their weakened public finances.

Blue-chip stock indexes in Spain and Portugal slumped nearly 6% and 5%, respectively, while an index of Europe’s 600 biggest companies dropped 2.7%. The euro sank more than 1% against the U.S. dollar to an eight-month low of $1.3727 and lost 3% of its value against the Japanese yen.

The global economic downturn, and extensive government spending to fight it, have led to major fiscal problems in Europe, especially for less-dynamic economies like Greece, Portugal, Ireland and Spain. Such countries took advantage of their membership in the 16-nation euro bloc during the boom by borrowing at unusually low interest rates. But now, investors are worried about how they will reduce yawning budget deficits that exceed 12% of their economic output in the case of Greece and Ireland.

Read moreFears Rise of Euro Government Default, Euro And Stock Markets Slump

Director of National Intelligence Says US May Kill Americans Abroad

Sounds like a nice official, international SS death squad to me.

The US government is about to kill US citizens and it is the US government that defines who is a terrorist, and who’s not.

Related information:

US Soldier: The Enemy Is At Home

Rep. Ron Paul on Obama seeking to assassinate ‘US citizens’ he labels as terrorist

Rep. Ron Paul Warns of Social Unrest and Martial Law

CIA Director Reveals Spec Ops Report: US Needs Hit Squads, ‘Manhunting Agency’


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In a striking admission from the Obama Administration’s top intelligence officer, Director of National Intelligence Dennis Blair announced Wednesday that the United States may target its own citizens abroad for death if it believes they are associated with terrorist groups.

“We take direct action against terrorists in the intelligence community,” Director of National Intelligence Dennis Blair told the House Intelligence Committee. He said US counter-terrorism officials may try to kill American citizens embroiled in extremist groups overseas with “specific permission” from higher up.

If “we think that direct action will involve killing an American, we get specific permission to do that,” Blair said in response to questions from the panel’s top Republican, Representative Pete Hoekstra.

Blair’s comments came after The Washington Post reported that US President Barack Obama had embraced predecessor George W. Bush’s policy of authorizing the killing of US citizens involved in terrorist activities overseas.

If a United States citizen was determined to have joined a foreign terrorist group, that person could be legally murdered under orders given by President George W. Bush after the 9/11 attacks.

“After the Sept. 11, 2001, attacks, Bush gave the CIA, and later the military, authority to kill U.S. citizens abroad if strong evidence existed that an American was involved in organizing or carrying out terrorist actions against the United States or U.S. interests, military and intelligence officials said,” the Post reported. “The evidence has to meet a certain, defined threshold. The person, for instance, has to pose ‘a continuing and imminent threat to U.S. persons and interests,’ said one former intelligence official.

“The Obama administration has adopted the same stance. If a U.S. citizen joins al-Qaeda, ‘it doesn’t really change anything from the standpoint of whether we can target them,’ said a senior administration official. ‘They are then part of the enemy.'”

Read moreDirector of National Intelligence Says US May Kill Americans Abroad

US Soldier: The Enemy Is At Home

Bush and Blair knew that the war was illegal and that Iraq did not have any WMD’s!

Tony Blair Was Warned By All 27 Senior Government Lawyers That Iraq War Was Illegal

Dutch Inquiry: Iraq War Was Illegal, Had ‘No Basis In International Law’

US and UK knew that Iraq Didn’t Have WMDs

Tony Blair ‘knew Iraq did not have WMD before war started’

In case you want to know one reason why the ‘real terrorists’ invaded Afghanistan, then read this:

Former UK ambassador: CIA sent people to Uzbekistan for extreme torture, to be ‘raped with broken bottles,’ ‘boiled alive’ and ‘having their children tortured in front of them’

Almost the entire US government is bought and paid for.


Here is a short video of a speech given by a military soldier explaining the simple truth as to why we are actually in Iraq.


YouTube

Why are we at war?

War is profitable, that’s way.

It matters not how many die, as long as the warmongers make a profit on it.

Inquiring minds are noting increasing resentment against US militarism in places some might least expect. Please consider Thousands protest in Tokyo against U.S. military presence in Japan

Thousands of protesters from across Japan marched today in Tokyo to protest against U.S. military presence on Okinawa, while a Cabinet minister said she would fight to get rid of a marine base Washington considers crucial.

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Some 47,000 U.S. troops are stationed in Japan, with more than half on the southern island of Okinawa. Residents have complained for years about noise, pollution and crime around the bases.

Japan and the U.S. signed a pact in 2006 that called for the realignment of American troops in the country and for a Marine base on the island to be moved to a less populated area.

But the new Tokyo government is re-examining the deal, caught between public opposition to American troops and its crucial military alliance with Washington.

On Saturday, labor unionists, pacifists, environmentalists and students marched through central Tokyo, yelling slogans and calling for an end to the U.S. troop presence.

They gathered for a rally at a park – under a banner that read ‘Change! Japan-U.S. Relations’ – for speeches by civil leaders and politicians.

Read moreUS Soldier: The Enemy Is At Home