Help Greece Save Herself

Paolo Manasse

Apr 28, 2010 11:50AM

On Friday, April 24, the Greek government requested the IMF and European Union to activate the agreed 45 billion euro loan. The request came just a day after Moody’s downgraded the Greek debt (from A3 to A2) and Eurostat revised its estimate of the 2009 government deficit to 13.6% (up from 12.7%) of GDP. S&P followed soon. 

The Euro Trap

Date: 30-04-2010
 Source: PAUL KRUGMAN

Not that long ago, European economists used to mock their American counterparts for having questioned the wisdom of Europe’s march to monetary union. “On the whole,” declared an article published just this past January, “the euro has, thus far, gone much better than many U.S. economists had predicted.”

Oops. The article summarized the euro-skeptics’ views as having been: “It can’t happen, it’s a bad idea, it won’t last.” Well, it did happen, but right now it does seem to have been a bad idea for exactly the reasons the skeptics cited. And as for whether it will last — suddenly, that’s looking like an open question.

Europe: The Titanic is Sinking

John Mauldin’s Outside the Box, 29. April

This is a special Outside the Box. I got this letter from my good friend Greg Weldon last night and got permission to pass it on to you. I think it illustrates the problems that the world is facing from the sovereign debt crisis that is building in Europe.

There are no good solutions here, only very difficult ones. In order to get financing, Greece must willingly put itself into a multi-year depression. And borrowing more money when it cannot afford to pay back what it has will not solve the problem. 61% of Greeks now favor leaving the euro. How has Greece responded? By banning short selling on its stock market for the next two months.

Greek Banks Downgraded to Junk by S&P

S&P downgraded four Greek banks (EFG Eurobank Ergasias S.A., Alpha Bank A.E., Piraeus Bank S.A. and EFG Eurobank) to BB from BBB on April 27, after cutting the sovereign rating to BB+. S&P also lowered the National Bank of Greece S.A. (NBG) to BB+ from BBB+. The move follows reports by the FT, Reuters and other sources that Greek banks have been growing increasingly desperate for support from the government and ECB. Though the ECB reported strong inflows into Greek banks in February, other sources in March and April have been citing evidence of outflows. Credit downgrades are also threatening banks’ viability.

S&P Downgrades Portugal’s Sovereign Rating Two Notches to A-

S&P cut Portugal’s sovereign debt rating from A+ to A-, citing concerns about the Portuguese economy’s ability to stabilize deteriorating public finances. S&P expects economic growth in Portugal to remain subdued, held back by severe structural weaknesses. Furthermore, access to external financing, which has boosted economic growth in the past, will prove much more limited going forward. Fiscal consolidation will hence prove more difficult given weak economic growth prospects in the medium term. Additional fiscal austerity measures, beyond those outlined in the stabiliy program, might be required to reach the announced fiscal targets. S&P maintained its negative outlook for the Portuguese sovereign rating.

Ist Niederösterreich viel anders als Kärnten?

Ein aufschlussreiches Video zum Abzocken: http://www.youtube.com/watch?gl=DE&v=z-PKO0sE4bo

Reviewing the Case for Radical Surgery

Dies ist Nugget #7 aus Prof.  Kotlikoff’s sensationellem Buch “Jimmy Stewart is Dead. Ending the World’s Ongoing Financial Plague with Limited Purpose Banking“, März 2010.

Moody’s Raises Iceland’s Rating Outlook Following IMF Disbursement

An US$160 million disbursement from the IMF prompted Moody’s to raise its rating outlook for Iceland’s foreign and local currency loans to stable from negative on April 23, after concerns about Iceland’s external liquidity situation had degraded its sovereign credit ratings for months. Only a few weeks earlier, Moody’s had downgraded Iceland’s outlook. Moody’s still ranks Iceland the lowest investment grade, Baa3. In late March, S&P cut Iceland’s local currency ratings but kept Iceland’s debt investment class. In early January, Fitch downgraded Iceland’s main sovereign ratings to junk status. Iceland’s large debt has raised questions about the country’s ability to repay its creditors, though the size of the final Icesave bill is still unclear.

The Federal Government is a Wholly-owned Subsidiary of the Financial Sector

Dies ist Nugget #6 aus Prof.  Kotlikoff’s sensationellem Buch “Jimmy Stewart is Dead. Ending the World’s Ongoing Financial Plague with Limited Purpose Banking“, März 2010. Weitere Nuggets folgen.

Taking Stock

There are many critical lessons from what happened in the fall of 2008 and over the following year. First and foremost, we saw the amazing fragility of the current financial system and the fact that our politicians are fully prepared to publicly advertise its fragility in order to

Goldman Sachs – die Blasenmaschine

Das allererste, was man über Goldman Sachs wissen muss, ist, dass sie überall sind. Die mächtigste Investment Bank der Welt ist eine große Vampir-Krake, die sich über das Antlitz der Menschheit gestülpt hat und ihren Saugmund unablässig überall dorthin steckt, wo es nach Geld riecht.

Aus „Rolling Stone“. GoldmanSachs_Analyse