The Markets and Greece - Eurozone Crisis

BBC News: Reports on comments by former Greek PM Lucas Papademos, the former PM has stated that the Greek Government might be making plans to leave the Euro. This has sent EU Stock Markets tumbling.

Lets Get Real:

One can postulated folks that Greece might be out of the Euro before the June 17th Greek General Election, how long can the Markets take this constant up and down from Euro leaders when it comes to the Greece and the Euro. At the G8 the Leaders made it clear they wanted Greece to stay in the Euro but meet the terms of its agreement when it comes to austerity, Stock Markets for some reason went up, now they are heading down again, from between 1% t0 2%. At present the FTSE 100 in the UK at 1.40pm is down 2.9%. There is another EU leaders meeting tonight folks, as the article notes new French President, Francois Hollande wants Euro Bonds, the Germans have said NO, they fear that they will end up having to bailout the PIIGS till forever. Thus either the Markets or the Germans might decide before June 17th that's enough is enough and give Greece a RED CARD, this blog sees 4/10 chance of that happening, its not out there folks, time is not the side of the Euro or the Greeks.

POTUS and Germany

Courtesy of the White House

As overhead by an American Eagle, Distance might have confused this conversation.

POTUS: Please AM gives me Euro Bonds, that will keep Greece in the Euro and get me re-elected.

Chancellor: Hows that 16 Trillion Debt going?

POTUS: If we spend we can get growth.

Chancellor: Weimar Germany, NO

POTUS: IF don't get re-elected you get a Conservative President.

Chancellor: Thanks I need a laugh, you bailout Greece after you get re-elected and I will say yes to Euro Bonds.

POTUS: Your not keen on me are YOU, my Staff and the NYT love me.

Chancellor: That's your problem!

Greece and the Euro

Telegraph: Reports that the G8 has called for Greece to remain in the Euro but for it to keep to its agreements.

Lets Get Real:

The above in a way is a threat to Greece, toe the line as to your agreement or your out, the political leaders might stress growth but only Germany has the money to bailout Greece and the rest of the PIIGS, and the German tax payer has had enough of its lose spending EU allies. Thus since the May election in Greece the Greeks banks have seen billions taken out by people afraid that their saving will be cut over night should Greece return to its original currency. The question that has to be asked can Greece get to June 17 and its General Election before the Greeks banks go under, will the EU/IMF/ECB bailout the Greek banks before the June election. If not Greece will be carried out of the Euro by events not the political process. Its down to Greek voters folks, they have to decide, austerity or OUT of the Euro. The fate of Greece and the Euro could be settled by the June election in Greece.

G8 and the Euro

BBC News: Reports that the US and French stress on growth won out in the debate at the G8 about the present crisis facing the US and Europe, the losers in the debate are seen as the UK and Germany and their austerity plans.

Lets Get Real:

It does not matter what the US and France want, its Germany that holds the money strings, the US has a near 16 trillion debt, POTUS is taking the class warfare attack at present to keep his uber liberal base happy. In the case of President Hollande he is still in Campaign mode, he has Parliamentary elections coming up, thus he cant fold, he needs to stress growth, as if this is some cure to all the economic ills facing Europe. The nightmare for Hollande after just winning the election would be to share power with the extreme right wing PM, that would be a political nightmare for him and the his left party. The Germans and the UK will of course stress growth but they are not going to drop their austerity plans to keep Hollande happy, as it was noted in Germany of late, the Germans are not going to pay for French election promises.

NYT on Merkel of Germany

The New York Times: Has the following tough Editorial on German Chancellor Angela Merkel and her austerity policy on Greece and the EU, " This is no time to mince words: Her one-size-fits-all austerity program has been a failure.. ".

Lets Get Real:

This is the uber liberal and bloated NYT wanting to spend money, it does not get the fact that the US is heading for a debt of 16 trillion, that EU States minus Germany are broke, that their idea of policy is tax the rich, in other words its the typical left wing rubbish you expect from the NYT and Labour in the UK. The Welfare State created since 1945 in the US and the EU can not be afford folks, sooner or later and it will be sooner the US and the EU will get the fact that the idea that the State can look after you from birth to death will kill that States in economic terms. The very success of the welfare state means that people live longer, thus benefits never go down, they always go up, if you tax people at 100% then you don't get any money in, that simple folks. Why should someone create a business when the left wants to make people that make money hate figures, why go through such a critical review, why bother, that's the question that the left never have an answer, they just want to tax, it never works folks, just look at the UK in the 70s, it was the sick man of Europe, over taxed and no up and go to create business, the EU is heading in that direction folks, the left never has any real answers just slogans, ah for a leaders like Lady Thatcher or Ronald Reagan, the greats, but they don't come around that often folks.

The UK and Greece - Eurozone Crisis

Guardian: Reports on the comments of Robert Chote of the Office of Budget Responsibility, Mr Chotes has warned that a Greek exit from the Euro " .. threatens to plunge Britain into a second recession equal in ferocity to the record postwar slump of 2008-09.. ".

Lets Get Real:

It has been stated by G8 sources that no solution can be expected from the G8 meeting or further EU meetings, it seems Eurozone leaders are waiting for Greece to make up its mind, the EU and the Euro does not have a month to wait, as we have seen over the past 48 hours Spanish Banks have started to come under threat, also it has been noted by Spanish economic experts that the Spanish Government does not have the money to bailout the entire Spanish banking system should that become an issue. The new Spanish PM has made it clear that while the Market might have 7% as the cliff point for Spanish bonds the present cost of 6% can not be held for long, thus if Greece is not solved in days the EU might find that its Spain that needs a major bailout, and this blog will promise that German tax payers will not agree to bailout either Spain or Italy. Also the Germans might have pushed the Greeks to far by the suggestion that they hold a referendum on the Euro, the Germans are playing Russian Roulette with the Euro, they think the Greek voters can be pushed around like the Irish voters, that might be a bluff to far folks. Either Germany gets its wallet out big time or Greece has to be thrown out of the Euro and then the money that would have been used to save Greece would be used to protect Spanish Banks. That simple and brutal folks.

Stock Markets and the Euro

BBC News: Reports that US and EU Stock Markets had another bad day to the worry over Greece and Spain. In the UK the FTSE 100 was down 1.33%.

Lets Get Real:

It can be argued with some justification that Western political leaders are fiddling while Euro burns. The G8 in Washington D.C is not expected to come up with any solutions. The only solution coming from the G8 minus Germany is that German tax payers bailout the Euro, this would include the PIIGS. That will go down like a lead balloon in Germany. The old solution is for Euro bonds to be under written by Germany, the problem is that German Basic Law states that Germany can not take on the debts of others, the German High Court has made it clear that it wont allow the German Chancellor to under write such bonds. Thus no solution folks, Spanish Banks have come under the spotlight, if Spain and Italy goes so does the Euro , the EU would not be that far behind. It is that drastic folks.