US Credit Downgrade ?

BBC News: Reports from the US via ABC News that the Credit Agency, Standard & Poor's is to downgrade US credit. Thus folks the debt ceiling deal didn’t help, the Agencies wanted around 4 trillion in cuts, the deal is around 2.5 trillion, throwing tea cup at a fire, ( stronger language but its open page ), the Eurozone Crisis with the high chance that Italy will default has sent the markets tumbling this week. Our lords and masters seem to fiddle while Rome burns, the EU has its head up its backside at the moment, it thought it had solved the problem with a 2nd Greek bailout, problem its gone from HIV to Aids, the entire economic structure has been affected, thus Italy is almost a certain default, Spain has 60/40 chance of getting through as its debt to GDP is around 70%, the EU/IMF can deal with that, it cant deal with Italy. The cure folks, as stated many times in this blog, the EU has to get serious, bailout out Italy and Spain, kick out Greece, Ireland and Portugal, reform the welfare state in these countries, live in the 21 Century not the start of the 20th. Don’t hold much hope folks, this kind of action would take political courage, modern politicians not that brave.

Obama TALKS = Eurozone/Syria

Has a read of talks between President Obama and President Sarkozy of France and Chancellor Merkel Germany, “ The President spoke with French President Nicolas Sarkozy and, separately, with German Chancellor Angela Merkel this afternoon about the latest developments in the eurozone crisis. Noting the significant steps taken at the July 21 summit of leaders of the euro area and the importance of their implementation, the President welcomed the continued leadership of President Sarkozy and Chancellor Merkel in addressing the challenges facing Europe’s economy. The President also consulted with President Sarkozy and Chancellor Merkel on the situation in Syria. The leaders condemned the Assad regime’s continued use of indiscriminate violence against the Syrian people. They welcomed the August 3 presidential statement by the UN Security Council condemning Syria’s actions, but also agreed to consider additional steps to pressure the Assad regime and support the Syrian people. ”. In essence folks, Obama, Sarkozy and Merkel are in the same political lifeboat when it comes to the Eurozone crisis, if one goes down they all go down, they need each other, as with Syria its hot air, no action thus just PR.

Death in Afghanistan

MOD: Reports that a UK Soldier was killed on Friday in Afghanistan, the Soldier was a “ Royal Marine from 42 Commando Royal Marines. ”. Thus since 2001 the UK has lost 378 of its Armed Forces Personnel in Afghanistan, of that total it has lost 334 in combat action and 44 due to illness, accidents or other incidents.

Markets Live

Guadian Live: Reports that the London market is expect another sell off tomorrow of around a hundred points. Folks have this feeling it could be a lot more than that, the US job figures come out tomorrow, expected to be bad, also the article states that Germany, France and Spain will hold emergency talks tomorrow to discuss the market crisis, thus expect Europe to have a major sell off day, its going to get darker folks, a lot darker.

The Markets TUMBLE

BBC News: Reports on the major slides in Shares in the UK and US, the fault line is the bad US economic news and the sovereign debt crisis in Europe. At close the FTSE-100 was down 191.37, that’s 3% down folks, in the US the Down Jones is down by 4%, nearly 500 hundred points down. The question that has to be asked is what has happened to our politicians, in the UK the House of Commons is in recess, also the US Congress. The UK PM David Cameron and his Deputy Nick Clegg are on holiday and in the US, President Obama is celebrating his birthday, the economic structure of the West is going down the drain and our politicians party, God help us all.

Silvio Berlusconi = The Speech that failed

Guardian: Reports that a Speech by the Italian PM to the lower House of the Italian Parliament has failed to sooth the markets, the article states the following on the speech, “ ..contained neither an appeal to the nation for painful sacrifices …..(or )..radical, structural reforms that most economists believe Italy badly needs. ” Lets be honest Mr Berlusconi with his various Court cases should not be PM of Italy at this minute, there are rumours of disagreements within the Government between the PM and the Finance Minister, hardly something that will calm the markets. Also if you’re a politician in trouble and Mr Berlusconi is in legal trouble you cant afford real harsh measures that would destroy your political base, just ask Obama how popular he is with his base after the debt ceiling agreement. Thus it can be postulated that the Berlusconi Government wont push the tough economic reforms that Italy needs and thus will need a bailout from the EU/ECB and the IMF. Thus the future default of Italy is down to its politics not its economy.

The Rescue - ECB

Telegraph: Reports that the European Central Bank is expected to announce on Thursday that it will buy the bonds of at risk countries such as Italy and Spain. The question that has to be asked will it be enough for the markets, should ECB not rescue Spain and just give limited support to Italy. What even if the ECB buys the bonds of Italy and Spain and it does not solve the problem, just crating more bad debt in the system, it might just give these Countries some economic relief over the next few months, but is it a long term solution, from 2008 European Government bailout out banks, but all it did was move the debt from the banks to the state, this is part of the reason that the Europe faces a Sovereign debt crisis. At some point the debt will be to much folks, when that shoe drops it will cause major disaster in Europe.