BBC - Newsnight: Paul Mason: How do you leave the Euro? Plan C: odious debt...

BBC

"I once used to frequent a very decent restaurant on Kefalonia where you could get lobster pasta for 1700 drachmas. In the summer of 2002 I was stunned to find, chalked on the very same board in the very same harbour, that lobster pasta was now to cost 17 euros. In fact the old zeros were still faintly visible, but not the drachma sign.

The final exchange rate of the Greek drachma was 340/1, making the pre-Euro lobster a notional 5 euros - so this was a > 3x increase. But on adoption of the Euro the restaurant had simply decided it had entered the north-European economy and would now charge north-European prices. I have to say, it was still worth it - but it was a shock.

Soon Greeks may experience a shock in the other direction."

Krækja: BBC - Newsnight: Paul Mason: How do you leave the Euro? Plan C: odious debt...

German Economic Policy and the Euro 1999 - 2010

The aim of this paper is to assess to what extent Germany - whether by accident or design - has been a beneficiary of the Euro era, and what negative impact, if any, there has been on the Eurozone’s smaller economies.

Analysis shows that trade imbalances within the Eurozone centre upon Germany, the most important economy, and by far the largest exporting nation. Germany has substantial trade and current account surpluses with the other Eurozone members. In the last three recorded years for example, it was €114.3 billion in 2007, and €104.5 billion and €79.7 billion in the recession years of 2008 and 2009 respectively.

This situation is greatly exacerbated by the ECB’s exchange rate policy which (wittingly or not) favours German interests. This is because, at the outset, the German people gave up their beloved D-Mark under an implicit agreement that EMU would never lead to inflation in their country. For this reason the European Central Bank tightens monetary policy whenever the German economy is in danger of over-heating, regardless of the needs of the Mediterranean economies.

When the Euro was founded in 1999, it was fondly assumed that with Germany’s exchange rate ‘irrevocably fixed’, then there would be no more periodic crises such as those which repeatedly afflicted the ERM between 1979 and 1992. The ruling elite, now in total control, could sit back smugly anticipating economic convergence and the facilitation of political union, however ill-defined this concept is and no matter how unwanted.

It was never going to happen like this. Rather, German exchange rate policy, within the Euro, represents the most lethal danger to the survivability of the Single Currency. The fundamental reason for this is stark in its simplicity.

The Bruges Group - krækja:  German Economic Policy and the Euro 1999 − 2010 | PDF-skjal

The Euro Zone's Bumpy Road to Recovery - WSJ.com

"In the pre-euro era, they would devalue their currencies to make German goods dearer and their homemade stuff cheaper. That was then and this is now. No such mechanism is available to struggling Greece, Ireland, Portugal, Spain or Italy—they gave up the ability to revalue their currencies when they ditched them in favor of the euro." . . .

Krækja á grein Irwin Stelzer á Wall Street Journal: The Euro Zone's Bumpy Road to Recovery - WSJ.com:

Finns Threaten Debt Bailout Plan as Election Nears: Euro Credit - Businessweek

"Feb. 28 (Bloomberg) -- Finnish voters may prove as great a threat to the euro region’s retooled bailout plan as German taxpayers.

Support for the anti-euro True Finns party has soared as an April 17 election nears. It’s the fastest-growing movement in the northernmost euro member, with opinion-poll backing to rival the nation’s biggest opposition party. Voters are rallying to its argument that Europe shouldn’t have rescued Greece or Ireland, and Finland should veto more cash for the bailout fund.

“How come they can’t see the euro doesn’t work?” Timo Soini, leader of the True Finns, said in a Feb. 24 phone interview. “If a melon and an apple each wear the same size baseball cap, everyone can see that just doesn’t work.”"

Krækja: Finns Threaten Debt Bailout Plan as Election Nears: Euro Credit - Businessweek:

Vaxtakostnaður portúgalska ríkisins í hæstu hæðum, yfir 7,5 prósent

Mynd Bloomberg; Þróun vaxtakostnaðar portúgalska ríkisins í myntbandalagi Evrópusambandsins: Vextir á 10 ára lánum til ríkisins. 

Vaxtakostnaður portúgalska ríkisins fór í allra tíma hæstu hæðir í gær, 24 feb 2011, og er nú sögulega hár og hærri en hann hefur verið frá janúar 1997. Lánshæfnismatslækkun S&P bíður nú ríkissjóðs. Áhættan við að lána portúgalska ríkinu peninga í 10 ár hefur ekki, af fjárfestum, verið átilin meiri en hún er nú. Mynt Portúgals er evra Evrópusambandsins.

Verðbólga í Portúgal mældist 3,60% í janúar sem gerir raunstýrivexti seðlabanka Evrópusambandsins í Portúgal neikvæða. Raunstýrivextir = stýrivextir mínus verðbólga

Wall Street Journal skrifar

"LISBON (Dow Jones)--Portugal's Treasury and Government Debt Agency has announced a reverse auction for March 2, the second in two weeks, aiming to buy back two government bond lines maturing in the second quarter, and easing pressure on the country to seek a possible bailout.

The buyback, however, could follow a possible downgrade on Portugal's sovereign ratings by Standard & Poor's, which is expected to review its decision to put the country under creditwatch negative by the end of this month.

In November, S&P put the nation's A- long-term rating, which is four notches into investment-grade territory, on watch for downgrade, citing economic pressures and increased risks to the government's creditworthiness. It said then it would review the creditwatch within the next three months."

2nd UPDATE: Portugal To Buy Back Bonds As Funding Costs Bite - WSJ.com:

Fólksflótti frá Írlandi - Wall Street Journal

Reikna með að 2,5 af hverjum hundrað Írum yfirgefi land sitt á næstu 24 mánuðum



Irish Workers Leave the Emerald Isle
The great recession has triggered yet another wave of Irish emigration. WSJ's Don Duncan reports on how that is playing out in the national election.

Grikkland - evrusvæðið: Anti-austerity protests spark violent clashes in Greece- France24

Clashes broke out between riot police and protesters Wednesday during a massive anti-austerity march in Athens,leaving three police injured - one after being set on fire by a Molotov cocktail.

The heavy use of tear gas broke apart a demonstration that had rallied some 18,000 protesters in the capital according to police, and over 60,000 according to union organisers.

At least 36,000 people according to police took part in protests held in Athens, Thessaloniki and the port of Piraeus to reject economic policies dictated by Greece's narrow bankruptcy rescue by the EU and the IMF last year.

"Nobody believes in the government and in the (austerity) plan," said Yiannis Albanis, a computer technician joining the protest."





Krækja: France24

Slovakia’s jobless rate climbs close to 13 percent in January - The Slovak Spectator

13 prósent atvinnuleysi í Slóvakíu

"Slovakia's unemployment rate in January reached record-high figures for the post-crisis period at 12.98 percent, an annual increase of 0.52 percentage points, the Labour, Social Affairs and Family Office (ÚPSVaR) stated on February 21 as reported by the TASR newswire."

Slovakia’s jobless rate climbs close to 13 percent in January - The Slovak Spectator:

Slóvakía tók upp evru þann 1. janúar 2009. 

FT.com - Greek police clash with anti-austerity protesters

"Greek riot police fired teargas at protesters who threw stones and petrol bombs as a demonstration against austerity measures by striking workers erupted in violence."

FT.com / Brussels / Economy - Greek police clash with anti-austerity protesters:

Statistics Finland; Unemployment rate 8.2 per cent in January

8,2 prósent atvinnuleysi í Finnlandi í janúar

Atvinnuástand í Finnlandi hefur aldrei jafnað sig eftir hrunið og ESB inngöngu landsins í kjölfarið. Atvinnuleysi hefur verið mikið og strangt allar götur frá 1993.

Hagstofa Finnlands: Unemployment rate and trend of unemployment rate 1989/01 – 2011/01

According to Statistics Finland’s Labour Force Survey, the number of unemployed persons in January was 215,000, which is 35,000 lower than one year ago. At 8.2 per cent, the unemployment rate was 1.4 percentage points lower than one year earlier. There were 43,000 more employed persons than in January of the previous year.

Krækja: Statistics Finland - Labour force survey:


2009: Mesti efnahagssamdráttur í Finnlandi síðan 1918

Landsframleiðsla Finnlands féll um hvorki meira né minna en 7,8% (leiðréttar tölur hagstofunnar segja 8%) á árinu 2009 í heild. Þetta er mesta hrun í landsframleiðslu Finnlands á einu ári frá því að mælingar hófust árið 1975. Í frægu finnsku kreppunni 1991-1993, þegar Finnland upplifði erfiða bankakreppu samhliða hruni Sovétríkjanna, þá féll landsframleiðsla Finnlands "aðeins" um 6% á árinu 1991, þegar verst lét. Til að fá fram tölur um svipað hrun og varð á árinu 2008-2009, þá þurfa Finnar að leita aftur til áranna 1917-1918. Það er víst óþarft að segja frá því hér að mynt Finnlands heitir og er því miður evra myntbandalags Evrópusambandsins. En ég segi það samt, já einu sinni enn.

Útflutningur Finnlands hrundi alls um 24% frá 2008-2009, fjárfestingar hrundu um 13%, innflutningur hrundi um 22% og einkaneysla féll um 2,1%. Rekstrarafkoma fyrirtækja hrundi um 39%. Þau greiddu því 44% minna í skatta og greiddu út 34% minna í arð; Hagstofa Finnlands

FT.com / Comment / Analysis - Ireland: A vote in a void

Tiger has fallen. The debate was dubbed: “Ireland – A Broken Dream?”

. . .

"Like other small countries, it has traditionally looked to the Commission as its protector. But the Commission’s relative power is in decline. The European parliament is increasingly powerful, but only 12 of its 736 members are Irish. Meanwhile, the first full-time president of the European Council, which unites EU governments, is Herman Van Rompuy, a Belgian perceived in Dublin to be instinctively close to France and Germany.

. . .

In the short term, Ireland appears to have almost no freedom of manoeuvre. EU authorities rule out bondholder write-downs for the present because of the risk of creating a funding crisis for banks across the eurozone. "

Krækja: FT.com / Comment / Analysis - Ireland: A vote in a void:

Return to the Drachma?: Economists Warn Greece May Have to Quit Euro - SPIEGEL ONLINE

"Greece's debts are rising rapidly despite radical austerity measures. Now a group of leading European economists has warned that creditors might have to write off more than 30 percent of their loans. Greece might even have to reintroduce the drachma to overcome its debt crisis, they argue.

The European Economic Advisory Group (EEAG), a group of leading European economists, has warned that Greece may need another bailout by 2013 at the latest."

[..]

New Worries About Portugal, Spain

Krækja: Return to the Drachma?: Economists Warn Greece May Have to Quit Euro - SPIEGEL ONLINE - News - International:

FT.com - Ireland needs help with its debt

What caused this calamity?

As Philip Lane of Trinity College notes: “There was a genuine Irish economic miracle, with very rapid output, employment and productivity growth during the 1994-2000 period.” Without entry into the eurozone, this might have petered out. But the fall in interest rates increased the risk that a credit-fuelled property bubble would emerge. So, indeed, it did.

Prof Lane observes: “The flavour of this boom was very different to the ‘Celtic Tiger’ years. In particular, it was dominated by a surge in construction activity.” Moreover, this “expansion in property investment was fuelled by rapid credit expansion”, not just to the household sector, but also to a “small group of property developers”."

FT.com / Comment & analysis / FT Columnists - Ireland needs help with its debt: "