EUROZONE / GREECE : Small Protest Continues After Cabinet Reshuffle; Merkel Reluctantly Relents To Voluntary Roll-Overs.

REUTERS / GUARDIAN

About 5,000, mostly communist, protestors marched on parliament...even after PM George Papandreou reshuffled his cabinet...because of his vow to continue austerity measures.

"What has changed with the reshuffle? Nothing," said a student."We are not planning to leave unless they take back the measures."

The Euro, European and world markets also settled down...as German Chancellor Angela Merkel ended her 6-week stand-off...and reluctantly relented to only "voluntary" roll-overs by investors of Greek debt that was pushed by French President Sarkozy and the ECB.

Merkel has long called-for private investors in Greece bonds to suffer forced debt re-structuring...so-called "haircuts".

Now she must face an increasingly antagonistic German parliament...and a populace unhappy about "supporting" the distressed, mostly southern tier of eurozone countries, sometimes called the "Club Med" nations.

"They've bought themselves time until September," said a London strategist.

EUROZONE/ IRELAND/ GREECE/ GERMANY: 8 May UPDATE: Speculators Savage Euro Over Rumor; More Predicted!

 

GUARDIAN /

   Friday "the markets"savaged the euro.
   Flirting recently as high as the $1.4848 level...it plunged from $1.4530...to $1.4337...in NYC.
   All on a nasty rumor.
  That apparently started on the website of Germany's DER SPIEGEL.
   It claimed Greece would abandon the euro...unless there was a new restructuring of its debt.
  The rumor was fed by the fact that finance ministers from leading eurozone countries are holding secret talks in Luxembourg.
   The BBC has just reported that Ireland will get an interest rate cut on its debt...currently at 5.8%.
   A German spokesman claimed: "There is a meeting of some finance ministers that has long been planned. Greece exiting the eurozone is not on the agenda of that meeting, and it has never been."
   One economist said pressure had been mounting from Berlin. "I think the Germans have been playing hard ball for a few weeks now. If Greece does go I don't think they will be the only one."
    "These scenarios are borderline criminal," PM George Papandreou is reported to have said."No such scenario has been discussed even in our unofficial contacts...I call upon everyone in Greece and abroad, and especially in the EU, to leave Greece alone to do its job in peace."
   But some economists predict a continuing euro bloodbath.
  "Perhaps we have crossed a rubicon," said economist Jonathan Loynes. "The knee-jerk response will probably be to push the euro lower. I believe the euro should be at parity with the dollar, not at $1.44 – I don't know what it's doing at anything like these levels."
   Jean-Claude Juncker ( Pictured above), president of the "eurogroup" of finance ministers, declared that a "further adjustment program" for Greece would be on the agenda when eurozone ministers meet in Brussels on 16 May to discuss Portugal's package.


SEE ALSO LATEST: 
http://www.guardian.co.uk/business/2011/may/08/greece-faces-new-bailout-deal

HUNGARY: 40,000 Protest Austerity Measures In Budapest.

AFP/

   As EU ministers met in Budapest to iron-out a $115 bn usd Portugese bailout, an estimated 40,000 people, led by trade unions, held a massive peaceful demonstration Saturday to protest austerity measures.
    There were placards declaring "No austerity" and demanding "fair pay and jobs," trashing bankers and  Chancellor Angela Merkel and President Nicholas Sarkozy.
   "We want jobs, growth, our welfare state intact, and we are not going to pay for bankers' mistakes,"  labor leader John Monks told the crowd. "The ministers are locked into this orthodoxy that there has to be suffering before everybody can have some growth. I think this is completely wrong," he told AFP before the march.
     A Hungarian currently leads the EU's president.

GERMANY: UPSET! Merkel's Party Will Lose B-W...After 58 Years; 200,000 Protest Nukes.

BBC

  In what is being called a referendum on Chancellor Angela Merkel's leadership, polls show her Christian Democrat party will lose the prosperous southwestern state of Baden-Wurttemberg for the first time... since 1953.
   Exit polling gave the CDU only 43% even with its FDP ally.
   Apparently, the recent tragic accidents in Japan made nuclear power the key issue.
   The upset victor Green party spokesman said: "It's a dream come true... we could never have dreamed of a result like this a few days ago."
    Some believe the CDU's defeat will be "the beginning of the end" for Merkel but others predict she will hang-on until the 2013 general election. 
   Merkel  tried to ease nuclear worries by suspending for three months extending the lifetime of 4 nuclear reactors in Baden-Wurttemberg. 

AND: More than 100,000 marched in Berlin on Saturday demanding an end to nuclear power. Tens of thousands also turned out in Hamburg and Munich.

    The protestors shouted "Fukushima, Chernobyl: Too much is too much!" or "Switch them off." They want all 17 German reactors shut down. A minute of silence was held to remember the victims of Japan's 11 March earthquake and tsunami.
http://www.msnbc.msn.com/id/42283994/ns/world_news-europe/

THE EU / SPAIN / PORTUGAL : "Debt Denial" In Madrid, Lisboa As Bondholders Bet... Against EU Success.

GUARDIAN/ ANALYSIS / P. INMAN/

   "Spain is in deep trouble. Ahead of a planned refinancing of its banking sector, the ratings agency Moody's has downgraded the country's debt.
    As far as the markets are concerned, the entire Iberian peninsula is overburdened with debt. Portugal is already considered a sure-fire future candidate for a European bailout. Spain, which has considered itself too big to fail, could be closer than it thinks to a rescue."

AND: "The problem lies in Brussels, Paris and Berlin, where political leaders are fighting over plans to introduce a bigger and better bailout facility for troubled sovereign states coupled with more stringent measures that would force them to reduce their debts at a faster pace.
      European Commission officials have sent out the same message as they did last year before the Greek crisis: they say the market exaggerates the size of the problem. In an attempt to make a virtue out of the stalemate, they say only minor changes to the bailout mechanism need to be agreed at a final meeting on 25 March."

EUROZONE /GERMANY: 12 Feb UPDATE: After Weber Stiffs Merkel on EU Bank Job, She Freezes Him Out.

NYTIMES/  J. Ewing, S. Castle /
Combined 2 Screen Read /

   Axel Weber, 53, the current president of the German central bank, and once the presumed top candidate to succeed Jean-Claude Trichet at the European Central Bank, unexpectedly renounced seeking the position, reportedly enraging Chancellor Angela Merkel.
   Weber also announced that he would quit the Bundesbank at the end of April.
    He cites"personal reason" for his sudden departure.
   Weber was considered an inflation hard-liner and many outside Germany  preferred a more moderate chief.   He also reportedly alienated many ECB colleagues.
   Weber was considered a trusted Merkel ally. But no more. The WSJ claims that with the Chancellor scorned, she has now frozen him out.
   His likely departure is being met with relief “not among the Germans, but every country from Italy to Greece, probably,” said  economist Marco Valli. “The French are not particularly sad.”
   Speculation now centers on Mario Draghi, the governor of the Bank of Italy.
   But the German newspaper BILD headlined:“Mama Mia! Please, not this Italian!” and wrote: “In Italy, inflation is as much a part of life as tomato sauce and pasta.”

EUROZONE: 16 Dec. UPDATE: Merkel Refuses Increasing $1Trillion Emergency Fund; Nein Also To Euro Bond Creation.

LINK CHANGE/ NYTIMES/ M. SLACKMAN/

   As some parts of Europe burn from protests, Angela Merkel tried to reassure  markets over fears about the16-nation eurozone.
    “No one in Europe will be left alone, no one in Europe will be abandoned. Europe succeeds when it acts together and, I would add, Europe succeeds only when it acts together.”
     But to the distress of many EU finance ministers, Merkel still rules out issuing new euro bonds and increasing the $750 million euro ($1 trillion usd) emergency fund.
     Merkel said that “strict conditions” will be tied to aid for distressed countries under a planned permanent rescue system that leaders are set to discuss.
    “The consequence is a stalemate that leaves us with a familiar sense of déjà vu,” said economist Ken Wattret. “Market tensions are likely to resurface, as governments remain very publicly divided on the appropriate way forward.”
    Already, the euro and Spain seems to be affected by the negative vibe after Moody’s said it may cut Madrid's Aa1 credit rating. That country lost its top rating in September. Belgium received a debt warning on Tuesday when the euro declined vs the usd again.

EUROZONE/GERMANY: More Call It's Bailout Approach Stubborn, "Un-European."

G.POST/ DAVID WROE :
     "Germany, long considered a reliable — and financially generous — supporter of European integration, has begun to anger some of its fellow European Union members with its stubborn, go-it-alone approach.
      Berlin’s tough stances during the euro currency crisis have prompted critics to accuse it of bullying smaller countries. The rhetoric culminated on Wednesday when Jean-Claude Juncker, the Luxembourg prime minister and chairman of the group of eurozone finance ministers, called Berlin’s behavior “un-European” — a stinging rebuke on par with one U.S. state calling another “un-American.”
     The overwhelming feeling is that Europe’s largest economy has decided that, if it must pay to keep the European dream alive, it will do so on its own terms. It’s Germany’s way — or the autobahn."

EUROZONE: Why Germans Are Balking Over Ireland's Bail-Out; Also An Opposing Argument.

GUARDIAN/ Kate Connolly /
    Six months after bailing-out Greece, the Germans are confronted with another rescue. This time Ireland. What especially galls some Germans is that Ireland's per capita annual income is around €34,000 – 4,000 more than Germany's €30,000.
    "The poor Germans are going to have to feed the rich debtors," wrote Die Welt.
   "If we carry the financial can for Greece and then this Irish bailout, we will never shake off the role," said a Berlin market vendor. "Before we know it, it'll be Portugal next. And then Italy maybe?"

GUARDIAN/ OPINION: Alan Posener : "I'm sick of Germans griping about having to fund bailout packages for Greece and Ireland. And sicker of politicians and the media stoking the fires of self-righteous nationalism. For a start, the German taxpayer has as yet not paid a single euro. The funds are guarantees, intended to reassure private investors that eurozone states will not default. Even if push came to shove they'd be loans, not gifts outright. Second, the Greek bailout was also a bailout of German – and French – banks, who had stacks of Greek bonds in their vaults, and of German investors, who held and hold all sorts of "financial products" in which high-yield (because risky) Greek, Irish, and Portuguese bonds play a large role."

FOR MORE,SEE:

http://www.guardian.co.uk/commentisfree/2010/nov/17/germany-ireland-bailout-griping

GERMANY/ EU: Merkel Wins Euro Protection Dispute In "Limited" Lisbon Treaty Rewrite.

LINK CHANGE/ NYTIMES /
     Powerhouse Germany's large contribution to an emergency fund, surging exports and rapid recovery from the financial crisis empowered Chancellor Angela Merkel to get her way in a "limited" rewrite of the EU's Lisbon Treaty to shore up the euro.
     Under a system preferred by Merkel and France's Sarkozy, to be in place by 2013, highly indebted eurozone countries will be forced to restructure their debt in a process of "managed insolvency" and their creditors must take financial "haircuts".
      European Central Bank chief Jean-Claude Trichet and Spain's PM among others objected to her plan.

EUROZONE: Soros Calls Germany "Main Protagonist" In Euro Crisis.

BLOOMBERG/     Germany “is the main protagonist” in the euro’s crisis and EU deflation risk is probable because Chancellor Angela Merkel insists on budget austerity, claims billionaire investor George Soros. “As the strongest and most creditworthy country it is in the driver’s seat. As a result Germany objectively determines the financial and macroeconomic policies of the euro zone without being subjectively aware of it. When all the member countries try to be like Germany they are bound to send the euro zone into a deflationary spiral.Unfortunately Germany does not realize what it is doing. It has no desire to impose its will on Europe; all it wants to do is to maintain its competitiveness and avoid becoming the deep pocket to the rest of Europe.”

EUROLAND: Germany Resents Being EU's Piggybank.

GUARDIAN.UK/ Ian Traynor/
"For 50 years, Europe has been Germany's passport to peace, prosperity and power. When Germany pursued its national interests, it did so effectively, benignly and called it "Europa". Those days are over. The German elite feels maligned and misunderstood. In public, and much more frankly in private, senior figures talk of robustly asserting the German national interest.It may be new for Europe that Germany is representing its interests with new vigour," said Thomas de Maizière, the interior minister and a Merkel confidant. "But for Britain, France or Italy, this was always a matter of course." "The mood among the Germans is quite defensive. They feel people are ganging up on them," said an EU ambassador."

EUROLAND: Merkel's Position Called "Moralistic Hysteria," Unsettles Markets.

BLOOMBERG/    German Chancellor Angela Merkel’s attempt to rein in speculators with a ban on naked short-selling is part of her proposals to gain control over “destructive” financial markets. But it is backfiring in debt and currency markets although the euro is up slightly from recent lows. Merkel's “... uncoordinated effort is counterproductive to the long-term survival of the euro,” says researcher Christopher Garman. “While it may temporarily alleviate what they see as the animal imagery of locus and wolfpack, or however else they describe speculators, it adds to a climate that’s becoming more uncertain by the day.” “Unless you have the U.K., United States and rest of Europe on board, then it’s a waste of time,” claims market analyst David Buik. “You’re asking people to look for trouble. It’s so ham fisted it’s laughable.”

EUROZONE: 3 Dead, 100,000 Riot In Greece Over Austerity Measures.

REUTERS/    What international investors fear  most--strong popular resistence to austerity measures linked to a $146 bn bail-out--is beginning to play-out on the streets in Greece. Hundreds of thousands demonstrated in Athens and three were killed as rioters stormed the Parliament, hurling Molotov cocktails and torching buildings despite police teargas counterattacks. Union reaction until now has been muted, although the country has been hit by a series of strikes. "The big participation in the strike today and the crowds that flooded the streets of Athens...send a message to the government: We will not let the EU and the IMF measures pass," declared a union official.

GERMANY: Time Runs Out For Merkel On Bailout Stall.

NYTIMES/       "Chancellor Angela Merkel’s strategy for dealing with Greece’s untenable debt problem was to stall and hope the crisis did not demand action until after a critical state election in early May. On Wednesday, the clock finally ran out. Merkel’s hand was forced by mistrustful credit markets and the ratings agency that downgraded Spain, Portugal and Greece in a matter of just two days. As the crisis worsened, political calculations had to take a back seat to the more basic task of ensuring the stability of the euro currency that replaced Germany’s beloved mark."

EUROZONE: Germany And France Reach Accord On Greece Aid And IMF.

GUARDIAN.UK/    It appears that stubborn German Chancellor Angela Merkel has gotten her way and reached agreement with France to help debt-laden Greece with a 23 billion euro package that includes IMF help. Merkel is also pushing for a treaty change allowing sanctions should a eurozone country ever default on its debts.

EUROZONE: Merkel Proposes Expelling Euro Rule Breakers.

REUTERS/    German Chancellor Angela Merkel is on the record as supporting the expulsion of countries from the eurozone that repeatedly break the bloc's economic guidelines. "In the future we need an entry in the treaty that would make it possible, as a last resort, to exclude a country from the eurozone if the conditions are not fulfilled again and again over the long term," she told the Bundestag.

EUROZONE: Merkel And Germans Demanding Austerity; Critics Fear Deflation, Instablitity.

NYTIMES/   Germany, acting as Europe's defacto euro protector, is telling the region's heavily indebted nations that they must drastically cut down deficits. Some call it a “cult of austerity” that could bring about deflation and actually bring down governments. French economics professor Jean-Paul Fitoussi describes it as"...it's self-defeating because if you have austerity and deflation in Greece, Portugal and Spain, then the European economy will not recover; firms will fail and jeopardize the banks.”

EUROZONE: Slowly Moves Towards Greek Bailout.

NYTIMES/    Negotiations continue over the Greek bailout with the Germans demanding even more austerity measures in order to obtain loan guarantees from the German and French governments and banks. For political cover, German Chancellor Angela Merkel is reportedly not ready to sign off until Greece has pushed through further cuts. But Merkel is also under pressure to protect the euro from the consequences of a Greek default. 

THE EU: Merkel And Ministers Demand More Fiscal Reforms.

REUTERS/ AM 16 FEB UPDATE/  Germany's deputy finance minister says Greece must mimic Ireland and Latvia by greatly slashing spending and wages. A statement gives Greece 30 days, until March 16th, to take steps . In Athens, customs officials began a  strike to protest salary cuts.