Posts Tagged ‘European Debt Crisis’
Friday, November 24th, 2023
Happy Black Friday, everyone! (Here’s my prepping/gift guide, if you haven’t seen it already.) I hope everyone had a great Thanksgiving. Some interesting international election results, unreasonable gun control legislation gets struck down in two different states, more legal trouble for Houston Democrats, and a weed company goes bankrupt. It’s the Friday LinkSwarm!
“Bidenomics Is Making This The Most Expensive Thanksgiving In History.”
The average price American families will have to pay to celebrate Thanksgiving with a traditional dinner will be the most expensive in history after years of sky-high inflation that experts attribute partially to President Joe Biden’s policies, according to data from the Bureau of Labor Statistics (BLS).
The price of all goods has risen dramatically under Biden following a period of sustained high inflation, which peaked at 9.1% in March 2022 and has since remained elevated, measuring at 3.2% in October, while the index for food rose 3.3% year-over-year for the month. The total increase in costs for a Thanksgiving dinner is about 26% since the beginning of Biden’s term, culminating in the most expensive Thanksgiving dinner in history.
Don’t buy the cookies. “Girl Scouts To Host Training Sessions On ‘Internalized Racism,’ ‘White Supremacy Culture.'” (Hat tip: Instapundit.)
“While Hamas Planned Its Attack on Israel, Biden’s Intel Community Was Focused On Climate Change.”
To the surprise and shock of the international community, Argentina elects an Anarcho-Capitalist president.
In a surprising turn of events, Argentina has elected the libertarian outsider Javier Milei as its new president. The hotly contested presidential run-off saw Milei defeating left-wing candidate Sergio Massa — a consequential shift in the country’s political landscape. Massa brusquely conceded on Sunday night, stating, “Milei is the president elected for the next four years.”
The victory of Milei, a self-proclaimed “anarcho-capitalist,” introduces an unconventional leader with what are considered to be radical economic views relative to Argentina’s neighbors. His campaign, characterized by anti-establishment rhetoric and metaphorical gestures such as wielding a chainsaw to show his fervor for cutting taxes, resonated with voters frustrated by Argentina’s economic decrepitude, including triple-digit inflation. One of Milei’s key proposals is the adoption of the U.S. dollar as Argentina’s national currency, an unprecedented move for a country of its size (Argentina is home to some 45.8 million people).
Massa — a lifelong politician and representative of Argentina’s left-wing political establishment — emphasized his government’s actions to address inflation during his tenure.
But Milei’s appeal, particularly among the younger generation, suggests a desire for change to break free from the cycle of economic crises.
Milei’s victory has produced excitement and concern alike. While some see him as the catalyst for much-needed economic reforms, others fear the potential austerity measures tied to his plans, such as shutting the central bank and slashing spending. Despite the uncertainty, Milei’s supporters view him as the only viable option to break the political status quo and address Argentina’s persistent and extreme economic challenges.
The election is not just a political shift but also a generational one, with Milei’s popularity among the youth reflecting a desire for a new direction. The effect of Milei’s win extends beyond Argentina’s borders, potentially influencing trade relationships, especially with his criticism of China and Brazil and his preference for stronger ties with the United States. As for the U.S., the hour is late, and we’ll take all the friends we can get, and Argentina is doubly welcome because the Millennium must be nigh if a libertarian won an election outside of New Hampshire.
Note: Linking to MSN rather than NRO because the latter has now raised it’s war against ad-blockers to obnoxious levels. Year-by-year, the TDS-infected NR has become ever-more sad and useless.
Of course, Milei also says Argentina claims sovereignty over The Falklands, so you have to take the bad with the good.
Speaking of election results the international community finds “unacceptable,” Geert Wilders anti-Jhad Freedom Party came in first in elections in The Netherlands.
Geert Wilders, the Dutch populist whose anti-Islam comments have led to death threats, could become the next leader of the Netherlands following an election upset for his Freedom Party (PVV) on Wednesday.
After 25 years in Dutch politics without holding office, Wilders was set to lead coalition government talks and has a good chance of becoming prime minister.
An exit poll on Wednesday evening showed the PVV in a clear lead, 10 seats ahead of its closest rival, Frans Timmermans’ Labour/Green Left combination.
“We will have to find ways to live up to the hopes of our voters, to put the Dutch back as number one”, Wilders said in his first response, adding that “the Netherlands will be returned to the Dutch, the asylum tsunami and migration will be curbed.”
“The 4th Circuit Says Maryland’s Handgun Licensing Law Is Unconstitutional.”
Maryland is one of 14 states that require background checks for all firearm purchases, whether or not the seller is a federally licensed dealer. Since 2013, Maryland has imposed an additional requirement on handgun buyers: They must first obtain a “handgun qualification license,” which entails completing at least four hours of firearm training and undergoing a seemingly redundant “investigation” aimed at screening out people who are legally disqualified from owning guns. According to the U.S. Court of Appeals for the 4th Circuit, that process, which can take up to 30 days, violates the Second Amendment.
In a decision published on Tuesday, a divided 4th Circuit panel concluded that Maryland’s handgun ownership licensing system is not “consistent with this Nation’s historical tradition of firearm regulation”—the constitutional test that the U.S. Supreme Court established last year in New York State Rifle & Pistol Association v. Bruen. Writing for the majority in Maryland Shall Issue v. Moore, 4th Circuit Judge Julius Richardson notes that Bruen “effected a sea change in Second Amendment law,” making a variety of gun control laws newly vulnerable to constitutional challenges. Maryland’s handgun licensing law is the latest example.
Speaking of unconstitutional gun laws being struck down: “It turns out that bullets are an essential part of a gun, and limiting the number of rounds in a gun violates the Oregon constitution. A county judge in Oregon made that decision on Tuesday overturning Measure 114, a citizen-passed measure that outlawed what gun grabbers call ‘high capacity magazines’ and required that Oregon serfs get a permit to be allowed to purchase a gun.” (Hat tip: Stephen Green at Instapundit.)
Funny how no Arab nation wants to take in Palestinians. They know the simple truth: They suck.
The Palestinians tried to take over Jordan in the 1970s, leading to the late King Hussein declaring war on them and driving them out. They were booted from Kuwait after collaborating with Saddam Hussein’s forces before the Gulf War. They set off a powder keg in Lebanon, a nation that has yet to recover from its brutal civil war that lasted 15 years. No Arab country wants these people because they bring instability and trouble.
(Hat tip: Instapundut.)
California’s Democratic convention gets derailed by all the vibrant diversity.
Outgoing Houston Mayor Sylvester Turner gets to enjoy a new host of scandals on his way out.
As term-limited Houston Mayor Sylvester Turner finishes his final days at the helm of the state’s most populous city, a new set of scandals have emerged over city contracts and a dispute over who will pay for a book touting the mayor’s legacy.
In the most recent dustup, an investigation by Houston’s KPRC 2 discovered that city contracts for much-needed water repairs were awarded to two relatives of Houston Public Works (HPW) employee Patrece Lee, including one for $4.5 million to Lee’s brother, who had only created his company six months before the city council approved the “emergency contracts.”
When KPRC reporter Amy Davis attempted to question Turner about the issue at a public event last week, Turner became irate and told his communications director to escort Davis from the room.
“You are not going to get away with this,” said Turner to Davis. “You are rude.”
Late Friday, HPW Director Carol Haddock announced that the employee had been placed on leave while the city’s Office of the Inspector General investigated the allegations.
In another contract scandal, Houston Landing media reported last week that the Midtown Redevelopment Authority had referred information to law enforcement on a since-fired manager who allegedly steered more than $4 million in taxpayer-funded landscaping contracts to himself and another contractor.
The latest developments came hard on the heels of Turner’s squabble with Houston First Corporation, the city’s marketing organization. During the “State of the City” luncheon last September, hosted by Houston First, attendees were given copies of Turner’s book “A Winning Legacy,” which celebrates the mayor’s accomplishments during his eight years in office.
As first reported by Bill King, Turner told President and CEO Michael Heckman that Houston First must pay a $123,979 invoice for the 600 copies, but Heckman refused, saying it was not in the corporation’s budget and not an appropriate expense. Houston First Chairman David Mincberg later told FOX 26 that the corporation would develop a strategy to raise private funds to pay for the books.
Controversy has also surrounded Turner’s management of city finances. Last year, Controller Chris Brown warned that the city was using $160 million in federal COVID-19 relief funds to plug budget holes and even to cover ongoing expenses.
Speaking of governments in trouble for spending Flu Manchu funds on other priorities, Germany is also in trouble for pulling the same trick after their high court told them to stop. As Europeans, spending within their means is unacceptable, so they’re now plotting to suspend debt limits…
Texas Governor Greg Abbott endorses Donald Trump for President. This is interesting in that Abbott is a careful, cautious Republican, who might be more ideologically inclined to endorse Ron DeSantis or Nikki Haley. That Abbott has endorsed Trump indicates he thinks Trump is a lock for the 2024 nomination. He may be right.
“Stacey Abrams’ Brother-In-Law Arrested, Accused Of Human Trafficking, Choking Underage Girl…Jimmie Gardner, a well-known Georgia-based youth motivational speaker, is accused of human trafficking, lewd or lascivious touching, and battery…According to the Tampa Police Department, Gardner invited a 16-year-old girl to his hotel room in the early hours of Friday, offering to pay her for sexual acts.” Sounds like the wrong sort of youth motivation…
“Paxton Impeachment Leader Andrew Murr Won’t Seek Re-Election.” Good.
Ouch! “450 Patients at Massachusetts Hospital Possibly Exposed to Hepatitis and HIV.”
You know you suck at business when you can’t make money selling pot to Californians. HERBL, California’s largest pot distributor, collapsed with $17 million in unpaid taxes.
Speaking of weed, the Snoop Dogg announcement turned out to be a head fake to flack for a smokeless outdoor fireplace.
Alabama woman with two uteruses is pregnant with twins…one in each womb.
The Critical Drinker liked The Killer.
Wish is shaping up to be the latest Disney box office disaster.
“Palestinian Authority Warns That Gaza Hospitals Running Dangerously Low On Ammunition.”
“10 Clues The Hospital You’re At Is Actually A Hamas Base.
Tags:2024 Presidential Race, Andrew Murr, Argentina, bankruptcy, California, Crime, debt, deficits, Democrats, Disney, Donald Trump, Elections, European Debt Crisis, Gaza, Geert Wilders, Germany, Girl Scouts, Global Warming, Greg Abbott, gun control, Hamas, Holly Hansen, Houston, inflation, Israel, Israel-Hamas War, Javier Milei, Jimmie Gardner, Ken Paxton, Libertarians, LinkSwarm, marijuana, Maryland, Massachusetts, Military, Oregon, Palestinians, Patrece Lee, Regulation, Sergio Massa, Social Justice Warriors, Stacey Abrams, Sylvester Turner
Posted in Austin, Budget, Communism, Crime, Democrats, Economics, Elections, Foreign Policy, Global Warming, Guns, Jihad, Media Watch, Military, Regulation, Social Justice Warriors, Supreme Court, Texas | 2 Comments »
Friday, July 1st, 2022
Welcome to the second half of 2022! The Biden Economy suckage becomes more obvious, the world’s most taboo lawsuit wants justice for real women being raped by fake women that the state of California forced on them, the Supreme Court slaps the EPA with a ruler over regulating carbon dioxide without congressional authority, and Eric Adams finally realizes he’s running a hellhole. It’s the Friday LinkSwarm!
“U.S. first-quarter GDP shrank 1.6%.” And the second quarter will probably suck as well.
$10 a gallon gasoline coming? If anyone can make it happen, it’s the Biden Administration.
Russia has taken Severodonetsk and is pounding Lysychansk. They have also successfully crossed the Donets River.
However, Russia has withdrawn from Snake Island.
Welcome to the world’s most taboo legal case, a lawsuit over imprisoned woman having the right not to be raped by men who “identify” as women.
On November 17, 2021, the Women’s Liberation Front, or WoLF, filed a civil rights lawsuit in California that drew almost no coverage. A press corps gearing up to be outraged en masse by the Amber Heard-Johnny Depp defamation case had zero interest in a lawsuit filed by far poorer female abuse victims.
Janine Chandler et al vs. California Department of Corrections targeted a new California state law, the “The Transgender Respect, Agency, and Dignity Act,” a.k.a. S.B. 132. The statute allows any prisoner who self-identifies as a woman — including prisoners with penises who may have stopped taking hormones — into women’s prisons. There was nothing TV-friendly about the scenes depicted in the complaint:
Plaintiff Krystal Gonzalez (“Krystal”) is a female offender currently incarcerated in Central California Women’s Facility. Krystal was sexually assaulted by a man transferred to her unit under S.B. 132. Krystal filed a grievance and requested single-sex housing away from men; the prison’s response to Krystal’s grievance referred to her assault by a “transgender woman with a penis.” Krystal does not believe that women have penises…
After a week spent denounced for reviewing the Matt Walsh documentary What is a Woman?, and for saying things I think will be boring conventional wisdom within a year, I was ready to never go near trans issues again and move to the impending financial disaster. But accident sucked me back. I’d made a point of pride of not reading a line of commentary about Heard-Depp, but listened to an episode of Blocked and Reported that touched on it after it was over, and learned three things that made me furious and think immediately of Chandler.
One, the ACLU, in apparent exchange for a pledge of $3.5 million, ghost-wrote Heard’s offending editorial, and in particular a line about her having “felt the full force of our culture’s wrath for women who speak out.” Two: Guardian writer Moira Donegan declared, “We are in a moment of virulent antifeminist backlash.” Three: Vice proclaimed without irony, “We’ve all failed Amber Heard.” Almost as one, the establishment press declared itself concerned with the suffering of a rich actress. However, there’s a gaping loophole in their concern for women, and Chandler sits in the middle of it.
Let’s talk about “the full force of our culture’s wrath for women who speak out” in the context of this case:
Chandler is the headline legal action in a nationwide battle over whether or not prisoners who self-identify as women, including those with histories of rape or sexual abuse, should be allowed to transfer to women’s correctional facilities. There have been both official and unofficial policy changes on this front in a growing collection of states across the country. These often happen with little to no public debate, because this issue may be the most impenetrable media taboo in America now.
The group bringing the suit, WoLF, has been targeted from every conceivable angle by pressure and censorship campaigns. While we at least heard about protesting Canadian truckers having their GoFundMe campaigns frozen, WoLF didn’t even bother trying to raise money on that platform, “because they just ban you really easily,” as legal director Lauren Adams put it.
They moved to a purportedly speechier platform, GiveButter, hoping they would have “less of a censorious kind of view.” But even GiveButter soon gave WoLF the boot (I reached out to the company, which hasn’t provided public comment yet). “It was just a general fundraiser,” Adams explains. “And they said we violated their community standards. So now we’re on GiveSendGo, which is a Christian crowdfunding site.”
If there’s a better illustration of the upside-down state of politics in 2022 America, it’s a feminist activist group forced to seek cyber-refuge in a Christian fundraising company.
Snip.
Most of the cross-dressing men claiming a “transgender identity” and granted transfer… are sex offenders, most are heterosexual men who want to be housed with women to get penis-in-vagina sex, most stop taking any feminizing hormone medications right after getting into women’s prison, they all refer to themselves as men when speaking to the women inmates, many have threatened to “fight you like a man” to women inmates, many have threatened to rape us, and they all have working penises that they are using to have sex with female inmates.
Transexism is now so central to the social justice victimhood politics ideology that controls the Democratic Party that it leads to letting men rape women rather than question the holy tenant that a man can magically become a women by declaring it so.
Notice how that “giant backlash” against the overturning of Roe vs. Wade seems to be limited to leftwingers freaking out on social media? Here’s a good explanation why:
Another salutary Supreme Court decision: The EPA cannot regulate carbon dioxide as a pollutant absent explicit congressional authorization to do so.
“U.S. and Canada Tell G7 That Climate Change Policy is More Important Than Feeding People.”
I’ll take “Headlines That Surprise No One” for $400: Top Three Worst-Run US Cities Are Controlled By Democrats. D.C., San Francisco, and New York City.
Speaking of which, New York City mayor Eric Adams is shocked, shocked to discover that the city he runs sucks.
During an exclusive interview conducted as Adams rode the subways overnight for more than three hours last week, the former NYPD transit cop said he was astounded by the botched “deployment of resources” that has New Yorkers on edge amid a nearly 40 percent surge in major crimes this year.
“Let me tell you something: When I started looking into this, I was shocked at how bad this place is,” he said of the city.
Adams — who campaigned on a promise to restore order to an increasingly lawless Gotham — said the scales fell from his eyes when he began reviewing internal city operations following his swearing in moments after midnight on New Year’s Day.
Yet somehow I could tell that despite living some 1,700 miles away, thanks to the magic power of “paying attention” and “not depending on the MSM for news.”
California’s Attorney general wants to revoke Second Amendment rights for citizens based on their political beliefs.
“More than 1 million voters across 43 states have switched to the Republican Party over the last year.”
Nowhere is the shift more pronounced — and dangerous for Democrats — than in the suburbs, where well-educated swing voters who turned against Trump’s Republican Party in recent years appear to be swinging back. Over the last year, far more people are switching to the GOP across suburban counties from Denver to Atlanta and Pittsburgh and Cleveland. Republicans also gained ground in counties around medium-size cities such as Harrisburg, Pennsylvania; Raleigh, North Carolina; Augusta, Georgia; and Des Moines, Iowa.
Who has the highest debt in the EU? Exactly who you would think: The PIGS (Greece, Italy, Portugal and Spain, in that order), then France, Belgium and Cyprus.
Supreme Court to Louisiana Democrats: No, you can’t have another Democratic congressional seat. Not yours.
Methinks thou hast punched thy ticket in a shade most pink. (Hat tip: Dwight.)
Following other western tech giants, Cisco plans to exit Russia permanently. Unless you’re in the sector, you might underestimate just how many pies Cisco has fingers in. (Hat tip: Stephen Green at Instapundit.)
The $37 billion road project that’s changing Indonesia.
Project Farm rates blue jeans.
Dear Bed Bath and Beyond: Turning off the air conditioning is not a way to win customers in Texas during the summer. (They deny the charge.) (Hat tip: Stephen Green at Instapundit.)
“Authorities Warn Tonight’s Protests May Escalate From ‘Mostly Peaceful’ To ‘Somewhat Peaceful.'”
Tags:2022 Election, abortion, Biden Recession, California, Cisco, Crime, Democrats, Dobbs v. Jackson Women’s Health Organization, Donets River, Eric Adams, European Debt Crisis, Foreign Policy, GiveButter, GiveSendGo, Global Warming, Greece, Indonesia, Italy, Janine Chandler et al vs. California Department of Corrections, Krystal Gonzalez, LinkSwarm, Lysychansk, Matt Taibbi, New York City, PIGS, Portugal, Republicans, Roe vs. Wade, Russia, Russo-Ukrainian War, San Francisco, Severodonetsk, Snake Island, Social Justice Warriors, Spain, Sumatra, Supreme Court, transexual, Ukraine, Washington D.C., Women’s Liberation Front
Posted in Crime, Democrats, Economics, Elections, Global Warming, Obama Scandals, Regulation, Republicans, Social Justice Warriors, Supreme Court | 2 Comments »
Sunday, February 6th, 2022
Let’s talk about the European Debt Crisis.
[The sound you hear is the countless multitudes clicking off to another blog.]
Way back last decade, dispatches on the ongoing crisis were a regular staple of the blog. To summarize the crisis for those who weren’t paying attention back then:
A bunch of countries joined the Eurozone without following the requirements outlined for membership, including limiting budget deficits to 3% of less of their GDP, and overall debt-to-GDP ratio of 60% or less. How were they able to join? Simple: They lied and the Eurocrats turned a blind eye, because EU.
Foremost among those running into trouble were the PIIGS (Portugal, Italy, Ireland, Greece and Spain). (Cyprus and Malta also had serious issues, but their tiny size meant they presented no systematic risk for other nations, and Cyprus relieved its problems by becoming the dirty Russian money laundering capital of Europe.)
Ireland was probably the most incongruous of the five, since their debt only spiked when the Irish government nationalized Anglo Irish Bank to prevent it from collapsing.
In all other cases, the cause of of the problem was obvious: Each ran huge budget deficits to underwrite generous welfare state programs for countries with below replacement birth rates, and they were allowed to get away with it for a while because they used Germany’s credit rating in lieu of their own thanks to the Euro.
The problem finally came to a head after the SubPrime Meltdown in 2008 made various banks and regulatory agencies actually scrutinize balance sheets and realize just how broke the PIIGS were.
Greece was the worst, being the most dysfunctional, and absolutely refusing to slow down spending on their own. There followed a reoccurring farce where various Euro regulatory agencies (including the International Monetary Fund, the European Commission, and the European Central Bank, collectively known as “the Troika”) demanded Greece end their ridiculous high levels of deficit spending, Greece refused, the Troika threatened to cut off the tap entirely, Greece promised to be better, the Troika reluctantly extended them another loan, and then Greece continued to spend recklessly, setting up the next round of the farce.
A bunch of Eurozone countries then implemented “austerity,” which involved not cutting spending to balance their budgets, but merely reducing the deficits slightly.
None of these “austerity” measures eliminated deficit spending, and none addressed the issue that’s driving all of Europe (and us) bankrupt, namely unwillingness to carry out structural reforms of the welfare state. The few tiny reforms that have been undertaken have been, as NRO’s Michael Tanner notes, ridiculously timid, and even those have been heavily weighted in future years. “So far, European governments haven’t even been willing to take a penknife to the welfare state, let alone an axe.” Plus a huge round of tax hikes…
Actual austerity would mean (at a minimum) reducing spending to the amount of money actually taken in. As best I can tell, none of the PIIGS, or France, or the UK has undertaken such real austerity. That “severe” Greek austerity that just caused a change in government? It reduced Greece’s official deficit spending from 9.0% of GDP to 7.5% of GDP. They didn’t even want Greece to stop digging a hole, they just wanted them to dig more slowly.
Austerity did not fail, it was declared difficult and left untried.
Eventually growth in the Eurozone picked up just enough, and the Troika managed to install enough of their own functionaries in various PIIGS positions to ensure that their half-assed, anemic austerity programs were actually followed that, along with Brexit and the Rise of Trump, it got Eurozone debt crisis off the front page and back under the rug.
So fast forward to today. Has the European debt crisis been solved?
Hah! Of course not. Does the EU ever really solve anything? European debt grew during the pandemic, but this time they get to blame Flu Manchu rather than slow growth, high taxes, declining births and a bloated welfare state.
Spain, Italy and Greece have all continued their PIIGS-ish ways. The UK, under ostensibly conservative Tory governments for the entire pandemic and constant attack for “austerity,” and they’re still piling up debt like one of the PIIGS, though the double-whammy of Brexit dislocations and idiotic lockdowns are more to blame than increased spending per se.
Ireland, with the lowest deficit for the period, seems to have proved that their membership among the PIIGS was transitory.
What then of Portugal? Have they improved? It turns out only slightly and relatively. Their debt increased by 13.9% for the period, making them better not only than Spain, Italy, Greece and the UK, but also France, Cyprus, Malta, Hungary and Slovenia. They evidently managed a balanced budget in 2019 (at least on paper). Their Flu Manchu deficit spending is still unsustainable, just slightly less unsustainable than many of their fellow Eurozone grave-diggers.
Ireland seems to have escaped PIIGSdom, but the others as are still very much in trouble, with debt-to-GDP rations at or above 100%:
Greece: 174.15%
Italy: 133.43%
Portugal: 119.46%
Spain: 95.96%
Ireland is down at 62.42%.
We don’t have much standing to condemn others, as the United States ratio stands at 106.70%. Donald Trump had numerous virtues as President, but he was no deficit hawk, and Biden would crank up deficits even higher if the Senate let him.
We can see the fruits of this orgy of deficit spending in the worldwide inflation we’re seeing. (Feel free to argue whether government budget deficits or central bank quantitative easing is more at fault.) Inflation may ruin nations, but it’s the deficit-spender’s friend, letting him pay off debt on the cheap with now devalued currency. And it’s the working poor whose lives are most impoverished by it.
Robbing Peter to pay Paul has always been a popular proposition to get Paul’s vote, but we’re now robbing Peter and Paul’s unborn grandchildren to delay financial reckonings until after the next election cycle.
It will not end well.
Tags:austerity, Brexit, Budget, coronavirus, Economics, EU, Europe, European Central Bank, European Debt Crisis, Eurozone, Foreign Policy, Germany, Greece, IMF, Ireland, Italy, PIIGS, Portugal, Spain, UK, Welfare State
Posted in Budget, Economics, Foreign Policy, Welfare State | No Comments »
Tuesday, May 29th, 2018
Remember the Eurozone crisis? It’s back!
Or, to be more accurate, it never went away.
Today’s locus of instability is Italy, where two Euroskeptic parties, one left (Five Star Movement) and one right (the League, AKA the Northern League), were prevented from forming a coalition government by the country’s Europhilic President Sergio Mattarella, who vetoed their pick of Paolo Savona for finance minister because he advocates leaving the Euro. Like Spain, Italy found out that if they went too strongly against the EU’s wishes, they’d simply be required to keep voting until they got it “right.”
The current reckoning has been a long time coming:
Accepting Italy as one of the eurozone’s founding members was a decision only made possible by ignoring common sense, by twisting statistics, and by making a mockery of the rules. But it was a Pyrrhic victory: Italy was allowed to trick its way onto a voyage that damned it. The euro simply did not fit the realities of Italy’s economy or its politics. By dramatically cutting the country’s financing costs (borrowing lire would have carried a significantly higher nominal cost) adopting the single currency allowed Rome to avoid tackling the country’s high debt load, a debt load that was made all the more dangerous now that it was all denominated in a ‘foreign’ currency. Italy could no longer print lire to pay off its creditors.
When the eurozone crisis hit, Italy was one of the victims, and so, in some respects was its democracy. In something that came uncomfortably close to a coup, the eurozone leadership essentially used Italy’s financial fragility as a lever to secure the replacement in 2011 of Prime Minister Berlusconi by a Brussels man, Mario Monti, a pliable, unelected proconsul. Next time you hear Brussels lecturing Eastern Europeans on democracy remember that.
Italy weathered the crisis in a ‘just a flesh wound’ sort of way. Its problems became chronic, rather than acute, if that’s the correct adjective to describe the consequences of staying stuck in the euro’s deflationary trap: High rates of unemployment and anemic economic growth.
The Independent:
Per capita GDP in Italy is still more than 8 per cent lower than it was when Lehman Brothers went bust in 2008. Quite incredibly, it is even lower than it was when the country joined the eurozone back at the turn of the millennium. Unemployment stands at 11 per cent, down from a peak of 13.1 per cent in 2014, but still double the 5.8 per cent low seen in 2007.
As the largest of the PIIGS and the third largest economy in the Eurozone, Italy’s participation in the Euro is a lot more vital than Greece’s, which is why the EU has actively been trying to crush any hint of (pick your neologism) Quitaly or Italeave.
Never mind the fact that, as in Spain, Italian voters want to have their cake and eat it too, advocating polices (in the form of “rolling back pension reforms and government subsidies to the unemployed”) that would only pile on further debt in a country that already has a national debt running at over 130% of GDP, secondly only to Greece in the Eurozone. That doesn’t change the fact that Italy has “ceded its sovereignty to the European Union and international financial markets.”
Naturally, traders have responded to the crisis by selling off Italian stocks and bonds.
Stay tuned…
Tags:Budget, Carlo Cottarelli, Economics, EU, Euro, European Debt Crisis, Eurozone, Five Star Movement, Foreign Policy, Italy, Northern League (Italy), Paolo Savona, PIIGS, Quitaly, Sergio Mattarella
Posted in Budget, Economics, Elections, Foreign Policy | No Comments »
Wednesday, March 22nd, 2017
Here’s a story that seems to have largely flown below the media’s radar: eight parcel bombs intercepted in Greece:
ATHENS — Greek counterterrorism officers have uncovered eight parcel bombs resembling those sent last week to the German finance minister in Berlin and to the Paris offices of the International Monetary Fund, a police official said on Tuesday.
The devices were discovered on Monday during a search of the Hellenic Post’s main sorting office, north of Athens, according to a police spokesman, Theodoros Chronopoulos. “The packages were destined for European countries,” he said, calling them “similar” to the ones sent to the German finance minister, Wolfgang Schäuble, and to the I.M.F.’s offices.
According to reports in the Greek news media, which Mr. Chronopoulos did not confirm, the packages intercepted at the Athens sorting office were addressed to European Union officials and to multinational companies. The targets reportedly included the leader of the eurozone group of finance ministers, Jeroen Dijsselbloem, who coordinates meetings on Greek bailout talks, and an unidentified official of the European Central Bank, one of Greece’s three main international creditors.
The Paris bomb injured a worker, but none of the bombs have caused fatalities.
As tempting as it is to pin any bombing jihadists, the targets suggest this was a bombing campaign carried out by the radical Greek left in advance of the Greek debt farce playing out again this summer. “A fresh crisis over Greek debt could be triggered as soon as in July when Greece is due to repay some 7bn euros to its creditors – money the country cannot pay without a fresh injection of bailout cash.”
I would say “stay tuned,” but I think we all know exactly how the current round of the farce will play out this summer…
Tags:bomb, European Debt Crisis, Greece, Intern, terrorism
Posted in Foreign Policy | No Comments »
Friday, January 13th, 2017
Time to extract more pure wheat from chaff!
Glenn Greenwald says Democrats will go to any lengths to avoid blaming themselves for their debacle:
I really haven’t experienced anything even remotely like the smear campaign that has been launched by Democrats in this really coordinated way ever since I began just expressing skepticism about the prevailing narrative over Russia and its role that it allegedly played in the election and, in particular, in helping to defeat Hillary Clinton. I mean, not even the reporting I did based on the Edward Snowden archive, which was extremely controversial in multiple countries around the world, not even that compared to the attacks now.
And the reason is very, very obvious, which is that it has become exceptionally important to Democratic partisans to believe that the reason they lost this election is not because they chose a candidate who was corrupt and who was extremely disliked and who symbolized all of the worst failings of the Democratic Party. It’s extremely important to them not to face what is really a systemic collapse on the part of the Democratic Party as a political force in the United States, in the House, in the Senate, in state houses and governorships all over the country. And so, in order not to face any of that and have to confront their own failings, they instead want to focus everything on Vladimir Putin and Russia and insist that the reason they lost was because this big, bad dictator interfered in the election. And anyone who challenges or anyone who questions that instantly becomes not just their enemy, but now, according to their framework, someone who’s actually unpatriotic, that if you question the evidence, the sufficiency of the evidence to support this theory, that somehow your loyalties are suspect, that you’re not just a critic of the Democratic Party, you’re actually a stooge of or an agent of the Kremlin.
In fact, Greenwald is all over this week’s LinkSwarm, saying that the U.S. “deep state” is at war with Trump:
For months, the CIA, with unprecedented clarity, overtly threw its weight behind Hillary Clinton’s candidacy and sought to defeat Donald Trump. In August, former acting CIA Director Michael Morell announced his endorsement of Clinton in the New York Times and claimed that “Mr. Putin had recruited Mr. Trump as an unwitting agent of the Russian Federation.” The CIA and NSA director under George W. Bush, Gen. Michael Hayden, also endorsed Clinton and went to the Washington Post to warn, in the week before the election, that “Donald Trump really does sound a lot like Vladimir Putin,” adding that Trump is “the useful fool, some naif, manipulated by Moscow, secretly held in contempt, but whose blind support is happily accepted and exploited.”
It is not hard to understand why the CIA preferred Clinton over Trump. Clinton was critical of Obama for restraining the CIA’s proxy war in Syria and was eager to expand that war, while Trump denounced it. Clinton clearly wanted a harder line than Obama took against the CIA’s long-standing foes in Moscow, while Trump wanted improved relations and greater cooperation. In general, Clinton defended and intended to extend the decadeslong international military order on which the CIA and Pentagon’s preeminence depends, while Trump — through a still-uncertain mix of instability and extremist conviction — posed a threat to it.
Whatever one’s views are on those debates, it is the democratic framework — the presidential election, the confirmation process, congressional leaders, judicial proceedings, citizen activism and protest, civil disobedience — that should determine how they are resolved. All of those policy disputes were debated out in the open; the public heard them; and Trump won. Nobody should crave the rule of Deep State overlords.
Yet craving Deep State rule is exactly what prominent Democratic operatives and media figures are doing.
One need not buy all of Greenwald’s analysis of geopolitics or Trump to conclude that his analysis of the current alliance between Democrats, the media and the intelligence community is essentially correct. (Hat tip: Ace of Spades HQ.)
Borepatch, who is a real life computer security expert, is not impressed with the Russian hacking claims:
My take is that several state actors certainly hacked Hillary’s email server for years and years, and silently read all her communications. Probably more than one state actor penetrated the DNC email system for several years.
It’s plausible than an insider leaked the DNC emails – some BertieBro IT Admin type who saw how the sausage was being made and who was smart enough to cover his tracks while pointing clues towards Russia.
Bottom line, this is a tale told by an idiot; full of sound and fury and signifying nothing. We know that something happened, but we don’t know who did it, and what they say in the report doesn’t change that.
Borepatch, in turn, points to this detailed analysis of the security on both Hillary’s email server and the DNC:
At this point, we can largely dispose of Hillary’s Hack. It was an open book to all comers and at least one was Romanian (and sharing with friends) and not Russia. However, I’d say it was almost certain that at some time a Russian intrusion happened. The name of the server was obvious. The location insecure. The operating system and protective layers a joke. Frankly, I’d expect them to be “in” the same day they first looked at it. Which means something like 8 years ago. So why didn’t things leak then?
Because the Russians Are Not Stupid. A fundamental of spycraft is you don’t expose sources and methods, you use them to collect intel for your use, not publication. I suspect they enjoyed a near real time email feed from the Secretary Of State for years, in silence. This argues for email dump to be someone other than them. My personal muse would be an NSA guy, aghast at what was in evidence. Like a Snowden, but not willing to give up the $1/4 Million salary… He (or she…) would have all the requisite skilz to pull it off and leave no finger prints, access to PRISM, and lots of neat toys to work with. Though more likely would be the underpaid I.T. guy Hillary had set it up who was making a backup one day and dropped a load… But I digress.
The bottom line on Hillary is we know she kept a full copy (found on Huma’s Laptop with the Wiener…) and that it was around until she had her lawyers erase it. We know it surfaced in full at the time the laptop went to the FBI, and in parts before that. We know at least one of her hackers was found (though he had likely not leaked it) and that he said he had a doomsday copy for safety. He wasn’t a very good hacker, so that shows lots of good ones walked right in and snagged copies. Assigning source of any Hillary leaks is going to be an exercise is “ME ME MEE!!! PICK MEEE!” with a dozen hands up in the room.
More from Guccifer 2.0 himself: “I have totally no relation to the Russian government. I’d like to tell you once again I was acting in accordance with my personal political views and beliefs. The technical evidence contained in the reports doesn’t stand up to scrutiny. This is a crude fake.” (Hat tip: Zero Hedge.)
“The opposition research firm that hired a former British spy to dig up dirt on Donald Trump is the same shady outfit that was hired by Planned Parenthood to put a positive spin on videos showing the sale of baby parts.” (Hat tip: Director Blue.)
Our new Secretary of Defense sounds serious about defeating the Islamic State. “We should try to shut down its recruiting, shut down its finances, and then work to fight battles of annihilation — not attrition, but annihilation — against them; so that the first time they meet the forces that we put against them, there should basically be no survivors.”
Speaking of which: “Islamic State publishes video of toddler executing prisoner on playground.”
House Republicans are already laying the groundwork to repeal ObamaCare.
News media buries story of Jeff Sessions bankrupting the Klu Klux Klan in Alabama because it doesn’t fit their narrative. (Hat tip: Dierctor Blue.)
Mexican illegal aliens are already self-deporting in advance of Trump’s inauguration. (Hat tip: Director Blue.)
The problem with rule by experts:
The problem that we are faced with, and what the American people seem to be rebelling against, are the “experts” who seek to influence government policy in ways voters are either opposed to or at the very least find ineffective and expensive.
To put it bluntly: those experts have screwed a lot of shit up. Obamacare, American foreign policy, the war on drugs, domestic environmental policy, the economy…the list of issues is seemingly endless. The American people were told for at least the last eight years that the smart set was in charge, and things would be just dandy if only we allowed the “experts” free rein. The problem is that there are a lot of things that may seem smart on paper but which just won’t work when forcibly applied to the citizens of 50 separate states, with 50 separate economies, and 50 distinct voting bases, and this assessment assumes that those implementing policy actually have America’s best interests as a free republic at heart.
This leads us to the real heart of the matter: liberty. The Washington political and bureaucratic classes have no Constitutional right to force the “solutions” to any of these problems on their fellow citizens. The health insurance “problem” is not a national problem insofar as there is no Constitutional right to health insurance (or even healthcare), and the answer to what problems there are in healthcare in Texas are very probably not the same as the answer for New Hampshire or Oregon. The federal government institutes regulations constantly affecting the economy that have no Constitutional basis. There is no Constitutional basis whatsoever for banning or regulating any drug at the Federal level, and yet we’re told we have a national “opioid epidemic” that demands a federal solution. Foreign policy experts are undoubtedly necessary, but our foreign policy, when any logic or reason can be discerned in it at all, certainly doesn’t seem to be guided by any experts in the field. There is even a very good possibility that actually fixing any “problem” at the federal level is viewed as bad for business, because without the problem to solve there would be a lot of unemployable experts.
In short, the American people don’t have a problem with experts or intellectuals. What they have a problem with is incompetence, and it is just a fact of life that the larger and more remote the government and bureaucracy become, the more incompetent and unaccountable they will be.
Thanks Obama. “93 percent of police officers are concerned about their safety on the job; 72 percent are less willing to stop suspicious characters; and 75 percent report increased tension between cops and the black community.” (Hat tip: Instapundit.)
U.S. troops sent on permenant deployment to Poland. Given that Poland joined NATO in 1999, it’s a surprise it took this long. (Hat tip: Director Blue.)
About half the EU has been cheating on the 3% deficit ceiling fiscal discipline rule half the time. Only Finland, Estonia, Luxembourg and Sweden have never broken the rule. And Poland, France and the brexiting UK have actually violated the rule more than Italy and Ireland. Once again: Austerity hasn’t been tried and found wanting in the EU, it’s been declared difficult and left untried.
Turkish president Recep Tayyip Erdogan blames “terrorist exchange rates” for attacking his country. Fun how that happens when you ruin your own country… (Hat tip: Stephen Green at Instapundit.)
Social Justice Warriors already deterring people from the “Women’s March on Washington.” See, they were all set to flaunt the peacock feathers of their leftwing virtue, only to be told “they had a lot of learning to do.” Because there’s nothing more fun than being lectured about how you’re a racist when you’re not. Welcome to Red State America, liberal white women! (Hat tip: Instapundit.)
“DNC Chair Candidate Forum to Be Held at Anti-Israel Restaurant” (Hat tip: Director Blue.)
Germany court rules that an attempt to burn down a synagogue is a “justified expression of criticism of Israel’s policies.” You know, I think I’ve seen this movie before…
Heh: “Intolerance at Berkeley as Faculty Demand Gay Immigrant Stay Off Campus.”
More: Berkley Social Justice Warriors dox the hosts of Milo’s speech. (Hat tip: Instapundit.)
1. “CEO Raises Salaries to $70K for EVERY Employee” 2. ???? 3. Wrecked company. (Hat tip: Borepatch.)
Teach women not to lie about rape.
Social Justice Warrior drama at the Free Software Foundation. “‘Developer’ Leah Rowe has been making unhinged, outrageous claims of harassment and bullying on behalf of her anonymous friend who was let go by the FSF. She then stole the Libreroot project from the community, locked it down away from the other devs, and made a unhinged claims of wrongdoing by the FSF and two employees. She has provided no evidence of any of these claims and as she is a post-modernist, we’re supposed to substitute her feelings for any facts as being equivalent.” The amazing thing is that, for once, FSF head honcho Richard Stallman (who is somewhere on the continuum between “true software visionary” and “fanatic lunatic no one wants to deal with”) isn’t the person at fault for the drama…
“An Arizona Department of Public Safety officer has survived an attempt on his life after a passing motorist shot dead a highway sniper who took aim at the trooper after stopping to assist an individual in a rolled vehicle.”
Also from Arizona: Naked woman steals police car, goes joyriding.
Clockboy’s lawsuit dismissed.
William Peter Blatty, RIP.
What the hell? YouTube takes down Legal Insurrection’s channel at the behest of anti-Israeli activists.
Slate won’t even delete their big mistakes:
Tags:2016 Presidential Race, anti-semitism, Arizona, austerity, Border Controls, Budget, Crime, Democrats, Donald Trump, Elections, EmailGate, Estonia, EU, European Debt Crisis, Finland, Foreign Policy, France, Free Software Foundation, Glenn Greenwald, Guccifer 2.0, Guns, Hillary Clinton Scandals, Islamic State of Iraq and Syria, Israel, James "Mad Dog" Mattis, Jeff Sessions, Jihad, Leah Rowe, Legal Insurrection, LinkSwarm, Luxembourg, Media Watch, Milo Yiannopoulos, ObamaCare, PIIGS, Poland, police, rape, Recep Tayyip Erdogan, Republicans, Russia, Slate, Social Justice Warriors, Sweden, Syria, Turkey, UK, YouTube
Posted in Border Control, Budget, Crime, Democrats, Economics, Elections, Foreign Policy, Jihad, Media Watch, Military, ObamaCare, Republicans, Social Justice Warriors | 1 Comment »
Monday, October 24th, 2016
The latest Clinton Corruption update pushed the LinkSwarm to Monday:
National Review published Victor Davis Hanson’s endorsement of Donald Trump. And the moon became as blood…
“Trump leading in poll that has best track record over last three elections.”
The poll with the best track record over the last three presidential elections gave Donald Trump a 2-percentage-point edge over Hillary Clinton on Saturday.
The Investor’s Business Daily/TIPP tracking poll has Trump with 42.1 percent and Clinton at 39.7 percent.
Thoughts on #NeverTrump: “They are putting a great volume of energy into bringing about a disaster, for which they will not take any ownership.”
No one trusts the media anymore. “Only one in nine Americans believes that Hillary Clinton is ‘honest and trustworthy.’ They don’t trust the media’s cover-up of her misdeeds, and the cover-up of the cover-up of the cover-up.” (Hat tip: Director Blue.)
“Why I Now Feel Compelled To Vote For Trump“:
More than anything, I can’t sit idly by and allow these perpetrators of fraud to celebrate and leak tears of joy like they did when they helped elect Barack Obama in 2008. I have to know I weighed in not only in writing but in the voting booth. The media needs to be destroyed. And although voting for Trump won’t do it, it’s something. Essentially, I am voting for Trump because of the people who don’t want me to, and I believe I must register my disgust with Hillary Clinton.
(Hat tip: Director Blue.)
And speaking of media bias, the Rolling Stone campus rape hoax case goes to trial. (Hat tip: Ace of Spades HQ.)
Here’s a New Yorker piece on the failure of the Euro. It provides a good, but incomplete, overview of the Euro’s failure (nowhere does it note that Europe’s cradle-to-grave welfare state is unsustainable, and it fails to note that none of the nations practicing “austerity” in southern Europe have cut outlays to match receipts). And the myopic policy prescription offered is, of course, more central planning. But there are some good bits. Like this:
The U.S. unemployment rate hit ten per cent for a single month in 2009 and is now below five per cent; the eurozone unemployment rate hit ten per cent around the same time, and is still in double digits. In some European countries, youth unemployment is more than forty per cent. America’s economy is bigger than it was when the crisis hit. The eurozone’s is smaller. To take just one example, Italy, the third-largest economy in the eurozone, has a per-capita G.D.P. that’s lower than it was at the end of the last century.
Also this:
Stiglitz observes that if the countries that committed to the single currency in 1992 had known what they know now, and if people had had the chance to vote on the proposal, “it is hard to see how they could have supported it.” That’s a hell of an indictment.
Hey, remember how we were told California’s assisted suicide law would only apply to terminally ill people who wanted to die? Now insurance companies are enouraging suicide rather than pay for life-extending drug treatments.
Even The New York Times figures out that new gun laws wouldn’t prevent most mass shootings.
Russia is conducting nuclear survival drills. (WSJ hoops apply.) Good thing we have Nobel Peace Prize winner Obama running things rather than that warmonger Bush… (Hat tip: Stephen Green at Instapundit.)
College isn’t for everyone:
But if you’re not sure yet what you want to do, then take time to decide before you spend $30,000, $50,000, or $100,000 you don’t have for something you don’t need. In the meantime, start working. You’ll probably only find low-paying, hard-working jobs at first, but guess what? If you go to college, you’ll be working those same jobs when you get out, only you’ll be four years older and fifty grand poorer.
Scientists at the Oak Ridge National Laboratory in Tennessee have discovered a chemical reaction to turn CO2 into ethanol. Better idea than corn subsidies…
The Large Hadron Collider “nightmare scenario has come true:
For the last ten years you’ve been told that the LHC must see some new physics besides the Higgs because otherwise nature isn’t “natural” – a technical term invented to describe the degree of numerical coincidence of a theory. I’ve been laughed at when I explained that I don’t buy into naturalness because it’s a philosophical criterion, not a scientific one. But on that matter I got the last laugh: Nature, it turns out, doesn’t like to be told what’s presumably natural.
Hamilton County, Tennessee doesn’t monitor parole tracking devices outside business hours. A good thing people never commit parole violations nights and weekends… (Hat tip: Fark.)
This just in: Democratic Representative Shelia Jackson Lee is still an idiot.
AT&T trying to buy Time Warner. I’ve got a bad feeling about this…
Internet-connected CCTV cameras made by Chinese firm Hangzhou Xiongmai Technology seemed to make up the heart of the botnet used in Friday’s DDoS attack.
Yuan hits all time low against the dollar.
Microsoft Surface sucks.
Texas is goat country.
Tags:#NeverTrump, AT&T, California, CO2, Crime, Donald Trump, Economics, Euro, European Debt Crisis, Eurozone, Guns, Hamilton County (TN), Hangzhou Xiongmai Technology, Hillary Clinton, Media Watch, Microsoft, Military, Oak Ridge National Laboratory, polls, rape, Rolling Stone, Russia, Shelia Jackson Lee, suicide, Texas, Time Warner, Victor Davis Hanson
Posted in Crime, Democrats, Economics, Elections, Guns, Media Watch, Military, Texas | No Comments »
Friday, October 14th, 2016
This year…
Rasmussen has Trump ahead.
Italy’s economy is a mile high house of cards.
Citigroup, parent of Citibank, had a huge role in staffing and shaping the agenda of Obama’s first term.
Cracked on the country/city divide fueling Trump’s rise.
Wisconsin Senate candidate Russ Feingold admits that he and Hillary Clinton want to disarm Americans.
Competitive shooter stopped Minnesota mall jihad rampage. (Hat tip: KR Training.)
Social Justice Warriors hate women’s magazines.
Peak New Hampshire.
Lawyers file fake lawsuits against fake plaintiffs to obtain fake judgements to take down real comments off the Internet, then pressure Google to deindex the offending article, all evidently at the behest of a “reputation management” firm. Presumably The King in Yellow is not involved…
Scandal claims another Andrew Cuomo advisor. (Hat tip: Instapundit.)
“Liberalism has lost the loyalty of the downtrodden that once, with admittedly mixed motives, it set out to help. That’s a loss it’s unlikely to survive.”
Library addition: Nine William F. Buckley, Jr. non-fiction books, seven signed.
Shorter than usual, for Reasons.
Have a nice weekend.
Tags:2016 Election, 2016 Presidential Race, European Debt Crisis, Guns, Jihad, LinkSwarm, Minnesota, New Hampshire, polls, Social Justice Warriors, William F. Buckley, Wisconsin
Posted in Democrats, Elections, Guns, Jihad | No Comments »
Wednesday, July 6th, 2016
Yesterday’s Brexit roundup mentioned that Italian banks account for nearly half the bad loans for the entire Eurozone.
Italy is now the heads-on favorite as the most likely instigator of the next global economic crisis. Some analysts are calling it a perfect storm:
Italy’s bank bailout fund might not be enough to beat back the Brexit. More key Italian financial services firms are under pressure and face the potential need to raise capital, leaving Italian government officials and its banking system trying to steer clear of a crisis.
As Italian bank bonds and share prices are seeing their value slammed in the face of rising uncertainty, banks with substantial bad loans are facing greater pressure, with rates around the world slipping into negative territory.
And, of course, they’re blaming Brexit rather than all the myriad problems with the EU that caused the Brexit.
Italy’s bank bailout fund might not be enough to beat back the Brexit. More key Italian financial services firms are under pressure and face the potential need to raise capital, leaving Italian government officials and its banking system trying to steer clear of a crisis.
As Italian bank bonds and share prices are seeing their value slammed in the face of rising uncertainty, banks with substantial bad loans are facing greater pressure, with rates around the world slipping into negative territory. It’s an anxiety some in Italy and throughout the European Union may have been hoping would be eased by the Brexit vote last month — but then the U.K. referendum delivered the opposite outcome from the one they had sought.
“Market volatility following the U.K.’s EU referendum result hit the Italian bank sector particularly hard because it is one of Europe’s weakest,” Fitch Ratings analysts said in a July 4 report. “Asset quality pressure is a main driver for the negative outlooks on several large and medium-sized Italian banks.”
The Brexit vote, which calls for the United Kingdom to abandon a European Union that has careened for years from one crisis to another, could hasten weak Italian banks’ downfall. It was widely expected that European and U.K. banks will suffer the brunt of the vote in late June, and while British banks have been hard hit by the news — which brings with it tremendous regulatory uncertainty — EU banks have suffered as well.
Many banks in Italy, including its largest, UniCredit SpA, have seen share prices pounded; its stock is down more than 60 percent so far this year. A staffer at UniCredit could not provide comment when contacted.
Already, Italian officials and executives appear to be pulling out all the stops to stave off banking sector contagion. The lingering question for banks is whether they can continue to support lending operations at a time when creditors face potential losses and as some of the country’s leading financial services firms could be subject to shotgun M&A marriages by regulators.
Italian financial services firms earlier this year established a multi-billion dollar fund called Atlante to buy non-performing bank loans. But the fund, which is in the 4-billion euro to 6-billion euro range ($4.43 billion to $6.65 billion), one analyst said, is far too small to cover all the non-performing loans held by major Italian banks. However, the fund could still be leveraged in order to support loan purchases.
“The authorities need to get banks to remove a large portion of soured loans from their books so they can loan more,” said Julien Jarmoszko, senior research manager at S&P Global Market Intelligence. “If investors fear more Italian banks, this will raise their cost of capital and reduce lending as a result.”
Look for some sort of holding action for temporary recapitalization (including a “bail in” or some sort of ECB scheme) to let all the insiders dump their bad debts onto the European taxpayer, which was the real point of prolonging the Greek farce.
More news on that front:
Atlante already took control of Veneto Banca after “a €1bn capital increase demanded by EU bank regulators attracted zero interest.” And Atlante may have to tap pension funs for further recapitalization.
Italy has also banned short-selling of imploding Banca Monte dei Paschi di Siena SpA. That’s never a good sign, and it never works for long.
“It’s bad – non-performing bank loans have risen to 18%. At 10%, most banks are technically bankrupt. That’s the percentage of capital and pledged deposits they have against bad loans. Our pledged deposits, not theirs. At 18%, they’re no longer “technically” bankrupt. They ARE bankrupt! Greece still has bad or non-performing bank loans of 34%, Ireland 19% and Portugal 12%. And we haven’t seen the next serious financial crisis yet.”
And bank bailouts could hit Italian sovereign debt right in the bond ratings. “Italian ratings are already at BBB- for S&P, though we must also add that DBRS still ranks the country at AL. Still, if these ratings start to come under pressure from the agencies, this could lead to speculation that Italy may eventually fall out of the investment grade bucket. This would have a major impact – in the first place in terms of the eligibility of Italian bonds for the PSPP.” That’s the European Central Bank’s public sector purchase program.
Of course, when push comes to shove, we’re likely to see all sorts of banking rules get thrown out the window…
Tags:Atlante, Banca Monte dei Paschi di Siena, Brexit, Economics, European Central Bank, European Debt Crisis, Eurozone, Foreign Policy, Italy, PIIGS, UniCredit, Veneto Banca, Welfare State
Posted in Economics, Foreign Policy | No Comments »
Tuesday, July 5th, 2016
While the reverberations from the Brexit vote are still being heard, here are a few interesting pieces you might have missed:
Nigel Farage resigns as head of UKIP. Hey, he fulfilled his victory conditions! What else has he got left to prove?
The elites still haven’t gotten over their defeat:
As several commentators, from Megan McArdle in The Atlantic to Rupert Darwall in National Review, have noticed, many liberal journalists, representing elites throughout the advanced world, have reacted with indignation to the fact that 52 percent of U.K. voters (many without degrees) have rejected the EU system of supranational government of which the elites approve. Naturally, these journalistic spokesmen argue, the common people could not possibly have good reasons for such an act of multinational vandalism. So they must be inspired by, er, racism, xenophobia, fear of globalization, and related other thought-crimes.
That account doubtless condenses and oversimplifies the elites’ response to the Brexit shock, which is just one small skirmish in a new class war in advanced societies between geographically mobile, liberal, skilled, high-earning professionals and more rooted, communitarian, particularist, and patriotic citizens (or what British journalist David Goodhart calls “nowhere” people and “somewhere” people). “Nowhere” people simply didn’t grasp the outlook of “somewhere people” in the referendum, not seeing that many decent people who voted for Brexit had such respectable anxieties as loss of community or, one step up, the transformation of their country as motives for casting their votes. So the elites thought the worst. They were still making the same mistake in their television and columnar explanations of the result on Friday morning. But what was remarkable was the Darwall-McArdle thesis that in other countries the elites reacted to the Brexit shock as if personally or spiritually affronted in their own lives. Alarmed, they asked: Why weren’t we told that they might vote for Brexit?
It’s a hard question to answer.
One aspect of it, however, is ideologically fascinating. Among the central arguments of those favoring Brexit was that the Brussels system was dangerously undemocratic and that British voters and MPs had lost the power to propose, amend, or repeal failed or oppressive laws. This was a passionate concern among English people who had grown up in a self-governing democracy, who may have fought for it in wars, and who simply couldn’t understand why the loss of their democratic rights didn’t worry their opponents. Yet again and again liberal journalists treated this passionate belief as either abstract or a cover for more primitive emotions and bigotries. Democracy as such was rarely given weight in Remain or liberal debates on the cost/benefit analysis of Brexit. They treat multinational political institutions as such unalloyed goods that it would be impolite to raise questions about such defects as a democratic deficit. Has the knowledge class/meritocracy/cognitive elite/nowhere people/etc., etc. developed not only an intellectual snobbery towards the rest of society, but even an impatient, dismissive contempt for democracy that cannot be openly avowed but that does influence its other political attitudes?
“Bigotry! Nativism! Racism! That’s what elites in Britain, Europe and here have been howling, explanations for why 52 percent of a higher-than-general-election turnout of British voters voted for their nation to leave the European Union. But there is plenty of bigotry, condescension and snobbery in the accusations and the people making them. And it’s incoherent to claim, as some do, that it’s undemocratic for voters to decide. That amounts to saying that ordinary people should be content to be ruled by their betters.” (Hat tip: Director Blue.)
“I think it’s shocking and appalling to assume because I voted to leave the EU that I’m racist.”
Even countries that aren’t contemplating leaving the EU (like France) are demanding changes to EU policies…and threatening to simply stop obeying them. There’s also this tidbit: “Italy’s banks are saddled with 360 billion euros ($401.18 billion) in bad loans.”
More on the same subject. “In Italy, 17% of banks’ loans are sour. That is nearly 10 times the level in the U.S., where, even at the worst of the 2008-09 financial crisis, it was only 5%. Among publicly traded banks in the eurozone, Italian lenders account for nearly half of total bad loans.”
If the UK can leave the EU. why can’t we leave the UN?
“London Banker Bonuses Set to Shrivel as Brexit Hits Dealmaking.” My heart bleeds…
And what is the UK leaving behind? “EU bans claim that water can prevent dehydration.” Finally someone with the guts to stand up to Big Dihydrogen Monoxide! (Hat tip: Daddy Warpig’s Twitter feed.)
Tags:Brexit, EU, European Debt Crisis, France, Italy, Nigel Farage, Regulation, UK, UKIP, UN, Welfare State
Posted in Elections, Foreign Policy, Regulation, Welfare State | 1 Comment »