Eurozone will collapse...

[Osem]

I think we're increasingly seeing that targets are a moveable feast...

[Alan Fry]

Originally Posted by Osem

The cost of borrowing for Spain has jumped above 6%, raising again the prospect of a bailout.

The yield on Spain's 10-year bonds reached 6.1%, ahead of auctions of debt on Tuesday and Thursday that could be increasingly expensive for Spain.

Investors have been worried by data showing Spain's banks are entirely dependent on emergency ECB loans....

....The yield suggests that if Spain wanted to borrow for 10 years today, it would pay more than 6%.

In comparison, the yield on 10-year bonds from Germany, the eurozone's strongest economy, is 1.73%.

http://www.bbc.co.uk/news/business-17725771

How long can this go on I wonder.

This is very unsustainable, it is very likly that they would need to borrow money from the ECB/EU or even have a bailout, Europe needs to be prepaired for it, the same goes for Italy and Hungary

[Osem]

Stock markets have fallen after weak manufacturing data and political uncertainty in France and the Netherlands hit investor confidence.

http://www.bbc.co.uk/news/business-17810759

Seems the markets aren't exactly reassured by Hollande's plans to spend France out of trouble.

Originally Posted by Osem

http://www.bbc.co.uk/news/business-17810759

Seems the markets aren't exactly reassured by Hollande's plans to spend France out of trouble.

so that's why the IMF wanted that extra £10 billion for

[Osem]

Originally Posted by heero_yuy

It will be interesting to see what we would have suffered if Labour's policies had been followed. Of course Sarki could still get back in but I don't think that's likely as Le Penn's supporters have a pathalogical loathing of him and will probably stay at home in the next round.

Yes, some people have very short memories and still seem to be oblivious to the perilous state we're in...

---------- Post added at 20:47 ---------- Previous post was at 20:43 ----------

Originally Posted by martyh

so that's why the IMF wanted that extra £10 billion for

Ooohhh we are being cynical today...

Originally Posted by Osem

Ooohhh we are being cynical today...

Touche

Originally Posted by heero_yuy

It will be interesting to see what we would have suffered if Labour's policies had been followed. Of course Sarki could still get back in but I don't think that's likely as Le Penn's supporters have a pathalogical loathing of him and will probably stay at home in the next round.

My understanding of what they proposed were cuts, but lesser cuts, with the idea that we could stimulate the economy by spending. Both the main candidates in this election aren't speaking much about the debt France is in so I don't think either candidate will calm the markets, not that 'the markets' should be able to scare people into how to vote.

[Osem]

This article makes interesting reading and shows why the French need to be very cautious about what the markets think about their government's intentions. It may not be nice but that's the reality of being in debt isn't it?

http://www.bbc.co.uk/news/business-17811923

The point is that the French government and French economy is disproportionately dependent on the goodwill of overseas investors and banks.

Here are the statistics.

According to IMF figures, 59% of France's government debt is held overseas - which means that well over half of all lending to the French state is not motivated by sentimentality or patriotism in any way.

To put that figure into context, just 24.8% of UK general government debt is provided by foreigners.

Perhaps more relevantly, the French government has to borrow a colossal sum equivalent to 18.2% of GDP this year and 19.5% next year to finance debt that is maturing and the current deficit.

So, to extrapolate from the current ownership pattern of its debt, France needs to retain the goodwill of overseas investors to provide loans equivalent to something like 10% of its GDP this year and a similar amount in 2013.

Again a comparison with the UK may be useful: the UK's financing needs for this year and next are much lower, at 14.8% of GDP and 13.9%, with perhaps no more than 4% of this needing to come from overseas.

Of course, this is no cause for joy here - if/when economies the size of France's get into difficulties anything can happen and that's why I hope the French will ber pragmatic and get on with tackling the problem not exacerbating it.

[Osem]

Dutch government falls in budget crisis

http://www.bbc.co.uk/news/world-europe-17811509

Dutch Prime Minister Mark Rutte has tendered his government's resignation to Queen Beatrix, paving the way for early elections.

His cabinet was plunged into crisis when Geert Wilders' Freedom Party (PVV) quit talks aimed at slicing 16bn euros (£13.1bn) from the budget.

Bitter financial medicine is made all the less palatable by the promise of a pain free quick fix.

[danielf]

Originally Posted by Osem

http://www.bbc.co.uk/news/world-europe-17811509



Bitter financial medicine is made all the less palatable by the promise of a pain free quick fix.

I think this is made into a bit more than it is really. The real issue isn't the cuts. Pretty much everyone (except Wilders) is in agreement that cuts are necessary, and that the 3% norm needs to be adhered to. The real issue is that Wilders, who has propped up the minority government with his populist 'Freedom' party, has decided to pull the plug on the government. I think the cuts are just an excuse. They were in negotiations over the cuts for 7 weeks, and he decided to pull out at the last moment, saying he wouldn't adhere to 'dictates' from Europe, conveniently forgetting that the Netherlands was one of the driving forces in favour of the 3% norm. He seems set to run for the next elections on an anti-Europe rather than anti-Islam ticket, coming off the back of slipping polls and substantial numbers of people leaving his party over the undemocratic way in which it's run. The real issue here is Wilders. Not the cuts.

[Osem]

Originally Posted by danielf

I think this is made into a bit more than it is really. The real issue isn't the cuts. Pretty much everyone (except Wilders) is in agreement that cuts are necessary, and that the 3% norm needs to be adhered to. The real issue is that Wilders, who has propped up the minority government with his populist 'Freedom' party, has decided to pull the plug on the government. I think the cuts are just an excuse. They were in negotiations over the cuts for 7 weeks, and he decided to pull out at the last moment, saying he wouldn't adhere to 'dictates' from Europe, conveniently forgetting that the Netherlands was one of the driving forces in favour of the 3% norm. He seems set to run for the next elections on an anti-Europe rather than anti-Islam ticket, coming off the back of slipping polls and substantial numbers of people leaving his party over the undemocratic way in which it's run. The real issue here is Wilders. Not the cuts.

Let's hope that's true and stability returns.

It seems to me that an increasing number of people throughout Europe will vote for what they want to hear rather than what needs to be done.

[danielf]

Originally Posted by Osem

Let's hope that's true and stability returns.

It seems to me that an increasing number of people throughout Europe will vote for what they want to hear rather than what needs to be done.

We'll have to see how he does in the next elections. I suspect he won't do too well, but you never know. My impression is that people are getting fed up with him and the undemocratic way he runs his party. Either way, unless he gets over 50% of the vote (highly unlikely, under proportional representation), he won't be back in government. He's proven himself an unreliable partner who has failed to take responsibility and act in the interest of the country. None of the major political parties will want to cooperate with him (ever) again.

[Osem]

Originally Posted by danielf

We'll have to see how he does in the next elections. I suspect he won't do too well, but you never know. My impression is that people are getting fed up with him and the undemocratic way he runs his party. Either way, unless he gets over 50% of the vote (highly unlikely, under proportional representation), he won't be back in government. He's proven himself an unreliable partner who has failed to take responsibility and act in the interest of the country. None of the major political parties will want to cooperate with him (ever) again.

Well it's certainly a risky 'game' for anyone to be playing, not only for the party(ies) involved but for the future of the European economy. At this time we need all serious parties to pull together, face the unpalatable truth and work together to solve the crisis. Sadly, what we're likely to get is the same old political opportunism and point scoring with the consequential risk that vital decisions are avoided, extremists of one sort or another gain popularity and tensions between 'partners' increase.

[danielf]

Originally Posted by Osem

Well it's certainly a risky 'game' for anyone to be playing, not only for the party(ies) involved but for the future of the European economy. At this time we need all serious parties to pull together, face the unpalatable truth and work together to solve the crisis. Sadly, what we're likely to get is the same old political opportunism and point scoring with the consequential risk that vital decisions are avoided, extremists of one sort or another gain popularity and tensions between 'partners' increase.

Yes, this is what has angered a lot of people in Holland. It's been an incredible waste of time, and elections now look set for September, which means that, unless all other parties pull together, it'll be difficult to pass new legislation, or reach agreement on the budget.

But, the good thing to come out of it is that Wilders has angered his coalition parties so much by stringing them along and then pulling the plug for reasons know only to himself, that he won't be back in government any time soon

[Ignitionnet]

Talking of the EU, bend over and take it. http://www.telegraph.co.uk/news/worl...-payments.html