Showing posts with label Bailout. Show all posts

Thursday, June 30, 2016

Hints Of Portuguese, Italian Bank Bailouts Suggest Europe Is In Trouble Again

Quitaly? Will Italy follow Britain out of the EU?

Following Germany's petulant refusal to allow Italy to breach Eurozone regulations, and pump up to €40 billion in new capital into its failing banks, Italy has another cunning plan to bail out its insolvent banks. Reuters reports, the Italian government may have to inject capital directly into weaker banks to bolster their financial stability a government source said on Thursday, adding Italy's treasury was waiting for the results of stress tests being conducted by European banking authorities. The results of the tests are expected to be published at the beginning of the third quarter , i.e.
next week.

Reuters report Italian sources said the government was also working on a plan to increase the firepower of bank bailout fund Atlante, which was set up in April to help lenders raise cash and sell bad debt, by 3-5 billion euros ($3.34-5.57 billion) by the summer. The source said the government was in talks with private pension funds to seek additional contributions for Atlante.

Other contributions were expected to come from the state lender Cassa Depositi e Prestiti and from a public company called Societa per la Gestione di Attivita.

And then, surprisingly, the EU appears to have flipped when Reuters headlines emerged suggesting that Europe would provide up to €150 billion for Italian banks"

LIQUIDITY SUPPORT FOR ITALIAN BANKS INCLUDES GOVERNMENT GUARANTEES OF UP TO EUR150 BILLION --EU OFFICIAL
BANK LIQUIDITY SUPPORT WAS REQUESTED BY ITALY FOR PRECAUTIONARY REASONS --COMMISSION SPOKESWOMAN

But...

LIQUIDITY SUPPORT APPLIES ONLY TO SOLVENT ITALIAN BANKS --COMMISSION SPOKESWOMAN

Which, technically is none of them, but practically any bank can - after the sufficient non-GAAP adjustments - pass for solvent.

So is another major bank bailout event on the horizon? It appears so. And Italy may not be alone. In comments that were ignored by mainstream media yesterday, Germany's Schauble said that Portugal may soon need another bailout, saying "It would have to apply for a new program, which it would get. But the terms would be severe and it is not in Portugal's interests."

As Reuters reported, German Finance Minister Wolfgang Schaeuble pressed Portugal on Wednesday to stick to its European fiscal targets and said that if it were to apply for a new aid program the terms would be harsh. Portugal's left-leaning acting government (which was imposed after an anti EU coalition won the last election but was prevented by Brussels from taking power,) has set out to reverse its predecessor's austerity policies, aiming to grow its way out of trouble by boosting demand and set an example for other post-bailout euro zone countries. So far there is no sign of the policy working.

"Portugal would be making a big mistake if it does not stick to its commitments," Schaeuble told a news conference in Berlin.

Pressed by journalists, Schaeuble stressed that Portugal would not need a new aid program if it sticks to EU rules. "They (the Portuguese) don't want it (a new package) and they don't need it if they stick to the European rules," he said. Portugal insists it will meet this year's budget deficit target of 2.2 percent, which is half last year's gap, and that no new measures will be necessary after solid budget execution in the first five months of the year. Schuble is recognised as a world class idiot of course, and he is playing to his strengths in ignoring the fact that it was EU rules that destroyed Portugal's economy in the first place.

And on top of that huge pile of brown, smelly stuff heading towards the fan, there's this:

World's Most Systemically Dangerous Bank Crashes Back To Record Lows

And that happens to be Germany's biggest bank, Deutsche Bank. So what I mean about petulant. The Germans are playing at Billy big bollocks when dealing with bankrupt Italy and Portugal, but their own economy is not that much better off, thanks to Hausfrau - Volksfuhrer Merkel's idiotic open doors immigration policy.

Saturday, April 02, 2016

EU Membership Vote in UK to Paralyze Decision Making

MORE FROM PROJECT FEAR

No longer chained to the deadweight bureaucracy of Brussels, Britain can soar. (Image source)

EU leaders face challenges on two fronts this summer if they want to maintain the staus quo within the union and even extend the control the Brussels bureaucratic dictatorship exercises over member states decision making. Whistleleblower website WikiLeaks have revealed that according to leaked documents the IMF fears a Greek default on its sovereign debt will coincide with Britain’s referendum on the country's future as an EU member, thus paralyzing the EU’s decision-making process.

Wikileaks obtained information (we understand it was minutes of an on the record discussion that took place on March 19, 2016, between two top IMF officials — Poul Thomsen, the head of the IMF's European department, and Delia Velculescu, the IMF mission chief for Greece.

The IMF executives believe that the likely Greek default on its third bailout will coincide with Britain's possible Brexit and it would be hard for the EU to deal with two major events at the same time.

"This is going to be a disaster," Velkouleskou said during the meeting.

According to the leaked information, the IMF wants to tell Germany that it will leave the Troika, composed of the IMF, European Commission and the European Central Bank, if the IMF and the Commission cannot reach agreement on the Greek bailout.

The IMF wants Greece to accept more austerity measures, such as raising taxes and cutting pensions. According to the leaked conversation, Greece needs to accept more of these draconian measures or the EU will face the threat of "an imminent financial catastrophe."

However, the Brexit referendum in June "will paralyze European decision making at the critical moment," the IMF officials fear, according to WikiLeaks. We don't see why they are worried, Britain's EU referendum is a matter for Britain alone. Unless of course the EU, IMF and United ~~Nazis~~ Nations plan to overturn the vote and tell us we can't leave. These supranational bureaucracies are not fans of democracy.

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