Around the Globe 04.19.2013

Plan for new Cyprus vote casts uncertainty on bailout – Cyprus Mail.

This is the key quote from the article:

“Whoever is prepared to vote against the loan agreement should at the same time propose where this €10 billion will be found,” government spokesman Christos Stylianides told state radio yesterday.“They should also propose how we would deal with issues such as paying wages and pensions, and how we would deal with the international uproar caused by a possible rejection of the loan agreement,” he said

The troika first sows seeds of fear.  Once voters are sufficiently scared, they will support anything that their government decides.  This is how the troika obtained money for the banksters from the citizens of Ireland, Portugal and Greece.

Here is a proposal for Cyprus.  Return to the pound and allow the banks to fail.  After a severe financial crisis, your country will begin growing again. Or, you can take the bailout and suffer the same fate the other countries that took the money, condemnation to years of economic stagnation and contraction.

Dutch Slump Woes Haunt Rutte as Deficit Breach Persists – Bloomberg.

Netherlands GDP Contraction

Netherlands Unemployment Rate

The Netherlands is in trouble because the country is attempting to cut its budget in the face of a bursting housing bubble while a strong euro saps growth in its multinational companies.  If consumption, investment and government spending all decline, so does GDP as a sum of all three components.

People point to the periphery as examples of countries using a currency that is too strong for their economies, but the Netherlands also is feeling the effects of this dynamic.  Judging from Nokia’s first quarter results, so is Finland.

Weidmann Says ECB Would Only Cut Rates If Data Worsen – Bloomberg.

euro-area-interest-rate

What exactly must happen for the ECB to cut interest rates? In September, the bank was proclaiming that growth would return to the Eurozone in the first quarter of 2013. They have pushed that estimate back to the second half of the year, and it will probably need to be pushed back again.  Yet, Weidmann states that rates will only be cut if economic data worsens.  Well, it’s been worsening consistently since the last rate cut, and we have yet to see any action.

Italy’s Political Strife Worsens on Presidential Vote.

Italian 10yr Yield 04.19.2013

Italy’s remains without a government and a new president.  Money printing cures everything as Italian bond yields continue to fall.

McDonald’s Posts Lackluster Results – WSJ.com.

mcd

McD shows the weakness in the lower reaches of the American economy.  High unemployment is sapping results and will continue to do so for the foreseeable future.  The euro crisis will also decrease business.  McD has seen a nice run since December but seems poised for a big correction.

Hungary’s PM Ready to Compromise With EU – WSJ.com.

If you have been paying attention to the goings-on in Cyprus, Greece, Ireland, Portugal and Spain, you should be aware that the EU does not compromise.

 

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4 thoughts on “Around the Globe 04.19.2013

  1. Note to Cyprus

    take the €10 billion

    then leave the Euro

    – well anyway, I hope they vote it down and go straight into their own economy
    I am just angry that as an IMF member my tax dollars are paying for it until they do so.

    I have said it myself several times but perhaps not as concisely ” deficit spending is nothing but deferred taxation ” – Pater Tenebrarum.

    they must realize they are in horrible terrible shape

    a primary basis/foundation of their (prior) economy, banking and tax haven

    has simply vanished,

    having dipped into accounts, and frozen most all

    what new customers would they ever get ?

    What Russian or any European is thinking here is a good idea,
    let me put money in Cyprus banks.

    Cyprus has to start over sooner or later

    not only re-create a currency
    but re-create their entire structure, the banking is gone.

      • I agree, they can

        A. Use their natural resources to provide for Euro Powers. Forever in debt. Euro powers will control quantity and pricing.

        or

        B. Start their own new economy and use their natural resources for themselves.

  2. EU Accomplishments with Cyprus

    Goal 1. Destroy Cyprus as a tax haven. Done.

    By doing so

    Goal 2. Create Cyprus Colony – where the people are indentured servants,
    and will make monthly payments. Done.

    .

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