The Economist magazine blog reports "billions of euros are flooding out of Europe’s banking system.." "

The report from my headline comes, one must remember, from a respected economic journal with a worldwide readership, based in London, that has always pushed the case for Britain being deep within the EU, now apparently crying "Wolf" on the eve of Thanksgiving as US markets prepare for a four day weekend with the traders and dealers looking forward to enjoying their turkeys.

What else will get gobbled up after this weekend?

The posting is linked here.

Child benefit cuts the consequence of EU Tyranny

While the headline of the Irish Times digital edition, this morning focuses on the protests concerning a proposed cut of €10 in child benefit payments, the lesson for Britain in continuing to sacrifice our economy comes from the following sentence in its Comment Column:

The sooner the consequences of a loss of economic sovereignty and the small print of our bailout terms are fully acknowledged, the more realistic people will become in their expectations.

Do not believe for one moment that Britain's politicians do not have similar measures planned for their own taxpayers', similarly caused by an unnecessary commitment to greedy and unscrupulous bankers with whom they shared the crazed fantasy of an EU Empire!

Irish Government standoff with their Banks

There is an interesting little side story to the euro crisis this morning from Ireland. The report from the Irish Times of the Irisn Banks refusal to pass on last week's ECB interest rate reduction to the banks mortgage customers with variable rate loans, highlights the complete anarchy now evident amongst those banks, since they were rescued by the previous administration with a state guarantee which will bankrupt generations of Irish citizens yet to be born. The article may be read from here.

Everything now taking place across the EU can eventually be placed at the door of a lethal mixture between the greed of our bankers and the obscene lust for unlimited and unaccountable power by the Continent's political classes. Just as Cameron could not initially be unlinked from Coulson, so the banks cannot be removed from their government provided taxpayer's drip feeds.

No solutions are available for the euro crisis as long as those who created the chaos remain in command. As PMs Papandreou and Berlusconi have been rejected by the terminally sick system, does this perhaps now uniquely qualify them to begin to perhaps seek out some solutions?

How Ireland removes itself from its pledge to its own bankers, will be most interesting to observe!

BNP Paribas Chairman's Confidence Statement worries me.

Living in France I do my local banking through an account with BNP Paribas. Yesterday's statement by that bank's Chairman, linked here, does not however give me any cosy warm feelings in my tummy.

A banker telling me not to worry is about as consoling as a Central Banker declaring there is no problem with the Euro nor Quantatitive Easing, and about as believable as a politician when seeking votes and pretending he has your best interests at heart, when he and his party have a long track record of doing the exact opposite.

Unhappily there seems nothing I can now do to regain that lost feeling that money is real, all I see argues the opposite, but also offers no sane alternatives to merely plodding on!

Bank shares slide across Europe

The ECB spent €13 billion on bond purchases last week. Italian and Spanish Credit Default Swaps on their sovereign debt are both up by over 6% today see here.

Confusion amongst Europe's politicians seems to be reaching new peaks even beyond those reflected in the Gold Price. As I type, gold is at $1898.98 per ounce.

The latest view from Germany on the Greek fiasco may be read in Der Spiegel from here. I particularly enjoyed the fact that the body to handle the privatisations has so far only two employees!

Herman Von Rompuy's remarks following his trip to Helsinki and meeting with the Finnish PM is here. Those not wishing to plough through the pdf can get this summary as follows:

Good progress is being made and I'm confident we will find an agreement soon.

Lifejackets anybody?

My response to John Redwood's post on Credit Crunch Costs!

The posting is linked here. My reply:

Martin Cole

Posted August 22, 2011 at 7:05 am | Permalink

Your comment is awaiting moderation.

Costs of the credit crunch and the excesses which led up to it?
The money matters little in the longer run!
More serious by far, in my view, are the loss of belief in the probity of the Civil Service and the word and motives of any politician sitting within the Palace of Westminster, in either of its two legislative chambers, would you not also agree?

Prepare for the next banking bail-out NOW!

The IMF warns in its Global Financial Stability Report, linked here, that the banks will soon come knocking for another four trillion dollars (four followed by twelve noughts). In a Telegraph article the following is noted:

Although the IMF does not mention individual countries, it is clear it has concerns about the UK. According to the Bank of England, British banks need to refinance £750bn-£800bn of funding by the end of 2012, £285bn of which is emergency support that expires in the same period.

The IMF adds: “Without further bolstering of balance sheets, banking systems remain susceptible to funding shocks that could intensify deleveraging pressures and place a further drag on public finances and the recovery.”

As the UK has now bankrupted itself in a failed attempt to rescue the spivs and charlatans who created this mess it seems sensible to adopt a more rational solution for the next round of banking bail-outs of which the IMF has so kindly now provided timely notice.

Money held by private individuals and small private companies with commercial banks allowed to proceed to liquidation should be honoured by a state owned bank duplicating the current account balance on production of 12 months statements from the failed bank. If crossover of accounts to the Government backed venture were accomplished in advance, individuals and companies would be saved much anguish and all taxpayer funds dispersed could be certain to be going to where they are most needed.

A silver lining to the black cloud of Britain's debt?

As I have hinted in earlier postings made this week on the general topic of the collapse of the Euro, with proper planning and deft diplomatic footwork Britain could soon set itself on a golden path to renewed prosperity. Gold and silver both rose to dizzying heights of relative dollar values at the end of this week, read one report from Bloomberg via the Sydney Morning Herald, linked here, headlined "Silver hits 30-year high as gold touches $US1300" Where can investors find protection for their capital in a world offering interest rates close to zero or effectively below zero when considering inflation and the exchange rate risks. On top of these considerations comes the real prospect of sovereign default? The three main credit rating agencies are quite frankly effectively discredited especially since the granting of AAA status to the EU rescue package backed by states themselves about to tap into the available funds! Who can investors now trust with their money? While the focus of Britain's relationship with the eurozone group of countries must be supportive and meticulously correct during the period of crumble and collapse of the common currency (Britain can ill afford providing justification for any accusation that they have in some way contributed to the coming chaos as they have managed to achieve to date) steps could nevertheless be undetaken to prepare new debt instruments, backed by the historical probity and centuries long record of non-default by the Bank of England, which could offer investors some certainty of a return of their money at a similar purchasing value, which is what is presently apparently being sought in the rush into precious metals, with their zero returns and accompanying risks of value erosion should quantatitive easing be sensibly be abandoned. If Britain had not lost the capacity to bring forth political leaders of character, such a scenario would be feasible. Given the reality of our Coalition Government we will instead, no doubt, simply be dragged down with the rest of the Continent, thus gaining nothing from our brave effort of having retained our national currency over recent years, in the apparently vain hope of eventually salvaging some of our lost sovereignty. Could Cameron, Clegg, Osborne and Cable devise such plans and present them as both believable and feasible? Better chance of that than of either of the two Marxist-bred Miliband brothers even wishing to restore wealth and prosperity to the nation, their cause seems one of political ideology of a nature always resisted in our islands! The fact that one or the other of these brothers will later today be announced as leader of the Labour Party and now sole opposition party, will make 25th September 2010 one of the blackest days in British history, whatever turns out with the Euro.

Bank of Englan Governor finally admits insanity of Banking Bailout - Osborne must GO!

As proposals for a 7p rise in basic income tax, VAT hikes and extensions emerge this morning and Mervyn King finally pushing the alarm button last evening, is sanity about to appear in Britain? Year after year and month after month this blog has warned of the certain disaster heading the country's way. Finally some of the incompetent madmen who have created this mess are about to face reality, will we see the Prime Minister now crack-up in public? Will the simpleton in charge of the main opposition party's economic policies now stand aside to allow a man of stature with economic experience and gravitas prepare the policies essential for effective governance? Complete and utter financial ruin is now the best way to describe the nation's economic plight, one question is, of course, how those who caused this mess can continue in power for yet one more week - another perhaps of even greater significance for the future - is how can the Shadow Chancellor of the Exchequer, whose main task has been to effectively oppose those policies during the past few years, be allowed to retain his position for yet one more day? George Osborne should stand down or be fired today!

Banking scam finalised while Brown avoids questioning

Reuters reports this afternoon, here, that the final details of the scam that will rob future generations of billions of pounds from their earnings for decades were being put in place as the architect of the disaster cleverly AGAIN avoided any questioning in parliament over the crisis he created. The Conservative Party having been conned into a rigged leadership election without complaint and tolerated a pathetically weak opposition that allowed Brown's partner in crime Tony Blair, to receive a standing ovation from the Conservative Party as he nimbly fled the House of Commons before proper questions could be raised, now blubs in the sidescreens as the country is sold down the river to the greedy and corrupt bankers who were Gordon Brown's main accomplices in this decade long scandal. Bank shares are, of course, rising on the news.

ANZ Bank Losses

Some quotes from a report from 'The Age' in Australia on ANZ Bank's shock results: "I would recommend all of you visit London and New York in the near future just to see the effect of what is really happening there," Mr Smith said. "This is a financial services bloodbath and I think the Australian banking system is in remarkably good shape in comparison." ANZ will put aside $US200 million ($A220 million) as a provision against agreements it entered into with New York-based bond insurer ACA Capital, which has become imperilled as billions of dollars in loans given to people in the US with poor credit have failed........ Mr Smith said accounting standards required the bank to account for the losses on the derivatives, though it was likely they would regain their value when conditions changed. An ANZ spokesman said the companies represented included Fortune 500 companies in the US and Western Europe. "For ANZ to experience an actual loss on this exposure, it would require a significant number of what is a large and well-diversified portfolio of corporate names to go belly-up around the world," Mr Smith said. "If that happens, we're looking at an Armageddon situation."