Even Greece Exports Rise in Europe’s 11% Jobless Recovery
By Simon Kennedy - Mar 21, 2013
Europe’s crisis-torn nations are paving an escape route to recovery.
From Ireland to Spain, the austerity demanded by policy makers in exchange for aid amid three years of debt woes is starting to deliver the competitiveness needed to restore economic growth even as the turmoil risks reigniting in Cyprus.
At the price of a doubling in unemployment and near-10 percent plunge in labor costs, the so-called peripheral euro nations are reviving manufacturing and trade. In Spain, exports reached a record 222.6 billion euros ($287 billion) in 2012. PSA Peugeot Citroen (UG) is hiring there and in Portugal.
“The countries that were highly imbalanced are undoubtedly, progressively, but very effectively, correcting these imbalances,” former European Central Bank President Jean- Claude Trichet said in a March 3 interview. “The current- account deficits of countries that have been under stress diminished over the last years considerably.” More Comment: Expect more news of the same line soon.
Cameron Evokes Black Wednesday as Pound Weakens 7%: U.K. Credit
By Gonzalo Vina & Lucy Meakin
When Cameron and Osborne took office in May 2010, they predicted the economy would grow more than 5 percent over the next two years, a budget deficit equal to 11 percent of gross domestic product would fall to 2 percent by April 2015 and the U.K. would keep its top credit rating. Instead, output rose 1.1 percent, the deficit is still 8 percent of GDP and analysts say Fitch Ratings and Standard & Poor’s will follow Moody’s in downgrading Britain’s credit score after today’s budget.
Credit-default swaps insuring gilts rose 69 percent from a more than four-year low of 26 basis points on Nov. 1, the most among 67 governments tracked by Bloomberg. The premium investors demand to hold gilts rather than German bunds has increased fivefold since August to 52 basis points. More
Comment: Too bad Cameron can't blame the euro for Britain's malaise.
False Flags, Fake Media Reporting, Deceiving the Public: Social Engineering and the 21st Century “Truth Emergency”
On March 9, 1995 Edward Bernays died at the age of 103. His professional endeavors involved seeking to change popular attitudes and behavior by fundamentally altering social reality. Since he laid the modern groundwork for deceiving the public we are for better or worse living out his legacy today. More
There has been no shortage of dire warnings about the mounting US national debt, but President Obama is now offering a different assessment: no big deal.
"We don't have an immediate crisis in terms of debt," President Obama said in an exclusive interview with George Stephanopoulos for "Good Morning America." "In fact, for the next 10 years, it's gonna be in a sustainable place."
It's an assessment that will throw cold water on the latest attempt to achieve a so-called grand bargain to reduce the deficit. After all, a grand bargain would require excruciatingly difficult decisions for both sides - for Republicans, it would mean raising taxes, and for Democrats, cutting future spending on cherished programs like Social Security and Medicare. If there is no crisis, why would either side do it?
So, what happens if this latest effort to reach a deficit agreement falls through? Once again, the president's answer was, essentially, no big deal.
"Ultimately, it may be that the differences are just too wide" to get a deal, President Obama said. "That won't create a crisis. It just means that we will have missed an opportunity."
The president's reasoning is that the series of 11th hour agreements he has struck with Republicans over the last two years - to prevent a government shutdown, raise the debt ceiling and avoid the fiscal cliff - have resulted in enough deficit reduction to get the debt under control.
Comment: Obama's message to the Americans - first step: ignore your debt. Second step: stop paying for something that don't exist.
A man goes to his doctor for a routine checkup. The doctor performs a perfunctory examination and informs him that unless he receives an experimental treatment the doctor has devised, he will soon become disabled. “What’s it cost, Doc?” the man asks. “Well, unfortunately it’s not cheap, Mr. Smith, and I can’t tell you exactly how much the total cost will be until the entire treatment has been completed, but unless you get this treatment, you will soon be in big trouble.”
The man agrees to undergo the treatment. He has to sell some of his possessions and go deeply into debt to pay for it, but, relying on the doctor’s advice, he believes that the alternative to getting the treatment would be catastrophic.
After the treatment, however, the man actually feels worse than before. So he visits his doctor and is startled when the doctor reports that he has relapsed and must undergo the same treatment again or he will probably die. As before, the doctor cannot say in advance how much the treatment will cost.
So, the man sells more of his possessions and goes even further into debt to finance the treatment. To his surprise, shortly after its completion, he feels even worse, and the doctor informs him that he has relapsed again and will have to undergo the treatment again lest he die shortly.
The man sells his remaining possessions, exhausts his capacity to borrow, begs money from his relatives, and has the treatment a third time. After its completion, he feels horrible. Once more, the doctor reports that his condition has not been improved and therefore he will have to undergo a fourth round of treatment.
This time, however, the man is completely broke, so he resigns himself to his imminent demise, puts his personal affairs in order, spends as much time as possible with close friends and family members, and waits to die.
But he doesn’t. Indeed, after a year, he is still alive and feels much better than he did immediately after his treatments. To everyone’s astonishment, he returns to work, feels fine, and considers himself lucky to have had a spontaneous recovery from a disease that threatened to take his life.
Having repaired his financial condition after ten years of normal, happy, healthy working life, the man’s curiosity gets the best of him and he visits a different doctor, an old Austrian, who examines him thoroughly and reports: “There is absolutely nothing wrong with you; nor do I see any indication that anything was seriously wrong with you before you began the treatments. You appear to have been misdiagnosed and treated for no good reason, and the treatments made you sick. When the treatments stopped, you returned to your previous, normal, healthy condition.”
(The foregoing is a parable about government intervention in the economy.) Source Comment: Quack doctors are everywhere, particularly in politics
who favor more government expenditures in the face of a public debt
crisis suggest that the very same strategy that has led to the calamity
would also be its solution. Yet the debt crisis as such cannot provide
any rationale to borrow more. Indeed, the very fact that a debt crisis
has shown up reveals that already too much debt has been already
accumulated. In order to overcome a debt crisis, a stimulus for private
business is needed instead of more public spending..... Read more