Portugal centre-right wins re-election despite bailout per BBC News

Do you know what's missing from this BBC report? http://www.bbc.co.uk/news/world-europe-34440667

I'm not going to tell you, spend five minutes on Google to find out and prepare to be shocked!

Is Greece about to fall out of the Euro?

From der Spiegel:

'The debt crisis in Greece has taken on a dramatic new twist. Sources with information about the government's actions have informed SPIEGEL ONLINE that Athens is considering withdrawing from the euro zone. The common currency area's finance ministers and representatives of the European Commission are holding a secret crisis meeting in Luxembourg on Friday night.

Greece's economic problems are massive, with protests against the government being held almost daily. Now Prime Minister George Papandreou apparently feels he has no other option: SPIEGEL ONLINE has obtained information from German government sources knowledgeable of the situation in Athens indicating that Papandreou's government is considering abandoning the euro and reintroducing its own currency.

Alarmed by Athens' intentions, the European Commission has called a crisis meeting in Luxembourg on Friday night. The meeting is taking place at Château de Senningen, a site used by the Luxembourg government for official meetings. In addition to Greece's possible exit from the currency union, a speedy restructuring of the country's debt also features on the agenda. One year after the Greek crisis broke out, the development represents a potentially existential turning point for the European monetary union -- regardless which variant is ultimately decided upon for dealing with Greece's massive troubles.'

And whilst this is going on, we send money to bailout Portugal.

'"It would lead to a considerable devaluation of the new (Greek) domestic currency against the euro," the paper states. According to German Finance Ministry estimates, the currency could lose as much as 50 percent of its value, leading to a drastic increase in Greek national debt. Schäuble's staff have calculated that Greece's national deficit would rise to 200 percent of gross domestic product after such a devaluation. "A debt restructuring would be inevitable," his experts warn in the paper. In other words: Greece would go bankrupt. '

Greece this week; how long before Portugal? Spain? Italy? Who next?

Euro Synchronicity

I note that just as the ratings agency Moody's announce that they have put Portugal on watch prior to a possible credit rating downgrade from its prized A1 status, the death of one of the founders of the Euro currency, the Italian economist,  Tommaso Padoa-Schioppa was announced. I believe that is what is called synchronicity...

And here go the big ones

Moody's has put Spain's rating on review - citing concerns about its mounting debt and its funding needs for next year. That's Greece and Ireland gone, Portugal reduced to begging China for money and Spain on 'review', PIGS are on their way and Spain is too big for the EU to support. This cannot and will not end well...

Here comes trouble

Portugal's finance minister is in Beijing to try to persuade Chinese authorities to buy Portuguese government bonds.

Greece, Ireland, Portugal, Italy, Belgium, Spain... but is there more to worry about?

Following on from my last piece, I have somewhat less humorous news about EU debt. The consensus view is that the EU countries that are in real trouble and have or will soon have to ask for (or have forced upon them) bail-outs are Greece, Ireland, Portugal, Italy, Belgium and Spain; but is there more to worry about? Yes the UK is often mooted as next in line but what about Germany? Germany's debt problems were not too large but these bail-outs might be an issue for them. As The Telegraph reports:

'Credit default swaps (CDS) measuring risk on German, French and Dutch bonds have surged over recent days, rising significantly above the levels of non-EMU states in Scandinavia.

"Germany cannot keep paying for bail-outs without going bankrupt itself," said Professor Wilhelm Hankel, of Frankfurt University. "This is frightening people. You cannot find a bank safe deposit box in Germany because every single one has already been taken and stuffed with gold and silver. It is like an underground Switzerland within our borders. People have terrible memories of 1948 and 1923 when they lost their savings."

The refrain was picked up this week by German finance minister Wolfgang Schäuble. "We're not swimming in money, we're drowning in debts," he told the Bundestag.

While Germany's public and private debt is not extreme, it is very high for a country on the cusp of an acute ageing crisis. Adjusted for demographics, Germany is already one of the most indebted nations in the world.

Reports that EU officials are hatching plans to double the size of EU's €440bn (£373bn) rescue mechanism have inevitably caused outrage in Germany. Brussels has denied the claims, but the story has refused to die precisely because markets know the European Financial Stability Facility (EFSF) cannot cope with the all too possible event of a triple bail-out for Ireland, Portugal and Spain. '

Read the whole piece and ask yourselves how on earth do we all get out of this mess? I really don't see a way, it looks like doom and disaster all the way to me.

Nigel Farage speaks a lot of sense and even manages a 'bunker mentality' line and does not get thrown out of the European Parliament

As usual a good, honest assessment of the situation by Nigel Farage, but the EU is not listening they are too busy accumulating power and wealth.


Thanks to A Tangled Web for the video spot.