greece

Greece on the Verge of Default

greek dominoesThe rumors are swirling that a Greek Default is imminent:

Despite strong denials that the country is heading for a default, rumours have grown that the end game is approaching. Wolfgang Schäuble, the German finance minister, has insisted that a sixth, €8bn (£6.8bn) instalment of aid will not be released unless Greece enacts corrective measures to kickstart its economy and improve competitiveness. Experts from Washington and Brussels will fly into Athens this week to assess whether Greece is sticking to its programme of drastic spending cuts and tax rises, amid fears that its creditors could be ready to pull the plug.

Literally there are talks about seizing Greek assets, by force.

Germany’s EU commissioner Günther Oettinger said Europe should send blue helmets to take control of Greek tax collection and liquidate state assets.

Greece, assuming in response, announced a new property tax, collected through electricity bills:

The tax is €4 per square meter (about $0.50 per sq. feet). The government is projecting this levy will make up for the revenue shortfall due to the sharper than expected contraction in the Greek economy.

Saturday Reads Around The Internets - Just Another $8.5 Billion Please

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Welcome to the weekly roundup of great articles, facts and figures. These are the weekly finds that made our eyes pop.

 

China iPhone Manufacturer Foxconn's Horrific Working Conditions

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The Black Swans of Europe

The financial news from Europe is getting increasingly distressing.
A new EU report warns that economic conditions in Portugal and Spain could "result in a high ‘snowball’ effect on the government debt.”
French financial group AXA says "there is a fatal flaw in the system and no clear way out." They are predicting the Eurozone to break in half or completely disintegrate in the next 18 months.
Over 13% of Europe's investors are betting on a Black Monday-style collapse in stock prices (think 1987).

Greek contagion spreading to Spain

Discussion of the economic crisis in Europe has been largely confined to Greece and how it effects the Euro. All that changed this week.
It all started with the Spanish banks at the start of the week.

CajaMurcia, Caja Granada, Sa Nostra, and Caixa are joining together in a SIP (System of Integrated Protection), which will combine bank reserves and result in a firm worth €100 billion, according to Cotizalia.
This comes after yesterday's announcement that four banks, Cajastur, Caja de Ahorros del Mediterráneo, Caja Extremadura, and Caja Cantabria were merging under a similar agreement.
All of this started with the weekend's €530 million bailout of CajaSur, and is sure to continue as Spain tries to sure up its banking sector under IMF pressure.

Sudden mergers of major banks, following a major bank bailout, is very suspicious. The markets noticed, and two days later the Spain's central bank was forced to act.

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