Deja Vu: Pasok Is Warming Up To Coalition With Only New Democracy

Ahh, the great PASOK flip-flop.  Nice..  Sensible Greeks, you have every reason to believe the two parties that brought you to the brink of financial DOOM will find the way back to prosperity!  Good for you;  Here's a participation ribbon!  Rest up, Riot Dog; You'll be busy soon enough!  Zero Hedge.  Excerpts:

One of the biggest caveats from yesterday's Greek election result was that Pasok announced it would only participate in a broad coalition government that includes Syriza. Obviously Syriza promptly turned down the offer, which has now put the ball back in the court of the Pasok leader - Venizeloz. Being a career politicians, and knowing quite well what the final outcome of the Greek fiasco would be, it was only a matter of time before the former minister of defense, finance, and yes, sport, would flip flop, and hint that a government of just ND and Pasok would also work, as the alternative is just too harsh to even consider. In other words, we may shortly get a repeat of the precisely same leadership that brought Greece to 23% unemployment and a completely destroyed financial and economic system, with Veni back in the role of finance minister once again.

And:
Does this mean a Greek government just may happen, evading a 3rd Greek election in as many months? We will know for sure by tomorrow night, when Pasok said is the deadline by which a new government has to be formed. As for bets on the longevity of the new cabinet, we have no idea what the spread is, but we take the under.


What's the definition of insanity?  Happy fun times are just ahead with your "new" old leaders, Greece!  Opa!  When you take back to the streets, remember to hydrate?  It's gonna be a long, hot summer!

And Now, Courtesy of Bridgewater... It's Italy's Turn

The E.U. implosion continues.  Zero Hedge.  Excerpts:

Earlier today, by way of a simple graphic, the world's biggest hedge fund, Bridgewater, was kind enough to remind the world just how pointless any debates about Europe's future viability are if the primary funding conduit: the EFSF/ESM hybrid can not provide the cash needed for even half the combined funding needs of Italy and Spain. Now, Bridgewater strikes at Europe once again, this time redirecting the general attention to where it is long overdue: Italy.
And:
..at negative €48 billion in residual LTRO capital, Italy flat out has no additional cash with which to plug ongoing debt funding needs.



Greece, Spain, and Italy in various states of economic and domestic flux.  Germany has to be thinking of leaving the Union..  Greece has shown them that austerity through the EU won't come without many fights.  As the "Banker" country, problem nations have a lot of outstanding money owed to Germany.  They might be economically the strongest country in the EU, but Germany is not invincible, and quite capable of being sucked asunder in the financial quicksand trapping their debtors. 

Decision time looming for all countries, including Germany and France.  Who stays?  Who goes?  Can a few be sacrificed for the many?  Is it too late?
How long before Italy's distress begins to reverberate here in the U.S.?

Spain in recession as austerity bites deep

Austerity is Stasis/Immovable Object.  Dynamic populations are Inertia/Irresistible Force.  There's definitely going to be more trouble before stability and growth returns.  Reuters.  Excerpts:

Spain sank into recession in the first quarter and economists said spending cuts aimed at meeting strict EU deficit limits, together with a reeling bank sector, would delay any return to growth until late this year or beyond.



It is the second recession in just over two years for the euro zone's fourth largest economy and comes as the government tries to convince investors it will not need outside aid to put its house in order.


The country is caught between pressure from its European peers to fix public finances and growing domestic resistance to austerity measures that have helped push unemployment to more than double the EU average.



Ratings agency Standard & Poor's added to the country's problems with a two-notch rating downgrade last week and on Monday it chopped the credit score of 11 banks.
..
"The wheels are very clearly coming off," Jefferies economist David Owen said. "It wouldn't surprise me to see a very significant decline in GDP both in the second and third quarters this year."

..
Spain's demand for electricity, a good indicator of the strength of economic output, fell for the eighth month in a row in April, the national grid operator said.



Spanish bonds showed little reaction to the GDP report but yields have risen to around 6 percent in recent weeks. At around 7 percent, they are seen as financially unsustainable.


The IBEX share index finished April down 12.7 percent, its worst monthly showing in nearly 1-1/2 years..

The real problems haven't even begun.  Spain and Greece are just the opening act.  Followed by, in no particular order, Portugal, Italy, and Ireland.  The others(E.U. and non-E.U.) will also be sucked asunder, victims of Austerity's implosion wave.  How much pressure can France, and ultimately Germany, withstand? 

The E.U.'s individual country/collective state implosion illustrates the concept of Immovable Object/ Irresistible Force:  I'm unsure of the outcome, but the Victor will soon be known by all.  These circumstances, at present, cannot sustain.  There will be no dispute after this head-on, high-impact event.

Greece Has Defaulted: Here Is Where We Stand

This weekend should be interesting.  From Zero Hedge.  Excerpts:
1) Greece was able to write off 100 billion euros worth of debt in exchange for a 130 billion rescue package of new debt, of which Greece itself will receive 19%, or about 25 billion, so that it can continue to operate as an ongoing concern. Somehow Greece is in a better position than before, with more debt and less sovereignty and still---by virtue of sharing a common currency---trying to compete toe-to-toe with the likes of Germany and the Netherlands, kind of like being the Yemeni National Basketball team in an Olympic bracket that includes the US, Spain and Germany. At least a "within the euro" default prevented bank runs in Portugal, Spain, Italy et al.



2) As a result of the bond haircuts, Greece has many pension plans that can no longer even pretend to be viable, at least according to the original contracted scheme, but pensionholders still working can take heart in the fact that their current wages will be cut, too.
And:
8) Given how much angst was caused by the drawn out Greek affair, the Spanish leader knows he has enormous leverage with EU leadership and he can continue to do what he has been doing with regard to ignoring the deficit targets demanded/suggested by the EU. The EU might well bark at him, but they cannot afford to bite at this time. Muchos gracias, Greece.

That Loud Boom You'll Hear Is Greece Exploding..

The Real Deal begins later today.  My gut says Austerity measures pass, and Athens begins to ROCK shortly afterward..  If Austerity fails..  The Greek economy goes into collapse, and Athens begins to ROCK shortly afterward.  Maybe, maybe not.  But the Greeks do like to riot, and they're really good at it..  (By no means is this an insult, either.  The No Bullshit political will of the Greek people is inspiring to others living in more complacent regions of the world.  It's good to see that spirit alive and well..  Somewhere..)

Greece and Europe brace for austerity measures vote  The Sofia Echo.  Excerpts:

Greek lawmakers, under the watchful eyes of the rest of the world, are due to vote on a second round of austerity measures that sparked nationwide strikes and violent riots on June 28.

The vote will be held later on June 29.
The outcome of the vote will be vital for the stability of the European economy and for the future stability of Greece which is facing bankruptcy. Resembling a typical Greek drama, the voting process itself has become rife with accusations of betrayal and treachery following revelations in Greek media that there are mavericks in both camps who could sway the result unexpectedly.
..
If the government fails to pass the austerity measures, Greece will go bankrupt. The proposed measures will affect the public sector and will consist of the sale of assets as well as higher taxes and more spending cuts.

Massive protests are expected on the streets of central Athens and outside Syntagma Square in front of the parliament building, protests which have the potential to turn violent judging from the past.

WRAPUP 2-Greek lawmakers seen backing austerity, future unsure  Reuters.

Greece's parliament looked increasingly likely to approve unpopular austerity measures on Wednesday, despite violent protests, to secure international funds to prevent the euro zone's first sovereign default.

But with the country on the brink of bankruptcy, it remains uncertain whether a weakened Socialist government can push through laws to implement structural reforms and privatisations in a second series of votes on Thursday, and then stick to a tight EU/IMF-imposed schedule for implementation.
Many economists and investors still expect Greece to default in the medium-term.

Greek leader 'dead man walking', Greek bailout 'collective punishment'  Video courtesy Russia Today, via You Tube.

And Now, To Greece..

Greece: Prime Minister George Papandreou survives by just 12 votes

GREECE'S prime minister survived a key confidence vote, keeping alive a government bid to avert a debt default that could spark a financial maelstrom around the world.

MPs voted 155 to 143 along party lines last night to back George Papandreou, who now faces a critical vote next week on a massive austerity package that Greece's international creditors have said must pass by the end of June.

He is seeking 28 billion euro (s24.8bn) in budget cuts and new taxes and 50 billion euro (s44.3bn) worth of privatisation of public assets. Unless the new measures pass, Greece will not receive the next batch of bailout funds worth 12 billion euro (s10.6bn), and will face a disastrous default in July, when it runs out of money.

A default by Greece could drag down Greek and European banks and renew fears over the finances of other eurozone countries such as Portugal, Ireland and Spain.
And:
As deputies voted, several thousand protesters gathered outside parliament chanting "Thieves! thieves!", shining green laser lights at the parliament building and into the eyes of riot police. Continuing strikes by electricity company workers objecting to privatisation caused a second day of rolling power cuts.

This anger doesn't seem to be factored as a tangible power.  But it is, and it's just begun to fester.

Greece As 6 Million Dollar Man..

"She's breaking up! She's breaking up!"(heh..) The question remains: Can we rebuild him?? Suddeutsche Zeitung: EU prepares for Greece to declare bankruptcy Short, and not sweet excerpts:

According to EU sources in the European capitals it is already running the preparation on Greece to declare bankruptcy, German newspaper Suddeutsche Zeitung announced.
..
Meanwhile, the Ministry of Finance denied preparing an emergency plan for Greece.

Not that Greece isn't going bankrupt, mind you, it's just that France doesn't have an emergency plan in place. Already gone (and probably not ever coming back) is Greece's refugee/asylum system, at least from the German perspective.. Excerpts:

Berlin announced this week that it is halting deportations to Greece for a year, despite European Union rules stating that the first country a refugee arrives in is responsible for processing any asylum request.

Germany's Interior Ministry announced on Wednesday that the new measure is aimed at reducing the burden on Greek authorities, who are struggling to deal with the volume of refugees reaching the country's shores and borders.
And:
Humanitarian organizations, including the United Nations Refugee Agency (UNHCR), have voiced concern about the conditions that asylum seekers and illegal immigrants are forced to endure in Greece, with overcrowded detention facilities and a dysfunctional and overstretched system of assessing asylum claims.

Kind of like their banking system! Speaking of which, the Finance Minister says that Greece won't try debt re-structuring(read; anything new) as it might worsen the country's financial situation. Instead, they'll continue to follow the EU/IMF approved directives for their bailout. Although they wouldn't mind to(unofficially) stretch those payments out a little..

Hell, it's worked really well so far!

Forget South Korea: The Greeks Know How To Throw A Riot..

Raw Footage from Russia Today via Godlike.  Intense.  Yesterday was their General Strike, and it erupted into a pretty major riot.  Not full scale, as the police didn't shoot to kill, but with more riots possible, full scale fighting will happen.  See for yourself:

You can, if you'd rather, read about it here. 

Amazing video.  Greece is just the first, and this was just the beginning.  The Global Financial Crisis is already ugly, and now it's turning violent.

If You Live Anywhere Other Than America Or Korea, These Will Be The Two Big News Stories Today..

Asia Session: Awaiting the Irish Budget

The Euro continued to move higher in Asia as markets looked ahead to the hopeful passing of the 2011 Irish budget which is due later in the day. Now loaded with new austerity measures in order to appease the EU and IMF after securing a bailout package the proposed Irish budget for 2011 was to be put in front of the parliament later today. The passing of the budget without any hitches would surely help the Euro currency and that optimism was seen in today’s Asian moves from 1.3280 to 1.3350 in EUR/USD. The ECB’s move to extend its bond purchasing program also proved beneficial to the European currency as investors welcomed the determination of the European Central bank.

At the moment, the proposed budget looks like it will pass. Of course, bankers and politicians are pretty happy with that projected outcome, but the non-ultra rich, non banker, non politicians aren't happy, and will be expressing their displeasure later today, and probably frequently for quite some time..

And then there's the World wide bank run, originating in France, scheduled for today.  Your host?  Eric Cantona.:

Following an idea put forward by Eric Cantona recently the 7th December is planned to be ‘bank run’ day. The general idea is that nowadays protesting in the street doesn’t achieve much – but if we all withdraw our money from the banks at the same time the banks will collapse.

Will this destroy the European banking system?  Probably not, and most likely not in America, but people in other countries are paying attention, and we won't know what the end result will be tomorrow, or in the near term..  And it all starts today.

So much information, so much to disseminate, so little time..