FedUpUSA

Archive for the ‘Angela Merkel’ Category

Damn we don’t learn, do we?

Merkel has suggested she would like to see the EU have the right to interfere in national budgets in extreme cases where euro zone stability is put at risk. But Germany has stopped short of that in its proposals and asks rather for sanctions for those that breach deficit rules to be written into the treaty.

This would involve the right to challenge states at the European Court, to have their budgets declared void, without meddling further in the details.

Uh huh.  Void a budget eh?  So what can you spend without a budget?  That would be…. nothing, right?

So what is the fundamental function of a government?  Why it is to provide services to the people that enable it (remember, all governments exist with the consent of the governed.)  What Merkel and the rest of Germany proposes is nothing less than the arrogation to themselves of the sovereign right of other nations.

That’s what happens in a war ladies and gentlemen, and whether its done with a briefcase or a gun it is in fact the same thing.

The inevitable outcome of this action will be the same too, just as it was in the early 1900s and then again in the 1930s.

And people wonder why I have said that the “Tea Party” has no claim to anything here, as they sold out immediately upon election and have utterly refused to demand that the people and institutions responsible for the mess we are in be held to account.  In fact we have both sides of the aisle claiming that “there was no lawbreaking” going on — of course as I have repeatedly documented this is only true if you ignore repeat offenses in securities laws, money laundering for drug cartels and the filing of over a hundred thousand perjured affidavits — for openers.

As a direct and proximate cause of this willful aversion of eyes, along with the complicity and active involvement of both major political parties, we’re seeing the inexorable march of the same dynamics that twice before led to massive armed conflicts once again arise on the land, and originating in the same part of the world where it did the last time.

We learned nothing.

Unlike the Keynesian and Monetarist academic clowns that rule US academia German academics push for EU sovereign default plan

Almost 200 German economics professors have signed a declaration rejecting current proposals to resolve the eurozone debt crisis, instead calling for a way for distressed countries to declare bankruptcy.

More than 200 professors were invited to sign the document, and 189 did so, including prominent figures such as Manfred Neumann of the University of Bonn and Justus Haucap of the University of Duesseldorf, both in western Germany.

Instead of the collective support mechanism set up last year that could be made permanent in a modified form from 2013, the economists argued it would be better to let countries restructure their debts.

“Restructuring allows the countries concerned to reduce their debt and start over,” said the economists.

The solution being mulled at present and likely to be approved by European leaders next month would amount to “a permanent guarantee” of some countries’ debt, with “very serious consequences,” they added.

The signatories also doubted the effectiveness of measures to reinforce the competitiveness of weaker eurozone countries and control members’ public finances owing to the European Union’s “limited firepower.”

The document was published as lawmakers from Chancellor Angela Merkel’s ruling coalition sent her a clear message ahead of negotiations on a permanent EU rescue plan to take place in Brussels.

The German deputies said the future European Stability Mechanism should not be allowed to buy eurozone government debt, as the European Commission and European Central Bank would like.

Those 189 academics simply want the ECB to admit that the debt owed by Greece, Ireland, Spain, Portugal, cannot possibly be paid back. What cannot be paid back, won’t, and pretending that it will just makes problems worse. It is refreshing to see a large group of academics on the right side of an economic issue.

Axel Weber, once heir apparent to ECB presidency to replace Jean-Claude Trichet, resigned as president of the German central bank over the issue of the ECB buying sovereign debt. He did not want the ECB to buy debt, most of the rest of the ECB did.

Academics in Germany are disregarded even though they make economic sense. Keynesian and Monetarist academics in the US make no sense but are revered.

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com

The German Government Has Had Enough

Posted by Karl Denninger

If you thought the German government was going to be a lapdog for Sarcozy, or worse, was going to fellate Brussels and the ECB, you got a rude shock today.

It appears that the German Government has just plain had enough of the crap that the banksters have tried to pull, and has decided to do what Barack Obama should have done in early 2009.

That is:

• No more naked credit crap, especially against sovereigns but not only against sovereigns.  No insurable interest, no CDS – period.
• Naked shorting will now be actually stopped in 10 leading financial institutions.
• Germany has had it with naked shorting of Gold, and specifically noted bank manipulation of gold prices via naked shorts beyond intent or ability to deliver.
• Germany has also said that they’re not going to permit Euro derivatives that are not a “bonafide” FX hedge.  That is, no more naked bets on Euro movements either.
• Hedge funds are going to be regulated, position size limits mandated and enforced, reporting enhanced and a transaction tax is coming.

It’s about damn time.

Oh, and it appears that instead of telling all the banksters what they were going to do and “getting permission” first, or even discussing it with other governments, the German Government did what all governments should do – make up your mind and then do it without giving a good damn whether the banksters or other governments like it – and without giving them input into the decision or notice that it’s coming.

The bid rigging, the game-playing and the rest are all a bunch of crap.  I’ve been hollering about this now for more than three years and yet our government spends it’s time fellating the bankers and their dogs instead of enforcing the law.

It is illegal to defraud people.

It is illegal to rig markets, including the massive bid-rigging that I wrote about this morning, the Jefferson County Alabama scam and dozens if not hundreds more – all committed, it is alleged (and in some cases proved) by the major banks.

It is illegal to short stocks with no intention or ability to deliver.

And it is illegal to bribe government officials, no matter how you accomplish it.

These are not “isolated incidents” or even a pattern of conduct – as the bid-rigging report this morning makes clear ripping people off has become an institutionalized practice and policy throughout the entire banking system.

Many said that the Germans were not “really” arm-twisted by Sarcozy and the French Banking interests a week or so back.  I think we can put that to rest here and now, as it’s pretty clear that the truth is something else entirely.

Now Barack, about your willingness to get up off your knees and kick these banksters in the nuts?

Better late than never.

Angela Merkel Clanks When She Walks

Posted by Karl Denninger

“Gee, it’s all going to be ok and Germany is going to come to everyone’s rescue!”

Nope.

Angela Merkel, the German chancellor, mounted stiff resistance tonight to any swift bailout of Greece, as a rift opened up between European capitals over how best to tackle the risks posed to the euro.

Despite a show of Franco-German unity on the crisis and the first statement from EU leaders pledging to safeguard the currency’s stability, hopes on the markets of a German-led rescue plan to shore up Greece’s critical public finances were dashed by Merkel, who repeatedly emphasised that Athens would need to put its own house in order and brushed aside all questions of financial support.

“See, I told you so.  Twice.”

Someone forgot to tell the market pumpers (along with those who started buying Euros and Pounds against the dollar) that Greece is a bit player in this mess.

What ‘ya gonna do about Ireland – a nation that has enough out there in bank debt to make Iceland look like a Girl Scout picnic?  Or Spain?  Portugal, which has had an actual failed bond auction already?

and

One would hope that Merkel and friends in Germany aren’t really stupid enough to implement such a transfer of a peripheral nation’s problem to the EU’s core, but then again we have seen time and time again that “can-kicking” is the mantra of the world since this crisis began.  Rather than deal with the underlying problems – excessive leverage, naked swaps that the seller can’t possibly pay, various forms of fraud and gamesmanship in securities issue and similar – governments have instead decided to lift up the corner of the carpet and sweep, time and time again.

Should the EU implement this with Greece they may indeed set a precedent that could easily destroy the European Union over the next couple of years.  Faced with Spain, Portugal, Italy and Ireland, all of which are huge problems compared to Greece both in terms of the debt outstanding and the size of their economies Germany will find itself unable to backstop all four nations – yet it will have to, once the die is cast with Greece.

It appears that unlike Barack Obama and Ben-d-you-over-the-table Bernanke, who doesn’t much care about the formalities of what’s supposed to be on The Federal Reserve’s balance sheet, Angela Merkel has both a brain and she clanks when she walks!

I like it, although I’m not so sure that Ms. Merkel would be so steadfast had she not the benefit of watching other fools, specifically Henry Paulson, from afar, and thus got to see that the market always calls bluffs.  She witnessed Fannie and Freddie’s “Bazooka” and the non-bailout that was a bailout and then more bailout via TARP, AIG and others, and thus knows damn well that if she comes to the aid of Greece (assuming the German court system will let her) the PIIS (heh, that’s a good acronym, no?), sans-Greece, will be there with hands outstretched instantly – and not by choice either.

Rather, the market will simply shift it’s attention to Spain, Portugal, Ireland or all three, and place them under speculative attack until the story is repeated time and time again.

Germany simply lacks the ability to bail everyone out.

Our “officials” lacked the brainpower to recognize this even after having reality smash into their face at 450 mph in the form of a clue-by-four after Hank Paulson was so puerile as to threaten the market with his mighty “Bazooka”.

He proceeded to blow off his own balls with that very bazooka just days later.

The market is bigger than any one man or any one nation and it does not suffer arrogance lightly.  Virtually everyone who has tried to tangle with it has wound up with their head between their legs after not only their head was chopped off but both arms as well.

If Ms. Merkel has learned this lesson adequately from the last three years then progress has indeed been made.  Perhaps she can put in a visit to Mr. Obama and whack him upside the head a few times, knocking some sense into that arrogant ass before he blows our nation to Hell with his belief that $1.6 trillion deficits are a “small mismatch” between spending and income – a mismatch that he largely created himself.

I wish Ms. Merkel luck dealing with her banks.  Don’t think for a minute that they’re not neck-deep in the sludge themselves – they are – or that somehow they’re so much wiser than us in the land of beer and schnitzel – they’re not.

But when it comes to the consequences of “bailout world”, it appears that Angela Merkel has learned from the experience of others, and as such, she deserves – at least for today – a gold star.

We’ll see if I have to revoke it tomorrow.