Concerns that the global recovery could be derailed began last summer when a devaluation of the Chinese currency sparked a meltdown on the Shanghai stock exchange. A series of economic downgrades to the Chinese and US economies since then, coupled with a rise in US interest rates, have fuelled investors’ misgivings about optimistic forecasts for a recovery in economic fortunes.

Adding to the concerns of a sharp downgrade in global growth this year, a survey for the consultants PwC before the Davos meeting revealed that two-thirds of chief executives saw more threats facing their businesses than three years ago. And the head of the Swiss banking giant UBS, Axel Weber, turned the screw by warning that the world was stuck in an era of low growth.  Last week, an investment analyst at Royal Bank of Scotland advised clients to “sell everything” except the safest high grade bonds after warning of a “cataclysmic” year and the strong likelihood of a stock market crash. His comments came after the chancellor, George Osborne, warned in a new year speech of a “cocktail of threats” to the UK’s prospects from an increasingly uncertain world economy.

Independent researchers reported detecting elevated methane levels as far as 8 miles from the massive, ongoing leak of natural gas from a storage site in northwestern Los Angeles. A ruptured well at Southern California Gas Co.'s Aliso Canyon underground facility has spewed more than 80,000 metric tons of methane into the atmosphere since the leak was discovered Oct. 23. The release of the powerful greenhouse gas led to the evacuation of thousands of people from the affluent Porter Ranch neighborhood a mile from the leak after reports by residents of nosebleeds, rashes, headaches and nausea.Finding elevated methane levels well beyond the Porter Ranch area raises potential health concerns for people living outside the immediate vicinity of the leak, the researchers said. Inhaling low concentrations of methane, the primary component of natural gas, is generally not considered a health concern, but natural gas often contains trace amounts of other, more harmful gases.  "Whatever else may be in the gas-benzene, toluene, xylene -- that is what people may be breathing," said Nathan Phillips, an earth and environment professor at Boston University. "Even though we're not measuring things other than methane, there is a legitimate concern that there is that other nasty stuff in there."  The findings challenge assurances from the South Coast Air Quality Management District, the regional air pollution control agency, and the state's Office of Environmental Health Hazard Assessment that the leak hasn't increased residents' exposure to toxic gases.  The cumulative methane emissions from the Aliso Canyon facility to date have the greenhouse gas equivalent on the Earth's atmosphere of burning nearly 800 million gallons of gasoline, according to the Environmental Defense Fund.  On Wednesday, Los Angeles City Councilman Mitchell Englander called on SoCal Gas to extend its residential relocation program to residents of neighborhoods adjacent to Porter Ranch, according to the Los Angeles Daily News. People in these communities were also reporting similar symptoms related to the leaking gas, according to the paper. SoCal Gas spokeswoman Kristine Lloyd said the gas company is providing temporary accommodation and air filtration for residents within a five-mile radius of the leak, extending beyond Porter Ranch.  Democratic US Senators Barbara Boxer and Dianne Feinstein of California sent a letter to the Department of Transportation, the Environmental Protection Agency and the Department of Justice Wednesday calling on the federal agencies to offer further assistance to the State of California in responding to the gas leak.  In a mapping effort funded by the Home Energy Efficiency Team, a Cambridge, Mass., nonprofit, Phillips and Robert Ackley of Gas Safety Inc. measured methane emissions for the past several days near the Aliso Canyon leak. Gas Safety Inc. provides natural gas leak detection services to industry, businesses and homeowners.  They used a laser-based system mounted to a car. It recorded methane concentrations and plotted the readings on Google Earth. On Tuesday and Wednesday the researchers drove further from the leak and recorded methane concentrations as much as two times higher than background levels, as far as 8 miles away from the site.

“The markets have drawn comfort” from the Fed, said Mr Lewis after officials at the central bank said they believed economic developments would “warrant only gradual increases in the federal funds rate”.  However, Mr Lewis said further rises presented “a major uncertainty” hanging over both the Fed and markets.  “All territory is now uncharted”, he argued, as the US central bank attempts to raise rates from historically low levels, while the banking system is flush with cash.

He added: “The Fed and other major central banks have maintained emergency policy-settings for so long that the global economy cannot be presumed to react in standard fashion to a rise in interest rates, however small that might be.”  The central bank, led by chairman Janet Yellen, plans to keep increasing rates by quarter-point increments after raising rates by a quarter of a percentage point from their 0pc to 0.25pc range last month. Stephen Lewis, chief economist at ADM ISI, said that Fed policymakers would regard “the mildness of the response to their action as a tribute to their success”. While the main US index, the S&P 500, closed lower in 2015 as a whole – its first annual loss since the financial crisis – economists have not attributed this to the Fed’s move. Annual wage growth is expected to have picked up from 2.3pc to 2.8pc in December, generating inflationary pressures. Central bank watchers will also pay close attention to the minutes of the Fed’s December meeting, being released on Wednesday. These will show how confident policymakers are in returning inflation to target. The Fed has a mandate to promote full employment and to steer inflation towards 2pc. The inflation measure tracked by US policymakers stood at just 0.4pc in the year to November. Analysts at Barclays said that they expected to see “disparate views on the current state of inflation” and they would “be attentive” to how this impacts on “different views on the most likely path of monetary policy in 2016”.

Finland's parliament will debate next year whether to quit the euro, a senior parliamentary official said on Monday, in a move unlikely to end membership of the single currency but which highlights Finns' dissatisfaction with their country's economic performance. The decision follows a citizens' petition which has raised the necessary 50,000 signatures under Finnish rules to force such a debate, probably the first such initiative in any country of the 19-member euro zoneThe petition - which will continue to gather signatures until mid-January - demands a referendum on euro membership, but this would only go ahead if parliament backed the idea.  Despite the initiative, a Eurobarometer poll this month showed 64pc of Finns backed the common currency, though that is down from 69pc a year ago. But the Nordic country has suffered three years of economic contraction and is currently performing worse than any other country in the eurozone. Some Finns say the country's prospects would improve if it returned to the markka currency and regained the ability to set its own interest rates, pointing to the example of neighboring Sweden, which is outside the euro. The markka could then devalue against the euro, making Finnish exports less expensive. Since 2008 the Swedish economy has grown by 8pc, while ours has shrunk by 6 percent," said Paavo Vayrynen, a Finnish member of the European Parliament who launched the initiative. Now is a good time to have a wider debate whether we should continue in the eurozone or not," said Vayrynen, a veteran lawmaker from the co-ruling Centre Party who is known for his opposition to greater European integration. The center-right government is struggling to balance public finances and improve export competitiveness through "internal devaluation", including cuts to workers' holidays and other benefits, amid opposition from unions. Before 1992, Finland devaluated its markka currency time and again to improve export competitiveness.

The Fiware project is a public-private partnership between the EU and a consortium of companies that started in 2011.  The software tools that entrepreneurs like Visser may use were developed by European telecommunication companies like Telefonica and Ericsson. The industry has said it is also investing €300 million in the project, which includes online tutorials on how to use Fiware, and local 'Fiware innovation hubs'.  Fiware is royalty-free and open source, which means that it can be used free of charge, and developers may further develop it as well.  Non-European companies can use the tools as well.   “We don't mind if they are from Japan, from US, from China, from Latin America”, said Jesus Villasante, from the department of Net innovation in the European Commission. “What we don't want is that there would be only one operator that would be able to capture value. For us the idea is that internet should be open, and therefore we should allow for open initiatives that would compete with some proprietary initiatives.”  Proprietary software, as opposed to open source, can only be used if you have acquired a license. Examples include Microsoft Windows, Adobe Photoshop, and Mac OS X.  "In Europe there is a strong potential for innovation, for start-ups, for entrepreneurs. We need to have this innovation capacity in an open environment, not in a closed environment”, noted Villasante.  To promote the use of Fiware, the EU is investing €80 million in up to 1,000 start-ups.  The money is being distributed to 16 so-called accelerators, organisations that help start-ups grow by providing funding and other support.  Konnektid is one of the beneficiaries of such an accelerator, called European Pioneers, based in Berlin.  One way the EU is trying to spread the use of Fiware is by making grant money - up to €150,000 per start-up - conditional on its use. “It's a kind of a trade-off. You need to find Fiware attractive and useful. If not, then you probably should be applying to a different accelerator”, said Ludtke, adding that the 12 start-ups under his guidance have so far not experienced it as a burden.  Michel Visser hasn't either, although he is defiant about what would happen if he found a piece of non-Fiware software that would be better for his app. “It's business first. If it's stopping my business I would definitely say: listen, I tried it, this is what I experienced, this is my feedback, but I'm going to use something different. That's what I would fight for. I'm a founder of a company and I need to run my business. ”

The EU commission's Villasante is much less strict than Ludtke - who oversees the handing out of money to some start-ups- on the use of Fiware as a precondition. Villasante said it was more important that the start-ups tried Fiware to see if it is useful to them.

“We don't believe that all the 1,000 start-ups will develop applications that will be successful in the market. There may also be some SMEs that play with Fiware, develop the product, but decide: this is not for me, I prefer to use this other thing. That's fine.”

Some recipients of the EU grants have told this website that they were more interested in the grant money than in Fiware.

“There are plenty of alternatives to Fiware that are also open source,” said one entrepreneur who wished to remain anonymous.

“The EU is pushing software that is not necessarily the best,” he added.

Ukraine needs a government of national unity that reaches out to its own people and tackles the country’s long overdue reforms; both Russia and Western powers should back a vision for the country as a bridge between East and West, not a geopolitical battleground.

In its latest report, Ukraine: Running out of Time, the International Crisis Group analyses instability in Ukraine on the eve of the 25 May presidential election and offers recommendations to rebuild and reform the country and reverse the geopolitical standoff it has provoked. The Kyiv government has been unable to assert itself or communicate coherently and appears to have lost control of parts of the country to separatists, emboldened if not backed by Russia. To prevent further escalation, Ukraine needs strong international assistance and the commitment of all sides to a so lution through dialogue, not force.

The report’s major findings and recommendations are:

 

• Although conditions for the election are far from ideal, it must take place as planned and nationwide. The vote is needed to produce a new leader with a popular mandate to steer the country through a process of national reconciliation and economic reform. All presidential candidates should, before the polls, commit to establish a broad-based government of national unity; the new president’s first priority must be to form such a government.
  
• Ukrainian leaders should reach out immediately to the south and east and explain plans for local self-government and minority rights; they should also declare that they do not desire NATO membership.
  
• Ukraine’s damage goes far beyond separatism. It is the fruit of decades of mismanagement and corruption across security organs and most other arms of government. Far-reaching reform of the security sector and measures to strengthen the rule of law are crucial.
  
• Russia should declare unqualified support for Ukraine’s territorial integrity and withdraw all troops from the borders, as well as any paramilitaries who have infiltrated from Crimea or elsewhere. It should persuade Russian speakers in the south and east to end their occupations of government buildings and attacks on local security apparatuses and disband their militias.
  
• The U.S. and EU need to convey a consistent and measured message, recognising – even if not accepting – Moscow’s take on the crisis’s origins. This message should comprise political support for Kyiv to conduct elections; political, financial and expert support for a national unity government to carry out stabilisation measures; measures to make Ukraine viable for investors; further sanctions to bite deeper into Russia’s economy if it does not change course; and quiet high-level talks with Moscow aimed at resolving the crisis.
  
• Both Moscow and Western powers should emphasise that the present situation can only be resolved by diplomatic means; express support for a post-election government of national unity; take all possible measures to avoid geopolitical confrontation; and insulate other mutual concerns from divisions over Ukraine.

“On the ground in Ukraine today, Russia has immediate advantages of escalation” says Paul Quinn-Judge, Europe and Central Asia Program Director. “Over time, the West likely has the economic and soft-power edge. A successful, democratic Ukraine – integrated economically in the West but outside military alliances, and remaining a close cultural, linguistic and trading partner of Russia – would benefit all”.

The ECB’s own policies appear to be in contradiction. Its latest Financial Stability Review warned that bond tapering by the US Federal Reserve could lead to an interest rate shock, with a sharp rise in bond yields. Yet it has been slow to mitigate the dangers with pre-emptive stimulus.

Mario Draghi, the ECB’s president, told an audience in Berlin last week that bank needs a “safety margin against deflationary risks” after eurozone inflation fell to 0.7pc.

He warned that low inflation makes it harder for crisis states in Southern Europe to control their debt trajectories while at the same time carrying out internal devaluations within EMU to regain competitiveness, though he denied that the two goals are inherently contradictory.

“If average inflation is allowed to drift too low, adjustment runs into major head winds as demand suffers and real debt burdens rise,” he said.

Mr Draghi has to walk through a political minefield. The German constitutional court has not yet ruled on the legality of his back-stop plan for Italian and Spanish debt (OMT), making it very risky for him to push his case too hard. While Germany does not have a legal veto on ECB decisions, it has a de facto political veto.

Veteran EU watchers say the sacred contract of monetary union is that Germany will never be overruled on crucial matters. Mr Draghi has to work in tandem with Germany’s ECB board member Jörg Asmussen. The bank is in reality a twin-headed institution.

Portugal's PM has criticized the top court's ruling that parts of the 2013 budget are unconstitutional, and has held urgent talks with the president. PM Pedro Passos Coelho held an extraordinary cabinet meeting on Saturday and said the Constitutional Court had made meeting commitments to international lenders difficult.

The court had rejected four out of nine austerity measures in the budget.The PM met the president late on Saturday to discuss the next steps. President Anibal Cavaco Silva said after the talks that the coalition government should remain in office and that the country should honour its international commitments.

Rein in spending. The government said it respected the court's ruling but did not agree with it, suggesting that the judges had failed to take into account steps taken by the government to make its austerity measures fair to all citizens.

After the cabinet meeting, the government said the court ruling had created "serious difficulties" for meeting budget targets agreed with international lenders.  The BBC's Alison Roberts in Lisbon says the PM is expected to make a statement on Sunday evening.

The court ruling would deprive the state of some 1.5bn euros (£1.3bn) in savings the government had said were necessary to meet the terms of a eurozone and International Monetary Fund bailout.

The terms require Portugal, which has already received 61bn euros of its bailout, to rein in spending sharply.

The court rejected a measure to scrap summer holiday bonuses for public sector workers and pensioners, as well as cuts to unemployment and sickness benefits.

Savers in Cyprus could face losing one-quarter of their bank deposits under new proposals being discussed by the government as ministers flew to Brussels to salvage a European bailout.

The new bank levy would only apply to people with more than €100,000 (£85,260) in their accounts, according to the finance minister, Michael Sarris, who also said that significant progress had been made in talks with European officials.

President Nicos Anastasiades travelled to Brussels to work out an alternative plan to raise funds that would allow the country to qualify for an international bailout. Cyprus must raise €5.8bn (£4.9bn) before Monday to qualify for the €10bn EU bailout it needs to prevent the collapse of its banks and a potential departure from the eurozone.

The idea of raising money through a one-off levy on bank deposits was criticised in Cyprus, Russia and elsewhere and was unanimously rejected by the Cypriot parliament earlier this week, but is being reconsidered after negotiations with Russia to find alternative finance did not achieve a result.

On Friday, the Cypriot parliament passed nine bills, including three that would see ailing banks restructured, starting with Laiki, Cyprus's second-largest bank, a "national solidarity fund" and capital controls that would prevent large withdrawals from the country. A decision on the controversial bank savings levy and how it would be applied is due on Saturday.

Other Cypriot politcians discussed a smaller bank levy of 1% which would be aplied to all accounts. The debate is divided between those that want the levy to be borne only by the wealthy which includes a high percentage of Russians who hold €30bn in Cypriot banks.

Eurozone ministers are scheduled to meet on Sunday to decided how to help Cyprus avoid economic chaos. The European Central Bank has threatened to cut off funding from Monday and the banks face a run of investors withdrawing money when they re-open.

The Cypriot parliament will meet after the meeting of the eurozone ministers on Sunday evening.

Massive crowds jammed St. Peter's Square Sunday morning for one of the last public appearances of Pope Benedict XVI. ... The 85-year-old pontiff blessed tens of thousands of pilgrims and Romans. They cheered as he asked for their prayers and thanks them for their "affection and spiritual closeness."... Sunday night he'll begin a Lenten retreat, leaving behind a world of speculation, rumors and conspiracy theories of why he's really resigned and who will replace him next month. ...The Vatican's vague announcements feed the fire. The latest was spokesman Rev. Frederico Lombardi comments Friday that they were examining whether they can legally speed up the election for Benedict's successor. Current church law is clear that a conclave is to be held no earlier than 15 days after the papacy is vacated.So a change would require finding a loophole in the densely woven canon laws on conclaves-- or getting a dispensation. Then it would be a frantic push to racewalk a new pontiff up the nave of St. Peter's for his installation so he'd be in place for Palm Sunday, March 24..... Bad idea, says political scientist and Vatican expert Rev. Thomas Reese. Among his reasons rushing "would be a mistake," Reese says: -- "Church law should not be changed on a whim. Only the pope can change the rules; once he resigns, no one can change the rules. -- "If the pope does change the rules before he resigns, which he can, the media will immediately be filled with conspiracy theories opining how this favors one candidate over another. The church does not need this."

The jobless rate has reached an all-time high of 26.6pc in Spain, rising to 56.5pc for youth. It is much the same picture in Greece, where unemployment has spiked from 19pc to 26pc over the past year as austerity bites in earnest, with Portugal not far behind as it follows suit with draconian cuts. There are now 18.8m people looking for work across the eurozone.

“A widening gap is emerging,” said Laszlo Andor, the European Social Affairs Commissioner. “Peripheral states appear to be caught in a downward spiral of falling economic output, rapidly rising unemployment and eroding individual incomes.”

Mr Andor’s unemployment report said the welfare systems of southern Europe are unravelling as governments slash benefits, leaving families exposed to the full brunt of the crisis. The “automatic stabilisers” are no longer functioning properly.

He said there is a rising risk that the long-term jobless will fall into an “enormous poverty trap” if the crisis is allowed to drag on. “Severe material deprivation” has surged to 31pc in Latvia and 44pc in Bulgaria, casting doubts on claims that these two euro-pegged countries have shaken off the crisis .

Spain’s long-term jobless now number 2m, while the country’s GINI coefficient measuring inequality has risen from 31.2 to 34 since the crisis began. The report said the biggest single cause of the jobs crisis is a “demand shock” to the Euroland economy, deeming other factors to be “less relevant”. The findings reflect deep dissent within the EU policy apparatus over the contractionary policy settings, and undercut claims by hard-liners that labour reforms in the Club Med bloc are enough to pull the region out of slump.

Mr Andor’s grim warnings came a day after Commission chief Manuel Barroso claimed the eurozone crisis had “essentially been overcome”.

Graeme Leach, from the Institute of Directors, said the European Central Bank has bought time with its bond-buying pledge but the deeper economic crisis grinds on with a “terrifying” human cost. “The figures are shockingly bad. This saga is far from over,” he said. The North-South gap makes it very hard for the ECB to run monetary policy for the whole bloc. Unemployment is just 4.5pc in Austria, 5.4pc in Germany, and 5.6pc in Holland. Real household income, after tax, had fallen 17pc in Greece, 8pc in Spain, 7pc in Cyprus, and 5pc in Ireland between 2009 and 2011, a slide still gathering speed. Mr Andor said labour market reforms would bear fruit eventually, adding that the jobless rate may be near its peak in Spain. Jobs data tend to be a lagging indicator so the latest rise in unemployment may reveal much about economic growth prospects for 2013.

In conclusion....nada, nothing ...lots of hot air ...

European leaders wound up their final summit of 2012 on Friday in much the same manner as they started the year – kicking the euro crisis can down the road, playing for time, crossing their fingers, hoping the worst is behind them.

In almost three years since the Greek drama erupted in February 2010 and spread quickly around the fringes of the eurozone, the leaders have never quite managed to get ahead of the curve despite 22 summits and countless meetings of eurozone finance ministers.

This week's two-day summit in Brussels repeated the pattern. It was supposed to lay out a grand plan and timetable for reforming and stabilising the euro regime through a battery of federalising political and fiscal moves. In the event, the documents from the EU council president, Herman Van Rompuy, were shredded amid more clashes over fundamentals between Berlin and Paris, while an even more ambitious blueprint from the Commission president, José Manuel Barroso, was simply ignored.

"One wonders how these two gentlemen will enjoy Christmas," quipped Andrew Duff, the Liberal Democrat MEP and ardent European federalist.

Van Rompuy, who has had a very bad month, was told to come back in the middle of next year with a better, more modest plan. The mood was darkened further by German Chancellor Angela Merkel dismissing claims that the worst was over for the eurozone and stressing that the bloc faced two years of painful reforms, slow growth and high unemployment.

"The changes we are going through are very difficult and painful," she said. "We have tough times ahead of us that cannot be solved with one big step."

Despite the stalemate and the seeming complacency, leaders concluded their summit keen to list the year's achievements. And they do have things to brag about

In a statement issued just after the London markets closed, S&P warned there was a one-in-three chance that it would strip the UK of its cherished AAA status within the next two years. "We believe this could occur in particular as a result of a delayed and uneven economic recovery, or a weakening of political commitment to consolidation," it said. S&P did not call for the government to abandon its austerity plans, but it warned that the deficit-cutting strategy will continue to undermine growth. "We continue to believe that government's efforts over the next few years to engineer the planned correction in the UK's fiscal accounts will likely drag on economic growth." It added that belt-tightening by debt-burdened consumers and weak investment by anxious firms were likely to continue to depress demand. Ministers, including chief secretary to the Treasury Danny Alexander, have played down the significance of a ratings cut in recent days; but the chancellor has pinned his political reputation on maintaining Britain's reputation as a "safe haven" for foreign investors. S&P's announcement came after Osborne was forced to announce in last week's autumn statement that economic growth has been far weaker than he hoped even in his March budget; and he now expects to flunk his self-imposed rule of cutting the public debt burden by 2015-16. S&P said its own calculations suggested the debt-to-GDP ratio, forecast by the independent Office for Budget Responsibility to peak just below 80% of GDP, could actually hit 100% of GDP - on its own definition - if the economic recovery continues to disappoint. Standard & Poor's rating agency announced it is downgrading Britain's economic outlook from stable to negative, hours after the chancellor defended his Autumn Statement before MPs. The ratings agency said it placed a negative outlook on the British economy to reflect its view that it could lower the country's rating within two years if fiscal performance weakens beyond current expectations. It cited "a delayed and uneven economic recovery, or a weakening of political commitment to consolidation" as possible causes for a future downgrade. S&P warned "if economic growth recovers more slowly than we currently forecast, due to domestic factors or waning economic performance by the UK's main trading partners, such slow recovery could result in net general government debt approaching 100pc of GDP, by our calculations, from its current estimated level of 85pc of GDP in 2012". The downward revision came just hours after chancellor George Osborne, speaking before the House of Commons Treasury Select Committee, downplayed the importance of the UK's treasured top credit rating, describing it as just "one test" and not the key symbol of an economy's strength. “It’s one test alongside others and the ultimate test is what you can borrow money at,” said Mr Osborne.

The centre-left coalition of Prime Minister Victor Ponta is projected to win Romania's general election.

Exit polls gave his Social Liberal Union (USL) about 57% of the vote, as compared with just 19% for President Traian Basescu's Right Romania Alliance (ARD).
Mr Ponta said: "This is a clear victory with an absolute majority."
But he will have to share power with Mr Basescu, whose term runs until 2014. Official results are not expected until Monday. Mr Ponta and Mr Basescu have been locked in a power struggle since Mr Ponta came to power in April following the collapse of the previous centre-right government.
The two men have argued over control of state television and the Romanian Cultural Institute and attempts to draw up a new electoral law. Political decision-making has at times been paralysed.
In July, Mr Ponta suspended Mr Basescu and tried to impeach him. But a referendum failed to meet the required turnout.
Mr Basescu hinted before the election that he might refuse to re-appoint Mr Ponta as prime minister. He has described him as a "mythomaniac"....Mr Basescu's popularity has plummeted since he introduced stringent austerity measures and a 25 per cent cut in pub lic sector pay. The country, together with neighbour Bulgaria, are under special EU monitoring because of concerns about judicial independence, corruption and political influence in state institutions. Romania is trying to negotiate a new loan from the IMF to replace the existing one which expires early next year.

BUCHAREST, Romania — Romania’s center-left government won a clear victory in Sunday’s parliamentary elections, according to exit polls. The result could inflame the personal rivalry between the nation’s top two officials and bring yet more political upheaval. The prime minister’s governing alliance had about 57 percent of seats in the 452-seat legislature, according to a poll published after elections on national television TVR. Coming in second was a center-right group, allied to President Traian Basescu, which polled over 18 percent. A populist party headed by a media tycoon won about 13 percent, according to the poll. First results are expected Monday. Basescu and Ponta are bitter rivals after the government tried to remove Basescu from office in an impeachment vote in July, a bid that failed as too few people voted to make the election valid. Basescu has indicated he won’t appoint the 40-year-old Ponta again, calling him a “compulsive liar” and saying he plagiarized his doctoral thesis. Ponta says Basescu is a divisive figure who overstepped his role as president by meddling in government business. As he voted, Basescu again accused the government of the former communist country of failing to devote itself to democratic reforms. He said Romania must continue its “path toward the West” and show the world it is “headed toward Brussels, not Moscow, and Washington, not Beijing.” For his part, Ponta said he remains committed to leading Romania to a better future. Many Romanians are fed up with the power struggle between the top two leaders, especially as the country remains one of the poorest and most corrupt members of the European Union. Romania is enduring deep austerity cuts in return for a €20 million ($26 million) bailout to help its foundering economy. Sunday’s vote was hampered by heavy snow and authorities asked the army and the defense ministry to help clear roads closed by blizzards. About 250 polling stations were prevented from opening on time, officials said. Turnout was more than 30 percent three hours before the polls closed.

 

IN EUROPE: Italy faces a return to political chaos - IN FACT , ITALY WANTS OUT FROM UNDER THE GERMAN BOOT - after Prime Minister Mario Monti announced at the weekend that he will resign, prompting his notorious predecessor Silvio Berlusconi to say he would attempt a comeback. The renewed uncertainty sent European shares into a slump as trading for the week began on Monday morning. Investors aren't the only ones worried, either. German Foreign Minister Guido Westerwelle told SPIEGEL ONLINE on Monday that the situation in Italy threatened to spark renewed financial problems in the euro zone. "Italy can't stall at two-thirds of the reform process," he said. "That wouldn't cause turbulence for just Italy, but also for Europe." Westerwelle's concerns were echoed by Klaus Regling, the head of the permanent euro-zone bailout fund, the European Stability Mechanism (ESM), who told German daily Süddeutsche Zeitung on Monday that he feared the heavily indebted country could abandon necessary reforms. "In the last year Italy has pushed through important reforms," he told the paper. "So far, the markets have honored that, although they have reacted with concern to the developments of recent weeks." The reform process must continue for the sake of both Italy and the entire currency union, Regling said. BERLUSCONI SHOUL GET iTALY OUT OF THE FOURTH REICH !!!!

Greece's national debt is €301 billion. Population is 11 million - so a family of four owes €109,500.

Average net salary is €14,000 - so (assuming a family of four has one average earner) that debt is 7.8x annual income. This is their share of the national debt only - it does not include their own mortgage or personal debt.

Sustainable? My arse...... Even if the haggling to knock off €20 billion succeeds, the result is still bullshit.

How many times does the obvious have to be said?The Greek debt is so great that there is no realistic prospect of it ever being repaid. Creditors and creditor governments and institutions are just trying to buy time until some further write down or orderly default can be implemented that will not be too politically damaging to them. All the time hoping that Greece's current account balance can be kept moving into the black so that further bailouts to cover current government spending can be avoided.
All this fancy financial footwork has one goal only, to save the Euro. No one gives a damn about the mess the Greeks have got themselves into and for which they will pay dearly, and rightly so.But for how long can Greece avoid social and political explosion while they are the guinea pigs for a heroic surgical experiment designed to save the architects of the Euro from the folly of their creation.

The International Monetary Fund said on Thursday that it would not disburse funds under its part of the EU-IMF package unless the eurozone delivers on a bond "buy-back" scheme, which is supposed to cut Greece’s burden by 10pc of GDP and is deemed crucial for restoring long-term viability. If the IMF withdraws, Finland and Holland will also pull out of the programme. "This has become a really big problem," said Raoul Ruparel from Open Europe. The dispute comes as Moody’s said the EU-IMF deal to unlock €44bn in bail-out payments to Athens merely papers over cracks and does little to alleviate Greece’s "extreme economic and social fragility".  "We believe that the country’s debt burden remains unsustainable," it said. Moody’s warned that there can be so lasting solution until EU states and official creditors agree to write down their holdings, now the lion’s share. Private investors are furious at demands that they take a second "haircut" of 70pc on residual holdings, after already taking a 53.5pc loss earlier this year, while official creditors still refuse all loses.   Having given guarded and subsequently misleading support for the latest Greek bail out plan, Ms Lagards has now done her job, which is to carry out IMF policy, not French, Euro or personal
inclinations. This whole Greek farce is a tragedy for the Greeks and everyone connected with them and their failed economy.
She should have made the IMF position clear at the meeting rather than offer false hope to so many, and she should be condemned for that.   The Greeks, meanwhile seem to have two options.
Leave the Euro, or alternatively, leave the Euro.

The only moral approach to this nightmare is for the EU to allow/encourage/force Greece to return to its own currency and instead of pouring endless zillions into the bottomless pit of keeping Athens in this latest piece of European utopian insanity, the EU/IMF etc should use what funds it can donate to help the Greek economy benefit from its newly minted but devalued Drachma to rise again from the dangerous and irrational EMU.

Heil Merkel!.......

"We have laid the foundations to ensure that Greek debt, the most tortuous and destabilizing problem facing the country, has become manageable," Mr Samaras said in a television address, adding that Greece has "ensured its place in the euro." It came after eurozone finance ministers finally reached a deal over Greece's debt burden, enabling the release of its latest tranche of rescue funds. Markets breathed a sigh of relief as eurozone finance ministers finally reached a deal to keep Greece afloat through what was dubbed “bail-out number three”. After 12 hours of talks at their third meeting in three weeks, the euro group settled on measures to cut Greek debt by €40bn (£32bn) and keep the country in the eurozone, a deal which lifted European indices in early trading. The agreement enables the release of the latest €44bn tranche of bail-out funds for Greece and was heralded by Antonis Samaras, the country’s prime minister, as marking a “new day for all Greeks”. ... German news see Merkel and the Deutsche Bundesbank - the state bank- as the winners of the deal....Why? Whereas the ECB is handing over the billions profit it made on Greek bonds to help out, the Bundesbank is pocketing the profits that will fill the German Federal Governments pocket. The Bundesbank is the institution that blocked a further cut to Greek debt, as it stated earlier in the week. Germany in spite of all appearances is benefiting from prolonged Greek misery, and has no wish to see Greece come out of the red. Heil Merkel!

Be it the United States or the European Union, most Western countries are so highly indebted today that the markets have a greater say in their policies than the people. Why are democratic countries so pathetic when it comes to managing their money sustainably? In the midst of this confusing crisis, which has already lasted more than five years, former German Chancellor Helmut Schmidt addressed the question of who had "gotten almost the entire world into so much trouble." The longer the search for answers lasted, the more disconcerting the questions arising from the answers became. Is it possible that we are not experiencing a crisis, but rather a transformation of our economic system that feels like an unending crisis, and that waiting for it to end is hopeless? Is it possible that we are waiting for the world to conform to our worldview once again, but that it would be smarter to adjust our worldview to conform to the world? Is it possible that financial markets will never become servants of the markets for goods again? Is it possible that Western countries can no longer get rid of their debt, because democracies can't manage money? And is it possible that even Helmut Schmidt ought to be saying to himself: I too am responsible for getting the world into a fix ?

What's worse than an unelected hack steamrolling the lives of ordinary people?

Ireland's former attorney general, former minister for Justice and now practicing senior council one Michael McDowell was on national radio earlier today, wondering out loud why the country was not debating a Federal Europe that is being foisted on small countries by dint of an economic crisis exported from the core to the periphery. He wondered why Ireland was not paying enough attention to the UK's efforts to de-couple itself from core competencies and obligations being foisted on it by EU "Euro fascists" (my words). He wondered, if crossing the border from the Irish republic was going to be akin to crossing the border from East Germany into West Berlin during the dark days of the USSR. Entering the land of the free?I agree with his sentiments, federalism is a complete misnomer, buried deep inside the velvet glove of federalism is the Iron fist that will be used more and more boldly to smash the sovereign nation state. It is nothing less than a takeover of most states within Europe by Wolfgang, Von Rompuy and other egotistical men such as Barroso and Rehn. Dangerous people who know not what they are unleashing across the Eruopean continent. These are people who would barely get people to cross the road with them under their banner of a federalist Europe but who are marveling at the power an economic crisis has bestowed upon them. Small wonder they want to make crisis permanent? It is the UK once again who are standing up for what is left of democracy in Europe and god knows that in itself tells us a lot about how far the rot has gone because we know that democracy in Britain itself has been significantly eroded over the last 40 years.

The Single Market is like a customs union. Tax and duty paid in one member country is deemed as tax and duty paid in another member country and so goods are free to move across borders between members. Many readers eher will not remember the bad old days when trucks crossing borders had to queue and wait for a customs official to measure the amount of diesel in the fuel tank and then the driver had to pay tax on the import of that fuel into that particular country. Only passenger vehicles were exempt.

Hannah is simply playing word games. He admits the EU is internally a free trade area but, the fact that it is not free and open to the world is not unusual. Most of the world is not free and open to the EU or to many other parts of the world.

Hannah provides examples of free trade areas, Nafta (Canada, the United States and Mexico) and ASEAN (ten South East Asian states). The EU is setting up similar Free Trade Agreements, EU-Japan Free Trade Agreement, EU- Canada Comprehensive Economic and Trade Agreement, EU-US Transatlantic Economic Council, EU-India Free Trade Agreement, EU-Mercosur Free Trade Agreement.

Hannah says nothing but he does demonstrate his naivety; "The optimum deal for the United Kingdom is surely to be in a European free trade area but not in a customs union." That's like saying that the optimum deal for the United Kingdom is one where the UK is the sole winner.

We'd all like unlimted freedoms but with no attached responsibilities but you will never ever eliminate 'if you sell to him, I won't sell to you' and very quickly, 'and I'll ask my mate not to supply you at all'. Deals are struck, bargains are made. No one allows a single trader to take all the profit.