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Paul Merrell

ECB Head Mario Draghi Admits For First Time EU May Break-Up - TruePublica - 0 views

truepublica.org.uk/...for-first-time-eu-may-break-up

banksters euro EU-disintegration

shared by Paul Merrell on 01 Feb 17 - No Cached
  • Back in 2012, Mario Draghi, President of the European Central Bank, pledged to do “whatever it takes” to protect the eurozone from collapse, infamous words I’m sure he has come to regret. Draghi’s speech at an investment conference in London boosted markets at the time and forced down Spain and Italy’s borrowing costs after saying; “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough.” The markets responded because they were effectively being manipulated. Known as “Outright Monetary Transactions” the scheme was to have been deployed alongside a QE programme from March 2015, itself racking up ¢80billion a month. Several trillion euros later and the EU looks as precarious as ever with growth a distant memory. In Italy, yields on bonds dropped from 6.3 per cent to 1.2 per cent after that famous speech and all seemed good – on the face of it. But deep down, it was not as we had been led to believe. Italy’s government debt grew and is now equal to 133 per cent of GDP. When Ireland imploded and had to be fully bailed out by the ECB, it’s debt pile was 132.2% of GDP.
  • With all this intervention, the ECB’s balance sheet ballooned – set to overtake the U.S. Fed Reserve and has now reached over $3trillion according to Bank of America Merrill Lynch (not to be confused with national debt). Then, totally off the mainstream media radar came news that another Italian bank had disintegrated. And while attention was focused on the rescue of Banca Monte dei Paschi di Siena, which is still not fully finalised, news came that Banca Etruria, has quietly slipped into bankruptcy. “It was announced (Dec 21st) that the first part of an investigation concerning fraudulent bankruptcy charges (at Banca Etruria), in which 21 board members are implicated, had been closed. This strand of the investigation concerns €180 million of loans offered by the bank which were never paid back, leading to the regional lender’s bankruptcy and eventual bail-in/out last November that left bondholders holding virtually worthless bonds.” Next up and out of the blue comes UniCredit, the country’s largest bank. It is seeking to raise €13bn of desperately needed capital but large as though this is, the biggest problems, according to the FT is that the smaller banks, like Banca Etruria, are now in a perilous position and on the verge of falling over the cliff edge. Italy has banks on every street corner, with more branches per capita than any other OECD country. The lack of growth (occurred since it joined the Euro), has suppressed much needed profits on the one hand whilst seeing poor wage growth on the other, causing drastically increased non-performing loans that now add up to an eye-watering €360billion.
  • The FT reports that Italian banks “have long sold their own shares and debt to their retail customers as an attractive alternative to savings products, a disgraceful practice that should never have been allowed. It means that ordinary Italians, many in retirement, have already suffered as bank shares have fallen. They will suffer much more in a bail-in.” The FT is suggesting that a full bail-in is on the cards. It is. truepublica reported back in September that banks throughout the EU would simply steal depositors money if any of them failed now that new bail-in rules had been implemented. And that is exactly what is happening. The result of all this is that Mario Draghi, clearly feeling the strain, has finally admitted defeat and said that there is a strong possibility of the EU falling apart. This time the tactic to keep unity was to threaten every country in the EU by stating that leaving the Eurozone would cost dearly and would require any member country to settle its claims or debts with the bloc’s payments system before severing ties. There’s nothing to stop a desperate member country from leaving and simply defaulting.
Paul Merrell

Washington Misses Bigger Picture of New Chinese Bank « LobeLog - 0 views

www.lobelog.com/er-picture-of-new-chinese-bank

shared by Paul Merrell on 22 Mar 15 - No Cached
  • Bibi Netanyahu’s election, persistent violence through much of the Middle East and North Africa, and intensified efforts to forge a nuclear deal between the P5+1 and Iran topped the news here in Washington this week. But a much bigger story in terms of the future order of global politics was taking place in Europe and Beijing. The story was simply this: virtually all of the closest European allies of the United States, beginning with Britain, defied pressure from Washington by deciding to apply for founding membership in the Asian Infrastructure Investment Bank (AIIB). This Chinese initiative could quickly rival the World Bank and the Asia Development Bank as a major source of funding for big development projects across Eurasia. The new bank, which offers a serious multilateral alternative to the Western-dominated international financial institutions (IFIs) established in the post-World War II order, is expected to attract about three dozen initial members, including all of China’s Asian neighbors (with the possible exception of Japan). Australia, Russia, Saudi Arabia, and other Gulf states are also likely to join by the March 31 deadline set by Beijing for prospective co-founders to apply. Its $50 billion in initial capital is expected to double with the addition of new members, and that amount could quickly grow given China’s $3 trillion in foreign-exchange reserves. More details about the bank can be found in a helpful Q&A here at the Council on Foreign Relations website.
  • Along with the so-called BRICS bank—whose membership so far is limited to Brazil, Russia, India, China and South Africa—the AIIB poses a real “challenge to the existing global economic order,” which, of course, Western nations have dominated since the establishment of the International Monetary Fund (IMF) and the World Bank in the final days of World War II. As one unnamed European official told The New York Times, “We have moved from the world of 1945.” That Washington’s closest Western allies are now racing to join the AIIB over U.S. objections offers yet more evidence that the “unipolar moment” celebrated by neoconservatives and aggressive nationalists 25 years ago and then reaffirmed by the same forces after the 2003 Iraq invasion is well and truly. And yet, these same neoconservatives continue to insist that—but for Obama’s weakness and defeatism—the United States remains so powerful that it really doesn’t have to take account of anyone’s interests outside its borders except, maybe, Israel’s. (That Washington’s closest Western allies are now racing to join the new bank over U.S. objections could also presage a greater willingness to abandon the international sanctions regime against Iran if Washington is seen as responsible for the collapse of the P5+1 nuclear negotiations with Tehran. Granted, Iran’s economy—and its potential as a source of investment capital—is itsy-bitsy compared to China.)
  • Indeed, commentators are depicting US allies’ decision to join the AIIB (see here, here, and here as examples) as a debacle for U.S. diplomacy. The Wall Street Journal editorial board has predictably blamed Obama for defeat, calling it a “case study in declining American influence” (although it also defended Washington’s decision against joining and accused Britain of “appeasing China for commercial purposes.”) What the Journal predictably didn’t mention was a key reason why the administration did not seek membership in the new bank: there was virtually no chance that a Republican-dominated Congress would approve it. Indeed, one reason Beijing launched its initiative and so many of our allies in both Asia and Europe have decided to join is their frustration with Republicans in Congress who have refused to ratify a major reform package designed to give developing countries, including China, a little more voting power on the Western-dominated governing boards of the IMF and the World Bank. The Group of 20 (G20) biggest economic powers actually proposed this reform in 2010, and it doesn’t even reduce Washington’s voting power, which gives it an effective veto over major policy changes in both institutions. As a result of this intransigence, the United States is the only G-20 member that has failed to ratify the reforms, effectively blocking their implementation.
  • Paul Merrell on 22 Mar 15
     
    U.S. global hegemony is rapidly disintegrating as former puppet states in Europe jump from the dwindling dollar economy to the rising remnimbi/ruble BRICS economies. And many of the "stans" south of Russia threatened by U.S. mercenaries provided by the Gulf Coast States are jumping in that direction too, along with Turkey, a NATO member. The Stans involved are oil and natural gas rich; combined with Russian oil and gas, they have enough oil and gas reserves to rival the Gulf Coast States.  The most interesting part to me is the debate now under way in the EU over dropping out of NATO and creating a replacement European mutual defense force that excludes the U.S. I'm beginning to hit some chatter about inviting Russia into that hypoethesized treaty. That makes sense for the EU because it would give Europe the benefit of Russian nuclear deterrence, both in land and submarine-based ICBMs. I'm not convinced that Russia would sign on. Russia is already running joint military exercises with China, which is playing the role of Russia's economic savior at this point. So China might have the final say on that scenario. A pan-Eurasian mutual defense treaty? What would be left of the U.S. Empire without NATO, particularly given that the dollar would surely collapse before such a treaty were signed? The War Party in Congress has only one tool to work with, war, and when all you have is a hammer, all problems look like nails. Current U.S. military power is built around the capacity to wage two major wars concurrently, but is very heavily dependent on NATO to do so. I'm not sure at all that the War Party has what it takes to cope with a peaceful group boycott by other NATO members. 
Paul Merrell

Asia Times Online :: The Fall of the House of Europe - 0 views

www.atimes.com/...WOR-01-110313.html

banksters financial-collapse EU collapse Italy

shared by Paul Merrell on 12 Mar 13 - No Cached
  • There's more, much more. These four characters - Bersani, Monti, Grillo, Berlusconi - happen to be at the heart of a larger than life Shakespearean tragedy: the political failure of the troika (European Commission, European Central Bank and International Monetary Fund), which translates into the politics of the European Union being smashed to pieces. That's what happens when the EU project was never about a political ''union'' - but essentially about the euro as a common currency. No wonder the most important mechanism of European unification is the European Central Bank. Yet abandon all hope of European politicians asking their disgruntled citizens about a real European union. Does anybody still want it? And exactly under what format?
  • All hell is breaking loose in the EU. Le Monde insists Europe is not in agony. Oh yes, it is; in a coma. And yet Brussels (the bureaucrat-infested European Commission) and Berlin (the German government) simply don't care about a Plan B; it's austerity or bust. Predictably, Dutch Finance Minister Jeroen Dijsselbloem - the new head of the spectacularly non-transparent political committee that runs the euro - said that what Monti was doing (and was roundly rejected by Italians) is ''crucial for the entire eurozone''.
  • The verdict is of an Italy ''in the hands of polit-clowns that may shatter the euro or force the country to exit''. Even the liberal-progressive Der Tagesspiegel in Berlin defines Italy as ''a danger to Europe''
  • ...3 more annotations...
  • So whatever government emerges in Italy, the message from Brussels, Berlin and Frankfurt remains the same: if you don't cut, cut and cut, you're on your own. Germany, for its part, has only a plan A. It spells out ''Forget the Club Med''. This means closer integration with Eastern Europe (and further on down the road, Turkey). A free trade deal with the US. And more business with Russia - energy is key - and the BRICS in general. Whatever the public spin, the fact is German think-tanks are already gaming a dual-track eurozone.
  • Philosopher Franco Berardi - who way back in the 1970s was part of the Italian autonomous movements - correctly evaluates that what Europe is living today is a direct consequence of the 1990s, when financial capital hijacked the European model and calcified it under neoliberalism. Subsequently, a detailed case can be made that the financial Masters of the Universe used the aftermath of the 2008 financial crisis to turbo-charge the political disintegration of the EU via a tsunami of salary cuts, job precariousness for the young, the flattening of pensions and hardcore privatization of everything. No wonder roughly 75% of Italians ended up saying ''No'' to Monti and Merkel.
  • What Grillo's movement has already done is to show how ungovernable Europe is under the Monti-Merkel austerity mantra. Now the ball is in the European financial elite's court. Most wouldn't mind letting Italy become the new Greece. So we go back full circle. The only way out would be a political reformulation of the EU. As it is, most of Europe is watching, impotently, the death of the welfare state, sacrificed in the altar of Recession. And that runs parallel to Europe slouching towards global irrelevance - Real Madrid and Bayern Munich notwithstanding. The Fall of the House of Europe might turn into a horror story beyond anything imagined by Poe - displaying elements of (already visible) fascism, neo-Dickensian worker exploitation and a wide-ranging social, civil war. In this context, the slow reconstruction of a socially based Europe may become no more than a pipe dream.
Paul Merrell

The West Wants Turkey Out - nsnbc international | nsnbc international - 0 views

nsnbc.me/...the-west-wants-turkey-out

war & peace Turkey NATO-membership SU-24-shootdown

shared by Paul Merrell on 27 Nov 15 - No Cached
  • The downing of Russia’s Su-24 bomber by the Turkish Air Force is “one of the nightmare scenarios that military planners had envisaged as a result of Moscow’s decision to enter the conflict,” reports The Financial Times.
  • In turn, The Washington Post believes that “NATO faced being thrust into a new Middle Eastern crisis… The incident marked a serious escalation in the Syrian conflict that is likely to further strain relations between Russia and the NATO alliance.” The Guardian argues that we’ve witnessed “a nerve-jangling event, that raised the spectre of a direct confrontation between two large powers: one a Nato member, the other nuclear-armed”. While it’s clear that neither Russia nor NATO wants to go to war against each other, each side is trying to deal with the situation and identify the reasons that provoked the recent crisis and, what’s even more important, to establish who’s at fault.
  • However, to resolve the difficult crisis that followed the destruction of the Russian Su-24 quickly, the West is now searching for those “guilty” of this blatant attack, which is, without a doubt, the Turkish leader – Tayyip Erdogan. It seems that NATO states are not afraid to criticize Turkey for its actions against Russia. Vice-Chancellor of the Federal Republic of Germany and the chairman of the Social Democratic Party of Germany (SPD) Sigmar Gabriel expressed harsh criticism of Turkey after the downing of Russia’s Su-24 bombers by labeling it an “unpredictable player”, reports the German Die Welt. The members of NATO fear that the “impulsive actions” of Turkey’s President will force them into a new major conflict, and NATO is not prepared to fight it yet. These “impulsive actions” may trigger the response that is required by Article 5 of the North Atlantic Treaty. No wonder Hollande, while declaring war against ISIL, made no reference of Article 5, by quoting the EU Lisbon Treaty instead.
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  • France is convinced that once the “Muslim Brotherhood” came to power in Turkey, headed by Recep Tayyip Erdogan, Turkey has become a major headache for Western politicians, says Le Figaro. According to its journalists, Turkey used to be an ally of the West, however, it is nothing of the kind anymore. Relations with Turkey took a U-turn once Erdogan started systematically “undermining” Turkey’s strategic relations with Israel which were stable since 1949. Anti-Turkish sentiments in the West were aggravated even further by the games Erdogan had been playing during the “Arab Spring”, when he first became a close friend of Bashar al-Assad, and then stabbed him in the back by allowing jihadists from around the world to swarm into Syria by crossing through Turkey’s territory. When the sworn enemies of Erdogan – local Kurds were dying in a heroic defense of the city of Kobani, Turkey did nothing to relieve their suffering, waiting for Western countries to save the population of the city instead. In this context it’s curious what the former NATO commander of Europe, Ret. General Wesley Clark, has been saying about Turkey : “Let’s be very clear: ISIL is not just a terrorist organization, it is a Sunni terrorist organization. It means it blocks and targets Shia, and that means it’s serving the interests of Turkey and Saudi Arabia even as it poses a threat to them All along there’s always been the idea that Turkey was supporting ISIS in some way… Someone’s buying that oil that ISIL is selling, it’s going through somewhere. It looks to me like it’s probably going through Turkey, but the Turks have never acknowledged it.” Here’s the reason why Russia was stabbed in the back by a NATO member country.
  • Once Russia began military operations against ISIL in Syria, Ankara’s relations with Washington started deteriorating rapidly. The situation we have on our hands now is further complicated by the fact that it was “defenseless” Turkomans who were shooting Russian pilots as they descended with parachutes, along with bringing down a Russian helicopter that was sent to rescue the pilots. All the recent NATO meetings have been stained by concerns that the Turkish agenda in Syria has little to do with the position of the West. Now that Erdogan’s arrogance has become apparent to everyone, even though he allowed the US Air Force to use a base in Turkey’s territory, he has also been launching attacks against Syrian Kurds that remain the most faithful allies of Washington in the fight against ISIL. It is, therefore, hardly surprising that a retired US Major General Paul Vallely accused the Turkish government of an attempt to create a new Ottoman Empire. According to him, due to all well-known facts of Ankara’s assistance to the Islamic State, Turkey should be expelled from NATO. The Washington Times is also questioning Turkey as a member state of NATO, while underlying that the attack on the Russian Su-24 makes this debate particularly relevant and timely. The newspaper notes that Ankara has been providing ISIL units with close air support when the latter was fighting Kurds in Syria and Iraq. Its journalists are convinced that Turkey has been turned into a theocratic Islamist dictatorship, where the freedom of the press is gradually been destroyed.
  • The conservative American Thinker goes even further by claiming it’s about time to replace Turkey with Russia in NATO, since the West has more in common with Russia than with the Islamist Turkey. To support this position, the magazine notes that when Turkey joined NATO back in February 1952, the advocates of this step argued that they need an Islamic state to prevent Soviet expansion in the region from happening. But it’s clear that this was a deal with the devil. After all, it was the Turkish invasion of Cyprus in 1974 that broke the alliance apart, forcing Greece to withdraw its troop from under NATO command. In 2012, Syria shot down a Turkish fighter since it was deliberately violating its airspace. Later that same year, Turkey bombarded government facilities in Syria. For decades, Turkey has used NATO membership, in order to achieve its own objectives, which, as a rule, do not coincide with the interests of the alliance. In the early 2000s, Turkey chose to demonstrate its support of Islamism, which has always been a more serious threat to the West than the Soviet Union. Therefore, it seems that the American Thinker has expressed the opinion of a larger part of the western public, by urging NATO to get in an alliance with Russia against Islamism, including the “Islamic state of Turkey.”
  • Paul Merrell on 27 Nov 15
     
    When considering Turkey being booted out of NATO, let's not forget its role in staging the false flag sarin gas attack in Syria that was aimed at provoking the U.S. into attacking Syria --- and almost succeeded.  But better still, let's dissolve NATO. Its reason for existence disappeared when the Soviet Union disintegrated. 
Paul Merrell

Greece's friendly relationship with Moscow could cause a headache for Brussels | Journa... - 0 views

journalitico.com/...-cause-a-headache-for-brussels

economic-warfare Greece Russia EU-disintegration U.S.-foreign-policy

shared by Paul Merrell on 29 Jan 15 - No Cached
  • The Syriza win in Greece has had everyone from Brussels to Mars wondering about a potential ‘Grexit’ from the euro zone, but there hasn’t been quite as much talk about what having Alexis Tsipras in power means for Russia. Until now. Now that he’s in, the wheels of thought have been turning rather furiously in the anti-Russia, pro-whatever-Washington-wants media circles and the consensus is broadly: Oh, dear. Greece could now turn into a real troublemaker for the European Union and, by extension, the US — and in more ways than one.
  • If Athens breaks with the Brussels line, watch out for Hungary and Slovakia to possibly do the same.
  • It’s also worth remembering that only weeks ago, French President Francois Hollande dangled the idea of lifting Russia sanctions if progress could be made in Ukraine. France does not want to “push Russia onto its knees,” he told Bild am Sonntag newspaper in December.
  • ...3 more annotations...
  • Greece could jettison the sanctions based on genuinely ideological grounds — and if they do, a small anti-sanctions coalition in the EU could make itself known and ultimately veto any expansion of penalties against Russia — without the unpleasantness of being ‘the only one’.
  • Another possibility is that Greece will use Russia sanctions to trade favors with Angela Merkel. In other words: Give us some class of a debt write-down and we’ll give you your sanctions consensus. At that point, Germany would have to chose, what’s more important — doing everything it can to prevent a ‘Grexit’ by conceding to some Greek demands in return for a ‘yes’ vote from Greece on more sanctions — or sticking with the hard-line stance on Greece’s debt and letting the chips fall where they may when it comes to sanctions?
  • This scenario assumes of course that Greece would actually use Russia sanctions as a bartering tool, which is far from certain — especially given that the pro-Russia stance over Ukraine seems to be more about morals than about money.
Paul Merrell

Tomgram: John Feffer, On the Verge of the Great Unraveling | TomDispatch - 0 views

www.tomdispatch.com/..._verge_of_the_great_unraveling

war & peace Middle-East refugees Europe Islamaphobia

shared by Paul Merrell on 10 Nov 15 - No Cached
  • The figures are staggering. In what looks like a vast population transfer from a disintegrating Greater Middle East, nearly 200,000 refugees passed through Austria in September alone. About half a million desperate refugees from Syria, Iraq, Afghanistan, and elsewhere have arrived in Greece since 2015 began (those, that is, who don’t die at sea), and the numbers are only expected to rise. Seven hundred children a day have been claiming asylum somewhere in Europe (190,000 between January and September 2015). And at least three million refugees and migrants from the planet’s war and desperation zones are expected to head for Europe in 2016. Under the circumstances, I’m sure it won’t surprise you that, once the first upbeat stories about welcoming European crowds had died down, the truncheons and water cannons came out in some parts of the continent and the walls began to go up. Nor, I’m sure, will you be shocked to learn that an anti-immigrant, anti-Muslim fervor is now gripping parts of Europe, while far-right parties are, not coincidentally, on the rise.  This is true in France, where Marine Le Pen’s virulently anti-Muslim, anti-immigrant, anti-European-Union National Front is expected to make significant gains in local elections this winter (and Le Pen herself is leading early opinion polls in the race for the presidency), while in “tolerant” Sweden a far-right party with neo-Nazi ties is garnering more than 25% of the prospective vote in opinion polls. In Poland, an extreme party wielding anti-refugee rhetoric just swept into power. And so it goes across much of Europe these days.
  • All of this (and more) represents a stunning development that could, sooner or later, reverse the increasingly integrated nature of Europe, raise walls and barriers across the continent, and irreversibly fracture the European Union, while increasing nationalistic fervor and god knows what else. In the United States, in a somewhat more muted way, you can see similar developments in what’s being talked about here as an “outsider” election, but is, in fact, significantly focused on keeping outsiders separated from insiders. (Just Google Donald Trump, Ben Carson, and immigrants, and you'll see what I mean.) Isn’t it strange how we always speak of the “tribal” when it comes to Africa or the backlands of Pakistan and Afghanistan, but never when it comes to our world? And yet, if these aren’t, broadly speaking, “tribal” responses, what are?
  • Paul Merrell on 10 Nov 15
     
    The refugee situation in Europe has Obama reeling from European leader backlash, pressuring him to join forces with Russia to bring the U.S.-Saudi-Turkey-Qatar Middle East wars to an end. 
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