Mish/ MIke Shedlock – Christine Lagarde, Head Of IMF, In Court Facing Questions Od Embezzlement And Fraud – 24 May 2013

Christine Lagarde, head of the IMF, is in court today addressing her role in a $366 million payout to Bernard Tapie, a close friend of former president Nicolas Sarkozy who was also Lagarde’s boss at the time. Lagarde was Sarkozy’s finance minister. Reuters reports IMF’s Lagarde in court for French arbitration case.

IMF chief Christine Lagarde was questioned in court by French magistrates on Thursday over her role in a 285-million-euro ($366 million) arbitration payment made to a supporter of former president Nicolas Sarkozy.

Mish/ Mike Shedlock – Merkel Pins Cameron In Corner; Will Cameron Bury His Head In The Sand, Pretending To Not Notice? – 21 May 2013

UK prime minister, David Cameron, promised to hold a referendum on whether Great Britain should remain in the EU, but only on two conditions. The first condition, that Cameron be re-elected as prime minister is iffy enough. The second condition, that Cameron renegotiate the Lisbon Treaty, I said would never happen. And it won’t. German Chancellor Angela Merkel sealed the fate on that score as Berlin plans to streamline EU but avoid wholesale treaty change.

Mish/ Mike Shedlock – Folly of Preserving the Euro at All Costs; Should France Lead Breakup of Euro? – 20 May 2013

The Local, a website with German news in English reports Economists warn against German euro exit.

“Even a believable rumour that Germany would exit the euro would result in a massive capital flight from the countries of southern Europe to Germany.”

The southern European banking system would then collapse, bringing down entire economies with them, Schmieding said.

Mish/ Mike Shedlock – Hollande Asks ECB To Engage In Japanese Style Currency Debasement – 18 May 2013

French president Francois has had enough of austerity but claims he “cannot do it alone”. The Financial Times reports François Hollande goes on ‘offensive’ over stalled EU economy.

François Hollande promised an “offensive” to bring “more growth and less austerity” to Europe as he launched a bid to resurrect his presidency.

Mish/ Mike Shedlock – Senior Eurozone Official : “As Spain Goes, So Goes Slovenia” – 7 May 2013

The spotlight is once again on Slovenia. Olli Rehn, the European commission’s economic chief is unhappy with economic progress in Slovenia and is threatening to put the country into an “excessive imbalances procedure” by the end of the month.
The problem is, Spain is in a similar “excessive imbalance” state prompting an unnamed eurozone official to state “As Spain Goes, So Goes Slovenia”. Please consider Brussels trains its sights on Slovenia.

Mish/ Mike Shedlock – Former Portugues Prime Minister Says “Portugal Cannot Pay Its Debts”, Calls For “Agentine-Style Default” – 14 April 2013

It’s rare to hear any bit of common sense from political leaders, but today I have a sterling example. Mário Soares, Prime Minister of Portugal from 1976-1978 and 1983-1985, and the 17th President of Portugal from 1986 to 1996 speaks the truth. Soares says “Portugal Cannot Pay Its Debts“. He calls for an “Argentine-Style Default”, and states “The desire to please chancellor Merkel is ruining the country.”

“Portugal can not pay what you owe and however much they impoverish people, however much they steal the money to people who have it, not be able to pay what you owe. And when you cannot, the only solution is not pay. ” The president of Portugal, Mario Soares socialist argues that it is impossible for Portugal to return all of its foreign debt. So has asked to make a Argentine-style default to avoid economic collapse. “Look at Argentina, was in crisis when he said we do not pay. ‘And something happened?” Asks Soares. “No, nothing happened,” he says in an interview with Antena 1, which airs tonight and that includes the Business Journal. Soares, who was also prime minister, has called for the overthrow of the government, has criticized the European Commission president, José Manuel Barroso and launched a series of warnings to the President of the Republic, Cavaco Silva. The former head of state also defended as imperative the change in government and an end to austerity. “This desire to be useful to Mrs Merkel, are ruining the country and forcing him to sell everything. In two years, this government has destroyed almost everything in Portugal,” he says. For Soares, “any politician with an ounce of common sense when booed-as are the government every day, calling them thieves, should have the dignity to leave. But they cling to power,” he concludes.

Sooner or Later

Sooner or later some politician is going to run on that exact platform and be elected. Alternatively, a politician will decide the same thing while in office.

Eurozone math practically guarantees that outcome. For further discussion, please see Eurozone Math; One Size Fits Germany; Door Number Two.

Mike “Mish” Shedlock
www.globaleconomicanalysis.blogspot.com / link to original article

Mish/ Mike Shedlock – Germany’s Net Foreign Assets Exceed €1 Trillion; 10 Complete Failures Of The Eurozone – 9 April 2013

The eurozone was supposed to equalize trade and interest rates. The Maastricht Treaty supposedly ensures the free movement of goods, capital, people and services. Tensions were supposed to drop. Instead, the eurozone has been a complete failure.

Mish/ Mike Shedlock – EU Warns Portugal on Austerity Measures; Portugal Faces Fresh Spending Cuts; Second Bailout Coming Up – 8 April 2013

As expected, Brussels rejected the Inane Plan “B” Measure to Pay Workers in T-Bills following a Portuguese court ruling that certain austerity measures are unconstitutional.

Reuters reports Portugal must stick to agreed budget targets to get loan extension.

And so Portugal faces fresh cuts to spending.

Mish/ Mike Shedlock – Netherlands, The Next Chip To Fall? – 7 April 2013

Most attention lately has been on Cyprus, Spain, and Italy. Long-time troubles have been brewing in Portugal and I have an update coming up shortly.

First consider Underwater: The Netherlands Falls Prey to Economic Crisis.

The Netherlands, Berlin’s most important ally in pushing for greater budgetary discipline in Europe, has fallen into an economic crisis itself. The once exemplary economy is suffering from huge debts and a burst real estate bubble, which has stalled growth and endangered jobs.

Mish/ Mike Shedlock – 97% Of Spain’s Social Security Pensions Are Invested In Spanish Government Debt – 5 April 2013

Looking for a disaster waiting to blow sky high? I have one right at hand. El Economista reports 97% of pensions are invested in Spanish government debt in 2012.

The Reserve Fund of Social Security in 2012 increased their holdings of Spanish debt to 97% of total assets, up from 90% who had in late 2011.