For those of you who missed this morning’s jolly jape about Draghi, Lagarde, van Rompuy and Barroso, unless the Forces of Darkness have taken it down, it should still reside here. What I really didn’t count on was that news during the day would illustrate beyond any reasonable doubt that, when it comes to eurocrats, the correlation between criminality and incompetence is as near as damnit 100%.
Thus – to add to the earlier four most wanted criminals – we now have their four biggest f**k-ups.
GREECE: Two bailout agreements, total aid of 240 billion euros, and one bondholder haircut later….Greek public debt remains very nearly as high as it was in 2010 – the year in which Greece sought ‘rescue’ by the Troika. The numbers are, 2010 Public debt – 31o.3 billion euro; 2013 Public debt – 309.4 billion euro.
This bears some thinking about. All the hardship, all the lost growth, all the closed tourism businesses, and all the socio-political agony the Greeks have been through. A quarter of a trillion euros expended on the exercise. All for a gain of just one tiny, weffer-thin 0.9 billion euros.
To put this into perspective, had HMS Troika been rescuing the passengers on the Titanic, 1 person would’ve been saved…as opposed to the 202 that made it without any help at all.
SPAIN: Overnight the shares of Bankia plunged 51.4%. That is a disaster to put the Troika’s Titanic mission in the front rank of rescue achievements. The citizens of Spain bought preferred shares, hybrid bonds on the basis of an implied guarantee from the State. Many European analysts had suggested that the swap out of these instruments into equity would drop the price of the stock to about 1.35 Euros but reality emerged today as the equity price plunged to 0.68 Euros. The shares traded today were forty-two times the normal average trading volume and indicated the size of the problem. The stock has lost 90% of its value since May 6.
As Mark J Grant so aptly puts it, ‘…the central bank of Spain has said that the Spanish banks might have to reserve 5-10 billion Euros in more provisioning. This number is a joke and one more IMF/EU/ECB projection with all of the merits of two sparrows lifting a 747 for take-off. The number is more like 50 billion Euros and possibly twice that much the way things are going in Spain.’
ITALY: The second Enrico Letta’s government started making vaguely reasonable noises to Brussels, there was an immediate fall in the morale of ordinary Italian citizens. Since then, Letta has suspended a hated housing tax that was due to be paid in June and promised to cut labour taxes. He says he will tackle youth unemployment of above 38 percent and lobby the European Union for more growth-oriented policies. But Italians appear unimpressed. The government’s approval rating has fallen 12% to just 31% in three weeks.
If any reader is still wondering why that might be, get with these data: the number of Italians living in families considered to be seriously deprived has doubled in the past two years to 8.6 million, or about 14%of the population. The eurozone’s third largest economy has contracted for seven straight quarters since the middle of 2011.
PORTUGAL: Portugal seems highly likely to request a third revision to deficit targets agreed with EU-IMF creditors as part of its 78billion euro international bailout, said Prime Minster Pedro Passos Coelho today. The warning comes as a new government spending package, announced by the centre-right government earlier this month, foresees the slashing of 30,000 public sector jobs out of a total 700,000. Mr Coelho said that the 2013 deficit target of 5.5% of gdp would be met. He just didn’t say how, given budget figures for the first three months of the year are already miles out.
Portugal’s economy has been in recession for two years, and contracted by another 0.3% in Q1 2013. Unemployment stands at a record high of 17.7%.
There isn’t a lot more one can say really, beyond cheering oneself up with the apparent fact that crime doesn’t pay after all.
At least, it doesn’t for the victims.