Baltic Dry Index. 915 +15 Brent Crude 58.75
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
Bailout: noun. The act of parachuting
from an aircraft, especially to escape a crash, fire, etc.
We open with general agreement on Germany’s penal colony, Greece. Monday’s grovelling capitulation by Greece will accomplish nothing without a massive debt write-off. Below, the IMF jumps the sinking ship. The IMF seems to be starting a war with Germany, but would they be doing it without cover from Washington? This EU is now dying right before our eyes. And we still have Belgium, France, Italy and Spain to come. Brexit now!
Before me things create were none, save things
Eternal, and eternal I endure.
All hope abandon ye who enter here.
The sign above the EUSSR.
IMF calls for Greece debt relief ahead of bailout vote
ATHENS/BRUSSELS
|
An International Monetary Fund study published on Tuesday showed that
Greece needs far more debt relief than European governments have been willing
to contemplate so far, as fractious parties in Athens prepared to vote on a
sweeping austerity package demanded by their lenders.
The IMF's stark warning on Greece's debt came as Prime Minister Alexis
Tsipras struggled to persuade deeply unhappy leftist lawmakers to vote for a
package of austerity measures and liberal economic reforms to secure a new
bailout.
In an interview with state television, he said that although he did not
believe in the deal, there was no alternative but to accept it to avoid
economic chaos.
The IMF study, first reported by Reuters, said European countries would
have to give Greece a 30-year grace period on servicing all its European debt,
including new loans, and a dramatic maturity extension. Or else they must make
annual transfers to the Greek budget or accept "deep upfront haircuts"
on existing loans.
The Debt Sustainability Analysis is likely to sharpen fierce debate in
Germany about whether to lend Greece more money. The debt analysis also raised
questions over future IMF involvement in the bailout and will be seen by many
in Greece as a vindication of the government's plea for sweeping debt relief. A
Greek newspaper called the report, which was initially leaked, a slap in the
face for Berlin.
---- German
Finance Minister Wolfgang Schaeuble said in Brussels on Tuesday that some
members of the Berlin government think it would make more sense for Athens to
leave the euro zone temporarily rather than take another bailout.
More
IMF stuns Europe with call for massive Greek debt relief
'There would have to be a very dramatic extension with grace periods of 30 years on the entire stock of European debt,' the fund says
The International Monetary Fund has set off a political earthquake in Europe, warning that Greece may need a full moratorium on debt payments for 30 years and perhaps even long-term subsidies to claw its way out of depression."The dramatic deterioration in debt sustainability points to the need for debt relief on a scale that would need to go well beyond what has been under consideration to date,” said the IMF in a confidential report.
Greek public debt will spiral to 200pc of GDP over the next two years, compared to 177pc in an earlier report on debt sustainability issued just two weeks ago.
The findings are explosive. The document amounts to a warning that the IMF will not take part in any EMU-led rescue package for Greece unless Germany and the EMU creditor powers finally agree to sweeping debt relief.
This vastly complicates the rescue deal agreed by eurozone leaders in marathon talks over the weekend since Germany insists that the bail-out cannot go ahead unless the IMF is involved.
The creditors were aware of the IMF’s report as early as Sunday, yet choose to sweep it under rug. Extracts were leaked to Reuters on Tuesday, forcing the matter into the open.
More
http://www.telegraph.co.uk/finance/economics/11739985/IMF-stuns-Europe-with-call-for-massive-Greek-debt-relief.html
Greek Bailout Rests on Asset Sale Plan That Already Failed
July 13, 2015 — 10:00 PM BST Updated on July 14, 2015 — 1:21 PM BST
Greece’s last-ditch bailout requires the country to sell 50 billion
euros ($55 billion) of assets, an ambition it hasn’t come close to achieving
under previous restructuring plans.
The government of then-Prime Minister George Papandreou in 2011 set the
same financial goal, which it sought to achieve by hawking airports, seaports,
and beachside real estate. Since then, such deals have yielded just 3.5 billion
euros, according to the state privatization authority.
Making the asset-sale math work as the economy contracts will be
difficult for Greek Prime Minister Alexis Tsipras, who on Monday bowed to
demands from European creditors in exchange for a bailout of as much as 86
billion euros that will keep his nation in the euro zone. Half the money from
asset disposals is earmarked to pay off emergency loans for teetering Greek
banks. They need cash to rebuild their capital buffers and without it may no
longer be able to operate.
“Fifty billion euros is a very unrealistic target,” said Diego Iscaro,
an economist at research firm IHS Inc. “Asset prices have been badly hit by the
economic depression and we do not expect them to significantly recover any time
soon.”
----A 915 million-euro deal to sell the seaside site of the former Athens airport, a plot three times the size of Monaco, has stalled and no money has yet changed hands. Tsipras’s government had said it wanted to halt the transaction on environmental grounds.
----All told, 7.7 billion euros in sales have been agreed, with less than half that actually being paid so far, figures from the Hellenic Republic Asset Development Fund show.
More
http://www.bloomberg.com/news/articles/2015-07-13/greek-bailout-rests-on-asset-sale-plan-that-s-already-failed
Greece Rewrites Economic Textbooks With Austerity on Austerity
July 14, 2015 — 12:18 PM BST
It could be a chapter in an economics textbook: What happens when severe
austerity is imposed on an economy that’s already lost a quarter of its output?
Greece will find out how bad it could be.
The package of measures that Tsipras was strong-armed into agreeing to
early Monday after an all-night summit with euro leaders requires pension curbs
and tax increases, with no promise of debt relief. To prove his commitment to
reforms, Prime Minister Alexis Tsipras must pass those measures through
parliament as early as Wednesday.
The country’s economic slump has already saddled it with a 26 percent
unemployment rate as previous governments implemented budget cuts at the behest
of creditors, and output may fall by 10 percent this year. The International
Monetary Fund admitted in a report two years ago that it underestimated the
recessionary impact of the original 2010 bailout plan.
“If there’s a permanently horrible business environment it just prolongs
the agony,” said Gabriel Sterne, head of macro research at Oxford Economics in
London. “It already is one of the worst post-crisis output performances ever
apart from uber-commodity slumps and wars.”
Greece could also see a rerun of the kind of civil strife seen in
central Athens up to 2012 during parliamentary votes on budget bills. While
protests in recent weeks, both for and against a deal with creditors, have been
peaceful, minor scuffles have broken out with riot police at rallies organized
by anarchist groups. Public sector workers are set to strike on Wednesday,
indicating the first general strike since November might follow.
More
Elsewhere, Asia’s
wobble’s back. If it stays around for long forget about any Greece rescue. The “good
news,” all recent Chinese statistics met or exceeded estimates. The bad news,
no one in Beijing believes China’s statistics. Like Uncle Scam, China has form,
as they say down at New Scotland Yard.
Asian shares pare gains as China markets slump
TOKYO
|
Asian stocks erased most of their gains on Wednesday as Chinese shares
slumped despite upbeat economic data, while the yen was steady after the Bank
of Japan slightly trimmed its economic growth projection.
Investors continued to await other key events, including a Greek
parliamentary vote on austerity measures and congressional testimony by the
U.S. Federal Reserve chief.
MSCI's broadest index of Asia-Pacific shares outside Japan was flat as
Chinese shares skidded, with Shanghai's benchmark composite index down 2.5
percent, and the CSI300 index of the largest listed companies in Shanghai and
Shenzhen falling 2.6 percent.
China's second quarter gross domestic product grew an annual 7.0
percent, steady with the previous quarter and slightly better than analyst
forecasts. Fixed-asset investment and industrial output growth also beat economists'
forecasts.
Further stimulus is still expected after the quarter ended with a savage
correction that shaved about 30 percent off share market value since last
month, before Beijing's support steps stemmed the freefall.
"Stock investors at present care more about what the government
policy toward the market is, whereas the connection between the economy and the
market has somehow loosened," said Zhang Qi, senior stock analyst at
Haitong Securities in Shanghai.
Japan's Nikkei stock index advanced 0.4 percent by midday, as investors
awaited BOJ Governor Haruhiko Kuroda's post-meeting press conference at 0630
GMT.
The BOJ kept monetary policy steady as expected and mostly maintained
its upbeat inflation forecasts, even as it cut its growth outlook on soft
exports and household spending.
More
Through me you pass into the city of woe:
Through me you pass into eternal pain:
Through me among the people lost for aye.
The new sign at Athens airport.
At the Comex silver depositories
Tuesday final figures were: Registered 58.96 Moz, Eligible 120.36 Moz, Total
179.32 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Below, what the UK’s largest newspaper thinks of
the so called Greek rescue. Europe couldn’t be promoting Brexit any harder if
they tried. This version of the EU is clearly failing, but there is absolutely
no sign in continental Europe that anyone at the top cares.
MAX HASTINGS: Deceitful Greek bailout deal is sure to end in tears
Sometimes it is hard to understand the outcomes of
major international summits – but not this one.
The leaders of the eurozone nations have cut a deal
that makes believers in Cinderella and Sleeping Beauty seem like realists.
They have agreed not to reduce Greece’s
unsustainable debt and not to admit that Athens will never implement the
financial reforms its joke prime minister has agreed. They will start
negotiating a £60billion loan package that offers no prospect of reviving the
shattered Greek economy. Greece’s people will remain embittered pensioners on
German charity.
One of the most respected leaders in the world,
Germany’s Angela Merkel, has sacrificed her own credibility in the name of
solidarity, to keep alive the ideal of an indissoluble eurozone.
She is party to two grand deceits. The first is a
refusal to admit that most Greek debt is irrecoverable – this is to avoid being
lynched by her own electorate.
The second is the pretence that the eurozone can
maintain its present membership
Mrs Merkel has flinched from a showdown with her
French counterpart Francois Hollande, who fears that if Greece drops out of the
euro, the financial markets will spotlight the vulnerability of Spain, Ireland,
Portugal – and France.
For the French economy and public finances are in
desperate straits. Only their German-made corset staves off a showdown.
Hollande is celebrating yesterday’s uber-fudge because it does more to save his
own skin than that of any Greek.
Statesmen are supposed to be people capable of
taking a long view. David Cameron, though, gives the impression that he
believes that strategy is about how to get past next Tuesday.
But in comparison, the eurozone leaders make him
seem far-sighted.
If they had been rational, they would have set a
schedule for an organised withdrawal of Greece from the euro, supported by a
write-off of irrecoverable debt. They would have agreed a financial aid package
to assist Greece towards an economically sustainable path, and prevent it from
becoming a failing state.
Instead, we have a solution to nothing.
The Greeks will remain in turmoil. Their finances remain as parlous as ever.
The emergency summit process will simply be repeated when Athens suffers its
next collapse, next week or next month.
More
"Those entrapped by the herd instinct are drowned in the deluges of history. But there are always the few who observe, reason, and take precautions, and thus escape the flood. For these few gold has been the asset of last resort."
Antony C. Sutton
Solar & Related Update.
With events
happening fast in the development of solar power, I’ve added this new section.
Updates as they get reported. Is converting sunlight to usable cheap AC energy
mankind’s future from the 21st century onwards? A quantum computer
next?
Below, global air
pollution adds to the pressure to switch to cleaner electric vehicles.
London Assembly Urges Faster Cuts to Diesel Emissions
July 14,
2015 — 12:01 AM BST
London must cut diesel emissions faster than planned to reduce pollution
levels that breach legal limits, the London Assembly’s Environment Committee
said.Previously announced measures, such as an “Ultra Low Emission Zone” to come into effect in 2020 with a ban on the most polluting diesel cars in parts of the city, should be expanded and brought forward, the committee said in a report published Tuesday.
Government agency Public Health England says thousands of annual deaths in London are caused by pollution. Mayor Boris Johnson announced an air quality strategy in 2010 and is under pressure to comply with European Union rules on pollution following a U.K. Supreme Court ruling in April. The assembly oversees the work of the mayor.
“The drive to diesel cannot be allowed to continue,” said Stephen Knight, the chairman of the committee. “As petrol engines become cleaner with time, it’s becoming clear that diesel emissions are a large part of the problem. We call on the mayor to finally take ownership of the matter in order to help London’s air quality meet legal limits.”
http://www.bloomberg.com/news/articles/2015-07-13/london-assembly-urges-faster-cuts-to-diesel-emissions
The price of solar power drops to an incredible new low (again)
by Cat DiStasio, 07/13/15
A new record low price for solar project
bids has been reached, making it the second time this month that previous cost
barriers were shattered. This time, the news comes from NV
Energy,
a Berkshire Hathaway-owned utility company serving the state of Nevada. The
utility has signed a PPA to purchase electricity from the 100 MW Playa Solar 2
power plant at the amazingly low price of
$0.0387/kWh.
This beats the previous record set just a few
weeks ago in Austin, Texas, by just a fraction of a penny per kWh. What’s clear
is that, as competition heats up to provide less expensive solar power to the
grid, we’re looking at a greener future.
Admittedly, this report has us feeling a bit of deja vu, and it’s justified. Less two weeks ago, we reported Austin, Texas had become the site of the lowest solar power bids on earth at just under $0.04/kWh, beating out the previous low price set in Dubai. And it was true, until it wasn’t. The new, new low price of $0.0387/kWh is approximately 68 percent cheaper than the national average electricity price, according to Clean Technica. Here’s what this means for regular folks: as public utility companies begin seeking out better deals on solar projects—and then hopefully see those prices actually fulfilled in procurement—a massive savings will be passed on to consumers.
more
The monthly Coppock Indicators finished June
DJIA: +98 Down. NASDAQ:
+192 Down. SP500: +127 Down.
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