EU Leaders To Set Tight Timetable On Completing EURO BANKING UNION.

EU Leaders To Set Tight Timetable On Completing EURO BANKING UNION.(Reuters).

* EU wants agreement on bank resolution by end-year

* Wants plan on rewarding reforms by December

* Reforms seen key for sustainable growth in Europe

BRUSSELS – European leaders will confirm on Friday an ambitious timetable for the completion of a banking union, Europe’s biggest project since the euro, and set a December deadline for fleshing out the idea of rewards for structural reforms in the euro zone.Policy-makers believe a banking union in the 18 countries that will share the euro from next year will help increase the flow of credit, boost growth and help prevent financial crises in the future.

Under the union, the European Central Bank will directly supervise the euro zone’s 130 biggest banks from November 2014 and have the power to take over supervision of any of the smaller banks if needed.

Such a Single Supervision Mechanism is to be accompanied by a Single Resolution Mechanism (SRM) – a yet-to-be-created euro zone authority with its own fund that would decide how to wind down or restructure banks that are no longer viable.

As an intermediate step towards the SRM, the euro zone wants to agree on a Bank Resolution and Recovery Directive (BRRD), under which national authorities would coordinate their actions to deal with cross-border bank failures.

Euro zone finance ministers have already agreed what this intermediate law should look like, but they now need to reach a deal on the details of the legislation with the European Parliament.

European leaders meeting in the European Council will urge the parliament on Friday to adopt the BRRD and the Deposit Guarantee Directive by the end of the year, draft conclusions of their meeting, seen by Reuters, showed.

The leaders will also set an end-year deadline for euro zone ministers to move on to the next step, by agreeing on how they want the SRM to work, according to the draft conclusions.

That common position on the SRM would also have to go through the European Parliament – and time is short because the last parliamentary session before elections is in mid-April.

The European Council “underlines the commitment to reach a general approach by the Council (of ministers) on the Commission’s proposal for a Single Resolution Mechanism by the end of the year in order to allow for its adoption before the end of the current legislative period,” the conclusions said.

The European Commission, the EU executive arm, has proposed that it should be the single resolution authority – an idea that Germany opposes.

TESTS, BACKSTOPS, REFORMS AND REWARDS

Meeting all the deadlines appears ambitious, but it would allow the single resolution authority and its fund, which is to be financed from contributions from the banking sector, to become operational in early 2015 – an date favoured by the ECB.

Before the ECB takes over its supervisory duties, it wants to check all the banks’ financial health, by estimating the value of their assets under various adverse scenarios.

Because policy-makers expect the ECB check to show that some banks need more capital, EU leaders will reiterate that governments should be prepared to help if a bank cannot raise additional funds from the market.

“Member states should make all appropriate arrangements, including national backstops, applying state aid rules,” the draft conclusions said.

EU leaders also want to flesh out in December a plan for euro zone countries to sign contracts with European institutions, promising to bring in reforms to make their economies more stable. Under the scheme, countries would get money if they deliver.

“Work will be carried forward to strengthen economic policy coordination, including by agreeing in December on the main features of contractual arrangements and of associated solidarity mechanisms,” the draft conclusions said.

Some policy-makers are sceptical about such contracts, mainly because no money has yet been set aside for “solidarity mechanism”.

Cash-strapped governments would be reluctant to create a new fund of a meaningful size on top of their existing commitments to the EU-wide long-term budget.

“These contractual arrangements are extremely unattractive because they are either not possible to finance or they are a bit condescending – it is a bit like telling the kids what to do and then giving them some pocket money,” one senior policy-maker said.

Related:

Hmmm....Is Luxemburg next? Luxembourg Warns of Investor Flight from Europe

Eurozone Funding Shortfall Rises To Over $4 Trillion, Increases By More Than $500 Billion In A Year...But wait Europe has a Plan.

Eurozone Funding Shortfall Rises To Over $4 Trillion, Increases By More Than $500 Billion In A Year...But wait Europe has a Plan.HT: ZeroHedge; Hat4uk.

Back in April 2012, Zero Hedge pointed out something rather disturbing for the European banking sector and defenders of the European monetary myth: the "aggregate shortfall of required stable funding Is €2.78 trillion" which was the number estimated by the BIS' Basel III rules needed to return to some semblance of balance sheet stability in Europe. More importantly, this was a number so big, it was obvious that there was only one way to deal with it: cover it up deeply under the rug and pray it never reemerged.
What happened next was inevitable: Basel III's implementation was delayed as there was no way Europe's banks could satisfy their deleveraging requirements, while the actual capital shortfall hole became bigger and bigger. Today, 16 months later, the FT discovers what Zero Hedge readers knew long ago in "Eurozone banks need to shed €3.2tn in assets to meet Basel III." In other words, not only has Europe not fixed anything in the past year, but the liquidity tsunami injected by the central banks merely taped over the epic capital shortfall that just got epic-er, increasing from €2.8 trillion to €3.2 trillion, an increase of over half a billion to over $4 trillion in one short year.
Sadly, just like back in April 2012, so now, Europe has no hope of actually addressing this much needed deleveraging and so the can kicking will continue until the number rises to $5 trillion, $6, $7 etc until one day the market's "head in the sand" strategy finally fails and every emperor around the world is found to be naked.
From the FT:

Europe’s biggest banks will have to cut €661bn of assets and generate €47bn of fresh capital over the next five years to comply with forthcoming regulations aimed at reducing the likelihood of another taxpayer funded bailout.
The figures form part of an analysis by the UK’s Royal Bank of Scotland – which singles out Deutsche Bank, Crédit Agricole and Barclays as the banks most in need of fresh capital – highlighting that five years on since the financial crisis, Europe’s banks are still “too big to fail”.
Overall, the region’s banks need to shed €3.2tn in assets by 2018 to comply with Basel III regulations on capital and leverage, according to RBS.
The burden is greatest on smaller banks, which need to shed €2.6tn from their balance sheets, raising fears that lending to the region’s small and medium size enterprises will be sharply reduced as a result.
“There is too much debt still across Europe’s economies and the manifestation of that is on bank balance sheets,” said James Chappell, an analyst at Berenberg bank. “The major issue is that the banks still don’t have enough capital to write down those loans.”
Eurozone banks have already shrunk their balance sheets by €2.9tn since May 2012 – by renewing fewer loans, repurchase and derivatives contracts and selling non-core businesses – according to data from the Frankfurt-based European Central Bank.
Deutsche Bank recently said it would seek to cut its assets by about a fifth over the next two and a half years. Barclays, which announced a £5.8bn rights issue last month, said it wants to shrink its balance sheet by £65bn-£80bn.
Europe’s banking sector assets are worth €32tn, or more than three times the single currency zone’s annual gross domestic product.

Of course, if Europe's banking sector actually does take its deleveraging obligations seriously, what will happen to Europe's economy, where private sector loan creation is already at a record low level, will be nothing short of a stunning contraction, unlike anything seen in the past 5 years. And yet, that is precisely the path Europe most take in order to emerge on the other side with a healthy beating financial heart. That it won't is a given because doing the right thing would mean a complete wipe out for the banker oligarchy. And, as always, it will be the common man who will suffer when the forced deleveraging day finally comes.

The PLAN:

 Revealed: official details on how the EU will steal from us.

Three beaming eurocrats – Barroso, Van Rompuy and Lithuanian Dalia Grybauskaite – emerged triumphant from a session two days ago, in which they mapped out the biggest bank heist in world history. This is to put flesh on the eurozone law hastily passed on August 1st (while EU citizens were on holiday) to deal with the inevitability event of a bank collapse. Under this draft proposal – which many expect to be applied to the entire EU – no depositor big or small will in future be able to feel safe with money deposited in a bank. The Slog now calls for those who represent us, across the entire cultural spectrum of European society – to do something.
In a barely read piece a month ago, the International Business Times reported on the rapidly drafted new EU law for “overhauling its policy on how banks receive bumper bailouts”. Be aware: this is an EU move, not a eurozone move: it is already law (it passed on August 1st) and although for now it applies only to the eurozone, it is an EU law. Hardly anyone has commented on this, but the approach being taken matches word for word the 3-card trick George Osborne used six weeks ago when he said:

“In future, taxpayers will not be called upon to bail banks out. It will be down to the creditors and the owners”.

The most remarkable example of double-speak to date, at the time I pointed out that creditors are taxpayers (they’re account holders, simple as that) and so as the Establishments daren’t ask us for higher taxes to bail out their mates in the banking system, they will take it via, if you like, Direct Debit. It is exactly the same principle of stealing the Troika wishes to apply to Greek private pension funds.
The initial piece at the IBT website noted that ‘Eurozone leaders agreed upon the major policy shift and also confirmed that the new rules will help protect the taxpayer and move the burden of bailing out the banks onto shareholders and junior debt holders.” Again, more bollocks: how will ripping your money out protect you? And note – junior debt holders…aka, you and I.

But yesterday from the German site Deutsche Wirtschafts Nachrichten (German Economic News) came a piece reporting that all bets are off as far as the ‘guarantee of all funds under €100,000′ pledge is concerned. Under the current Lithuanian Presidency of Dalia Grybauskaite (seen left between a Trot and a poet), the proposal as drafted – and almost entirely ignored by the Western media – states as follows:
* Treatment will not be the same regardless of size of deposit, BUT small account holders will have to wait up to four weeks to get their money….’depending on how serious the insolvency is’. During that time, there will be a maximum withdrawal of €100-200 per day – again, perhaps less depending on the seriousness of the failure. (Based on the Cyprus experience, the haircut in the end will be at least 60%).
* The EU Parliament – allegedly – is demanding that deposits of €100,000+ euros should be confiscated within five days. (So much for MEPs offering us some kind of protection from the Sprouts).
* In the event of a banking collapse, all previous government commitments are null and void.  The force majeur of “exceptional circumstances” can lead to ways round such pledges. Part of the new plan suggests savers could also be subject to a ‘penalty tax’ if they have less than € 100,000 in the bank. (So much for Merkel’s promise to the German people).
George Orwell could’ve dropped acid and still not come up with a scheme quite so assumptive and brazenly deranged as this one. It is based on the following insane principles:
1. Putting money in a bank makes every citizen a creditor of that bank, equally prone to confiscation in order to repay….who exactly? The answer is, other banks it owed money. So it’s not really our money after all, it’s the banking sector’s money. After it’s been taxed by the Government, despite the fact that we earned it…it’s really all bankers’ money after all. Unbelievable.
2. If we are prudent enough to keep money in smaller amounts in lots of accounts, we will have to pay a ‘penalty tax’ – well of course we will: I mean, given it’s never our money really – we’re just borrowing it, or something – then quite right too. And because it isn’t really our money, we shall be given strictly limited spending money per day. The brass neck is beyond belief.
3. If you have been seditious enough in your life to actually make quite a lot of money legally, then within five days the money that was never really yours will be taken back by its rightful owners…the bankers….or the Government rescuing the bankers but without doing it in our taxes. Why five days – why not five seconds? I mean, it’s their money: we were just earning it for safe keeping, right? Of course we were.
4. Anything is an exceptional circumstance if they say it is. Even the Nazis in 1933 had to burn down the bloody Reichstag to declare a State of Emergency. In 2013, it requires just one dumb, over-leveraged, f**kwitted bank to collapse under the weight of its CEO’s ego, and we’re all pauperised by Law.
This is no longer a political issue. This is a case of one simple rule by which decent citizens must abide: stealing things is wrong…especially when it’s done to repair your own stupid decisions in the past.

"What was yours is now OURS" - Obama Proposes Retirement Account Limit In First "Wealth Tax" Salvo.

"What was yours is now OURS" - Obama Proposes Retirement Account Limit In First "Wealth Tax" Salvo.(Zerohedge).The witch-hunt against the "rich" (as defined by a random group of people) through the establishment of creeping global capital controls continues. First, it was Europe deciding that €100,000 in savings is the "fair" threshold on savings above which any haircut goes, with Cyprus demonstrating first. and next Italy making it clear local depositors above the threshold will also be impaired in the future; then a group of journalists mysteriously lands millions in top secret files exposing essentially every offshore bank account: a perfectly legal option, however when mixed in with the implication that this money is all tax-evasion gotten it provides for a combustible mix, and now it is America's turn to fire the first shot across the capital control bow, because as part of his proposed budget, Obama plans to set a limit of how much one can spend per year on retirement through tax-preferred retirement plans. As it turns out, according to the Obama administration it is only fair to spend a total of $205,000 in nominal dollars per year on retirement, but not more.
Per The Hill, "The proposal would save around $9 billion over a decade, a senior administration official said, while also bringing more fairness to the tax code." Ah yes, "fairness."
This means that as a result of the artificial limit, the Budget will set a total cap on retirement plans of about $3 million. Anything above that, feel free to please spend on your peas instead of saving, or just invest in Bernanke's stock market ponzi. After all, that is the only artificial indicator Obama has to point to, when "proving" his policies are working.
Of course, once the administration's destructive policies of attempting to inflate away the debt finally funnel through to the economy, and inflation explodes, that $205,000 may or may not be enough to buy a loaf of bread. But why pretend to even think logically or ahead at this point. It's not like anyone has any real plans about the future of the country when the president is actually willing to release statements like this: “Under current rules, some wealthy individuals are able to accumulate many millions of dollars in these accounts, substantially more than is needed to fund reasonable levels of retirement saving."
Why thank you Mr. President for telling the people what you consider "reasonable." 
Of course, it would be so much below you to simply go on the record as saying the rich (arbitrarily chosen as those who have over $1 million in assets... or $500,000... or $50,000 - who knows, it's "arbitrary") are now fair game and all those who recently received an Obama phone would be legally excused if they were to accidentally eat them. Because all is fair in hate and class warfare.
And speaking of hate, that is precisely the cover that Obama will use to pass his proposal:

The most prominent taxpayer with a multimillion-dollar IRA is Romney, the 2012 Republican presidential nominee and co- founder of Bain Capital LLC. Romney disclosed in public filings during the campaign that his retirement account held between $18.1 million and $87.4 million. At one point, the maximum exceeded $100 million.

IRAs have evolved from a retirement-planning technique into an estate-planning tool for some wealthy families because tax laws allow the accounts to be passed on to heirs, said Ed Slott, an IRA specialist and certified public accountant based in Rockville Centre, New York.

“Over the last election it hit a critical mass when a lot of people found out that Romney had $100 million in his IRA,” Slott said. “People thought, how on earth did that happen? I think that was the tipping point.”

The Romney campaign didn’t explain how he amassed that much money in an IRA when contribution limits are much lower. Most taxpayers can contribute a maximum of $5,500 for 2013. Older workers, self-employed workers and those who save through 401(k)-style plans have higher caps and can roll those accounts into IRAs.

One possibility is that Romney included Bain investments valued at close to nothing that later grew exponentially. The value would increase tax-free in the retirement account and would be subject to taxation at ordinary income tax rates when taken out.

Of course, the outcry from those who are stupid enough to actually save cash instead of blowing it all on iPhones and other worthless gimmicks will be loud, but since they are outnumbered about 9 to 1 by those who have zero financial planning skills, zero savings but lots of debt, will be promptly drowned out.
We wonder if the administration be as forceful in limiting the net present value of public worker retirement pensions (funded by other taxpayers of course), already over $500,000/year in some cases, with the same passion as it has in going after private wealth. Or maybe because the purchasing of votes with other people's money might be impaired, Obama will just let this slide?
Finally, like everything out of the administration, there isn't actually a plan on how to do this:

The administration’s statement didn’t explain in detail how the proposal would work. The cap would apply to the total of all of an individual’s tax-favored retirement accounts.

So all up in the air and very much unknown. But what is very known is that the tax on the wealthy, which by definition has to be global in nature, is rapidly coming, and the only question is at what threshold of total taxable financial assets it will be arbitrarily set.
However since we predicted all of this in September of 2011, and did some math to go along with it, expect to hand over anywhere between 30% and 40% of your hard earned assets to whatever parasitic government happens to be your host (this of course, after being taxed on the cash flows used to generates these assets).
Because in the new socialist international normal, "it's only fair."

Cyprus-Style “Bail-Ins” Are Proposed In The New 2013 Canadian Government Budget!

Cyprus-Style “Bail-Ins” Are Proposed In The New 2013 Canadian Government Budget! HT: Economic Collapse. By Michael Snyder.

The politicians of the western world are coming after your bank accounts. In fact, Cyprus-style “bail-ins” are actually proposed in the new Canadian government budget. 

When I first heard about this I was quite skeptical, so I went and looked it up for myself. And guess what? It is right there in black and white on pages 144 and 145 of “Economic Action Plan 2013″ which the Harper government has already submitted to the House of Commons. 

This new budget actually proposes “to implement a ‘bail-in’ regime for systemically important banks” in Canada. “Economic Action Plan 2013″ was submitted on March 21st, which means that this “bail-in regime” was likely being planned long before the crisis in Cyprus ever erupted. So exactly what in the world is going on here? 

In addition, as you will see below, it is being reported that the European Parliament will soon be voting on a law which would require that large banks be “bailed in” when they fail. In other words, that new law would make Cyprus-style bank account confiscation the law of the land for the entire EU. 

I can’t even begin to describe how serious all of this is. From now on, when major banks fail they are going to bail them out by grabbing the money that is in your bank accounts. This is going to absolutely shatter faith in the banking system and it is actually going to make it far more likely that we will see major bank failures all over the western world.

What you are about to see absolutely amazed me when I first saw it. The Canadian government is actually proposing that what just happened in Cyprus should be used as a blueprint for future bank failures up in Canada.
The following comes from pages 144 and 145 of “Economic Action Plan 2013″ which you can find right here. Apparently the goal is to find a way to rescue “systemically important banks” without the use of taxpayer funds…

Canada’s large banks are a source of strength for the Canadian economy. Our large banks have become increasingly successful in international markets, creating jobs at home.
The Government also recognizes the need to manage the risks associated with systemically important banks — those banks whose distress or failure could cause a disruption to the financial system and, in turn, negative impacts on the economy. This requires strong prudential oversight and a robust set of options for resolving these institutions without the use of taxpayer funds, in the unlikely event that one becomes non-viable.

So if taxpayer funds will not be used to bail out the banks, how will it be done? Well, the Canadian government is actually proposing that a “bail-in” regime be implemented…

The Government proposes to implement a “bail-in” regime for systemically important banks.This regime will be designed to ensure that, in the unlikely event that a systemically important bank depletes its capital, the bank can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital. This will reduce risks for taxpayers. The Government will consult stakeholders on how best to implement a bail-in regime in Canada. Implementation timelines will allow for a smooth transition for affected institutions, investors and other market participants.

So if the banks take extreme risks with their money and lose, “certain bank liabilities” (i.e. deposits) will rapidly be converted into “regulatory capital” and the banks will be saved.
In other words, the banks will just be allowed to grab money directly out of your bank accounts to recapitalize themselves.
That may sound completely and utterly insane to us, but this is how things will now be done all over the western world.
Sometimes a “bail-in” can be done by just converting unsecured debt into equity, but as we just saw in Cyprus, often when there is a major bank failure a lot more money is required to “fix the banks” than can possibly be raised by converting unsecured debt into equity. That is when it becomes very tempting to dip into uninsured back accounts.Read the full story here.

Hmmm....Is Luxemburg next? Luxembourg Warns of Investor Flight from Europe

Hmmm....Is Luxemburg next? Luxembourg Warns of Investor Flight from Europe.(Spiegel).
The debate over this week's "bail in" of bank account holders in Cyprus as part of the country's debt crisis bailout is continuing to simmer in Europe. In Luxembourg, Finance Minister Luc Frieden has warned that the example set in Cyprus by taxing people holding €100,000 ($129,000) or more in their accounts could drive investors out of Europe.

"This will lead to a situation in which investors invest their money outside the euro zone," he told SPIEGEL. "In this difficult situation, we need to avoid anything that will lead to instability and destroy the trust of savers."

Earlier this week, Euro Group President Jeroen Dijsselbloem sparked an enormous controversy after stating that the solution found in Cyprus could be applied throughout the euro zone in the future.

The remark triggered immediate criticism from his predecessor as head of the Euro Group, Luxembourg Prime Minister Jean-Claude Juncker. "It disturbs me when the way in which they tried to resolve the Cyprus problem is held up as a blueprint for future rescue plans," Juncker told German public broadcaster ZDF earlier this week. "It's no blueprint. We should not give the impression that future savings deposits in Europe might not be secure. We should not give the impression that investors should not keep their money in Europe. This harms Europe's entire financial center."

Hmmmm.....yesterday Reuters: "Hands off our banking sector, Luxembourg tells euro zone." seems they know they're on the 'Hit List'.Read the full story here.

Related: MFS on Wednesday - "The Great Euro Bank Robbery" - Hands off our finance sector, Luxembourg warns

Hmmmm.....As i wrote on Monday: Reading material Here:

Euroclear Bank is subject to effective regulation, supervision and oversight of the NBB and FSMA, but cooperation with the Luxembourg authorities should be improved.

The legal framework provides the Belgian authorities with sufficient powers to obtain timely information and induce change.
However, as Euroclear Bank is in competition with the Luxembourg based Clearstream Banking Luxembourg—which offers similar settlement and banking services––close cooperation with the Luxembourg authorities is needed to avoid any competition on risk management frameworks.

As both entities are highly relevant for the global financial stability the Belgian and Luxembourg authorities should evolve from the existing cooperation towards a cooperative framework that would allow them to take common decisions and implement these simultaneously in both entities.

The plans to include Euroclear Bank on the list of eligible banks for the SSM may further contribute to a level playing field.

77. The national securities depositories of Belgium, France, and the Netherlands, that share a common IT platform provided by the Euroclear Group, are subject to effective regulation, supervision, and oversight of the Belgian, Dutch, and French authorities, despite the fact that the legal frameworks differ substantially between the three countries. The cooperation between the different authorities is effective and contributes to the financial stability in Belgium, France, and the Netherlands. Crisis management frameworks are in place that are regularly tested and updated

Video - Ezra levant "Eurozone fail."

"Happy Easter" The EU Took €100 Million from the Cypriot Greek Orthodox Church.

"Happy Easter" The EU Took €100 Million from the Cypriot Greek Orthodox Church.(Cyprus Mail).

This so-called “bail-in” designed only to protect the hedge funds of the European and British money center banks scalped the one entity which could help the poor during the nations transition from quasi-capitalism to European serf state. From the article in today’s paper:

The Church stands to lose more than 100 million euros in the bailout deal reached with international creditors early Monday, its leader Archbishop Chrysostomos said.

“The capital owned by the Church, which was over 100 million euros, has been lost,” the archbishop told reporters.

“There will be many difficulties, some will lose their jobs, the hungry will be multiplied and the Church has to take care of people,” he added.

Granted, I’m sure they won’t suffer at the top of the church as in the old Vatican tradition, the Greek Orthodox Church has been known to enjoy ornate lifestyles and investments which per the article range from breweries (yes, that’s correct) to hotels and resorts. The bigger picture is that the European Union using the power of the ECB and IMF combined has now found a formula not just to create vassal states, but to seize the assets of the Church, something the atheistic Marxists which created the Eurozone have fantasized about for over a decade.

This action should make the Vatican extremely nervous about their massive Italian and Spanish property holdings in those nations.

John Galt: When this program is translated into an American version, look for only those “Federally approved” institutions to be exempt from property and capital seizure. Three is no better formula to force a religious institution to pay taxes and force compliance with the political elite’s prevailing point of view to extinguish the concept of freedom of expression.Read the full story here.

"The Great Euro Bank Robbery" - Cyprus Popular Bank’s large deposit holders could face 80% cut.

"The Great Euro Bank Robbery" - Cyprus Popular Bank’s large deposit holders could face 80% cut.(RT).

Cyprus Popular Bank’s richest clients with uninsured deposits over €100,000 could get only 20% of their money, as the government eyes to wind down its operations, says Finance Minister Michalis Sarris.

"Realistically, very little will be returned," Sarris said in a televised interview with state broadcaster CyBC, adding that it could also take years before those depositors see any of their money back.

“Certainly, for depositors above 100,000 euros it could be a very significant blow," Sarris concluded.

Earlier it was reported the losses facing large depositors at Bank of Cyprus could reach as much as 40%.

The island’s second biggest lender, Cyprus Popular Bank (Laiki), has faced the most serious troubles amid the crisis. Its healthy part will merge into the Bank of Cyprus transferring a debt of 9.2 billion euros and leaving around 8 thousand employees in Cyprus and abroad without work.

Russian companies and businessmen, who between 2007 and 2011 transferred around $135 billion to Cyprus seem to be the most affected.

On Wednesday, the Russian state-owned Bank for Development and Foreign Economic Affairs announced plans to work out a way to help Russian firms with money in Cyprus. Usually the bank helps only too-big-to-fail companies.

Meanwhile, the US-based credit agency Moody's has said the Cyprus crisis puts extra pressure on the Eurozone's downgrade-threatened sovereign ratings, and shows policy makers overestimated their ability to contain the crisis. Market analysts fear that could set a dangerous precedent for future rescue efforts and make the region more prone to bank runs if depositors in other debt-strained countries think their money is no longer safe.Hmmmm......At which time will people say "ENOUGH" of that Euro communism?I hope people with deposits in Luxembourg learned their lesson and have an Easter 'banking trip' to Luxembourg. Read the full story here.

"The Great Euro Bank Robbery" - Hands off our finance sector, Luxembourg warns

"The Great Euro Bank Robbery" - Hands off our finance sector, Luxembourg warns.(HD).

Luxembourg railed on Wednesday against what it fears is a new eurozone position that oversized finance sectors must be scaled back in line with national economic output following the Cyprus banking debacle.

Former Eurogroup chairman Jean-Claude Juncker's government is "concerned about recent statements and declarations that were made since the crisis in Cyprus sharpened", a news release said.

Specifically, it rejects "general assessments of the size of the financial sector in relation to a country's GDP (gross domestic product) and the alleged risks this poses for economic and fiscal sustainability".

The government said the Luxembourg finance sector acts as "an important gateway for the euro area by attracting investments and thus contributing to the general competitiveness of all member states".

Juncker's successor as eurozone head, Dutch Finance Minister Jeroen Dijsselbloem, has said that the Cypriot financial sector was too big compared with the country's overall gross domestic product, a problem that has forced Cyprus to break up one Cypriot bank and downsize another in exchange for an international bailout worth 10 billion euros ($13 billion).

While few eurozone economies depend on the banking sector as heavily as Cyprus does, Berenberg Bank economists noted on Monday that bank assets in three other eurozone countries were bigger as a percentage of gross domestic product than in Cyprus, where they amounted to more than 700 percent of GDP in 2011.

In Luxembourg, the percentage was an astounding 2,500 percent, the economists said, while in Ireland they were more than 800 percent and in Malta close to 800 percent. The eurozone average was given as 360 percent.

"The financial sector is oversized compared to the rest of our economy," a senior Luxembourg government official nevertheless told AFP on condition of anonymity.

And yet, European Union Markets Commissioner Michel Barnier was quick to insist earlier this week that "the problem is not Luxembourg -- it was certain banks in Ireland, in Spain, in Portugal." One of six founding members of the EU, Luxembourg is one of just four eurozone states -- alongside Germany, the Netherlands and Finland -- to have maintained a triple-A classification with all three major global credit rating agencies Moody's, Fitch and Standard and Poor's.

Its debt-to-GDP ratio is in the region of 20 percent -- compared to a target 120 percent for bailed-out partners -- and its deficit is well within the regularly-ignored EU threshold of three percent.

Yet Luxembourg has increasingly come under an EU microscope in post-global financial crisis legislative clean-up action, primarily for its culture of banking secrecy.Read the full story here.

Hmmmm.....As i wrote on Monday: Reading material Here:

Euroclear Bank is subject to effective regulation, supervision and oversight of the NBB and FSMA, but cooperation with the Luxembourg authorities should be improved.

The legal framework provides the Belgian authorities with sufficient powers to obtain timely information and induce change.
However, as Euroclear Bank is in competition with the Luxembourg based Clearstream Banking Luxembourg—which offers similar settlement and banking services––close cooperation with the Luxembourg authorities is needed to avoid any competition on risk management frameworks.

As both entities are highly relevant for the global financial stability the Belgian and Luxembourg authorities should evolve from the existing cooperation towards a cooperative framework that would allow them to take common decisions and implement these simultaneously in both entities.

The plans to include Euroclear Bank on the list of eligible banks for the SSM may further contribute to a level playing field.

77. The national securities depositories of Belgium, France, and the Netherlands, that share a common IT platform provided by the Euroclear Group, are subject to effective regulation, supervision, and oversight of the Belgian, Dutch, and French authorities, despite the fact that the legal frameworks differ substantially between the three countries. The cooperation between the different authorities is effective and contributes to the financial stability in Belgium, France, and the Netherlands. Crisis management frameworks are in place that are regularly tested and updated.

UKIP leader Nigel Farage: "Europe is now in the grip of fanatics, I don’t just want Britain out of the EU, I want the rest of Europe out of the EU.”

UKIP leader Nigel Farage: "Europe is now in the grip of fanatics, I don’t just want Britain out of the EU, I want the rest of Europe out of the EU.”HT: TundraTabloids.

There can’t be many senior politicians who are able to pack a hall on a freezing, snowy night and then, when the meeting’s over, roll into the local pub and hold fort at the bar for the next hour and a half.

Step forward, Nigel Farage, leader of the UK Independence Party.

It was standing room only at the Brandon Community Hall in Suffolk. More than 300 people crammed into the room. Another 20 or 30 people stood in the corridor straining to listen and the police were called to direct the traffic.

“I thought UKIP was only for eccentrics, fruitcakes and gadflies, so I’m glad so many of you are members of the club,” joked Mr Farage, referring to a comment by Prime Minister David Cameron, while pushing his way to the front.

Mr Farage is not going to let that one go in a hurry and Mr Cameron’s words must be ringing in his ears when an events like this attract so much attention.“The fact that there are so many of you here shows that there’s a change going on.”

The UKIP leader believes that the Westminster parties have lost touch with the concerns and aspirations of ordinary people and he thinks UKIP can fill the gap.

“We’re plain spoken, we’re not bound by political correctness and we’re talking about the kind of things that people are talking about around their dining room tables,” he told us later.

 "Europe is now in the grip of fanatics," said the MEP. "I don't just want Britain out of the EU, I want the rest of Europe out of the EU." Mr Farage criticised the deal to rescue the Cyprus economy, involving a levy on bank deposits. "It is deeply worrying and sets a dangerous precedent," he said and advised anyone with a second home in Europe or savings in a European bank to think very carefully.Read the full story here.

Overseas lending, bank exposure to Cyprus around $100 billion: BIS, Moody's.

Overseas lending, bank exposure to Cyprus around $100 billion: BIS, Moody's.(Reuters).(Compiled by Steve Slater, Marc Jones and Edward Taylor; Editing by David Cowell). Overseas lenders, excluding those in Russia, had $59.2 billion of outstanding loans to Cyprus at the end of September, according to Bank for International Settlements (BIS) data.

BIS statistics, the only ones to chart cross-border lending around the world, do not include loans from Russia. Ratings agency Moody's estimates Russian bank loans to Cyprus-based companies of Russian origin were $30-40 billion.

The BIS data show lenders from Greece and Germany have the biggest exposures to Cyprus of the reporting countries.

Cyprus on Monday reached a 10 billion euro ($13 billion) rescue plan to avoid economic meltdown after more than a week of intense scrutiny on the island's future.

Some banks disclose their loans to Cyprus, but the European Banking Authority has not forced banks to release a breakdown since a 2011 stress-test.Read the Full story here.

COUNTRY EXPOSURE TO CYPRUS (in Billions of dollars)

Russia* 30-40

Greece 16.4

Germany 7.6

France 2.5

Switzerland 2.2

United Kingdom 2.2

Netherlands 1.9

Austria 1.7

United States 1.7

Italy 1.6

Sweden 1.4

'до свидания' - Have The Russians Already Quietly Withdrawn All Their Cash From Cyprus?

'до свидания' - Have The Russians Already Quietly Withdrawn All Their Cash From Cyprus?(ZeroHedge).By Tyler Durden.

Yesterday, we first reported on something very disturbing (at least to Cyprus' citizens): despite the closed banks (which will mostly reopen tomorrow, while the two biggest soon to be liquidated banks Laiki and BoC will be shuttered until Thursday) and the capital controls, the local financial system has been leaking cash. Lots and lots of cash.
Alas, we did not have much granularity or details on who or where these illegal transfers were conducted with. Today, courtesy of a follow up by Reuters, we do.
The result, at least for Europe, is quite scary because let's recall that the primary political purpose of destroying the Cyprus financial system was simply to punish and humiliate Russian billionaire oligarchs who held tens of billions in "unsecured" deposits with the island nation's two biggest banks.
As it turns out, these same oligrachs may have used the one week hiatus period of total chaos in the banking system to transfer the bulk of the cash they had deposited with one of the two main Cypriot banks, in the process making the whole punitive point of collapsing the Cyprus financial system entirely moot.
From Reuters:

While ordinary Cypriots queued at ATM machines to withdraw a few hundred euros as credit card transactions stopped, other depositors used an array of techniques to access their money.

No one knows exactly how much money has left Cyprus' banks, or where it has gone. The two banks at the centre of the crisis - Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus - have units in London which remained open throughout the week and placed no limits on withdrawals. Bank of Cyprus also owns 80 percent of Russia's Uniastrum Bank, which put no restrictions on withdrawals in Russia. Russians were among Cypriot banks' largest depositors.

So while one could not withdraw from Bank of Cyprus or Laiki, one could withdraw without limitations from subsidiary and OpCo banks, and other affiliates?
Just brilliant.
And if there was any doubt that the entire process of destroying one entire nation was simply to punish Cyprus, it can be completely cleared away now:

ECB officials contacted Latvia, another EU country that has received large Russian deposits, to warn authorities against taking in Russian money fleeing Cyprus, two sources familiar with the contacts said.

"It was made clear to our Latvian friends that if they want to join the euro, they should not provide a haven for Russian money exiting Cyprus," a euro zone central banker said.

If one thinks there is any material Russian cash therefore left in Cyprus with this epic loophole in place, we urge them to make a deposit in the insolvent nation. One person who certainly will not be allocating any of his money into Bank of Cyprus is German FinMin Schaeuble:

German Finance Minister Wolfgang Schaeuble said the bank closure had limited capital flight but that the ECB was looking closely at the issue. He declined to provide figures.

Perhaps because if he did, it would become clear that the only entities truly punished by this weekend's actions are not evil Russian billionaires, but small and medium domestic companies, and other moderately wealthy individuals, hardly any of them from the former "Evil Empire."

Companies that had to meet margin calls to avoid defaulting on deals were granted funds. Transfers for trade in humanitarian products, medicines and jet fuel were allowed.

The stealth withdrawals by Russians of course means that the two megabanks are now utterly drained of capital, and that the haircuts on those who still have unsecured deposits with the two banks will be so big it will likely mean a complete wipeout of all deposits. As in 0% recovery on your deposits!
In other words, by now any big Russian funds in Cyprus are long gone, and the only damage accrues to the locals: for one reason because their money over the critical EUR100K threshold has been "vaporized", and for another because the marginal driving force and loan demand creator in Cyprus, the Russians, are gone and are never coming back again.
This is what passes for monetary real-politik in the New Normal - an entire nation becomes collateral when pursuing a wealthy group of people. And the "wealthy group" is victorious in the end despite everything...
If we were Cypriots at this point we would be angry. Very, very angry.Read the full story here.

Matt O’Brien‏@ObsoleteDogma

Cyprus is done as a tax haven. Latvia has been warned to stop if it wants to join the euro. Luxembourg & Malta know they could get Cyprus’d.



Reading material Here:

Euroclear Bank is subject to effective regulation, supervision and oversight of the NBB and FSMA, but cooperation with the Luxembourg authorities should be improved.

The legal framework provides the Belgian authorities with sufficient powers to obtain timely information and induce change.
However, as Euroclear Bank is in competition with the Luxembourg based Clearstream Banking Luxembourg—which offers similar settlement and banking services––close cooperation with the Luxembourg authorities is needed to avoid any competition on risk management frameworks.

As both entities are highly relevant for the global financial stability the Belgian and Luxembourg authorities should evolve from the existing cooperation towards a cooperative framework that would allow them to take common decisions and implement these simultaneously in both entities.

The plans to include Euroclear Bank on the list of eligible banks for the SSM may further contribute to a level playing field.

77. The national securities depositories of Belgium, France, and the Netherlands, that share a common IT platform provided by the Euroclear Group, are subject to effective regulation, supervision, and oversight of the Belgian, Dutch, and French authorities, despite the fact that the legal frameworks differ substantially between the three countries. The cooperation between the different authorities is effective and contributes to the financial stability in Belgium, France, and the Netherlands. Crisis management frameworks are in place that are regularly tested and updated.

Cyprus Fallout: Moscow Accuses Euro Zone of Theft -- and Worse.

Cyprus Fallout: Moscow Accuses Euro Zone of Theft -- and Worse.(Spiegel).

Russia has sharply criticized the bailout deal for Cyprus, with Prime Minister Dmitry Medvedev accusing the EU of theft. Russian state television even likened the forced levy imposed on wealthy investors -- many of them Russian -- to the expropriation of Jews by Nazi Germany.

The verdict of Russian state television on Europe's effort to save Cyprus was damning. The last week "will enter the history books of the EU as a destructive one," said Dmitry Kiselev, the presenter of the popular news program Vesti Nedili on the Rossiya channel.

Kiselev heaped criticism on the forced levy to be imposed on bank deposits in Cyprus. He said the last time a Western European government proceeded so recklessly was when Adolf Hitler expropriated the Jews.
Nazi propaganda at the time described the money held by Jewish people as "dirty," said Kiselev. That was precisely how Europe was talking about Russian assets deposited in Cyprus, he added.

"The new world order is being founded against Russia, at Russia's costs and on the rubble of Russia," said a Rossiya correspondent from the Mediterranean island nation.

The Kremlin feels it has been sidelined in the tug-of-war over the Cypriot bailout, European Commission President José Manuel Barroso visited Moscow for talks last Friday, but just a few days later, Europe's new attempt to avert a financial meltdown in Cyprus has elicited fierce criticism from Moscow. Read the full story here.

"Dijselbloem and the Forty Euro Thieves? - "Cyprus Deal Is A New Template."

"Dijselbloem and the Forty Euro Thieves? - "Cyprus Deal Is A New Template."(IW).

Today, in an interview with Reuters and the Financial Times, Dutch Finance Minister and President of the Eurogroup of euro zone finance ministers Jeroen Dijsselbloem said that the Cyprus deal will serve as a template for future bank restructurings in the euro zone.

Reuters reporter Luke Baker has the scoop:

"What we've done last night is what I call pushing back the risks," Dutch Finance Minister Jeroen Dijsselbloem, who heads the Eurogroup of euro zone finance ministers, told Reuters and the Financial Times hours after the Cyprus deal was struck.

"If there is a risk in a bank, our first question should be 'Okay, what are you in the bank going to do about that? What can you do to recapitalise yourself?' If the bank can't do it, then we'll talk to the shareholders and the bondholders, we'll ask them to contribute in recapitalising the bank, and if necessary the uninsured deposit holders," he said.

European bank stocks are extending their losses today on the news.However, that appears to be somewhat by design.

FT correspondent Peter Spiegel published more comments from the interview with Dijsselbloem that seem to indicate this:

But he said that investor skittishness could ultimately make the financial sector healthier since it would raise the cost of financing for unsound banks.

“If I finance a bank and I know if the bank will get in trouble, I will be hit and I will lose money, I will put a price on that,” Mr Dijsselbloem said. “I think it is a sound economic principle. And having cheap money because the risk will be covered by the government, and I will always get my money back, is not leading to the right decisions in the financial sector.”

In short, though euro area leaders have stressed that the Cyprus deal was a special case, it's becoming increasingly clear in the wake of negotiations that this is the new normal for euro zone bank restructurings.Hmmmm.......Sounds like Government bonds are to become worthless, after they first 'Forced' the pension funds in Europe to invest at least 20% of their assets in Gov Bonds of their country of origin. Read the full story here, more here.

Interesting reading material here.

In our view, two more elements are necessary to stabilize the shaky foundations of the Euro. First, some sovereigns are undoubtedly insolvent. A credible, orderly, bankruptcy procedure for sovereigns that minimizes the risk of contagion is needed.
Second, the financial system of the Eurozone is too fragile and contains too many systemically risky institutions.A Eurozone(wide banking resolution regime,able to prevent contagion and protect European depositors, must be put in place.)

Are The Europeans About To Start The Second Half Of Our Great Depression?

Are The Europeans About To Start The Second Half Of Our Great Depression?(ZeroHedge).“Just when we think the worst is over – and let’s face it we have been in this crisis for five years – we get the second half; are the Europeans about to start the second half our Great Depression with massive bank runs” are the Jaws-music-inspired words that recent media-favorite (yes, us too) Niall Ferguson uses in an interview with CBC. His main concern is that this kind of (bank-run) event can quickly spiral out of the control of even the ECB as he uncomfortably conjures the image of the initial US stabilization that occurred in 1930 to May 1931 only to be knocked back into a greater depression by the failure of Credit-Anstalt, which set off bank failures and eventually defaults in 1932 on many government debts. The deposit run potential is the single-biggest reason to care about Greek-exit – in itself it is not large enough economically to interfere with global growth but it is the message and contagion that it sends that is critical in bringing forth a pan-European banking crisis and implicitly spilling over to the US and Asia via global trade and banking transmission channels. An excellent brief interview that summarizes the exact fears that face Europe and implicitly the US, explains the rather simple solution of fiscal federalism and the fact that today’s German politik is very different from 1989′s Helmut Kohl-era with regard to their commitment to the Federal outcome. His conclusions are worrisome. Germany is the key – and there is not a good understanding of financial markets in Berlin.

Europe is a part of North America's destiny because the financial systems are so intertwined - and remember even the all-knowing Fed massively under-estimated the second-order effects of Lehman.

"It's a total fantasy to think that the meltdown that I am discussing that could happen in a matter of weeks would not have a major impact on North America's prospects of sustained recovery."

Read the full story here at ZeroHedge.

MFS - The Other News

                       Morning Posting.

• Syria Live Blog - June 27 Here .(Al-Jazeera).

• Libya Live Blog - June 27 Here (Al-Jazeera). 

• Yemen Live Blog - June 27 Here. (Al-Jazeera).

• Updated !Earthquakes in the last 24 hours in the world seismic activity today.More info here.

• Japan - Latest official Situation Update No. 134.Source : Here .

                                                                      

• Japan : For the most accurate info on the nuclear disaster go to : Paul Langley's Nuclear History Blog.Here.

• Breaking News: Flood Wall fails At Fort Calhoun Nuclear Power Plant.(Intelhub).A flood wall at the Fort Calhoun Nuclear Power Plant has failed, leading many to speculate as to the consequences.Omaha.com. Photos of the flooding at the Fort Calhoun Nuclear Power Plant.floodwaters surrounded several buildings at the Fort Calhoun Nuclear Station early Sunday morning after a water-filled wall collapsed .The plant, about 19 miles north of Omaha, remains safe, Omaha Public Power District officials said Sunday afternoon.The U.S. Nuclear Regulatory Commission is monitoring the Missouri River at the plant, which has been shut down since early April for refueling. The 2,000-foot berm collapsed about 1:25 a.m. Sunday due to “onsite activities,” OPPD officials said. The Aqua Dam provided supplemental flood protection and was not required under NRC regulations. Considering the face that the NRC has a long history of cover ups, it seems safe to say that whether or not the plant was safe, the NRC would claim the situation is under control. Another report from the Associated Press quotes the NRC as well.FORT CALHOUN, Neb. (AP) – A berm holding back floodwater at the Fort Calhoun Nuclear Station has collapsed.The U.S. Nuclear Regulatory Commission says it’s monitoring the Missouri River flooding at the plant, which has been shut down since early April for refueling.The 2,000-foot berm collapsed about 1:30 a.m. Sunday, allowing the swollen river to surround two buildings at the plant. The NRC says those buildings are designed to handle flooding up to 1014 feet above sea level. The river is at 1006.3 feet and isn’t forecast to exceed 1008 feet.Recent independent radiation reports have shown normal background radiation levels which indicates that there most likely has not been a release of radiation from the plant, at least not yet.Mike Rivero of WhatReallyHappened.com has written a much more likely analysis.The external power we were told could not fail … has failed. Fort Calhoun’s cooling system is running on the emergency backup generators. They have fuel for 88 hours (less the time they have already been operating) unless the flood waters short out and shut down the generators or pumps.So basically, the nuclear power plants the US Government told us were safe are in danger of a major radiation release because the heavy snow pack the US Government told us was a thing of the past has produced heavy flooding which has overwhelmed toe flood controls systems the US Government assured us did not need repairs or upgrades.That about sum it up?Hmmmmm..."Never let a good crisis go to waste" watch and see.Read and see the full story here.More here.

• Return of Helen Thomas?She claims to have reapplied for White House press credentials.(DailyCaller).She might be gone, but she’s not completely forgotten. And now as a columnist for the Fall Church (Va.) News-Press, she might be making a comeback. In an appearance at the Busboys & Poets bookstore in Washington, D.C. on Sunday afternoon, embattled former Hearst newspapers columnist Helen Thomas, once known as the dean of the White House press corps, said she misses her spot in the White House briefing room.“Nothing can replace being there when you’re a reporter,” Thomas said. “Seeing with your own eyes — no, nothing can replace that. I was very lucky to cover history for so long.”Thomas lost her spot in 2010 after making some ill-advised remarks some regarded as anti-Semitic. Anas “Andy” Shallal, the owner of Busboys and Poets and moderator for her appearance Sunday, followed up by asking her if she had reapplied for those credentials. According to Thomas, she said she had but hadn’t gotten an official response and assumed she had been denied.“In a back way,” Thomas said. “I’ve been denied – I think so, I never heard.”Later in her appearance, Thomas was asked for her insight on the state of the country going forward. The Falls Church News-Press columnist said she was troubled, but not just about the domestic state of the nation, but by the state of the entire globe – more so than any other time in her life.“I think our country — world, not just the country, has never been in worse shape,” she said. “Even World War II – I went through the Great Depression, World War II, Vietnam, Korea, Vietnam and now Iraq and Afghanistan – what the hell is going on? Don’t we ever learn anything? I think that we are — there is no inspiration from the top. President Obama doesn’t have enough courage to do the right thing. And I think – there is no real leadership in this country and there is no inspiration. And I am shocked.”Hmmm.....And what might be 'The right thing'.... remove the state of Israel?Grab power in America?Read the full story here.

• America’s Fork In The Road,the moment of truth approaches.(TheBrusselsJournal).Obama needs more money urgently. This end of July all the (borrowed) money of the Federal Government is spent. The law sets the debt ceiling at a bit over 14 trillion dollars. Obama is unable to borrow more. He can’t push the US deeper in debt. Very soon, he won’t be able to pay for current expenses. That’s why he’s asking the Congress to raise the debt ceiling with at least two trillion dollars. The Republicans, in control of the House, accept to raise the ceiling under two conditions. First: only if the government is ready to cut spending over the next 10 years with a sum at least equal to the amount of the raise. Second: if taxes are not raised.

On Thursday, the negotiations collapsed between Obama and his fellow Democrats on one side, and the Republicans in Congress on the other side. Reason: the Democrats are only willing to cut some spending if they are allowed to raise the taxes. This deadlock obliges Obama to take initiative, to formulate a proposal. But, he hates making a first move. He prefers to ‘lead from behind’. He likes others to do the hard work. Recent examples of this attitude: Libya, Obamacare, etc.

Hard choices

If Obama and the Republican Congress don’t reach an agreement, Obama will have to make some hard choices.

For example:

1. Expiring US treasury bonds, and/or interest on these bonds, are not paid out any more. Consequences for the world: the faith in the value of the dollar disappears, and the dollar crashes, creating a Zimbabwean inflation in the US. For him: he can abolish personal freedom and expand government power.
2. Retirees don’t receive their monthly check any more, and/or doctors are not compensated any longer to take care of these retirees. Consequences for us: revolution. For him: he’s able, with the help of the press, to blame the Republicans for the mess, and secures his reelection in 2012.
3. He finally abolishes a number of Government Departments, and sacks tens of thousands of bureaucrats. Consequences for us: a general strike of the bureaucrats, and partial blockage of government services. We are freed from a lot of government intrusion, and the government finally starts saving. For him: he loses his staunchest supporters, the unions of government employees. This choice flies in the face of his collectivist persuasion.
4. He withdraws immediately all troops from Iraq and Afghanistan. Oops! He just partially decided that already earlier this week.

Who Will Blink?

 Since all options in the case of a non-raised debt ceiling are rather disastrous for the US, almost all pundits and observers believe the ceiling will be raised. The only question is: who will blink?

Obama? The majority of Americans can’t imagine Obama really wants to hurt the US still more. If he doesn’t accept severe cuts in government spending, and the projected economic disaster hits, the dollar devalues fast, most believe his reelection chances are zero. But on the other hand, a majority of the Americans is now convinced Obama made the economic situation of the US much worse during his two and a half years in office. Everything he touches becomes a mess. Since most also believe Obama is an intelligent man, the question is raised why he continues his disastrous policies. Is he able to learn from his mistakes, or does he have malicious ambitions?

The Republicans? Do they squander the unique chance in history they have here to force Obama into meaningful spending cuts? If they do, then the role of the Tea party in 2010 was only boring foreplay for what will happen during the elections of 2012. Republicans, who go along with a raise of the debt ceiling, without real spending cuts, or with new taxes, will find a Tea Party candidate opposing them in the primaries, and will be defeated in the election. On the other hand, Republicans are known to love showing their sense for responsibility. They will avoid an economic disaster. Republicans believe the opponent is rational and trustworthy. But, is he really?

My prediction

At the last possible moment, end of July, Obama appears on TV to state his will to cut spending with trillions without raising taxes. The debt ceiling is raised, which allows Obama to continue his wasteful spending to well after the 2012 elections. He’ll present himself as the savior of all humankind.The Republicans think they won, but after the summer recess it becomes clear Obama isn’t cutting any spending at all. Circumstances in the world, for example, the break-up of the EURO zone, the collapse of the Chinese economy, the fall of the Dow Jones with over 2,000 points in a week, or whatever, give Obama the excuse to print and spend more money. The Republicans understand too late, Obama deceived them again. Just as he did at the end of 2010, when the Republicans went along with Obama’s deal not to raise taxes and a cut in spending of a meager 40 billion dollars. Not even a week after the deal was voted, the real spending cuts were calculated as only about 300 million dollars!Hmmmm......Welcome to the 'Age of Obama'.Read the full story here.

• 'Just When You Thought Our Fiscal Nightmare Couldn't Get Any Worse'.(DougRoss)It is anything but cheery, but David Limbaugh's latest at Human Events is a must-read for every American.....Projections of the nation's impending doom have worsened: We face destruction if we don't act, and the crisis is accelerating.Last year, the CBO predicted our national debt would be 91 percent of gross domestic product in 2021. Now, just a year later, it is projected to be 101 percent in 2021.It gets worse. The debt is forecasted to be 150 percent of GDP by 2030 and 200 percent by 2037. And, if you can even imagine this, it will proliferate more rapidly thereafter. On our present course, by 2035, federal interest payments will be 9 percent of our entire economy, compared with 1 percent today.Adding insult to injury, Obamacare, which Obama fraudulently sold as an indispensable component of balancing the budget, will greatly drive up health care costs. The CBO says that mandatory federal spending on health care will increase by 86 percent, from 5.6 percent of GDP presently to 10.4 percent over the next 24 years. Don't say we didn't warn you... Adding aggravation to insult is the recently discovered "glitch" in Obamacare that allows for more than 3 million middle-class Americans to qualify for Medicaid...What Limbaugh alludes to is a devastating problem: the estimates of Medicare collapsing in only a dozen years and Social Security imploding shortly thereafter assumes rosy growth and hiring projections that can't possibly happen in the current economic climate. In short, these disastrous entitlement programs will collapse much sooner than anyone is willing to admit.President Obama took what should have been a normal, run-of-the-mill recession and turned it into a full-blown depression.By the time his first term ends, Obama will have nearly doubled the U.S. national debt. And just think: he spent it on a series of utterly failed programs like the "Stimulus", HAMP, Cash-for-Clunkers, Weatherization, Green Jobs Initiatives, Obamacare, "Banking Reform", drilling moratoriums, First-Time Home-Buyer Tax Credits, auto company takeovers and QE2, to name but a few.These are the disastrous policy failures that our children and grandchildren will have to pay for, in the unlikely event our financial system hasn't already collapsed. This is Democrat child abuse, plain and simple.Remember in 2012.Read the full story here.

• 'Israel, Egypt agree flotilla can unload cargo in El-Arish'.(JPost).Israel and Egypt have come to an understanding by which ships taking part in an upcoming flotilla to the Gaza Strip will be allowed to unload their cargo of humanitarian goods at the Egyptian port of El-Arish, from where it will be transferred on land to Gaza after being checked, Israel Radio reported on Monday.The government has declared that the flotilla, scheduled to arrive at Gaza later this week, will not be allowed to enter the territory by sea. If necessary the ships will be towed into Ashdod Port and the equipment on the ships impounded.On Sunday, Greek officials blocked some of the ships from setting sail to Gaza and organizers said that they had hired lawyers who will fight the stop-order with the aim of allowing the vessels to leave harbor on Monday or Tuesday.“We expect the flotilla to set sail later in the week,” a military source said. “We are preparing for various scenarios, from no violence to extreme violence.”The navy and Military Intelligence are closely tracking the flotilla, as well as reports that a Jordanian ship with close to 200 Palestinian and other Arab activists might join the voyage toward Gaza.“We are pleased that the Turks are not participating but do not yet know what to expect until we meet the ships at sea,” the military source said.The navy plans to stop the flotilla far from Gaza, after issuing a warning that the territory is under a sea blockade.“If the ships continue sailing after being warned, then we will have the right to stop them even if they did not yet enter Gaza’s territorial waters,” a defense official explained.During Sunday's special security cabinet meeting, ministers heard intelligence reports regarding the number of vessels, the passengers on board, and what the ships are carrying. Israeli officials expressed satisfaction that Cyprus has banned the use of it ports for the enterprise, and that Greece and numerous other countries – such as the US, Canada, France and Australia – have issued strong warnings to their citizens not to participate.Read the full story here.

• Gaza flotilla losing momentum.(Ynet). Greek authorities detain six ships supposed to partake in Strip-bound sail as Israel reiterates it will not allow flotilla of any size to reach Gaza.Six ships which were slated to take part in the Gaza-bound flotilla are being detained by the Greek port authorities, Ynet learned Sunday night.Senior officials in Jerusalem have confirmed the report, which followed a Sunday decision by Greece to stop the US vessel "Audacity of Hope" from participating in the sea-bound convoy.While the organizers of the maritime convoy claim that more than 1,500 activists are set to take part in the initiative, it now appears that no more than seven ships, carrying 200-500 passengers, will participate in the flotilla.Prime Minister Benjamin Netanyahu reiterated Sunday that Israel will not allow any ships to breach its blockade of the Gaza Strip. Jerusalem believes that the dwindling extent of the sail can be largely attributed to the Foreign Ministry's intensive "anti-flotilla" campaign vis-à-vis its European counterparts. "The Foreign Ministry is leading diplomatic efforts to delegitimize the flotilla in the eyes of the international community," Deputy Foreign Minister Daniel Ayalon said. "The world is aware that such sails are unnecessary, that they are just provocations which violate international law." Ayalon added that Israel is still gearing to meet whichever vessels do end up participating in the flotilla. The Shurat HaDin Israel Law Center, which focuses on legal action against terror groups, has also been working vis-à-vis the legal authorities in Athens in an attempt to stop the ships. "The flotilla is linked to radical Islamist groups, making it an act against Israel, which is a nation friendly to Greece," Attorney Nitsana Darshan-Leitner, who heads Shurat HaDin, said.Shurat HaDin claims that it was their information that led Athens to detain some of the ships in orders to make sure they were not in violation of international law.The organization further issued legal warnings to 36 Americans who planned to participate in the sail, saying that their action were in violation of the US Neutrality Act.Read the full story here.

• U.K. Dear Dead Troops - You upset 'people' ... Love The Government.(Telegraph).War dead to be driven down side streets to avoid the public.The bodies of soldiers killed in Afghanistan will no longer be honoured with a public parade but will be driven through back streets to avoid upset, it has emerged.For several years, the flag-draped coffins of fallen servicemen and women have been met by large crowds who line the streets to pay their respects as they return to British soil.But repatriation flights are to be diverted and will no longer be flown back to RAF Lyneham and through the small Wiltshire town of Royal Wootton Bassett, where they were saluted come rain or shine.Instead, they will arrive back to RAF Brize Norton, where they will be driven through the back gate and then down side roads, neatly avoiding the nearby town of Carterton, as they make their way to the John Radcliffe Hospital in Oxford.Andrew Robathan, Minister for Defence Personnel, Welfare and Veterans, admitted that the decision to avoid public scenes of emotion had been taken deliberately.“The side gate was seen by the Ministry of Defence and the police as the most appropriate way to take out future cortèges,” he told Radio Oxford.“I am not sure taking coffins in hearses past schools, past families, past married quarters is necessarily the thing that everybody would wish to see … the focus must be on the families of the dead service personnel. They are the people who care most. That is where our focus is.”The Ministry of Defence said the route from RAF Brize Norton, where flights had landed until the runway was closed for repair work in 2007, was decided by West Oxfordshire District Council but claimed that the side gate would be used to ensure minimal disruption to normal operations.A spokesman added: “Consideration has also been given to ensure the dignity and solemnity of the military repatriation ceremony is maintained and to those who are arriving at RAF Brize Norton about to deploy on operations.”More than 2,000 campaigners have joined a Facebook group calling for the repatriation route to be diverted through Carterton.
  One member said: "A good friend of mine is a member of this group and her son was killed in Afghanistan, he was repatriated at RAF Lyneham and was driven through Royal Wootton Bassett."The families get so much comfort from the respect shown and it would be a massive blow to families if their fallen hero was ushered in quietly like a dirty secret."Hmmmm......P.C. the death of a nation.Read the full 'story' here.
  
  
  
  
• Shariah Compliant? Major D.C. Complex Won’t Lease to Banks, Bars.(TheBlaze).A major development project in downtown Washington will not be leasing space to banks or bars once it’s completed, a move that happens to comply with the tenets of Shariah law prohibiting alcohol or collecting interest — the same project a Qatari investment firm is bankrolling.In April, the Washington Times reported the Qatari Diar Real Estate Investment Company put up $700 million to fund the CityCenterDC project, six blocks from the White House and slated for completion in late 2013.A New York Times article last week reported real estate companies Hines Interests and Archstone decided they would not lease space in the complex to banks or to “retailers whose primary business involves selling alcohol.”Even before the Qatari investors became involved, Hines and Archstone determined that leasing to banks would not help them create lively shopping streets, Mr. Alsup said. But as it happened, their hesitancy on bank branches meshed with the policies of their financial partners, who adhere to the restrictions of Shariah, or Islamic law, including the ban on collecting interest. Restaurants will be able to serve liquor, but retailers whose primary business involves selling alcohol will not be allowed, Mr. Alsup said.On Friday, Salon writer Alex Pareene ribbed the news, and predicted an “overblown right-wing outrage.”Shariah law, a stone’s throw from the U.S. Capitol. I am assuming the Times just neglected to mention that in addition to banning bars from the complex, all women will be required to wear the niqab, and obviously all infidels will be murdered, while shopping at the Apple store or whatever ends up there. And no dancing!Hmmmm.......How's that 'Outreach to Muslims' working?Read the full story here.

• US Top Admiral: We Will Need Ground Troops In Libya.(Big Peace).From Foreign Policy: The top U.S. admiral involved in the Libya war admitted to a U.S. congressman that NATO forces are trying to kill Libyan leader Muammar al-Qaddafi. The same admiral also said he anticipated the need for ground troops in Libya after Qaddafi falls, according to the lawmaker.House Armed Services Committee member Mike Turner (R-OH) told The Cable that U.S. Admiral Samuel Locklear, commander of the NATO Joint Operations Command in Naples, Italy, told him last month that NATO forces are actively targeting and trying to kill Qaddafi, despite the fact that the Obama administration continues to insist that “regime change” is not the goal and is not authorized by the U.N. mandate authorizing the war.“The U.N. authorization had three components: blockade, no fly zone, and civil protection. And Admiral Locklear explained that the scope of civil protection was being interpreted to permit the removal of the chain of command of Qaddafi’s military, which includes Qaddafi,” Turner said. “He said that currently is the mission as NATO has defined.”“I believed that we were [targeting Qaddafi] but that confirmed it,” Turner said. “I believe the scope that NATO is pursuing is beyond what is contemplated in civil protection, so they’re exceeding the mission.”Later in the same briefing, Turner said, Locklear maintained that the NATO mission does not include regime change. “Well, certainly if you remove Qaddafi it will affect regime change,” Turner said that he replied. “[Locklear] did not have an answer to that.”Locklear also said that, upon Qaddafi’s removal, ground troops would be needed during the immediate period of instability, Turner said. In fact, Locklear said publicly that a “small force” might be necessary following the collapse of the Qaddafi regime in a May 30 conference in Varna, Bulgaria.Turner joined hundreds of other lawmakers in voting against authorizing the Libya war on Friday morning. The authorization resolution was defeated 123 to 297. A subsequent vote on a bill to defund the Libya mission also failed 180-238 .Hmmmm......Kinetic coverup in action.Read the full story here.

• Lynch survivor Nir Nachshon: I saw murder in their eyes.(Ynet).Nir Nachshon, who was nearly lynched after accidentally entering Palestinian village, recalls moments of horror. Nir Nachshon, the moving company employee who was extricated from a lynch after mistakenly entering the east Jerusalem village of Issawiya Sunday night, is still trying to digest the harrowing experience.Speaking to Ynet from his hospital bed he said that "they started throwing rocks and cement blocks right into the car. I realized I was going to die and I started thinking this isn't the way I want to die."Nachshon, 28, was on his way home to Ma'aleh Adumim from the Mount Scopus Medical Center but a GPS device mistake meant that he ended up in the Palestinian village.The realization that he was in hostile territory, he said, came "just as I made the turn, I figured out that I made a mistake, but I didn't realize how big the issue was. This is Jerusalem. This is home." "Immediately when I made the turn a 12-year-old boy started screaming 'Jew, Jew'. Each time he called out dozens more people arrived." That is when they started throwing rocks and cement blocks into the car. Nachshon recalled how during the lynch he searched among his assailants for "children or young people, I tried to look them in the eyes and find an ounce of humanity in them but all I could see was murder in heir eyes. I felt my life would be over at any minute."Nir then described how his life was saved: "Someone came out of nowhere and tried to rescue me from the people; there was screaming but he managed to get me to his house. I was still scared, I didn't feel safe, and the people in the house said they needed to get me out of the village or they would also come under attack. "I was scared to go out but three of the young guys inside the house said they were with me and would protect me no matter what." The rescuers were one of the village's muhtar's and his sons. "I owe these people my life," Nachshon added "I hope I'll get to meet them again soon and thank them in person." Nachshon's saviors took him outside to a police patrol car waiting outside the village. Meanwhile Border Guard forces were rushed to the scene as well as Magen David Adom units, which took the victim to the hospital. Police forces canvassed the area but no detainees have been reported.In addition to the physical trauma Nachshon received from being beaten by clubs, rocks and wooden planks, he has to contend with the emotional trauma. "I'm still trying to digest everything that happened, all I know is that this was a miracle, I got my life back and first and foremost, I thank God for the gift." Hmmmm.......Obama administratie and Liberal's their 'peacepartners'.Read the full story here.

• Israeli Prime Minister Benjamin Netanyahu To separate Itself from the Palestinians?(Haaretz).Prime Minister Benjamin Netanyahu surprised many of the participants in the weekly cabinet meeting Sunday when he embarked on a monologue praising the idea of parting from the Palestinians and in relinquishing portions of the West Bank. Netanyahu said the number of Palestinians and Jews between the Jordan River and the sea "is irrelevant" and that it's more important to "preserve a solid Jewish majority inside the State of Israel." The PM made these statements during a discussion on a report by the Jewish People Policy Institute on demographic changes among Jews and Palestinians in Israel and the West Bank.Members of the institute presented the demographic data of Prof. Sergio DellaPergola, which show that, in a number of years, the demographic trends will result in a Palestinian majority between the Jordan River and the Mediterranean Sea. Ministers Limor Livnat and Uzi Landau were surprised by the data and asked that the data of other experts be presented - for example, the data of Yoram Ettinger, who is affiliated with the right. The right argue that the demographic threat to the State of Israel is not so serious. The prime minister cut short the discussion and surprised those present with previously unspoken sentiments about the future Israeli presence in the West Bank. "The debate over how many Jews and how many Palestinians will be between the Jordan and the sea is irrelevant," Netanyahu said. "It does not matter to me whether there are half a million more Palestinians or less because I have no wish to annex them into Israel. I want to separate from them so that they will not be Israeli citizens. I am interested that there be a solid Jewish majority inside the State of Israel. Inside its borders, as these will be defined," Netanyahu explained.Aides of the PM realized how politically explosive his statements were and asked all those present in the room to avoid disseminating the details. The Prime Minister's Office did not brief the media on the statements and refused to respond to questions on the issue or provide any quotes about the statements of the PM.Hmmmm........Read the full story here.

• Gaza Flotilla Partially Paralyzed.(KafirKanuck).“Ynet has learned that six ships that were meant to take part in the Gaza-bound flotilla are being detained by the port authority and the coast guard in Greece. Senior officials in Jerusalem have confirmed the report.”Even the Turks are now embarrassed over last year’s flotilla and have kept this year’s Turkey floater from participating.Meanwhile, the Sea Hitler gets ready to leave Montreal, in spite of warnings:

“The border around the Gaza Strip is under the control of Israeli and Egyptian authorities. Canadians who break the laws of another country are subject to the judicial system of that country. DFAIT can neither offer protection from the consequences of such actions nor override the decisions of local authorities.”

And via Challa, the US State Department warns the Flotilla Activists May Violate U.S. Law:

“Recent seizures by Israel and Egypt of advanced military systems, weapons, and ammunition bound for terrorist groups in Gaza, as well as periodic rocket and mortar attacks from Gaza against Israeli civilians, highlight the continuing problem of illicit arms smuggling to Gaza. These seizures underscore the vital importance to Israel’s security of ensuring that all cargo bound for Gaza is appropriately screened for illegal arms and dual-use materials.”

So why do they do it? I recently penned them as the League of Hate (LoH), and here I partially explain how supporters for such insanity fool themselves by compartmentalizing the facts so they can ignore the real facts and history. And they’ve added a new ex-Parliamentary Page to their numbers.

On the other side, we have some of the good guys: Cherna Rosenberg who’s filed a lawsuit; then there are some in the Media at the NP and recently Brian Lilley of the Sun Media who pointed out how Canadian Tax money has been funneled for radical anti-Semitic Terrorist agendas; the Canadian Jewish Defence League continue to do their part, and currently Voice of Canada is taking the protest strait to the London Ontario Mosque which raised money for the Sea Hitler. Read the whole story with many links here .

• Israel - Turkey wants UN to tone down report on Gaza flotilla raid.(Haaretz).Official says Erdogan government 'very worried' over criticism of Turkey the report is expected to contain.Turkey has asked Israel to agree to a toned-down version of the UN Secretary-General's report on last year's flotilla to Gaza, according to a senior government official in Jerusalem. According to the official, the Turks are "very worried" about the harsh criticism of Turkey they expect the report to contain, and want Israel to agree to a softened version as part of a package deal to end the crisis between the two countries over the flotilla, which took place in May 2010. The director general of the Turkish Foreign Ministry, Feridun Sinirlioglu, conveyed Turkey's request in a secret meeting early last week in Geneva with Vice Prime Minister Moshe Ya'alon. A draft of the report, due to be released within two weeks, was given to Israel and Turkey about six weeks ago. The committee determined that Israel's naval blockade of Gaza is in keeping with international law, and therefore its actions to stop the flotilla were also legal. According to a senior government official in Jerusalem, the report criticizes the Turkish government and highlights the relationship between it and IHH, the group that organized the flotilla. The report also states that, while Israel Defense Forces soldiers acted in self-defense, they used disproportionate force that led to the death of nine Turkish citizens. The report recommends that Israel pay compensation to the families of the dead and injured Turkish citizens, which Israel has already said it is willing to do.The official said the Turks would like to soften the parts of the report that could cause a political storm in Turkey. During the meeting with Ya'alon, the Turks suggested that the toning down of the report would lead to an end to the crisis and the normalalization of relations between the countries, which would include the return of the Turkish ambassador to Tel Aviv. Officials in Jerusalem said Israel and Turkey were finding it difficult to reach an agreement because of Recep Tayyip Erdogan's directives to Turkish negotiators, who were told not to yield on the matter of an Israeli apology for the killing of Turkish citizens.The Turkish representative on the UN panel, Ozdem Sanberk, presented a new version of an apology in an interview to the Turkish newspaper Hurriyet late last week, noting that Turkey expected Israel to admit to an operational failure. Sanberk told Hurriyet that if the crisis was not solved, Turkey could lose its influence in the region. "Panel chairman Geoffrey Palmer is willing to change the report in keeping with understandings reached by Israel and Turkey," the Israeli government source said. The official also said that if no progress was made before the the date of the report's release, it would be be more difficult to make progress thereafter.Hmmmm........No Blood Money or Diyya.Read the full story here.

• Iran to stage missile war games ment as a 'message of peace, friendship to countries in region'.(Ynet).Iran's elite Revolutionary Guards are set to launch a military exercises on Monday, which will reportedly include the firing of different range ballistic missiles, the state news agency IRNA reported.The exercise is titled the "Great Prophet Mohammad War Games," and was referred to as "Great Prophet-6." IRNA reported that Revolutionary Guards Commander General Amir Ali Hajizadeh confirmed the exercise will take place, without specifying how long the maneuvers will last."Short, medium and long-range missiles will be fired, especially the Khalij-Fars, Sejil, Fateh, Ghiam, and Shahab-1 and -2 missiles," Hajizadeh said.The general, whose force carries out war games each year in the Gulf region, said the latest exercises were "a message of peace and friendship to the countries of the area."In late May, Iran said it had equipped the Revolutionary Guards with a new surface-to-surface missile, the Qiam-1, which was built locally and test-fired last August.Iran says it has a wide range of missiles, some capable of striking targets inside arch-foe Israel as well as US bases in the Middle East.The Islamic Republic regularly boasts about developing missiles having substantial range and capabilities, but Western military experts cast doubt on its claims.Hmmmm.....With such a name sounds more as a last rehersal before the real deal .........in September?Read the full story here.

• Pakistani Taliban Send Husband And burqa wearing Wife Suicide Bombers To Attack Police Station,kill 8 police, two civilians.(Yahoo)The Pakistani Taliban said Sunday the group had sent a husband and wife suicide squad to carry out an attack on a police station in northwestern Pakistan that killed 10 people, a rare instance of militants using a woman as a bomber.The pair entered the police station in Kolachi on Saturday and said they were there to lodge a complaint, said Imtiaz Shah, a senior police official. Once inside, the two attacked with grenades and machine guns, triggering a five-hour standoff with police.Both attackers, including the woman wearing an all-covering robe known as a burqa, eventually blew themselves up. They killed eight police officers and two civilians, said Mohammad Hussain, another police official.“This shows how much we hate Pakistani security institutions,” Pakistani Taliban spokesman Ahsanullah Ahsan told The Associated Press by telephone from an undisclosed location.Ahsan claimed it was the first time the militant group had used a female suicide bomber.However, Pakistani officials said a female suicide bomber wearing a burqa attacked a World Food Program food distribution center in northwestern Pakistan late last year, killing 45 people.Read the full story here.

• And now for something completely different.UFO Video Shows Mulitiple UFOs In Austrailan Night Sky - AND - LONDON Daytime UFOs .Read and see the full story here.