World View -- European Council Deliberately Lied About Spain Bailout Policy
This morning's key headlines from
- Russia says it will suspend 'new arms shipments' to Syria
- European Council deliberately lied about its bailout policy for Spain
- Germany and France have negative bond yields, while Spain's surge
- No relief in sight for Greece at Monday's Eurogroup meeting
Russia says it will suspend 'new arms shipments' to Syria
Russia has been continually embarrassed for its support of the regime
of Syria's president Bashar al-Assad, which has been maiming,
slaughtering and exterminating innocent Sunni Arabs. To show what
good guys they are after all, Russia has announced that they will not
deliver any new types of weapons or sign any military contracts with
Syria until the situation there stabilizes. However, Russia is
leaving open the possibility of continuing to deliver weapons under
old contracts. In particular, Russia will deliver a group of Mi-25
attack helicopter gunships to Syria on time.
Ria Novosti and
Russia will deliver Mi-25 gunships to Syria on time
European Council deliberately lied about its bailout policy for Spain
For years, I've reported on numerous lies by European officials with
reference to the euro crisis. Last year, European officials told one
lie after another with respect to the various bailouts of Greece, and
once when EU officials were caught in a series of major lies about
Greece a couple of months ago, Eurogroup chairman Jean-Claude Juncker
was quoted as saying, "When it becomes serious, you have to lie," as I
reported at the time.
So I guess it's becoming "serious" again, because the European
Commission told some outrageous lies coming out of the June 28-29
meeting of the eurozone leaders. In "30-Jun-12 World View -- Germany and Angela Merkel cave in to Italy and Spain", I summarized the agreements, including the
much touted agreement that the European Stability Mechanism (ESM)
bailout fund would be authorized to lend bailout money to Spain's
banks, so that the debt will not appear on the books of Spain itself.
Well, apparently this was a full-throated lie by the European
Commission (EC). It turns out that countries will need to provide
guarantees in return for the bank aid that the ESM gives to the
country's banks. According to one euro zone official:
"There is some degree of mystification going on here
... in the broader public who think that under current rules the
ESM could all of a sudden end up owning [the Spanish bank] Bankia
with the full risk of Bankia on the balance sheet of the ESM.
This is very much not the case."
EuroIntelligence notes that the EC is trying to blame "the broader
public" for this lie:
"It is preposterous to argue that the fault lies with
the broader public as he suggests. It was a deliberate
misrepresentation of a policy by the European Council. If this
official is right, it means that the ESM will not ever inject
capital into the banks. Now it all makes sense why we don't need a
treaty change. If you don't change the policy, you don't need to
change the treaty."
This means that Germany and Angela Merkel didn't cave in after all, as
had been reported at the time. The culture of fraud and extortion is
alive and well.
Germany and France have negative bond yields, while Spain's surge
Last week, we reported that
Denmark's central bank is "paying" a negative interest rate on
certificates of deposit, which means that it costs you something to
store your money in Denmark's banks for safekeeping. On Monday,
short-term debt offered by Germany and France had negative yields --
-0.034% yield for 6-month bills from Germany, and -0.006% yield for
24-week bills from France. Meanwhile, 10-year bond yields for Italy
and Spain have been surging. The yield was 6.1% for Italy, which is
considered unsustainable, while it was 7.1% for Spain, considered a
major crisis level.
No relief in sight for Greece at Monday's Eurogroup meeting
A meeting of the Eurogroup in Brussels is showing no sympathy for
Greece's hope to get an agreement to delay new austerity measures.
Because Greece is so far behind on its previous commitments,
a Greek government spokesman said that they would not be seeking
an immediate renogtiation of the bailout terms:
"At the moment, we are way off our targets. We cannot
negotiate because to do so you need to give and take. The clear
impression we got at the recent EU leaders’ summit was that there
are some who are looking for an excuse to push us out of the
euro. But most people are telling us that if we prove we are
moving in the right direction, there will be room to
Luxembourg's finance minister agreed:
"We have to see how realistic the things are that we
want from Greece. I think we can accommodate Greece, but Greece
must also know that it’s not a one-way street. Greece has to enact
a series of reforms that we have demanded; we will need to hear
the Greek minister about this."