EU Finance: the Emperor’s New Haircut

The latest in the great Eurozone Crisis Saga.

And what is a haircut, you may ask?

"Gary Jenkins, head of fixed income at Evolution securities, outlined what a haircut would mean for Greek bond holders. ‘It involves a "voluntary" bond exchange with a nominal discount of 50% on notional debt held by private sector holders with €30 billion provided by the eurozone member states for credit enhancements, and it aims to reduce Greek debt to 120% by the end of the decade.’" Citywire.

Sounds like more of the usual paper-shuffling and prestidigitation to me.

How about recapitalisation?

"To what extent taxpayers have to plug the gap – and whether state aid rules then kick in – could depend on the timescale banks are given to raise the capital. Huertas told Newsnight that the EFSF would be there as a "last resort". He said: "The plan is for banks to access public markets first," before turning to nation states for support – and then the EFSF." Graun.

Yeah, yeah, yeah ….

Maybe commenter Moggoid sums it up better, over at the Slog: “I stumbled upon this article – tying to find out what “recapitalisation of banks” actually means. And I gather it means that somewhere large amounts of money are found and then just given to the bank – Is that right?”

The banks love the deal, which should make anyone who’s not a banker suspicious. The much-courted and fawned over “Markets”* love the deal - but then they loved the glistening 2000s bubble that preceded the 2008 Crash, didn’t they. So what do they know.


*The "Markets" - basically a bunch of saddoes with nothing better to do than play Crackberry with large numbers and screw the rest of us.

It's Socialism for Corporations, Stupid

Philip K Dick may have taken too much whizz, but he sure could cut through the crap of post-war America to see the nasty reality underneath all the hypocritical posturing of politicians. Interesting to find that 2010 saw the debut of a film of his book Radio Free Albemuth. Very timely.

And as ever in politics, plus ca change. Here's Kevin Carson at the Centre for a Stateless Society:

“If Obama’s such a socialist and all,” ask these know-it-alls, “How come he’s got an economic policy team made up entirely of investment bankers and hedge fund managers?”

"Well, I’ll tell you, Mr. Smarty-Pants Intellectual. It’s because he’s the worst kind of Marxist: a deep undercover Marxist. And all this seeming flirtation with Wall Street elites and corporate CEOs is just part of his master plan to destroy capitalism and turn the great Representative Republic of our Founding Fathers into a People’s Democratic Republic."

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