"Treasury head visiting Europe, to stress growth; Eurozone officials concerned about wilting economy" by Annie Lowrey | New York Times, April 08, 2013
WASHINGTON — Jacob J. Lew began his first trip to Europe as Treasury secretary Sunday, a four-city tour in which he is expected to try to persuade finance ministers to pursue a little more growth and a little less austerity to improve the economic fortunes there and elsewhere.
As his boss and his administration are telling you the opposite, Americans.
Growth apparently equals austerity for bank payments now.
Growth is again at the top of the Obama administration’s agenda as Lew meets over a 48-hour period with high-ranking leaders representing the European Union, Germany, and France. Europe’s sovereign debt crisis continues to simmer for its fourth year, most recently in Portugal over the weekend, and European unemployment rates are still rising. The eurozone economy shrank in the fourth quarter of 2012, with the large economies of Germany, France, Spain, and Italy all contracting....
If it shrank during the holiday season then they are really in trouble.
Some European officials have also said they are concerned about a potential cycle of austerity and recession, with budget cuts leading to shrinking economies....
The ‘‘economic outlook for the euro area remains subject to downside risks,’’ said Mario Draghi, the president of the European Central Bank, at a news conference last week....
But you said it was improving, asshole.
Also see: Draghi the Dictator
He's just acting like a banker.
But countries like Germany have shown little willingness to ease the constraints of austerity for peripheral European countries, or to engage in stimulus spending themselves.
And for years, European officials have bridled at being lectured by officials from Washington, particularly because many feel that their financial crisis was largely caused by American financial products exported around the world by American banks.
They would be 100% right in that assessment.
Though Lew will travel to Europe with a familiar message from Washington, it may not be delivered as urgently as in the past. The European crisis continues to weigh on American growth, cutting into exports, but many economists believe that the United States has entered a cycle of self-sustaining economic growth driven by a turnaround in housing and improving household budgets.
The self-delusional lies leave me astonished.
Moreover, American companies have over the last few years steeled themselves against Europe’s financial woes, and the risk of contagion is perceived to be relatively low.
Europe was the primary international concern for Timothy F. Geithner, Lew’s predecessor as Treasury secretary. But perhaps as a sign of Europe’s diminishing threat to US economic stability, Lew’s first overseas trip as Treasury secretary, last month, was not to Paris or Berlin or Brussels, but to Beijing.
Related: Lew's Lunch
I'm getting hungry.
European leaders are expected to press Lew on an eagerly anticipated free-trade agreement.
See: The NATO of Trade Deals
A study by the European Commission found that a deal could increase European Union exports to the United States by as much as 28 percent, a boost for the flailing European economy....
Financial regulations, including a proposed European tax on financial transactions, are expected to be a major subject of negotiations as well.
But concerns over growth, austerity, and stability in the eurozone looked certain to be the central topic of negotiations yet again.
Speaking at a conference in China on Sunday, Christine Lagarde, the managing director of the International Monetary Fund, also reiterated her concerns about growth.
‘‘Low and lopsided growth is not enough,’’ Lagarde said at the Boao Forum for Asia annual conference, citing the continuing troubles in Europe. ‘‘It is not enough of a real recovery. It is not enough of a global recovery.’’
Who cares what that criminal has to say?
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NEXT DAY UPDATE: US Treasury chief urges an EU focus on growth
A little appetizer:
"Luxembourg under scrutiny for potential as next crisis" Associated Press, April 08, 2013
BRUSSELS — Following the chaotic bailout of Cyprus last week, European officials have started wondering aloud if Luxembourg’s banks might hold the 17-nation eurozone’s next ticking bomb, despite the tiny nation’s status as the European Union’s wealthiest country.
Related: Keeping Current on the Cyprus Crisis
I haven't, but I'll try to get to that soon.
Mario Draghi, president of the European Central Bank, cautioned on Thursday that ‘‘the recent experience shows that countries where the banking sector is several times bigger than the economy are countries that, on average, have more vulnerabilities.’’
The increased scrutiny has taken Luxembourg’s government by surprise and put it on the defensive. It has rejected calls to shrink its country’s main source of wealth, claiming that its banking industry is much more secure than Cyprus’s.
Cyprus was forced to seek a bailout from its eurozone partners after its once-thriving banking industry collapsed. The country couldn’t afford to bail out its financial sector, which had grown to eight times the size of its economy.
Luxembourg banks’ balance sheets are about 22 times the country’s annual economic output of $57 billion — making it Europe’s richest country per capita.
Luxembourg has relatively little debt, so it could afford to borrow to bail out the odd bank. But EU officials worry it might not be able to cope with a widespread problem.
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The contagion is moving so fast it's hard to keep track:
"Portuguese leader warns of new spending cuts" by Barry Hatton | Associated Press, April 08, 2013
LISBON — Despite two years of corrosive austerity measures since it needed an international financial rescue, Portugal’s prime minister told his country Sunday to brace for even harder times after a court ruling forced his government to find more savings through steep spending cuts.
So the bailouts didn't work, huh?
Yeah, strange how piling more debt upon debt doesn't help.
Well, it helps $ome.
Pedro Passos Coelho said in a somber televised address to the nation that his center-right government must slash public services because of a Constitutional Court decision to disallow some of its latest tax hikes.
A new crackdown on public spending will focus on social security, education, health services, and state-run companies, he said. That is likely to bring more layoffs as Portugal scrambles to restore its financial health after it needed a $101 billion bailout in 2011.
‘‘Today, we are still not out of the financial emergency which placed us in this painful crisis,’’ Passos Coelho said.
Portugal’s worsening problems threaten to reignite the eurozone’s financial crisis not long after Cyprus became the fifth member of the 17-nation bloc to require rescue.
The Portuguese economy contracted last year....
What you begin to realize is despite all the corporate profits and mouthpiece media shit-shoveling regarding recovery, we are in the middle of the Grand Depression (as history will record). The only ones who benefited (as they always do during downturns) was the top 1% who bought low and are keeping or selling dear.
European leaders have for three years struggled to contain the financial crisis, and Portugal’s ongoing problems illustrate the dilemma of finding a balance between austerity measures and growth policies. Many Europeans want to abandon the austerity path and start spending again to create jobs and wealth.
The Constitutional Court on Friday prohibited pay cuts for government workers and pensioners included in this year’s state budget, leaving the government just nine months to make up for the sudden shortfall of almost $1.7 billion.
Oh, so the Court defied the bankers?
‘‘After this decision by the Constitutional Court, it’s not just the government’s life that will become more difficult, it is the life of the Portuguese that will become more difficult and make the success of our national economic recovery more problematic,’’ Passos Coelho said.
Oh, look, another pos prime minister.
He noted that Portugal has made progress on reducing its budget deficit, which stood at 10.1 percent in 2010. Last year, it was 6.4 percent. Even so, the three main international ratings agencies still classify Portuguese government bonds as junk.
I was told that was good stuff.
Passos Coelho said the court’s decision was a setback for Portugal’s hopes of returning to international financial markets soon.
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Related: European Commission 'Threatens' Portugal
Getting hungry like me?
"A new theory of why red meat, eaten too often, might be bad for people."
It's good only if it's banker.
Related:
Today's Boston Globe Menu
MSM Monitor: Globe Happy Meal
Slow Saturday Special: Globe's Lunch Specials of the Day
Now I don't know what to eat.
