Thought Id start this one going because its rather dead on this board at the moment and I suppose all my usual muckers are either at the Stella tennis event watching Dim Tim (lose again) or at Henly Regatta eating cucumber sandwiches (they wish,...NOT).

Anyway please feel free to just talk to yourself blast away and let it go on any company or subject you wish. Just wish Id thought of this one before.

cheers GF.

Why if the Euro and Euro Zone doomed is the following chart as it is.

http://www.indexmundi.com/xrates/graph.aspx?c1=EUR&c2=GBP&days=365

Saw ghost the musical in London last night. Amazing. Highly recommended.


http://youtu.be/Sw5a5beiLSw

I think anyone who thinks the UK is better outside the EU Should listen to the following conversation with Joseph Stiglitz (Clinton economic advisor) which was on World At One today.

http://www.bbc.co.uk/iplayer/console/b012r6v2

Also, I suggest they check the population of the European Zone, USA, Russia. India and China.and realise that UK economy is flea bite size and will be swatted if we are outside the larger Euro zone.

A lot of the members Euro Zone already see the UK as a pain in the arse and seem to be becoming more antagonistic to the ongoing attempts by various tory governments to fragment its existence.

Perhaps De Gaulle was sensible to block the UK enttry.

================

Another interesting article;



Splits begin to show in coalition as worries mount about rekindling growth

George Osborne was relieved that yesterday's figures show the UK in better shape than Europe. But political dangers lie ahead

Patrick Wintour
Patrick Wintour, political editor
guardian.co.uk, Tuesday 26 July 2011 20.29 BST
larger | smaller

George Osborne
George Osborne on a factory visit as new figures showed UK growth dropped from 0.5% to 0.2% in the second quarter of 2011. Photograph: Lewis Whyld/PA

Nigel Lawson in his memoirs described a chancellor's life as "a never-ending struggle against destabilising forces". Yet it says something for the jumpy mood at the top of government that growth figures published on Tuesday showing the economy has been flatlining for the past nine months came as a blessed relief. There had been fears that the economy would have contracted in the second quarter.

There is also relief that the dangerous political deadlock in Washington over the deficit and the continuing battle to stabilise the eurozone have made Britain look like a comparative haven of tranquillity. The markets did not nosedive on hearing the growth figures; inside the Conservative party there is only anxiety, but no sign of panic. Only Boris Johnson, worried about his re-election next May as London mayor, made noises about a growth manifesto.

But the political stability inside his party gets George Osborne only so far. A long L-shaped recovery looks possible, with all the attendant impact on public finances, deficit reduction and the remorseless propaganda battle with Ed Balls, the shadow chancellor, at the next election.

The Office for Budget Responsibility may be independent of government but it will not help the credibility of Osborne as chancellor to be forced to announce the fourth downgrading of his 2011 growth forecasts, as he surely will in the autumn statement in October or November. He can only blame cold weather and then the warm weather so many times.

Talk of friction between No 10 and No 11 is dismissed, but that does not mean there is no political pressure from across government on Osborne to show that Plan A is more than a merciless deficit reduction programme at a time of austerity. Sticking to a steady path has its virtues; and Osborne also has to exude confidence, hence his emphasis on Tuesday on the positive. But at the same time if he does not confide in the public soon he runs the risk of appearing out of touch with ordinary people increasingly worried by cuts in their living standards.

The message from other cabinet ministers is that Osborne must not give the impression of a man who has put the economy on autopilot and has nothing else to do but wait for the austere medicine to work at some indeterminate point in the future.

The Treasury was re-emphasising on Tuesday how much Osborne has already done to let the animal spirits loose, and to rebalance growth in the economy. Corporation tax will fall in three phases from 28p to 23p over four years. Tax credits for research and development are being boosted. Enterprise zones are being formed, planning rules relaxed and red tape lacerated.

No Liberal Democrat cabinet member is pressing privately for a change of course on the deficit. Both Vince Cable, the business secretary, and Chris Huhne, the energy secretary, recognise that a shift on the deficit would send the markets into turmoil.

But politically they would like to see more signs that government is reacting to the worse than expected growth. Cable has called for the Bank of England to undertake quantitative easing, a request that Osborne and Cameron will not follow or support.

There is also a developing disagreement between the Liberal Democrats and Conservatives over deregulation. Cable will deregulate with the best of them, and indeed will announce deregulation of shops on Wednesday. But some Liberal Democrats in government are arguing regulation can boost as well as hinder investment. For instance, regulation to require heat-efficient homes can lead to a surge in construction.

The worry for Osborne is that with interest rates at rock bottom, inflation high and no freedom to manoeuvre on spending, the only public intervention he can make is on growth strategy. Yet that is not going to produce a short-term boost.

There is every chance that the economy will remain flat for at least another six months. If that leads to a rise in unemployment in the autumn as the effect of the spending cuts bite, then there will be pressure on the public finances and revised forecasts from the OBR.

Labour thinks that could be the moment of maximum political danger.

That pressure will be intensified if growth in Britain continues to diverge from France and Germany. Germany achieved a growth rate of 1.5% in the first quarter of this year, and France grew by 1%.

By next spring's budget, Osborne may have to make a move on income tax, ending the 50p rate off the back of advice from Her Majesty's Revenue and Customs that it is not generating the tax take expected. That would lift the Tory mood at a dangerous time.

guardian.co.uk Guardian News and Media Limited 2011"

It looks fantastic. Glad you enjoyed.

Been to quite a few 3 monkies, this one was great. Thanks 3 monkies.

Banks bear brunt of blue-chip sell-off

Symbol Price Change
32H.BE 0.00 0.00

AUY.DU 18.95 0.00

BARC.L 221.00 -7.75

CNA.L 320.30 -5.40

CSMA 20.69 -0.04


20:00, Wednesday 27 July 2011

Traders remained reluctant to put their money on the table amid fears that US lawmakers will fail to agree a deal to avoid a default on the countrys debt, and European sovereign debt concerns still preyed on dealers minds.

FTSE today: market report live

Banks (Euronext: SBK.NX - news) bore the brunt of the sell-off, with Lloyds Banking Group (LSE: LLOY.L - news) , Royal Bank of Scotland and Barclays (LSE: BARC.L - news) among the sharpest fallers as strategists at Goldman Sachs (NYSE: GS - news) cut their stance on the banking sector to neutral from overweight.

Although the banks rallied strongly last week after European leaders struck an agreement to prop up debt-laden Greece, Goldman pointed out that disquiet about the deal remained.

After the initial optimism (the package included some very important elements that were above market expectations), doubts have started to creep back into the market, said the broker. In particular these revolve around the scope for funding the new initiatives, particularly in relation to the upsized role of the European Financial Stability Facility.

Goldman pointed to other factors that could weigh on the banks, such as weak domestic demand throughout the periphery of Europe (Chicago Options: ^REURTRUSD - news) . Concerns about capital raisings are also likely to remain high for some time, despite the relatively benign outcome of the stress tests, it added.

Nervous investors bailed out of the banks, sending Lloyds down 1.94 to 43.24p while Royal Bank of Scotland (LSE: RBS.L - news) shed 1.16 to 35.01p and Barclays lost 7.75 to 221p.

Their falls came as the market remained jittery about a failure to break the debt deadlock in America, where the Government is expected to hit its borrowing limit on August 2. Persistent sovereign debt concerns in Europe were also evident in the climbing yields of Spanish and Italian bonds. The FTSE 100 tumbled 73.15 points to 5856.58 while the FTSE 250 (FTSE: ^FTMC - news) sank 138.58 points to 11650.34.

Along with the banks, Burberry eased 40p to 15.09 while Centrica (LSE: CNA.L - news) fell 5.4 to 320.3p after Ofgem fined its British Gas business 2.5m for breaching regulations related to the handling of customer complaints. But on the upside, Autonomy (Dusseldorf: AUY.DU - news) advanced 64p to 17.20 as second-quarter sales at the software company jumped 16pc. Accountancy software business, Sage , put on 4.3 to 218.4p.

& DowngradesBonds.Related Quotes
Symbol Price Change
399320.SZ 2,095.00 +16.95

ABX.SG 0.00 0.00

BARC.L 221.00 -7.75

MCO 35.58 -1.84

NBXB.BE 0.57 0.00

Emma Rowley, 21:02, Wednesday 27 July 2011

As possible financial Armageddon looms in the shape of warring American politicians, many are asking what happens if the worst - a default by the US on its debt - is avoided, but the country still loses its prized triple-A credit rating?

The scenario is increasingly under discussion. Standard & Poor's, one of the triumvirate of leading credit rating agencies, has warned it could cut its rating on US Treasuries (government bonds) even if the debt ceiling is raised, since politicians may not agree to cut spending as it wants.

Investors are now turning to Japan (NYSE: MCO - news) for lessons as the country has first-hand experience of losing a top-notch rating. Certainly, Tokyo offers up a glaring example of what not to do over a downgrade.

Back in 2002, Takeo Hiranuma, the then economy minister, was the focus of an international row over his reaction to the decision by Moody's Investor Service (Shenzhen: 399320.SZ - news) to put his country's rating on a par with various emerging economies and below Botswana.

"About half of the people of Botswana are AIDS patients and it is outrageous that [Japan's] rating is lower," he fumed. Soon not only did he have faltering growth to deal with, but he also had to make a grovelling apology to AIDS sufferers over his (factually inaccurate) comment.

The drama marked just one of a series of downgrades which followed the move from Moody's to cut Japan's sovereign rating one notch, from Aaa to Aa1 (SNP: ^AA1Y - news) , its second highest grade, in November (Berlin: NBXB.BE - news) 1998.

Citing long-term risks arising from economic and policy weaknesses, Moody's put an end to the country's hopes to keep its prime credit rating.

The decision had already been anticipated a few weeks earlier when Fitch, the smallest of the top three agencies, downgraded Japan's foreign-denominated debt. Standard & Poor's, the last of the trio, eventually followed suit.

Yet ignoring the indignity of it all, Barry Knapp, an economist at Barclays (LSE: BARC.L - news) Capital, thinks the impact was not as bad as it looked. He concludes that it was the "macro fundamentals" - the bright spots and problems in Japan's economy - which drove asset prices, rather than the cut to the country's credit rating.

Admittedly, the reaction to the Moody's downgrade did look alarming. The yields, or returns, on Japanese government bonds rose sharply, suggesting investors demanded greater rewards to shoulder the risks around the debt. But "counter-intuitively", the yen and the Nikkei index (Osaka: ^N225 - news) rallied.

It turned out that Japan's industrial production had just bottomed out. Moody's had chosen to downgrade Japan "at the end of recession".

Not only that, but it was the autumn of the $4.6bn collapse of hedge fund Long-Term Capital Management. Worried investors' "flight to quality" such as Japanese bonds had depressed the yields.

That suggested that yields were already set to rise (in other words, demand for the bonds would fall) as markets regained their appetite for riskier assets. "The sharp move higher in yields had already begun prior to the downgrade and continued as the economy emerged from recession," Mr Knapp (Stuttgart: A0Q4LG - news) summarised.

What does this mean for the US? It will be downgraded but the big picture figures will drive shares, bonds and the dollar, Mr Knapp predicted. "After a brief muted market reaction, the direction of the markets will be highly leveraged to the data with expectations of a [second half of 2011] rebound in economic activity hanging in the balance."

A reassuring view assuming, of course, that the threat of default is just that.

Last updated: July 27, 2011 2:52 pm

Moodys downgrades Cyprus bonds
By Joshua Chaffin in Nicosia and Peter Spiegel in Brussels
Cyprus moved closer to becoming the fourth eurozone country to need a bail-out after Moodys downgraded its bonds to just two notches above junk, arguing that political turmoil on the island and its exposure to Greek debt raised questions about its ability to service its own debt.

Senior European officials insisted there were no special talks underway with Nicosia and said they did not believe a bail-out was imminent.

More
On this story
Triple wave of trouble threatens Cyprus
Editorial Cyprus awash in a tide of troubles
Cyprus bank chief sounds warning
Cyprus governor warns of emergency after blast
Notebook The shaky basis of the Greek rescue
It is not on my immediate radar screen, Franis Baroin, Frances finance minister, told the Financial Times on Wednesday.

But the Cypriot banks Greek debt exposure has raised concerns, particularly after last weeks eurozone deal, which will lead to defaults of some Greek bonds.

The country also faces political turmoil, with President Demetris Christofias calling for the resignations of all members of his cabinet at a meeting scheduled for Thursday.

A munitions dump explosion near the countrys largest power plant two weeks ago killed 13 and led to rolling blackouts across the island. The economic impact of the accident could be substantial. Moodys said it now believed there would be no growth in 2011; the Cypriot government had projected 1.5 per cent.

The accident has led accusations and ministerial resignations over what the government knew about the risks to the power plant. The upheaval has stalled an austerity package that European Union officials believed was essential to restoring the countrys fiscal health.

Cypriot banks are among the eurozones largest holders of Greek bonds. According to the European Banking Authority, Bank of Cyprus holds 2.4bn in Greek debt and Marfin Popular Bank holds 3.4bn.

Yields on Cyprus 10-year bonds maturing in 2014 jumped 0.85 percentage points to 10.18 per cent, well above the borrowing rates that forced countries like Ireland and Portugal into bail-outs.

We are monitoring the situation of the banking sector in Cyprus closely and are in contact with the authorities, said one senior European official.

Standard and Poors cut its rating on Greek sovereign debt from triple C to double C, the same level as Moodys, in anticipation of a selective default on some Greek bonds.

Hi Skinny,

Your right. Private Frazier it was.
Mind you a bit of cold steel up em (they don't like it Mr Mannering, they don't like it) might just wake them up a bit.

Cheers Greek

Debt crisis: America faces a decision that will affect us all

To understand the origins of todays stand-off between Republicans and Democrats over the US debt crisis, it is necessary to revisit an event which took place in Boston Harbour nearly 238 years ago. On December 16, 1773, a group of Massachusetts colonists boarded ships belonging to the East India Company and threw the entire cargo into the sea. There, in tax rebellion, began the American Revolution.

This iconic event in US history, the one from which the modern Tea Party takes its name, helped establish a national aversion to taxation that has remained at the heart of the American psyche ever since. For a people defined by the idea of rugged individualism, self-reliance and the frontier spirit, the presumption of low taxes and correspondingly small government is an article of faith as sacred as motherhood and apple pie.

Skinny,

I think the tea party and other barking mad parties (BNP, UKIP, Neo Fascists, Right wing partiesetc.) are -perfectly correct.

There should be no taxation, or at least reduce to as close to zero, as is possible.

A perfect society, without police, lanes instead of roads, sewerage in the gutters, education for only those who can pay. No emergency service, who needs them anyway. (At the moment.)

The comparison of the Tea Party an the organisers of the American Revolution doesn't stand examination. The taxes being paid by "Americans" to "England" were disproportionate and seen as payment to a distant elite by those who saw themselves as disenfranchised.

What could US President Barack Obama do if debt talks fail?

tweet0Print..Topics:USUpgrades & Downgrades.Reuters, 21:11, Thursday 28 July 2011

If the impasse over the US debt limit is not broken soon, President Barack Obama will be forced to decide how he will manage the crisis.

The US is drifting closer to a credit rating downgrade and default as Obama's Democrats and their Republican rivals work on competing plans to cut spending and raise the debt ceiling.

Treasury Secretary Timothy Geithner and a small team of his aides have worked on contingency plans should Congress fail to raise the US borrowing limit by an August 2 deadline.

Officials said on Wednesday the Treasury will lay out a plan in the next few days about how the government will operate if it appears Congress may miss the deadline.

The administration has said little in public about its plans and there is disagreement among private sector experts on the feasibility of some of the options. A number of them are complicated and could provoke a political backlash.

Even if the administration were to implement some of the options, the debt crisis could still trigger turmoil in financial markets, sending the dollar lower, US interest rates higher and putting the economy at risk.

Here is a look at the steps Obama could consider.

= Sale of assets =

Treasury could consider selling off some of the government's assets, including holdings of gold and mortgage-backed securities.

US officials say this option has major drawbacks because it would show the world the US is having difficulty honoring its obligations. These officials say the government might also have to accept firesale prices for the assets and that the sales likely would not buy much time.

= 14th Amendment =

Some legal scholars see a possible trump card for Obama in a provision of the Constitution that says the US's public debt "shall not be questioned".

Those scholars contend the 14th Amendment clause would give Obama the right to bypass Congress and raise the debt limit on his own.

Other legal experts believe Obama does not have the authority to ignore the cap on borrowing set by Congress. Obama administration officials have said they do not see the 14th Amendment clause as a solution to the impasse.

"I have talked to my lawyers," Obama said when asked about the option at a town hall forum. "They are not persuaded that that is a winning argument."

Treasury Secretary Timothy Geithner said that bypassing Congress was "not a workable option" to avoid a default crisis.

Obama's spokesman, Jay Carney, has issued the strongest denial so far that it could be used. "The Constitution makes clear that Congress has the authority, not the President, to borrow money and only Congress can increase the statutory debt ceiling," he said.

= Prioritising payments =

If the Treasury decides that neither an asset sale nor the use of the 14th Amendment are workable, it could look at delaying some payments to recipients of government benefits, government employees, outside contractors or other parties to ensure it has enough cash on hand to keep paying interest on its debts.

The Treasury will collect $172bn in revenue in August. Without fresh borrowing, that would cover only 45pc of the $306bn in payments the government is scheduled to make next month, according to the Bipartisan Policy Center think tank.

Some conservative Republicans have suggested Treasury could manage a default by shutting down many government services and putting a priority on debt payments. Geithner has dismissed this as unworkable.

If talks with congressional leaders on the debt ceiling fail, one big decision Obama would face would be what to do about a $49bn Social Security payment scheduled to go out on August 3.

Obama has warned that Social Security payments could be at risk without an increase in the debt limit.

Changing the dates of the 80m payments the government makes every month would also be complicated because the payments are automated so computers would need to be reprogrammed.

= Enlisting the help of the Federal Reserve =

In a sign that financial authorities were coordinating closely on the unfolding debt drama, Geithner has met with Federal Reserve Chairman Ben Bernanke and New York Federal Reserve Bank President William Dudley.

Philadelphia Fed President Charles Plosser told Reuters the US central bank, which acts as the Treasury's broker in financial markets, could not step in and borrow money on the Treasury's behalf. He said that would amount to conducting fiscal policy, which is not part of the Fed's mandate.

But the Fed might need to become involved in some operational issues since it clears checks for the government for everyone from Social Security recipients to federal workers.

Plosser said issues that would need to be looked at include: "How the Fed is going to go about clearing government checks? Which ones are going to be good? Which ones are not going to be good?"

Because the New York Fed is regularly in close contact with financial market participants, the central bank would also play a crucial role in monitoring the market reaction if a default or US credit downgrade were to spark a panic among investors. The central bank played a similar role during the 2008 financial meltdown following the collapse of Lehman Brothers.

Do not laugh but the international monetary Fund has warned france it faces a down grade
of its triple AAA rating unless it gets its spending under control. HAHAHAHa

..US Politicians Delay Crucial Debt Deal Again

Sky News 55 minutes ago
US Politicians Delay Crucial Debt Deal Again
....US politicians have hit another stumbling block as they urgently try to avoid an unprecedented debt default.

Republicans refused to back a budget deficit plan proposed by their own congressional leaders on Thursday night, further delaying a compromise with Democrats.

The party now says it will meet on Friday to assess their options - but leaders have so far been unable to convince some of their members that the plan is their best option to win deep spending cuts and avoid a default on August 2.

The delay resulted from House Speaker John Boehner's need for more time to try to overcome objections from conservative rebels in his own party.

It was not immediately clear what Mr Boehner intended to do regarding the legislation or when a vote might be held.


He has been grappling with Republican lawmakers such as Mick Mulvaney, a supporter of the Tea Party movement, that wants deeper spending cuts than Boehner has proposed.

Politicians are under pressure to lift the government's borrowing limit by Tuesday or risk a default and downgrade of the top credit rating that helps makes US debt a pillar of the global financial system.

However, even if a deal to raise the debt limit is struck, a downgrade of the US credit rating is likely unless a dent is made in the country's deficit.

A downgrade would raise US borrowing costs, hurt the already weak economy and would worry global investors.

International Monetary Fund chief Christine Lagarde has warned of the risks of Congress failing to raise the debt ceiling.

"One of the consequences could be a decline of the dollar as a reserve currency and a dent in people's confidence in the dollar," Ms Lagarde said.
...

I have a cunning plan.

I think that the USA and the EU could solve all it's financial problems if the USA joined the EU taking the Euro as its currency.
This would help the USA by taking the peg away from the dollar, which has been a false link for years.
As we all know the largest financial member of the EU is Germany, and they have benefited far more than any other country from membership.
If the USA became a member, they would obviously take over from Germany as the main hub of the European system.
They would not need to raise their monetary ceiling as they would never be allowed to go bust as that would be the end of the EU, so they would be allowed to print more money but backed by the new proposed Euro Bond.
The EU would of course benefit due to expanding its marketing/trading borders far more than ever envisaged, with the dollar going also opening the flexibility of the Euro.

China would of course then be forced to cut their inflationary policies or be left peddling their goods to none EU countries due to the Renminbi no longer being tied to the dollar.

The UK of course would the be in the driving seat, as their power of veto (which as we all know is sacrosanct) could be used to far more effect than ever due to the extra effect it would have on the enlarged EU area.

Its such a brilliant plan, I can't believe no one else has thought about it.

I propose to forward my idea to both the EU monetary commission, the US president and our prime minister

And why stop there, we could have a full world monetary union. I see one world wide currency, resulting in no monetary differential in the future.
If this was allowed to happen then no separate country would ever be allowed to default as due to the aforementioned single currency, it would effect all equally.

There would be fully open trade with no borders, as due to a single currency, trade barriers would be pointless.

World peace would of course follow.

I of course would go on to become financial adviser to all governments, earning vast amounts of money in the process, with at least a Knighthood of course.

What could go wrong.

I must say, that is an utterly brilliant plan, Greekman.

The only thing wrong with it, is that a handful of rebellious Republicans, who just need a mere 'winning over' to sensibility and it's 'job done'.

IMHO, all we need to sort all these debt problems out, is a tadge of rampant inflation.

Also, IMHO, that is what we are undoubtedly sooner or later, going to get.

What a stroke of luck that we have a government that is making the cuts before we get downgraded.

The effect being that the economy is shrinking and the UK is attempting to pay its debts with a falling GDP.

If I had an employee owing me money, I don't think I would take his tools of employment off him. I may help him to reorganise his financial problems.

If he had a reasonable business plan and he struck me as "honest", I may even lend him some more cash, to increase his profit margins by upgrading the tools.

Good god I am becoming a capitalist!

Mind Cameron experience of business was as a RR agent and it is showing.

Good to see the effects of this governments actions within the NHS is raising minimum waiting time to 15 weeks.

Brilliant efficiency move.

Hear there is a suggestion to reduce more Accident and Emergency Units and charge for road accidents.

Having bigger units covering larger areas, but unfortunately greater travelling distances. Costs should be less as many casualties will be DOA.

But it is hoped that Private Enterprise will step in and run new units more efficiently.

.