It is easy to ridicule European politicians for failing to solve the problems while continually claiming to do so. But what about markets, what about the media? Are they really any better than politicians with their rose-tinted glasses?

Barroso should have been careful with his wish that markets “act on fact not on fiction”. If markets actually did that they would never get themselves into a state of ecstasy whenever European leaders proclaim an end to the continent’s crisis. And yet the ensuing relief rally now belongs to the folklore of crisis meetings like press conferences in the dead of night and undiplomatic exchanges between top EU politicians.

Rapturous market reactions are now just as predictable as the political failures that cause them. Last Monday, three days before the results of the summit, I was interviewed on ABC Radio National about my expectations. My answer was …

Die Banken haben die Politik (wieder einmal) über den Tisch gezogen. Und Griechenland ist immer noch pleite.

Tyler Durden: Here Is How The 50% Greek Haircut Is Actually Just 28% (Zero Hedge)

Just the math, something Europe is unable to do:

- Greece has €350 billion in total debt including about €70 billion in Troika “post-petition” loans; these are untouched.
- Of the €280 billion, roughly €75 billion is held by the ECB: this, like the Troika loans, will be untouched.
- This leaves just ~€200 billion in actual debt to undergo a haircut.
- Apply a 50% haircut to this debt (ignoring the fact that of this about €35 billion is held by Greek pension funds, and once the realization that Greek pensions …

Während auf beiden Seiten des Nordatlantiks gegen die Schuldenkrise gekämpft wird, haben die Australier ganz andere Probleme. Sie müssen sich entscheiden, ob sie Teil des Westens bleiben oder sich verstärkt Asien zuwenden wollen. Angesichts der wirtschaftlichen Rahmenbedingungen sollte sich diese Frage eigentlich von selbst beantworten.

To describe Australia’s traditional position in the world two classic expressions come to mind, Geoffrey Blainey’s ‘tyranny of distance’ and Donald Horne’s ‘lucky country’. Both sum up Australia’s self-image as an outpost of the West, blessed with natural resources.

Despite their superficial straightforwardness, the terms have often been misunderstood. Blainey referred to the enormous distances within Australia as much as to Australia’s distance from Europe and America. And Horne’s saying was rather mockery than praise, which is obvious when you read the complete quote: “Australia is a lucky country, run by second-rate people who share its luck.”

As Australians …

Warum auch der nächste Euro-Krisengipfel keine dauerhafte Lösung bringt, habe ich im Radio- und Fernsehprogramm der australischen ABC erklärt. Und im SBS Radio gibt es das alles auch noch einmal auf Deutsch.

Update: Und heute Morgen noch einmal im ABC-Frühstücksfernsehen.

Und noch ein Update: Nachdem der Gipfel nun endlich geschafft ist, hier eine erste Einschätzung bei ABC News 24.

(Ideas@TheCentre, 21 October 2011)

The Occupy Wall Street movement has polarised public opinion: Either you regard the protestors as the new political avant-garde or as just plain silly. Either you believe they have a serious message or you think they are a bunch of nutters.

But what if the truth is a bit more nuanced than that? Perhaps the nutters have a point?

The silly stuff first: The protesters seem rather confused about what they are protesting against. They camp at Wall Street, which is fair enough if you want to object to financial capitalism. But they also protested in front of the Reserve Bank of Australia and the European Central Bank – not the usual suspects for financial excess.

It is also difficult to overlook some nasty anti-Semitic undertones in the rallies. One placard in Martin …

Once again the world is impatiently awaiting a European summit at which once and for all the continent’s problems will be comprehensively solved – or not. If history is anything to go by, we should not set our hopes too high. For modern Greece there has never been a lasting solution.

You may agree or disagree with Georg Wilhelm Friedrich Hegel’s deterministic world view, but it is hard to argue with the philosopher’s grim assessment of governments’ ability to learn: “What experience and history teach is this — that nations and governments have never learned anything from history, or acted upon any lessons they might have drawn from it.”

Since these words were written 180 years ago Europe’s dealings with Greece have proved Hegel right time and again. Greece is not a country with temporary economic, fiscal and monetary problems. It is a permanent basket …

For once Britain can be happy that there is the euro. As without all the discussions about Europe’s ailing currency, we would now be talking about the next sterling crisis.

As eurozone countries were once again engaged in a new round of emergency negotiations over Greece, bank recapitalisations and an extension to the EFSF rescue fund, the latest round of quantitative easing in the UK went almost unnoticed outside Britain.

The lack of international attention is despite the fact that a further £75 billion have now increased the total amount of Britain’s virtual money printing exercise to £275 billion. What’s more, it is possible (if not likely) that the Bank of England will continue this policy to much higher levels.

The EFSF extension is too small to make a difference and it comes too late to calm the markets. But the debate made it abundantly clear that Germany is not prepared to go any further in saving the euro – neither through fiscal nor monetary measures.

Merkel was spared the humiliation of losing the support of her own coalition in the EFSF vote. In the end, only fifteen parliamentarians from the parties forming her government voted against the package. However, this was due to exerting enormous pressure on MPs. Merkel may have also benefitted from an embarrassing level of ignorance about the package. Many lawmakers simply did not know what they were voting on.