European Government seizing cash from private bank accounts in Cyprus

The move is part of the so-called rescue plan to get the country out of its financial crisis

REUTERS | MARCH 18, 2013

The surprise decision by euro zone leaders to part-fund a bailout of Cyprus by taxing bank deposits sent shockwaves through financial markets on Monday, with shares and the bonds of struggling euro zone governments tumbling.

The bloc struck a deal on Saturday to hand Cyprus rescue loans worth 10 billion euros ($13 billion), but defied warnings – including from the European Central Bank – and imposed a levy that would see those with cash in the island’s banks lose between 6.75 and 9.9 percent of their money.

Parliament in Cyprus put off a vote on the measure – which has shaken depositors’ confidence in banks across the continent – until Tuesday, however, and with public anger at the deal widespread the government said it was already looking to ease the pain for small savers.

Without the rescue, Cyprus would have be unable to avoid a default. That would have undermined the promise that Greece’s debt writedown last year was a one-off, but the unprecedented move to hit depositors adds a radical new dimension to the crisis across the euro zone.

The initial response of investors was unambiguous. Shares lurched lower, the euro fell to a new three-month low, while safe-haven assets such as gold and German government bonds jumped.

The cost of insuring the debt of even high-quality European banks against default also rose sharply with analysts citing fears the decision could spark contagion across peripheral regions with the potential for widespread outflows of deposits.

“If I were a saver, certainly in Spain or maybe Italy, I think I’d be looking askance at these measures and think this could yet happen to me,” Peter Dixon, global financial economist at Commerzbank said.

The European Markit iTraxx senior financials index, which tracks the most important European bank credit default swap (CDS) rates, widened by 17 basis points.

Some credit default swaps in Spanish, Italian and Portuguese banks widened more sharply with the five-year CDS for Spain’s Santander 30 basis points higher, while for Italy’s UniCredit it was 23.5 basis points wider.

However, some in the markets were drawing support from a view that the safety measures put in place at the European Central Bank should contain the fallout.

“Clearly this is a negative development for European assets but in the terms of contagion we think it is quite limited,” said Guillermo Felices, head euro asset allocation at Barclays in London.

“There are tools – such as the ECB’s OMT (bond buying program) and the option of more 3-year LTROs (ECB loans to banks) that can provide liquidity if needed – that the market will feel comfortable about when assessing the longer-term implications.”

Three of the world’s biggest central banks are also expected to signal their fresh commitment to loose monetary policies this week.

The Bank of Japan welcomes a new governor on Wednesday who is likely to begin pumping huge amounts of yen into the recession-hit economy. On the same day the Bank of England may get a new pro-growth mandate in the British government’s annual budget, while the Federal Reserve is expected to reaffirm its commitment to the current aggressive U.S. bond-buying program.

Equity markets were underscoring the more immediate worries, however, that the Cyprus deal could see savers and firms in other highly indebted countries like Italy and Spain rush to pull money out of their own banks.

By 1115 GMT the pan-European FTSEurofirst 300 (.FTEU3) had clawed back around half of its initial losses but was still down 0.8 percent in its worst morning since last month’s inconclusive Italian election.

London’s FTSE 100 (.FTSE), Frankfurt’s DAX (.GDAXI) and Paris’s CAC-40 (.FCHI) were down 0.8, 1 and 1.4 percent respectively, leaving MSCI’s global share index <.MIWD00000PUS> down 0.85 percent.

CENTRAL BANK SUPPORT

In the currency market, the euro staged a slight recovery after having dropped as low as $1.2882 in the Asian trade, to session be up 0.1 percent on the day $1.2950.

The dollar (.DXY) itself, which investors often head for when tensions in Europe rise, gained 0.45 percent.

“Euro zone politicians will be at pains today to manage down the danger of contagion to other markets. The euro will find a little bit of support from that but markets will remain jittery,” said Jane Foley, senior currency strategist at Rabobank.

Italian and Spanish bond yields both jumped sharply as the two countries remain at the centre of concern in the euro zone due to the size of their economies which some economists warn would be too big to rescue.

If savers and firms did pull their money en masse from already strained banks it could tip the region back into full-blown crisis, although the ECB’s backstop measures are designed to prevent such problems.

The widespread anxiety drove up German government bonds, the traditional favorite of risk-adverse European investors, and indiscriminately pushed up the cost of insuring against a sovereign default in the euro zone’s southern rim.

German Bund futures were up 49 basis points at 144.09 by late-morning in Europe, while gold, another safe-haven asset, rising to a 2-1/2-week high of $1,608.30 an ounce before settling at $1,601.60, up 0.6 percent. (GOL/)

U.S. crude and Brent oil both tumbled, with Brent futures $1.70 a barrel lower at $108.12 before recovering a little to trade around $108.20 by 1030 GMT. U.S. oil declined $1.10 to $92.35. (O/R)

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Luxembourg Court backs Iceland’s decision not to pay banker-created Debt

By LUIS MIRANDA | THE REAL AGENDA | JANUARY 29, 2013

Who has to pay the bankers in Iceland’s banking crash? Not the Icelanders. Different from countries such as Spain and Ireland, Iceland decided that taxpayers should not pay for the excesses of an industry that had grown disproportionately, but most importantly, that had ramped up the country’s debt to a point where upwards of 90 % of the debt written under the country’s name was actually bank debt.

Iceland will compensate the British and Dutch two of the countries that had bet more heavily in the fictitious financial products offered by banks out of Iceland. The citizens said no twice through referendums, and now, five years after the collapse of its banking system, a Luxembourg court just gave the northern nation the reassurance that they did what needed to be done to get rid of the bankers’ tentacles.

The Court of the European Free Trade Association (EFTA) believes that the country did not violate any law when it refused to return to 300,000 savers money deposited in foreign entities offering some interests that then seemed to good to pass. “It is a victory for democracy. It sends the message that banks can not reap the benefits and send the bill to taxpayers when things go wrong, “says Magnus Skúlasson, an Icelandic economist.

The court, which also represented Norway and Liechtenstein, provides a very interesting nuance: Iceland is not obligated to pay as “the deposit insurance fund was unable to meet its obligations in the event of a systemic crisis “. The decision by the court would be equal to the FDIC fund not having enough cash to ensure the banking entities in the United States, with bankers demanding that U.S. taxpayers assumed the responsibility of a carefully crafted collapse of the American banking system. Just as in the case of Iceland, U.S. taxpayers would not be liable for the banks’ misconduct and therefore they wouldn’t have to pick up the tab.

A community spokesman was quick to answer that Brussels clings to the obligations of the deposit insurance funds that remain “valid also if there is a systemic crisis.” Nevertheless, the European Commission says it needs time to study the ruling. “The ruling is also good for the Netherlands and the UK. If they had won, it would mean that the nation-state is responsible for all bank deposits, something no country wants, “adds Jon Danielsson of the London School of Economics.

After the bankruptcy, the governments in London and Amsterdam used their coffers to compensate customers of the Icelandic bank. Shortly after they began the legal process that came to an end yesterday, as the ruling that Reykjavik considered “satisfactory”, does not admit any appeals.

Despite the support of the courts, Iceland has ended up paying some of the money. Reykjavik has already repaid about 3,300 million euros, about half of the total paid in Icesave, that corresponds to debt that the government itself was actually responsible for. The money corresponds to the debt from Landsbanki, one of three banks that failed in 2008 and led the entire country’s banking system to bankruptcy. The amount paid is more than 90% of the guaranteed minimum that the State was obliged to return.

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Attack on Sovereignty: The United States is the New World Order

By PAUL CRAIG ROBERTS | PCR.ORG | JANUARY 16, 2012

Those concerned about “The New World Order” speak as if the United States is coming under the control of an outside conspiratorial force. In fact, it is the US that is the New World Order. That is what the American unipolar world, about which China, Russia, and Iran complain, is all about.

Washington has demonstrated that it has no respect for its own laws and Constitution, much less any respect for international law and the law and sovereignty of other countries. All that counts is Washington’s will as the pursuit of hegemony moves Washington closer to becoming a world dictator.

The examples are so numerous someone should compile them into a book. During the Reagan administration the long established bank secrecy laws of Switzerland had to bend to Washington’s will. The Clinton administration attacked Serbia, murdered civilians and sent Serbia’s president to be tried as a war criminal for defending his country.

The US government engages in widespread spying on Europeans’ emails and telephone calls that is unrelated to terrorism. Julian Assange is confined to the Ecuadoran embassy in London, because Washington won’t permit the British government to honor his grant of political asylum. Washington refuses to comply with a writ of habeas corpus from a British count to turn over Yunus Rahmatullah whose detention a British Court of Appeals has ruled to be unlawful. Washington imposes sanctions on other countries and enforces them by cutting sovereign nations that do not comply out of the international payments system.

Last week the Obama regime warned the British government that it was a violation of US interests for the UK to pull out of the European Union or reduce its ties to the EU in any way.

In other words, the sovereignty of Great Britain is not a choice to be made by the British government or people. The decision is made by Washington in keeping with Washington’s interest.

The British are so accustomed to being Washington’s colony that deputy prime minister Nick Clegg and a group of UK business executives quickly lined up with Washington.

This leaves Great Britain in a quandary. The British economy, once a manufacturing powerhouse, has been reduced to the City of London, Britain’s equivalent to Wall Street. London, like New York, is a world financial center of which there are none in Europe. Without its financial status, there wouldn’t be much left of the UK.

It is because of the City’s financial importance that the UK, alone of the EU member states, kept the British pound as its currency and did not join the euro. Because the UK has its own currency and central bank, the UK was spared the sovereign debt crisis that has plagued other EU member states. The Bank of England, like the Federal Reserve in the US, was able to bail out its own banks, whereas other EU states sharing a common currency could not create money, and the European Central Bank is prohibited by its charter (at Germany’s insistence) from bailing out member states.

The quandary for the UK is that the solution to the sovereign debt crisis toward which the EU is moving is to strip the member governments of their fiscal sovereignty. For the individual countries, the spending, taxing and, thereby, deficit or surplus positions of the member countries’ budgets will be set by EU central authority. This would mean the end of national sovereignty for European countries.

For Britain to remain an EU member while retaining its own currency and central bank would mean special status for Great Britain. The UK would be the only member of the EU that remained a sovereign country. What are the chances that the UK will be permitted such exceptional status? Is this acceptable to Germany and France?

If the British are to fold themselves into Europe, they will have to give up their currency, central bank, their law, and their economic status as a world financial center and accept governance by the EU bureaucracy. The British will have to give up being somebody and become nobody.

It would, however, free the UK from being Washington’s puppet unless the EU itself is Washington’s puppet.

According to reports, sometime this year Scotland, a constituent part of the UK, is to vote on leaving the UK and becoming an independent country. How ironic that as the UK debates its dismemberment the country itself faces being merged into a multi-national state.

Wikileaks released material evidences US War Crimes

Yahoo News

WikiLeaks founder Julian Assange said Monday he believes there is evidence of war crimes in the thousands of pages of leaked U.S. military documents relating to the war in Afghanistan.

The remarks came after WikiLeaks, a whistle-blowing group, posted some 91,000 classified U.S. military records over the past six years about the war online, including unreported incidents of Afghan civilian killings and covert operations against Taliban figures.

The White House, Britain and Pakistan have all condemned the release of the documents, one of the largest unauthorized disclosures in military history.

Assange told reporters in London that “it is up to a court to decide really if something in the end is a crime. That said … there does appear to be evidence of war crimes in this material.”

Assange compared the impact of the released material to the opening of the East German secret police archives. “This is the equivalent of opening the Stasi archives,” he said.

The documents cover much of what the public already knows about the troubled nine-year conflict: U.S. special operations forces have targeted militants without trial, Afghans have been killed by accident, and U.S. officials have been infuriated by alleged Pakistani intelligence cooperation with the very insurgent groups bent on killing Americans.

WikiLeaks posted the documents Sunday. The New York Times, London’s Guardian newspaper and the German weekly Der Spiegel were given early access to the records.

White House national security adviser Gen. Jim Jones said the release “put the lives of Americans and our partners at risk.” In a statement, he then took pains to point out that the documents describe a period from January 2004 to December 2009, mostly during the administration of President George W. Bush. And, Jones added, before President Obama announced a new strategy.

Pakistan’s Ambassador Husain Haqqani agreed, saying the documents “do not reflect the current on-ground realities,” in which his country and Washington are “jointly endeavoring to defeat al-Qaida and its Taliban allies.”

The U.S. and Pakistan assigned teams of analysts to read the records online to assess whether sources or locations were at risk.

Pakistan’s powerful spy agency, Inter-Services Intelligence, said Monday that the accusations it had close connections to Taliban militants were malicious and unsubstantiated.

A senior ISI official said they were from unverified raw intelligence reports and were meant to impugn the reputation of the spy agency. He spoke on condition of anonymity in line with the agency’s policy.

Hamid Gul, a former head of the ISI who is mentioned many times in the documents, also denied allegations that he’d worked with the insurgents.

Assange said his group also had many more documents on other subjects, including files on countries from across the globe.

“We have built up an enormous backlog of whistleblower disclosures,” he said. “We have in this backlog … files that concern every country in the world with a population of over 1 million.”

He refused to go into detail, but said the information included “thousands of databases and files about all sorts of countries.”

Assange said that he believed more material would flood amid the blaze of publicity.

“It is our experience that courage is contagious,” he said. “Sources are encouraged by the opportunities that they see before them.”

* U.S. bombing of Children.  Read more details…

* War more out of hand than officials said.  Read more details…

Mobile phones responsible for disappearance of honey bee

London Telegraph

Their disappearance has caused alarm throughout Europe and North America where campaigners have blamed agricultural pesticides, climate change and the advent of genetically modified crops for what is now known as ‘colony collapse disorder.’ Britain has seen a 15 per cent decline in its bee population in the last two years and shrinking numbers has led to a rise in thefts of hives.

Now researchers from Chandigarh’s Punjab University claim they have found the cause which could be the first step in reversing the decline: They have established that radiation from mobile telephones is a key factor in the phenomenon and say that it probably interfering with the bee’s navigation senses.

They set up a controlled experiment in Punjab earlier this year comparing the behaviour and productivity of bees in two hives – one fitted with two mobile telephones which were powered on for two fifteen minute sessions per day for three months. The other had dummy models installed.

After three months the researchers recorded a dramatic decline in the size of the hive fitted with the mobile phone, a significant reduction in the number of eggs laid by the queen bee. The bees also stopped producing honey.

The queen bee in the “mobile” hive produced fewer than half of those created by her counterpart in the normal hive.

They also found a dramatic decline in the number of worker bees returning to the hive after collecting pollen. Because of this the amount of nectar produced in the hive also shrank.

Ved Prakash Sharma and Neelima Kumar, the authors of the report in the journal Current Science, wrote: “Increase in the usage of electronic gadgets has led to electropollution of the environment. Honeybee behaviour and biology has been affected by electrosmog since these insects have magnetite in their bodies which helps them in navigation.

“There are reports of sudden disappearance of bee populations from honeybee colonies. The reason is still not clear. We have compared the performance of honeybees in cellphone radiation exposed and unexposed colonies.

“A significant decline in colony strength and in the egg laying rate of the queen was observed. The behaviour of exposed foragers was negatively influenced by the exposure, there was neither honey nor pollen in the colony at the end of the experiment.”

Tim Lovett, of the British Beekeepers Association, said that hives have been successful in London where there was high mobile phone use.  “Previous work in this area has indicated this [mobile phone use] is not a real factor,” he said. “If new data comes along we will look at it.”  He said: “At the moment we think is more likely to be a combination of factors including disease, pesticides and habitat loss.”

The UK Government has set aside £10 million for research into the decline of pollinators like bees, but the BBKA claim much more money is needed for research into the problem, including studies on pesticides, disease and new technology like mobile phones.

According to the University of Durham, England’s bees are vanishing faster than anywhere else in Europe, with more than half of hives dying out over the last 20 years.  The most recent statistics from last winter show that the decline in honey bees in Britain is slowing, with just one in six hives lost.  This is still above the natural rate of ten per cent losses, but a vast improvement on previous years.

There has been an increase in the number of thefts of hives across the world and in Germany beekeepers have started fitting GPS tracking devices to their hives.