Germans Furious After Varoufakis/Tsipras Admit "Greece Will Never Repay Its Debts" | Zero Hedge

The Greco-Germanic war of words continues... Having pissed off The Greeks with his "Troika" remarks, Germany's Schaeuble went on today to more ad hominum attacks by reportedly calling the Greek FinMin "foolishly naive." The Greek ambassador has 'officially' complained to "friend and ally" Germany about the personal insult. But The Greeks had the last laugh, as first Varoufakis and then Tsipras explained respectively that "Greece would never pay back its debts," and "Greece cannot pretend its debt burden is sustainable." The German response, via tabloid Bild, "there must be an end to this madness. Europe must not be made to look stupid."

As Bloomberg reports, Germany and Greece confirmed Thursday that the Greek ambassador in Berlin made an official protest late Tuesday to the German Foreign Ministry over comments made by Schaeuble.

Schaeuble and his Greek counterpart Yanis Varoufakis have traded barbs in recent weeks, with Schaeuble on Tuesday suggesting that Varoufakis needed to look more closely at an agreement that Greece signed in February: “He just has to read it. I’m willing to lend him my copy if need be.”

“It was a complaint after what he (Schaeuble) said about Mr. Varoufakis. As a minister of a country that is our friend and our ally, he cannot personally insult a colleague.”

Koutras did not specify what the insult was, but Greek media had reported that Schaeuble had said that Varoufakis was “foolishly naive.”

Complete story at - Germans Furious After Varoufakis/Tsipras Admit "Greece Will Never Repay Its Debts" | Zero Hedge

Germans Furious After Varoufakis/Tsipras Admit "Greece Will Never Repay Its Debts" | Zero Hedge

The Greco-Germanic war of words continues... Having pissed off The Greeks with his "Troika" remarks, Germany's Schaeuble went on today to more ad hominum attacks by reportedly calling the Greek FinMin "foolishly naive." The Greek ambassador has 'officially' complained to "friend and ally" Germany about the personal insult. But The Greeks had the last laugh, as first Varoufakis and then Tsipras explained respectively that "Greece would never pay back its debts," and "Greece cannot pretend its debt burden is sustainable." The German response, via tabloid Bild, "there must be an end to this madness. Europe must not be made to look stupid."

As Bloomberg reports, Germany and Greece confirmed Thursday that the Greek ambassador in Berlin made an official protest late Tuesday to the German Foreign Ministry over comments made by Schaeuble.

Schaeuble and his Greek counterpart Yanis Varoufakis have traded barbs in recent weeks, with Schaeuble on Tuesday suggesting that Varoufakis needed to look more closely at an agreement that Greece signed in February: “He just has to read it. I’m willing to lend him my copy if need be.”

“It was a complaint after what he (Schaeuble) said about Mr. Varoufakis. As a minister of a country that is our friend and our ally, he cannot personally insult a colleague.”

Koutras did not specify what the insult was, but Greek media had reported that Schaeuble had said that Varoufakis was “foolishly naive.”

Complete story at - Germans Furious After Varoufakis/Tsipras Admit "Greece Will Never Repay Its Debts" | Zero Hedge

Russian Foreign Debt Fell $130 Billion in 2014 - Russia Insider

Russia's overall foreign debt fell by nearly $130 billion in 2014, Central Bank data showed on Tuesday, with total debt standing at $599.5 billion on Jan. 1, 2015.

Foreign debt has been falling rapidly in recent months as companies pay off foreign loans. Western sanctions imposed over the Ukraine conflict are making it harder for them to borrow abroad and refinance their debt.

However, much of the decline was a nominal effect. The ruble's devaluation has reduced the dollar value of foreign debts denominated in rubles.

Foreign exchange reserves have also been falling rapidly, declining last year to $385.5 billion from $509.6 billion.

The Central Bank said external debt of companies and banks at the start of 2015 stood at $547.6 billion, down from $651.2 billion a year earlier and from $659.4 billion on July 1.

Complete story at - Russian Foreign Debt Fell $130 Billion in 2014 - Russia Insider

The Humane Thing to Do Is to Let Ukraine Default - Russia Insider

Ukraine is a big country. After Russia it is the second largest in Europe. It is also a very populous country. It numbers 45 million people. I'm told that is more than lived in the entire Roman Empire.

In economic terms, however, Ukraine is sadly a minnow. Its GDP is about $180 billion.

In other words, its economy is smaller than that of Peru, Romania, Kazakhstan, Portugal and Greece — all of whom have far smaller populations and none of whom are known for exceptional wealth.

Ukraine’s budget in recent years has hovered at just under $60 billion. That is a small number.

Primarily due to a drastic fall in the exchange rate of its currency, its 2015 budget only amounts to $30 billion.

By comparison Slovenia is a post-Communist country in Central Europe of 2 million people. It has a budget of $20 billion.

Russia’s 2015 budget is $390 billion (3-4 times Ukraine’s population but 12 times the budget).

Complete story at - The Humane Thing to Do Is to Let Ukraine Default - Russia Insider

Russia's Duma mulls a bill that would let Russia stop paying debts to the aggressors and the states who introduced economic and financial sanctions against Russia

Russia's Duma mulls a bill that would let Russia stop paying debts to the aggressors and the states who introduced economic and financial sanctions against Russia.

Indeed, why should Russia continue to pretend that it is "business as usual," when the West tries to depose the Russian government and is making normal relations impossible? Why should Russia's obligations be kept as usual, when the West is making it clear that it is free to discard any rules and any of its own obligations?

Indeed, why should Russia pay debts which the West makes under sanctions much harder to pay back, in addition to freezing (and seizing) selected Russian assets? But with the one exception of agricultural products, Moscow tried to make virtue out of weakness (or incompetence? or impotence?) by "not responding," that is, by boasting of not taking any systemic defensive and much needed counter-measures, thus letting the West to play the game of progressive intimidation in which the West was promising possible future softening of actions that hurt Russia in exchange for real, major present concessions on the ground (principle already tried with Milosevic and Yanukovich: you retreat or disarm now and we will think about our reciprocity once the situation on the ground has radically changed as a result of you making the first step or "you shoot yourself first and we will then think whether we should do something similar as we make you believe that we have promised").
In war (and this is war), besides weapons and resources, one also needs a good mind and balls. Without balls, the mind is impotent, and without the mind, balls are just sacks.

Jon Hellevig: "If this goes forward then hell is loose. Law initiative aims at terminating of payments of Russian debt to foreign countries that have imposed sanctions on Russia. This would be done by amending the civil law provision of force majeure by adding sanctions among such conditions. - The law initiative stems from a known radical lawmaker, so we cannot know if it will fly. But the respected paper Izvestia already wrote about it. Maybe testing the reactions?"

Complete story at - Vladimir Suchan: Logos politikos: Russia's Duma mulls a bill that would let Russia stop paying debts to the aggressors and the states who introduced economic and financial sanctions against Russia

The Disgrace of Sacrificing a Generation - The Automatic Earth

Would you like to know how bankrupt our societies are? Financially AND morally? Before you say yes, please do acknowledge that you too are party to the bankruptcy. Even if you have means, or you have no debt, or you’re under 25, you’re still letting it happen. And you may have tons of reasons or excuses for that, but you’re still letting it happen.

Our financial and moral bankruptcy shows – arguably – nowhere better than in the way we treat our children. A favorite theme of mine is that any parent you ask will swear to God and cross and hope to die that they love their kids to death, but the facts say otherwise. We only love them as far as the tips of our noses, or as far as the curb. That means you too.

While we swear on our mother’s graves that we love them so much, we leave them with a world that lost half of its wildlife species in 40 years, that can expect to make coastal areas around the globe uninhabitable during their lifetimes, and a world that is so mired in debt just so we can hang on to our dreams of oversized homes and cars and gadgets that all there will be left for them are nightmares.

But I always wanted what was best for them! Yeah, well, you always chose to not pay too much attention, too, and instead elected to work that job you hate and keep up with the Joneses and tell yourself there was nothing you could do about it anyway other than a yearly donation to some socially accepted charity in bed with corporations (you didn’t know? well, did you try to find out?)

You elected leaders that promised to let you keep what you had, and provide more of the same on top. You voted for the people who promised you growth, but you never questioned that promise. You never wondered, sitting in your home, the size of which would only 100 years ago have put aristocracy to shame, what would be the price to pay for your riches.

Complete story at - The Disgrace of Sacrificing a Generation - The Automatic Earth

"De-Dollarizing" Russia Pays Down Near-Record $53 Billion In Debt In Third Quarter | Zero Hedge

Despite the reassuring narrative from The West that Russia faces "costs" and is increasingly "isolated" due to sanctions for its actions in Ukraine, the most recent data suggests reality is quite different. First, capital outflows slowed dramatically in Q3 (from $23.7 billion in Q2 to $13 billion in Q3) with September seeing capital inflows for the first time since Sept 2013. Second, Russia's current account surplus was significantly stronger than expected ($11.4 billion vs $8.8 billion expected) driven by increased trade. Third, and perhaps most crucially, Russia paid down a massive $52.8 billion in foreign debt as Putin "de-dollarizes" at near record pace, reducing external debt to the lowest since 2012.

As Goldman explains, Trade and income improved notably...

The current account balance for Q3 came in at a surplus of US$11.4bn, above consensus expectations of US$8.8bn and up sharply from a small deficit of US$0.7bn in Q3 2013.

On our estimates, on a seasonally-adjusted basis, this now puts the current account at 3.8% of GDP, up from a low point of 1% in Q2 2013 and 1.6% for the full-year 2013.

The improvement in the current account came from both the trade balance, where imports have contracted (due to slowing domestic demand and the weaker Ruble), and from the income balance.

In our view, the latter could be due to either cyclical or structural factors, which are difficult for us to pinpoint, but risks to our current account balance forecasts nonetheless remain to the upside.

Complete story at - "De-Dollarizing" Russia Pays Down Near-Record $53 Billion In Debt In Third Quarter | Zero Hedge

Forward Guidance | KUNSTLER

     Guess what? There is none. Rather, the Federal Reserve practice of Delphically divulging its intentions ought to be understood as the master pretense of US economic life — the delusion that wise persons are actually in control of anything. The result of this guidance continues to be the mis-pricing of everything, especially the cost of money as represented in the operations of debt, and hence the value of everything denominated in money.

     The interventions of our central bank have really been aimed at one objective: to compensate for the contraction of real wealth in an economy that replaced purposeful activity with Kardashian studies and tattoo art.  Purposeful economic activity provides surpluses that allow for the repayment of debt. Kardashian study and tattoo art lead to entropic entrapment, aka, a death spiral of culture and economy. That’s where we are at. The debt is now eating us alive, and the central bank trick of piling on additional debt to mask the failure of repaying old debt is losing  its palliative punch.

     One big problem with the Fed’s policies is that the mis-pricing of everything ends up being expressed in the very statistics (GDP, unemployment, inflation) that are used to justify further interventions that produce ever deeper perversities. That is, the Fed distorts prices, which distort statistics used to make policy, which prompt the fed to ramp up policies that further distort prices, a dangerous recursive dynamic. Since prices are the basic information for running an economy, we end up in a situation where nothing really adds up. The antidote to that has been pervasive accounting fraud — the covering-up of mis-pricing, pretending that things add up when they don’t.

Complete story at - Forward Guidance | KUNSTLER

Forward Guidance | KUNSTLER

     Guess what? There is none. Rather, the Federal Reserve practice of Delphically divulging its intentions ought to be understood as the master pretense of US economic life — the delusion that wise persons are actually in control of anything. The result of this guidance continues to be the mis-pricing of everything, especially the cost of money as represented in the operations of debt, and hence the value of everything denominated in money.

     The interventions of our central bank have really been aimed at one objective: to compensate for the contraction of real wealth in an economy that replaced purposeful activity with Kardashian studies and tattoo art.  Purposeful economic activity provides surpluses that allow for the repayment of debt. Kardashian study and tattoo art lead to entropic entrapment, aka, a death spiral of culture and economy. That’s where we are at. The debt is now eating us alive, and the central bank trick of piling on additional debt to mask the failure of repaying old debt is losing  its palliative punch.

     One big problem with the Fed’s policies is that the mis-pricing of everything ends up being expressed in the very statistics (GDP, unemployment, inflation) that are used to justify further interventions that produce ever deeper perversities. That is, the Fed distorts prices, which distort statistics used to make policy, which prompt the fed to ramp up policies that further distort prices, a dangerous recursive dynamic. Since prices are the basic information for running an economy, we end up in a situation where nothing really adds up. The antidote to that has been pervasive accounting fraud — the covering-up of mis-pricing, pretending that things add up when they don’t.

   

Complete story at - Forward Guidance | KUNSTLER