The Cypriot Template, The Greek Temptress And More Borisconi Tosh

By John Ward: A regular Irish correspondent, whose sharp eyes I value greatly, writes to remind me that the small island of Cyprus hasn’t gone away…but all its money has.

Equally mind-focusing, however, is the fact that when one analyses Cyprus on a comparative basis, the banking system that went spectacularly down the pan there a year ago was in most respects very similar to a great many currently extant in the US, the UK, Europe, Australia and South America. Zero Hedge put America under that spotlight this week, declaring that ‘the FDIC, which is supposed to insure deposits in the Land of the Free….is inadequately capitalized, failing to meet the legal minimum for its insurance fund. All of this is backed up by the US government, whose net worth is negative $17 trillion…. (BROKE) The Federal Reserve is supposed to be able to bail out the banks. But at this point, with $50+ billion in unrealized losses and a net equity of just 1.35% of its record $4+ trillion in assets, the Fed itself is practically insolvent.’

At the time of the financial rape of Cyprus, the EC (and most particularly Wheelchair Wolfie) tried to position the island as some kind of giant tax-evading casino with an unsustainable business model, catering to the needs of the Russian mafia. But as usual with Herr Schäuble, this was all so much dissembling poppycock. Cyprus got into trouble by trying too hard to help the Greeks keep their bullies at bay;
the Russian gangsters got their money out before the axe fell; and expats with £100,000 in savings are not fat oligarchs: they’re middle income pensioners living off their savings on a cheap and sunny island. What Brussels-am-Berlin wanted was unrestricted access for the EU to the gigantic reserves of gas and oil around Cyprus. Erdogan kept quiet about both this robbery and the attempt to blunder into Syria. His reward was one third of all future energy revenues from Crete’s waters.

It’s a grubby old world out there, but sanctimonious Belgians and Germans are about as bad as it gets. After the Swiss.

But what of the new improved, fully recovered, Merkel-approved Greek butterfly that took to the skies this week after five years in the chrysalis? Our man in New Mexico points out that, at just under 5% yield with repayment as near as damn-it guaranteed, for Hedge Funds buying this week’s Greek sovereign debt, the issue was offering six times the return available on German bunds. This was confirmed later by stats showing that 1 in 3 of those buying this paper tiger were Hedgies. One in three.

A sharp-eyed Athenian lady with a tongue to match points out that the issue was nothing other than Eurobonds in disguise. Investors buy them because of the implied, alleged, suggested support from the ECB, where Mario Draghi had pledged to do anything he needs to in order to support the euro and eurozone. This is of course very true – most of the money raised is owed to EC and IMF anyway now.

I wonder how many Greeks bought them. Probably none, as they’ve been too busy of late burning the furniture for warmth, foraging in the litter bins, looking for a job or trying to survive with tax-inflated prices everywhere. Greece in general – and Athens in particular – continue to make a mockery of the ‘deflation threat’ we hear so much about. But then the entire Berlin-driven strategy there is one in which all rules are reversed to keep the false flags waving merrily.

Meanwhile back on the ground, the issue raised less than 1% of Greece’s formidable public debt – we’ve had gesture politics, welcome to the world of gesture borrowing – and the day before, Greece held a General Strike. The day after, a car bomb went off outside the Bank of Greece. If the target was its boss Alexandros Tourkolias then police might as well call off the investigation now, as the perpetrators could’ve been anyone from Nicolas Sarkozy to Beppo Grillo. Not many know this, but Tourkolios has a Master’s Degree in the Philosophy of Shipping Economics from the University of Wales. As a cv item, they don’t come more surreal than that one.

Perhaps the last word in reality should be left to Professor Charles Wyplosz of the University of Geneva University:

“Debts above 130pc of GDP for Italy and 170pc for Greece are a recipe for disaster once we go into the next downturn….Today’s politicians believe the crisis is over and don’t want to hear any more about it, but they have not tackled the core issues of fiscal union and public debt,” he told a Euromoney conference on Wednesday. (See the last Readerama for confirmation from other sources of the shambolic nature of the ‘Union’ achieved thus far).
Another subject in the previous Readerama was the public money wasted by London Mayor Boris Johnson on his Thames estuary airport “plan”. There was some spluttering afterwards from City Hall et al in my inbox here, so let me just quote (again thanks to a Slogger’s keen eye for detail) this piece from Kent Online last September – which, as you will see, uses BoJo’s own accounts as the source:

‘Boris Johnson has spent £1.4 million promoting the idea of a Thames Estuary airport. Figures released by Transport for London reveal the London Mayor’s huge financial commitment to pushing a project which would irrevocably change the Towns. Since 2010 a total of £1,435,682 has been spent by TfL. The bulk of the cash, around £1.2 million, has gone to paying consultancy fees.’

This is the same Mayor Johnson who earlier this week replied to my email about Ebbsfleet concerns by saying that he had no jurisdiction over the Thames Estuary. Isn’t that £1.44m therefore a flagrant misuse of public funds?

“Not when Bojo does it,” came a chorus of trillling admiration from the Society for the Deification of Fat Frauds, known more colloquially as SODOFF.

Source 

X art by WB7