Free Republic

Unemployment in the eurozone fell for the first time in over two years, according to new statistics. The new figures show that24,000 fewer Europeans were considered unemployed since May. The jobless rate in the 17-member eurozone is still high at 12.1 percent and a decrease in spending by shoppers in France Germany, and Spain will mar the promising new data. Domestic demand across Europe remains weak due to the downturn and austerity measures being taken by many nations. In the 27-member European Union, the unemployment rate is 10.9 percent, down from 11 percent in May. The jobless rate of young...

The eurozone is still a mess. Instead of improvements, I just see more troubles. Economic slowdown in the region’s debt-infested nations is already staggering, but even those that were able to fight it are now experiencing huge problems. Around this time last year, the European Central Bank (ECB) was very clear about its plan for the eurozone crisis. It said that it’s “ready to do whatever it takes.” Back then it was the greatest relief to the market—the announcement calmed the rising debt rates in the eurozone and sent a wave of optimism toward the key stock indices. But it...

In retaliation for ridiculous EU tariffs on solar panels (sponsored mainly by France over the objections of Germany) China Declares War On Wine. Via Mish-modified Google translate from El Economista ... The Chinese government has decided to launch an investigation into the European wine sector with the later intention to apply a punitive tax if necessary, as China authorities accuse wine producers in the European Union (EU) of unfair trade tactics such as dumping and subsidies. The temporary imposition of a tariff on Chinese solar panels by the EU started a trade war whose greatest victim is wine. "This...

Moody’s Investors Service late on Monday said that it considers Cyprus to have defaulted after the debt-stricken island country swapped some local bonds for longer-term bonds. The ratings agency, which does not use a “default” or “selective default” rating, said it will revisit Cyprus’s rating to assess the impact of the exchange on the sustainability of the nation’s debt burden. Other factors, including the likelihood that Cyprus will comply with the rest of the measures spelled out in its bailout agreement with the International Monetary Fund, the European Central Bank and the European Union, will be taken into consideration as...

Bill Gross Discusses the "Tipping Point" For Bonds; Does He Miss the Boat? Bill Gross did not see this major selloff in bonds coming. He discusses the setup in his recent Investment Outlook called The Tipping Point. Much of the article is about how he almost tipped a ship while in the Navy. He uses the tipped ship metaphor to talk about the position in bonds. Gross says "Markets just had too much risk, and in PIMCO’s opinion, too much hope for a constant QE and for the growth that it would produce. In effect, the ship was top heavy...

Although he implemented a flat tax in Russia, I don’t think of Vladimir Putin as a supporter of free markets. Heck, he was head of the KGB during the communist era, and he presides over a country that is more known for cronyism rather than competitive markets. So if he criticizes European nations for having excessive welfare states, it’s like being called ugly by a frog. Here are some of the amusing details from Euractiv.com. He’s no Milton Friedman, but he’s right about the welfare state Russian President Vladimir Putin, speaking ahead of the G8 Summit in Northern Ireland on...

I received still more emails from French and Canadian readers on preserving culture. Since it's a slow news day, let's take a look at them. Olivier writes "Wouldn't a true conservative pay at least some respect to local cultural norms instead of trying to impose some economic diktat from on down?" Talk about getting things ass backwards. It is the social police attempting to impose cultural and economic diktats to preserve the local bookstore and the local farm to the point of absolute absurdity. Email From Canada Reader Mike from Canada writes ... Hi Mish, I totally agree with the...

No one wins a trade war. Ever. Not countries, not companies, and certainly not consumers. Yet, here we go again. People's Daily says China has more cards to play in EU trade dispute. China still has plenty more cards to play in an increasingly ugly trade dispute with the European Union, the official People's Daily newspaper said on Thursday, accusing Europe of not realizing that its global power was waning. The EU will impose duties on imports of Chinese solar panels from this week, a move that infuriated Beijing despite European attempts to soften the blow with a reduced rate....

France and Germany are pushing to have a full-time official lead the economic and financial policies of the 17-country euro currency bloc. … French President François Hollande and German Chancellor Angela Merkel said after a meeting in Paris that there needs to be a central figure to lead the Eurogroup. Speaking Thursday at a joint press conference, Hollande said he and Merkel “are in agreement that there should be more eurozone summits, with a full-time Eurogroup president with strengthened powers.” “We need more economic policy coordination, especially in the Eurogroup,” Merkel said. …

Video 5:27

Iceland just elected the parties which plunged them into crisis only five years ago. Is it casino capitalism all over again, or just a slap in the face of the EU? In terms of redemptive electoral stories, the return of the Independence Party in Iceland is quite significant, albeit that they will come back to government with only a few percentage points more votes than they polled at their nadir in the depths of the Icelandic crisis in 2009. However the biggest winner was Sigmundur Gunnlaugsson, the leader of the Progressive Party, who propelled his party to hold 19 seats...

Europe will take longer to recover from its economic crisis as it tackles a worse-than-expected recession in the eurozone and unemployment at record levels, the European Union warned Friday. In its spring economic forecast, the EU said that gross domestic product in the 17 member countries that use the euro will shrink by 0.4 percent this year; better than the 0.6 percent contraction in 2012, but 0.1 percentage points worse than the EU had forecast back in February. The report also had bad news for the wider 27-country EU: it now expects the region’s economy to shrink by 0.1 percent...

Wealthy households would face new taxes on property and other assets under German plans to prop up the struggling eurozone. Senior advisers to Chancellor Angela Merkel are pushing for better-off households to pay towards the cost of any future bail-outs for the weaker members of the single currency. The proposals, from members of Germany’s council of economic experts, raise the prospect of taxes being imposed on property in a country like Spain if its government was forced to seek a bail-out. The council, known as the “Five Wise Men”, is often used to test new policies that are later adopted...

However, of more immediate concern is how will the government now plug a hole of up to €1.3 billion in its €5.3 billion 2013 budget. A solution has, luckily, presented itself: bypass the unconstitutional provisions by paying government workers not in cash, but in government bills! From the WSJ: The Portuguese government is considering a plan to pay public workers and pensioners one month of their salary in treasury bills rather than cash after a high court ruled out wage cuts, a person familiar with the situation said Sunday. "This is one of the ideas being considered," the person said....

Commentary: U.S. uninsured depositors can and do take losse True, it was news that Dutch Finance Minister Jeroen Dijsselbloem was making that acknowledgment. The European finance ministers had been stressing as recently as last week that the opposite was the case, that Cyprus was a special situation. Dutch Finance Minister Jeroen Dijsselbloem is president of the Eurogroup council. The market genuinely was shocked.

Michel Sapin made the gaffe in a radio interview, which left French President Francois Hollande battling to undo the potential reputational damage. “There is a state but it is a totally bankrupt state,” Mr Sapin said. “That is why we had to put a deficit reduction plan in place, and nothing should make us turn away from that objective.” The comments came as President Hollande attempts to improve the image of the French economy after pledging to reduce the country’s deficit by cutting spending by €60bn (£51.5bn) over the next five years and increasing taxes by €20bn.

Forget about that dead parrot of a question – should we join the eurozone? The eurozone has officially joined us in a newly emerging international organisation: we are all now members of the Permanent No-growth Club. And the United States has just re-elected a president who seems determined to sign up too. No government in what used to be called “the free world” seems prepared to take the steps that can stop this inexorable decline. They are all busily telling their electorates that austerity is for other people (France), or that the piddling attempts they have made at it will...

(Reuters) - The euro zone debt crisis dragged the bloc into its second recession since 2009 in the third quarter despite modest growth in Germany and France, data showed on Thursday. The French and German economies both managed 0.2 percent growth in the July-to-September period but their resilience could not save the 17-nation bloc from contraction as the likes of The Netherlands, Spain, Italy and Austria shrank. Economic output in the euro zone fell 0.1 percent in the quarter, following a 0.2 percent drop in the second quarter. Those two quarters of contraction put the euro zone's 9.4 trillion euro...

When Greece's government pushed through a law last week aimed at slashing public wages and raising taxes, its biggest threat was not the firebrand opposition or the 100,000 protesters thronged at the gates of parliament. It was the assembly's workers themselves, a well-connected group that has long evoked disdain for enjoying the kind of lavish pay and benefits that have become emblematic of the public sector excess at the heart of Greece's debt crisis. The staff dispute that image. But, having discovered that a 500-odd page draft law of cost cuts and tax hikes included a last minute amendment giving...

The Swiss Army is preparing contingency plans for violent unrest across Europe. A nation mostly famous for its banks, watches and chocolate fears it may face a massive influx of European refugees in the near future. One of the world’s richest nations openly expressed concerns over the possible outcome of Europe’s continuing financial troubles, and is currently conducting army exercises against the possibility of riots along its borders. In September, the Swiss military conducted exercises dubbed ‘Stabilo Due,’ with scenarios involving violent instability across the EU.Switzerland has maintained an avowedly neutral stance for decades, and refused to join the eurozone...