Spain could hike value added tax (VAT) on products and services currently benefiting from a lower rate to boost revenues and help it meet tough public deficit targets, the Finance Ministry said on Tuesday. Spain's current rate for VAT is 18 percent, one of the lowest rates in Europe, and many products are charged at a reduced rate of 8 percent or a "super-reduced" 4 percent. "The ministry is studying reclassifying certain products and services that have reduced or super-reduced VAT," a spokesman for the ministry said. The European Commission and the International Monetary Fund have both recommended Spain revise the VAT it charges. Some analysts see a significant VAT hike as the only way Spain can meet its commitments to cut its deficit - pledges that will come under further scrutiny since Spain requested a bailout for its banks of up to 100 billion euros ($124.80 billion). Spain charges the 8 percent VAT rate on products like hotel stays, some other tourism products, cinema and theatre tickets. Books, newspapers and basic food products benefit from the 4 percent rate. Changing the categories for products could be a way to collect more taxes while saving political face since the centre-right government of Prime Minister Mariano Rajoy has often said putting up VAT could damage already fragile consumer spending, hurting growth. The government has said it will increase VAT next year but has not given any specific figures.
Portrait of George Washington, whose personal copy of the US Constitution and Bill of Rights fetched $9.8m at auction. Photograph: Stock Montage/Getty Images
George Washington's personal copy of the US constitution and bill of rights sold for $9.8m (£6.3m) at auction on Friday, setting a record for any American book or historic document.
Bidders at Christie's New York salesroom and others on the telephone competed for the first US president's signed, gold-embossed volume dating to 1789, which had a pre-sale estimate of up to $3m.
The non-profit Mount Vernon Ladies Association of the Union, which maintains the historic Mount Vernon estate in Virginia that was Washington's home and is now open to the public, was the successful bidder.
"The unique book had been in the Mount Vernon library until 1876, and will soon be returned to that library," said Chris Coover, senior specialist of books and manuscripts at Christie's.
The bound volume was Washington's personal copy of the Acts of Congress and is noteworthy for his bold signature marking it as his own.
The Acts of Congress include the Constitution, whose preamble promises to "secure the blessings of liberty to ourselves and our posterity," and the Bill of Rights, the first 10 amendments to the constitution, which establish such fundamental liberties as the right to free speech, press, assembly and religion.
Christie's described the book as being in near-pristine condition after 223 years. It was specially printed for Washington in 1789, his first year in office as president.
The margins include Washington's handwritten brackets and notations highlighting key passages concerning the president's responsibilities.
The Acts of Congress volume was sold from Washington's library at Mt Vernon in 1876 and eventually bought at auction by collector Richard Dietrich in the 1960s. It was being sold by the family's estate.
Similar volumes created for Thomas Jefferson, the first secretary of state and third US president, and attorney general John Jay, are in Indiana's Lilly Library and a private collection, respectively.
Rare books and manuscripts have achieved impressive prices in recent years.
An autographed manuscript of Lincoln's 1864 election victory speech sold for $3.4m in February 2009, which set a record for an American manuscript at the time. A 1787 letter written from Washington to his nephew on the subject of the ratification of the Constitution fetched $3.2m in December 2009.
Entitled "Cock and Bull," this showpiece by British artist Damien Hirst towers above diners at Tramshed, which only serves chicken and steak.
Internationally renowned British artist Damien Hirst has created an art piece for a London restaurant in which a whole Hereford cow and cockerel are preserved in formaldehyde in a steel and glass tank, smack dab in the middle of the dining room.
Called "Cock and Bull," the showpiece towers above diners at Tramshed which -- surprise -- serves only steak and whole roasted chicken.
Like a giant aquarium mounted on a TV stand, the art installation is an extension of Hirst's Natural History, a collection of preserved animals he's been creating since 1991 -- arguably his most famous series. Hirst also created a painting for the restaurant opening entitled "Beef and Chicken" which hangs on the mezzanine level and depicts the 1990s cartoon characters "Cow and Chicken."
In the basement level, the Cock ‘n' Bull gallery showcases a rotating art exhibit every six weeks. The first exhibition Quantum Jumping features art work themed around "jumping into a parallel dimension," and runs until July 1.
The classically British menu by chef and restaurateur Mark Hix, meanwhile, is conducive to family-style dining with whole roasted, free-range chickens or marbled sirloin steaks, both served with fries. Appetizers include Yorkshire pudding with whipped chicken livers, cauliflower salad, and smoked Cornish mackerel with beets and horseradish.
It's not unusual for restaurants to house the collections of famous and interesting artists, given the synergy between food and ambiance. Pierre Gagnaire's eponymous restaurant, in Paris, for instance, houses works from the Galerie Lelong, while Wolfgang Puck has also turned his restaurant space into an exhibit for a roster of rotating artists at his CUT steakhouse in Los Angeles.
Meanwhile, restaurants like Eric Ripert's Le Bernardin in New York, Jason Atherton's Pollen Street Social in London and Jean-Georges Vongerichten's Spice Market in London have been shortlisted in the Restaurant & Bar Design Awards this year.
Canadian photographer Edward Burtynsky is having a London moment. Not only are his familiar works on the oil crisis on view but he is also exhibiting a new series examining the impact of long-term farming in Monegros, Spain.
These photographs are looking at the tradition of dryland farming carried out over many generations in the north-eastern part of Spain. It's an agricultural region where the land is semi-arid, sparsely populated and prone to both droughts and high winds. The land is made up of sedimentary rock, gypsum, and clay-rich soil. The photographs show the impact of these conditions, as well as man's expanding foot print.
Burtynsky is shooting the photos from a helicopter, two thousand feet up: so high that there are almost no details to be identified. The topography looks like an abstract painting.
Despite a scarcity of water, generations of farmers have continued to farm, so the photos are a contrast between nature's untamed forces and man's attempts to harness it. The cracks and crevices form writhing lines with deep earthy tones.
I love, love, love, adore, and love macaroni salad. I’m also picky, picky, picky, particular, and picky about macaroni salad. No joke. Macaroni salad is a religion to me.
I have issues, is what I’m saying.
Here’s what I don’t like: Macaroni salad that’s gloopy. Here’s what I do like: Macaroni salad that’s creamy but still light. Here’s what I don’t like: Macaroni salad that’s overly vinegary. Here’s what I do like: Macaroni salad with a sweet/tangy/spicy kick. Here’s what I don’t like: Macaroni salad that’s mostly macaroni. Here’s what I do like: Macaroni salad with a confetti of wonderfulness coloring the whole mix with flavor, spice, and texture. Here’s what I don’t like: Tea. Here’s what I do like: Diet Dr Pepper.
Now that that’s all settled, let’s make Macaroni Salad!
The Cast of Characters: Macaroni, mayonnaise, vinegar, sugar, salt, pepper, milk, spicy/sweet pickles, black olives, roasted red peppers (you can use pimentos instead!), and green onions. Easy stuff!
Start by bawlin’ the macaroni till it’s done.
Then drain it…
Then rinse it under cold water until it’s totally cooled down.
Next, chop up some black olives! The good ol’ canned, ripe, nothing-exotic-about-them black olives.
Slice up three whole green onions pretty thinly…
Then grab some roasted red peppers! You can roast your own, of course, but in this dish it’s really not necessary.
You can also use diced or chopped pimentos instead.
Grab three or four of ‘em…
Then slice ‘em up…
And chop ‘em.
Now, grab some good, good, yummy, great, good, awesome pickles. These are made here in Oklahoma, and I love them. They’re pretty sweet, but also very spicy—you need both for macaroni salad. Any sweet/spicy pickles will do!
Grab a few slices, then eat one. Then grab another one from the jar to replace it and act like nothing ever happened.
Now set the veggies aside and make the dressing!
Start with half a cup of mayonnaise. The real stuff. Not the grody stuff.
Add some vinegar. I used red wine vinegar, but you can use regular distilled/white/clear/plain/unadorned. Just a slight bite is all you’re looking for!
Add in some sugar…
Because I can’t be in the presence of vinegar unless sugar is also involved.
Stir that around, then splash in a little milk—just enough to make the dressing pourable.
Use your incredibly awesome and beautiful hand to sprinkle in salt…
Then use your foot to sprinkle in a little black pepper.
Not really on the foot part.
I honestly have no idea why I said that.
Finally, splash in a little of the pickle juice. Adds a little more sweetness, a little more bite, and—if the pickles are nice and spicy—a little kick.
Spicy Pickles = Good.
Now the fun really begins! Throw the macaroni into a big ol’ bowl.
Then drizzle in 3/4 of the dressing (save the rest for later!)…
And mix it around. The dressing will seem thin at this point, but as it chills later, it’ll thicken up a bit! You can add the rest of the dressing later, after you toss in the other ingredients, if you think it needs it. (Amount of dressing is a personal preference!)
Now add the olives, red peppers, pickles, and green onions…
And toss it all together. Add more of the olives, peppers, pickles, and onions if you think the salad needs more stuff! The point here is not to have any macaroni that isn’t decorated with at least one of the ingredients. If you see even one macaroni noodle without something on it, the entire macaroni salad will be totally ruined!
At the end, taste the whole thing and add more of what it needs, which will probably include another good splash of pickle juice! This is where you can add the rest of the dressing if you think it needs it.
Then—this is important—chill the macaroni salad for at least a couple of hours.
Because you’re worth it.
Pile it into a bowl and serve it at your next barbecued/picnic/cookout/grilling party!
Or just have it for lunch today, by itself or with a piece of grilled chicken.
It’s the best macaroni salad ever!
Here’s the handy printable.
Recipe: The Best Macaroni Salad Ever
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Ingredients
4 cups Elbow Macaroni
3 whole Roasted Red Peppers, Chopped (more To Taste, Can Also Use Pimentos)
1/2 cup Black Olives, Chopped Fine
6 whole Sweet/spicy Pickle Slices, Diced (about 1/2 Cup Diced)
3 whole Green Onions, Sliced (white And Dark Green Parts)
1/2 cup Mayonnaise
1 Tablespoon Red Wine Or Distilled Vinegar
3 teaspoons Sugar, More Or Less To Taste
1/4 teaspoon Salt, More To Taste
Plenty Of Black Pepper
1/4 cup Milk (more If Needed)
Splash Of Pickle Juice (spicy Sweet Pickles)
Extra Pickle Juice To Taste
Preparation Instructions
Cook the macaroni in lightly salted water according to package directions. Drain and rinse under cold water to cool. Set aside.
Mix together mayo, vinegar, sugar, salt, and pepper. Splash in enough milk to make it pourable. Splash in pickle juice for extra flavor. Taste and adjust seasonings as needed. Set aside.
Place cooled macaroni in a large bowl and pour 3/4 of the dressing. Toss and add more dressing if you'd like. (Dressing will seem a little thin, but it will thicken up as salad chills.)
Stir in olives, roasted red peppers (or pimentos), pickles, and green onions. Add more of any ingredient if you'd like more stuff going on! At the end, splash in a little more pickle juice and stir.
Chill for at least 2 hours before serving. Sprinkle with sliced green onion to serve!
According to Merriam-Webster, ingenuity can be defined as "skill or cleverness in devising or combining" or "cleverness or aptness of design or contrivance." We'd say that's an apt description of a Frenchman named Emile who reportedly found himself stranded in the deserts of Northwest Africa after breaking a frame rail and a suspension swingarm underneath his Citroën 2CV.
What to do? Why, disassemble the broken hulk and build yourself a motorcycle from its pile of parts, of course! As the story goes, Emile was able to use the inventive machine to escape the desert, though not before convincing the local authorities that he wasn't an insurgent and paying a fine for importing a non-conforming vehicle...
Since Emile was the only soul in the area, nobody has been able to confirm the veracity of the events that led to the little French runabout's conversion into a makeshift motorcycle. That said, judging by the images you can see here (apparently from the March 2003 issue of 2CV Magazine), this Citroën-bred two-wheeler does indeed exist, and it was definitely fashioned from parts scavenged from an old 2CV.
Emile, wherever you are, we take our hats off to your real-life MacGyver skills, sir.
There is a mini-war being fought on Spanish doorsteps, between members of the public who can no longer afford to pay their mortgages and the banks who are threatening to evict them. Last year there were 58,000 evictions in Spain - a 22% percent rise. It means on average there are 159 evictions every day, and four in every five involves families with children. Bankia already owns it. But I still owe them 199,000 euros on the mortgage, and even if I paid it I still would not own the property. Hilda Marisol But protest groups have begun show up at evictees' front doors to try to stop the bailiffs gaining access to properties. With certain banks taking bailouts from the state, the campaign groups say institutions who are looking for support from the taxpayer shouldn't be throwing customers out on to the streets. Sky News went to meet Maclovia Luzmila and her 12 year-old daughter Vivian. The next day they were due to be evicted from their home after failing to make mortgage repayments and Maclovia feared Vivian may be taken into social care. "I'm not going to let her be taken somewhere else," she said. "We don't want to be separated. I only live for her." More than 300 people attended a meeting set up for those struggling with repayments Later when we met Maclovia at her work caring for the elderly she added: "I just want to pay what I can afford. "But with this job I don't earn the money to cover the repayments on my 200,000 euro mortgage. So we are going to resist. They will have to pull me out." In another suburb of Madrid, Hilda Marisol lives in a flat with five children. She was also due to be evicted this week but her bank, Bankia has given her till the end of school term to leave. Her sparse flat has no electricity, but she doesn't want to leave. "Bankia already owns it," she says. "But I still owe them 199,000 euros on the mortgage, and even if I paid it I still would not own the property." Bankia is currently asking for a 23.4 billion euro state bailout due to debts caused by the property crash. Which is why some anti-eviction groups feel they should be more sympathetic to people in debt. In response to the growing number of evictions one group has occupied a Bankia owned property in central Madrid, offering rooms for evicted families. Sky News attended a local support meeting for those having problems paying their mortgage, where 300 people turned up - many of them looking for legal advice. At the meeting, Maclovia appealed to the group to help her resist the bailiffs the following morning.
There were long queues outside a state-funded pharmacy in Athens yesterday as people lined up to get life-saving drugs for seriously ill relatives. The shortages in chemotherapy medicine and other expensive drugs arose when pharmaceutical companies cut credit to the country's largest state-backed heath insurance fund, EOPYY, which provides subsidised medicine to ordinary Greeks. The problem is yet another reminder of the challenges facing Greece, which goes to the polls for a second time this month after May's elections failed to deliver a government. Coalition talks between competing parties broke down when the far left demanded a renegotiation of the country's austerity drive – something that is opposed by its European partners, notably Germany. The ratings agency Standard & Poor's said this week that there was a one in three chance that Greece could quit the euro in the months after the elections on 17 June. Yesterday, the privately run SKAI TV showed scenes of hysteria as hundreds of Greeks queued outside one of the five pharmacies owned by EOPYY. A patient could be heard screaming inside the pharmacy, and a man said he had been waiting hours to get his mother's cancer medication. The average cost of a cancer patient's prescription is €2,000 (£1,600) but members of the EOPYY healthcare fund got the medicines at a heavy discount. By lunchtime, the morning queues had vanished. "I got my relative's drug a day early," said one woman. "But off course, with this situation, I'm worried we might not be this lucky next time." The morning frenzy, according to an employee, was due to misinformation. "Thousands came thinking we would provide all sort of medicine when we were ordered to hand out only the most expensive type." Workers at the EOPYY pharmacy at the Georgios Gennimatas oncological hospital told The Independent they gave out around 1,000 cancer drugs to about 300 patients. However, they still lacked some chemotherapy medicines, as one pharmaceutical company had yet to deliver. "One sufferer started screaming and insulting us because we lacked a medicine," said an employee who refused to give her name. "People are very anxious to get their medication and express their feelings in different ways. You can't blame them." Kalliopi Metaxa, a retired doctor and volunteer at the KEFI Cancer Society, said its members were desperate. "It's a chaotic situation – a temporary solution was provided to help the seriously ill. But what happens when the government runs out of money again?" She added that in her years as a state doctor, she had never seen such a health crisis although Greece had a history of being late with its payments to health providers. It's not just the pharmaceutical companies that are owed money. The EOPYY fund is also in debt to pharmacists. The government had pledged to repay the last outstanding instalment of this year's €270m debt to pharmacists after they cut credit to EOPYY, forcing members to pay for their own medicines, which are normally subsidised by the fund. But the Prime Minister, Panayotis Pikrammenos, said this week that his caretaker government could not begin repay £6.5bn of outstanding payments to pharmacies until Greece receives its next loan instalment from its international creditors. Analysts predict a tight race between the pro-bailout conservative New Democracy and the radical left-wing Syriza party, which has vowed to tear up the bailout agreement, putting the country's membership of the euro in question. To complicate matters for the pollsters, while public opinion is increasingly opposed to harsh cuts, most Greeks want to remain in the euro
It's one of the hardest things in the world to do, probably because it runs so counter to our powerful and primal need to feel safe, loved, and successful. For most of my life, I prided myself on relentless perseverance in the face of obstacles, and a refusal to give up on any goal or client I was pursuing. Letting go felt like failure or rejection, and both were nearly unbearable to me. I have no doubt that pushing so hard has influenced whatever success I've had. Increasingly, though, I've come to believe it exacts a toll that no longer makes sense or feels acceptable. At the most practical level, pushing continuously against resistance burns down our available reservoir of energy, and makes us less capable of doing anything well. Beyond that, pushing too hard can end up getting you what you think you want, only to discover, too late, that there was a good reason it didn't come together in the first place. Resistance is an early warning signal. Several weeks ago, a senior HR executive at a large company invited me to dinner after hearing me speak. He spent much of the dinner explaining why his firm wasn't inclined to create a more flexible work environment for its employees, and how he hoped he could find a way to introduce our work under the radar, and then slowly build interest in it. "You know what," I heard myself saying, "I don't think our work is right for you at this point." He looked slightly stunned. In all honesty, so was I. I couldn't quite believe I'd let go of a potential client who had explicitly expressed interest in our work. But by the end of the evening, I felt lighter, as if I'd done the right thing for both of us. The next week a CEO who had long claimed high interest in our work, but had never moved forward, wrote asking if we could introduce our work to his team in one-third the time we had suggested. Sure, it was possible. But we'd have been eviscerating the heart of what we do, which is grounded in giving leaders sufficient time to truly reflect on the way they're working, and to recharge. I wrote back and declined. Don't get me wrong here. I'm not suggesting the way to build a business is to regularly turn down opportunities. But not every one makes sense. I believe deeply in the value of the work we do, but I also know it only sings in a supportive and nurturing environment. Letting go of half-hearted clients frees up time and energy to invest in clients who passionately share our commitment to reenergizing the workplace in a world of infinite demand. The larger point for me is that foregoing opportunities may be less a sign of failure than of careful prioritizing and intelligent sacrifice. Likewise, learning to let go when it's clear you're not getting what you're after — to accept a "no" without trying to turn it into a "yes" — not only saves energy, but also dignity, which is no small contributor to our well-being. What makes it hardest to let go of anything we want is the assumption that we'll feel an enduring sense of loss. In reality, we're terrible prognosticators of the future. "Negative events do affect us," as psychologist Daniel Gilbert put it in his book, Stumbling on Happiness, "but they generally don't affect us as much or for as long as we expect them to." Nothing is as important as it seems in the heat of the moment. With all that in mind, I've come up with four questions I now ask myself each time I begin to wonder if it's time to ease back on something or someone I've been pursuing. Here they are: 1. Do I have a feeling in my gut that this dog just won't hunt? 2. How important will this seem to me in six months? 3. How important will this seem to me in two years? 4. Is there a more enjoyable and productive way I could be investing my time and energy right now? If the answer to 1 and 4 are "yes," or the answers to 2 and 3 are "not much," it's time to let go.
The life of an expatriate can be incredibly rewarding, exciting and challenging. However, it is a new life that is characterized by a massive upheaval and culture shock. The comforts of home, the friends and family members around and the ease of knowing how things work is something that expats react to differently. Embracing a culture that is different or going into a new job with no familiar faces is hard and many respond with significant emotional distress, insecurity and homesickness. For others, it is exciting and rewarding.
To deal with the hurdle of a new life, some people will turn to alcohol or drugs to quell their feelings and fears. This is true for people within their own country or those who are overseas on assignment. The pressure of meeting performance expectations, succeeding in the job and new life is magnified by the loneliness and isolation that expats experience. This can push some expats to abuse alcohol or drugs. For others, the life overseas offers them a hard-to-resist lifestyle where they can drink and use drugs to excess without being watched or criticized by others.
Expats face many challenges when they are living in a foreign country. Language differences, cultural differences and even food that is not like what a person is used to can be daunting. In addition to this, expats face separation from friends and family which can cause a person to feel isolated, lonely and bored. These emotional reactions are known to be factors in the development of a substance abuse problem because people use alcohol or drugs to silence fears and overcome boredom. Acknowledging that these emotions are triggers is one way that the expat can avoid abusing substances and have the courage to ask for help.
Expectations for Expats
Expatriate assignments often involve extensive networking as part of the role. It is often the job of the expat to facilitate and participate extensive social functions such as lunches and dinners as the representative of the company they are working for. These events typically involve alcohol and lots of it. Some may even involve use of other illegal drugs though this would be behind closed doors. These functions are used as a way to strengthen the ties between organizations and individuals and break down some of the cultural barriers. However, they are also very dangerous for a person who may be using alcohol too much to quash social anxieties or getting a boost from substances to deal with stress.
In some countries, such as Japan, the drinking culture is incredibly important to business and co-worker relationships. Declining to attend a social function or can be met with criticism and may impact on opportunities. This can cause significant stress for people who are unsure of the cultural traditions and can see that alcohol is integral to business. It is important for expats getting involved in these cultures to understand that it is ok to decline and say no to consuming alcohol. The importance of these social functions is to be present and develop good strong bonds in a social rather than work setting. One drink does not have to lead to a binge on alcohol.
Comfort in a Foreign Land
Alcohol and other drugs can provide comfort to an expat in a foreign country. Access to alcohol in particular is usually very easy and in some countries prices are very low. Many find comfort in having a drink and socializing when influenced by alcohol. In moderation, this is not harmful but if the drink becomes depended on for confidence, to help sleep or even to get through a weekend, problems can begin to form. Drinking is a common way to meet other people which is an important aspect of living in a foreign country. Alcohol breaks down some of the personal anxieties and help people to get over language or cultural barriers. But relying on a bar as the only way to socialize with people can lead to the development of an addiction or dependency. Expats should realize that there are other, healthier ways to meet people. Most countries with high expat numbers have social groups that can be joined and events to participate in. An internet search will show many listings and forums for these groups.
Prescription Medication and Expatriates
Prescription medication is a danger also with drugs that are under strict control in a home country being readily available and cheap. All a person has to do is go to any pharmacy and ask for whatever they like, no questions asked. Prescription medication abuse is one of the most serious public health concerns around the world. Prescription drugs may relieve some of the anxieties that a person is feeling as they are living overseas. It may also be misused to treat pain, sleeplessness or help elevate energy levels. Poor nutrition, lack of exercise and over-indulgence in alcohol can cause all of these problems. Using prescription drugs rather than focusing on natural ways to fix these problems is incredibly dangerous. In America, Canada, Australia and the United Kingdom abuse of these drugs is known to be very harmful and may cause significant health, personal and emotional problems.
Continuing an Addiction Abroad
There are some people who make the decision to move to a foreign country while they are suffering from a substance addiction. They make the choice to move to begin a new life away from the temptations, lifestyle of abuse or to avoid unwanted criticism or family intervention. It is an easy choice to move overseas to avoid personal, financial or even work problems and have a new identity overseas. The overseas lifestyle can be incredibly rewarding for their addiction. Cheap and readily available alcohol, prescription drugs without needing a doctors visit or illicit drugs on hand can mean the addiction can grow steadily and unchecked.
Traveling vs. Expatriate Substance Abuse
Living in a foreign county can mean that the holiday never ends and that the party can be all day, every day. The constant supply of new faces, new friends and new places can be tempting for those who struggle with substance abuse. People might not notice changes when they are only visiting for the short term. New found friends are willing to put up with bad behavior, pay for drinks and celebrate with the party guy or girl. Nobody tells them what to do or when to do it. They can hang out with people who are also into the same life path of abusing themselves and their body. Unfortunately this can also mean that having close friends or family members to get support from is difficult. Additionally, cross-cultural language barriers can mean that there is a difficulty in getting professional help in a foreign country.
Bank of England policymakers meet today to decide whether to change interest rates or to pump in more money into the ailing economy, with leading economist saying they may opt to inject a further £50bn of stimulus.
Global capital markets, now the most powerful force on earth, are rapidly losing confidence in the financial coherence of the 17-nation euro zone. A market implosion there, like that triggered by Lehman Brothers collapse in 2008, may not be far off. Not only would that dismantle the euro zone, but it could also usher in another global economic slump: in effect, a second leg of the Great Recession, analogous to that of 1937. This risk is evident in the structure of global interest rates. At one level, U.S. Treasury bonds are now carrying the lowest yields in history, as gigantic sums of money seek a safe haven from this crisis. At another level, the weaker euro-zone countries, such as Spain and Italy, are paying stratospheric rates because investors are increasingly questioning their solvency. And there’s Greece, whose even higher rates signify its bankrupt condition. In addition, larger businesses and wealthy individuals are moving all of their cash and securities out of banks in these weakening countries. This undermines their financial systems. 423 Comments Weigh InCorrections? Personal Post The reason markets are battering the euro zone is that its hesitant leaders have not developed the tools for countering such pressures. The U.S. response to the 2008 credit market collapse is instructive. The Federal Reserve and Treasury took a series of huge and swift steps to avert a systemic meltdown. The Fed provided an astonishing $13 trillion of support for the credit system, including special facilities for money market funds, consumer finance, commercial paper and other sectors. Treasury implemented the $700 billion Troubled Assets Relief Program, which infused equity into countless banks to stabilize them. The euro-zone leaders have discussed implementing comparable rescue capabilities. But, as yet, they have not fully designed or structured them. Why they haven’t done this is mystifying. They’d better go on with it right now. Europe has entered this danger zone because monetary union — covering 17 very different nations with a single currency — works only if fiscal union, banking union and economic policy union accompany it. Otherwise, differences among the member-states in competitiveness, budget deficits, national debt and banking soundness can cause severe financial imbalances. This was widely discussed when the monetary treaty was forged in 1992, but such further integration has not occurred. How can Europe pull back from this brink? It needs to immediately install a series of emergency financial tools to prevent an implosion; and put forward a detailed, public plan to achieve full integration within six to 12 months. The required crisis tools are three: ●First, a larger and instantly available sovereign rescue fund that could temporarily finance Spain, Italy or others if those nations lose access to financing markets. Right now, the proposed European Stability Mechanism is too small and not ready for deployment. ●Second, a central mechanism to insure all deposits in euro-zone banks. National governments should provide such insurance to their own depositors first. But backup insurance is necessary to prevent a disastrous bank run, which is a serious risk today. ●Third, a unit like TARP, capable of injecting equity into shaky banks and forcing them to recapitalize. These are the equivalent of bridge financing to buy time for reform. Permanent stability will come only from full union across the board. And markets will support the simple currency structure only if they see a true plan for promptly achieving this. The 17 member-states must jointly put one forward. Both the rescue tools and the full integration plan require Germany, Europe’s strongest country, to put its balance sheet squarely behind the euro zone. That is an unpopular idea in Germany today, which is why Chancellor Angela Merkel has been dragging her feet. But Germany will suffer a severe economic blow if this single-currency experiment fails. A restored German mark would soar in value, like the Swiss franc, and damage German exports and employment. The time for Germany and all euro-zone members to get the emergency measures in place and commit to full integration is now. Global capital markets may not give them another month. The world needs these leaders to step up.
According to Merriam-Webster, ingenuity can be defined as "skill or cleverness in devising or combining" or "cleverness or aptness of design or contrivance." We'd say that's an apt description of a Frenchman named Emile who reportedly found himself stranded in the deserts of Northwest Africa after breaking a frame rail and a suspension swingarm underneath his Citroën 2CV.
