Death Star Economics



Thursday, #4

Disclaimer: This news brief was circulated on Thursday, October 27, 2011.

Yesterday, the WSJ suggested the Eurovision Songt Contest to be a guide to solving the eurozone crisis, because if anything is worth fighting for, it is “Dana International, a transsexual from the little-known European country of Israel won, in Birmingham”.


Last night, a preliminary EU statement confirmed that by June 20, 2012, banks that have received government funding (that have been bailed out) need to have 9% of tier one capital (common stock, reserves, their own little savings account that their debit card isn’t linked to). For reference, the regulation framework Basel III had upped this capital requirement by 2% to 6% last year. Banks are meant to raise through “private capital” and “restructuring”. So essentially, instead of having banks own a whole lot of random financial institutions, like insurance business etc, private equity firms and investment managers will own them. Good for me, guarantees my job.
read statement




And as of this morning, we got a 50% haircut (no hair but only debt is cut, so why not call it debtcut) and a “four- or five-fold [increase] suggesting it could provide guarantees for around €1 trillion, or about $1.4 trillion, of bonds issued by countries such as Spain and Italy.” That haircut could be tied to an additional €30bn from the mean mad private sector, or a new fund made up from the EFSF and extra-European investors like (mean mad) China.
read article 



The UK (or rather George Osborne) said they don’t want to have anything to do with the EFSF, which I find outragous and ridiculous. All they want to participate in is IMF action. Osborne also said that the EU has a “chilling effect” on the UK. His face has a chilling effect. He’s just pathing the way for pushing the responsibility for the UK’s own debt chaos to Brussels. NOT THAT SIMPLE! Moron.


But on the plus side, stocks and treasury yields seem to be very happy about all of the above. Woohoo.


And to end it on something fun, here a brief history of web standards: view infographic 


So long.


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