No country is economically more dependent on the survival of the euro than Germany: the export powerhouse thrived because Eurozone countries could borrow unlimited amounts of euros to buy German goods. But now that the gravy train has stopped in front of a mountain of unmanageable sovereign debt, Germany finds itself at war—with itself.
Greece’s Extortion Racket Jumps To The Next Level
by Wolf Richter • • Comments Off on Greece’s Extortion Racket Jumps To The Next Level
Participants in the G-20 meeting in Cannes thought it would be a relaxed affair of photo ops, handshakes, and fancy dinners, interrupted by rubber stamping the Grand Plan of bailing out Greece, bondholders, and European banks. But then Giorgios Papandreou, prime minister of Greece, fired his bazooka. And the Greek extortion racket was back on.
Inflation High on the Hog For the Holidays
by Wolf Richter • • Comments Off on Inflation High on the Hog For the Holidays
The season’s ditty: companies announce big profits after they jack up prices. But even the inexplicable American consumer, the toughest creature out there, struggles with these prices as misery spreads into the middle class. Now add HoneyBaked to the list, just in time for the holidays. But there is hope.
Ruinous Symbiosis Between Congress And The Fed
by Wolf Richter • • Comments Off on Ruinous Symbiosis Between Congress And The Fed
The members of the congressional panel on deficit reduction are struggling to come up with something that will—I mean, let’s be realistic—get them reelected and fill their campaign funds. Even if they come up with a plan that will reduce the gargantuan budget deficits, Congress won’t follow through. Because it doesn’t have to, thanks to the Fed.
Economic Devil Is In The Details
by Wolf Richter • • Comments Off on Economic Devil Is In The Details
No More Golf or Pizza for the Yakuza
by Wolf Richter • • Comments Off on No More Golf or Pizza for the Yakuza
Tokyo’s organized crime exclusionary laws went into effect in October—and are wreaking havoc. Now doing business with the yakuza is a crime. In an ingenious twist, paying off the yakuza is also a crime. Even victims of blackmail—hush money is an outright industry in Japan—commit a crime if they pay.
Another Eurozone Country Bites the Dust
by Wolf Richter • • Comments Off on Another Eurozone Country Bites the Dust
Real estate in Cyprus has been popular with foreigners—they own 100,000 homes in a country with 803,000 people. Turns out, it’s Cyprus’ national sport sponsored by dumb money. Now the underlying title-deed scandal is unraveling the finances not only of expat owners, but also of the banks and the government … who are hushing it up.
The Inexplicable American Consumer Strikes Again
by Wolf Richter • • Comments Off on The Inexplicable American Consumer Strikes Again
Consumer confidence indices have collapsed to levels not seen in years or even decades. Yet the toughest creature out there that no one has yet been able to beat down struck again. Consumer spending increased at an annual rate of 2.4% during the third quarter, though the mood has become outright morose since.