Top -Suchen

September 29, 2016

1.G8 countries – of the 8 nations (actually reduced to G7 as Western sanctions against Russia for its intervention in Ukraine have been extended for another six months) only Canada and Germany continue with a triple A rating from all the three leading U.S. credit rating agencies, since Moody’s and Fitch downgraded Britain to Aa1, downgrading Standard & Poor’s Britain after its vote to exit the EU by two notches from AAA, cutting Moody’s and Fitch France credit rating to Aa1 and Standard & Poor’s further to AA, lowering Standard & Poor’s credit rating of the United States 1 notch to Aa1.

2.Currency composition of official foreign exchange reserves – 2014: Dollar 62,3%, €uro 22,6% (declining), Pstg 4%, Yen 3,9%, CHF 0,1%. Other currencies like the Australian, the Canadian and the New Zealand Dollar increased their participation. BIS sees Dollar reserve role as secure but set to shrink, from 65% and 70% to 50% and 60%.

3.SSFI program was established to provide stability and prevent disruptions to financial markets from the failure of institutions that are critical to the functioning of the U.S. financial system. The only participating institution getting money through this program was American International Group/AIG keeping it from collapsing, calling the Treasury later the program ‘AIG Investment Program’. The G20 group created the Financial Stability Board/FSB in an ambitious effort to strengthen international prudential standards in response to the financial crisis. The full range of its resolution powers specified in the Key Attributes are available to resolution authorities with responsability for the resolutions of banks that could be systemically significant or critical in the event of failure: Crisis Management Group/CMG, Institution-Specific Cross-Border Cooperation Agreements/COAGs, Recovery and Resolution Plans/RRPs. Meanwhile Europe is launching the ECB as banking supervisor for the Euro-zone, planning a rigorous asset review exercise, which is likely to put pressure on national supervisors outside the banking union countries to be equally, shaping EBA’s ongoing work of monitoring risk weights and any action it takes. Additionally and complying with Basel III big European and U.S. banks will be placed under stricter capital requirements. G20/FSB developed a policy framework and critical policy measures to address the systematic and moral hazard risks associated with systematic important financial institutions/SIFIs, targeting full implementation for 2019.

4.G8 – group of eight leading industrialized nations, representing around 15% of the world population and two-third of the global output, holding Russia the every 12 months rotating presidency this year, replacing Britain January 01, 2014, announcing to host the G8 summit 2014 in the Black Sea resort of Sochi, set for June 4th-5th, after holding the Winter Olympics there. As Ukraine crisis deepens Western countries decided not to attend a preparation meeting for the planned G8 summit in Sochi, announcing EU members of the G8 group to pull out of all preparations for the G8 summit in Sochi, threatening President Obama to ‘isolate Russia’, kicking the country out of the G8 group of leading economies, but opposing Berlin that. The Group of seven leading industrialized nations/G7 is considering meeting in the near future, a move that would exclude Russia, which joined what became the G8 in 1998, saying G7 in a statement that referendum on Crimea’s future is a violation of international law, declaring Crimea independence from Ukraine after official referendum results showed 96,77 of Crimean voted to join Russia, signing President Putin Crimea annexation treaty, calling Crimea an ‘integral’ part of Russia, defying U.S. and EU sanctions, including asset freezes and travel bans on officials from Russia and Ukraine, warning Ukraine that conflict with Russia has entered into a ‘military stage’, reaching relations between Russia and the West their lowest point since the end of the ‘Cold War’, planning Ukraine under pressure from Russian troops and local forces to abandon Crimean bases. Russia imposed retaliatory sanctions on nine U.S. officials and lawmakers, signing Putin final Crimea reunification treaty, while Ukraine signed an association agreement with the EU. G7 nations announced that the summit meeting planned for Sochi will now be held in Brussels, without Russia, suspending G7 nations their participation in the G8 until Russia changes course, saying G7 energy ministers will also meet to discuss ways to bolster the countries’ collective energy security, considering the great dependence on Russian oil and gas supplies in nations like Germany and Italy, getting EU about a third of its natural gas supplies from Russia. The U.N. General Assembly overwhelmingly affirmed Ukraine’s territorial integrity and deemed the referendum that led to Russia’s annexation illegal, announcing the IMF bailout program for Ukraine unlocking amounts to $27 Billion over the next two years. President Putin called President Obama to discuss U.S. proposal for a diplomatic solution to Crimea crisis, urging Obama to withdraw Russian troops from Ukrainian border, saying Russia it has no intention to invade eastern Ukraine, warning European leaders of gas supply cuts over Ukraine’s $2,2 Billion gas debt, accusing the U.S. that Moscow is using energy as ‘tool of coercion’. G7 powers used the first meeting without Russia in 17 years to warn Moscow of further hard-hitting sanctions, demanding that Putin must recognize and negotiate with the new Poroshenko Government in Kiev, stop the flow of weapons from Russia into Ukraine and induce the rebels to lay down their arms. Ukraine signed a historic association agreement with EU, after Georgia and Moldova ratified similar deals, alarming Moscow concerned about losing its influence over former Soviet republics.

4a)Significance of suspending G7 nations their participation in the G8 until Russia changes course: Russia, now the sole remaining member of the G8, considers the group of eight/G8 ‘as an informal club’, saying its mission is over because all the economic and financial problems are now discussed in the group of twenty/G20, retaining Russia its membership. Most European countries remain too fragile to cut off important investment and trade sources, warning, like big EU companies, of imposing stricter trade and financial sanctions on Russia. So far the EU, concerned of Europe’s dependency on Russian natural gas supply, has imposed limited sanctions on Moscow, including travel bans and asset freezes. German Chancellor Merkel, worried that economic sanctions against Russia would negatively affect Germany’s economy, said the Ukraine crisis should be resolved by political means without imposing economic sanctions on Russia. The United States and EU sanctions are especially designed to hurt President Putin’s inner circle, having of course also negative effects on Russia’s weak economy, but continued Western diplomatic pressure and already agreed sanctions may convince Moscow to ease its grip on Ukraine, allowing finally a peaceful settlement with pro-Russian rebels in the east of Ukraine, not ending Putin’s outright annexation of the strategic Black Sea Peninsula Crimea, he considers historically important as part of Russia.

4b)The next G7-summit will take place in Germany June 7 and 8, 2015, and German Chancellor Merkel considers that actually President Putin’s participation seems to be unlikely. EU ratified a new round of asset freezes and travel bans against 19 Ukrainian separatist and Russians, which will come into effect February 16, 2015, regardless of the latest ceasefire deal of Minsk, signed by pro-Russian rebels, and starting at 00:01 local time on February 15, 2015. The truce will be monitored by the OSCE, warning European leaders that Russia faces additional sanctions if the Minsk peace agreement is not respected, saying Ukrainian President Poroshenko there is ‘a long way to go to peace’. France’s President disclosed that EU sanctions against Russia could be loosened step-by-step in exchange for compliance with the Minsk peace agreement. German Chancellor Merkel said that there would be not any Group of 8 meetings with Russia as long as it fails to comply with basic common values of democracy and states based on rules of law. Hours after Germany’s Foreign Minister suggested Russia could be readmitted to the G8, a senior Russian official appeared to rebuff the notion, saying Moscow would rather work with emerging economies than the rich nation’s club, from which it was suspended following its annexation of Crimea from Ukraine. G7 leaders agreed to keep sanctions against Russia in Place until PM Putin and Moscow-backed separatists fully respect a ceasefire negotiated in Minsk in February 2015, warning they could escalate sanctions if needed, claiming Russia also Kiev must still fully implement the peace deal. Russia’s PM Medvedev said his country is in a new Cold War with the U.S. and its allies, even as Russia, Europe and the U.S. are suggesting to seek cooperation to end Syria’s civil war, resolve the armed stand-off in eastern Ukraine and make progress toward lifting European economic sanctions against Russia. The G7 summit 2016 in Japan without China and Russia on board left the question open if such a reduced G7 can tackle today’s problems, although some observers defended that like-minded countries are better able to prepare for decisive meetings, such as G20 summit 2016 in China of leading and developing countries, agreeing a common line. German Economy Minister Gabriel urged in June 2016 to quickly allow Russia to rejoin the G7 and turn it back into G8, saying: ‘Russia is an important global player and not a regional power’.

5.ICBC, the world’s biggest bank with a Tier 1 capital of $160.646 Billion per mid-2013, reached an agreement with Standard Bank Group Limited, UK, regarding the sale and purchase of shares in Standard Bank Plc, the largest African Bank, acquiring 60% of existing shares in SB Plc for around $770 Million, having a call option to increase its shareholding to 80% in the future and a put option to buy all of the shares of SB Plc.

6.Germany will hold G7/G8 Group’s presidency 2015, planning and hosting the summit 2015, followed by Japan in 2016.

7.Fannie Mae – financial sanctions: The Federal Housing Finance Agency filed in 2011 claims against 18 major financial institutions relating to U.S. residential mortgage-backed securities offerings between 2004 and 2007, remaining settlement of 7 suits against various institutions pending, after the latest $9,33 Billion agreement with Bank of America covering $57,5 Billion of private-label residential mortgage-backed securities bought by Fannie Mae and Freddie Mac.

8.BASEL III banking standards – to make financial markets more secure BASEL III is rising global minimum capital standards or levels of minimum common equity to risk weighted assets to 7% and for systemically important banks to 9,5%, complaining especially JP Morgan Chase that rules are not in ‘America’s interest’ and that the U.S. should not submit any more to BASEL rules. The Fed approved final U.S. rules implementing BASEL III capital frame work in July 2013, making the U.S. version of BASEL III due to an enhanced supplementary leverage ratio for covered bank holding companies and their insured depositary institution much stricter for larger U.S. banks than their European competitors and could present a disadvantage for U.S. banks, as U.S. regulators are lobbied to reduce the U.S. requirements. You find more BASEL III comments in: http://1read.me

8a)JP Morgan Chase – living will – for the 8 biggest U.S.banks capital ratio – Tier 1 capital (predominant common shares and retained earnings, perhaps some equity, like nonredeemable preferred shares) will have to be 9,5% to risk-adjusted assets, and new rules could raise the minimum capital ratio for the biggest banks from 9,5% to 11,5%, proposing the Fed regulations against banks that are still thought to be too big to fail in favor of smaller less complex banks. JP Morgan seems to be already at 9,8%. The leverage ratio, seen by the Fed as a crititical backstop to the risk-based capital requirements for banks that rely on risky short-term funding, assets to Tier 1 capital on a bank’s balance sheet (including also off-balance sheet exposures), maintaining a minimum of 5%, while FDIC-insured bank subsidiaries would have to maintain a minimum of 6%, and by 2018 banks must rely more on funding sources such as shareholder equity rather than borrowing money. JP Morgan is predicted to have a shortfall under the new standards of $15,6 Billion. But most banks are already on track to comply and could meet requirements by retaining earnings or could shrink or restructure some assets to reduce capital needs. FDIC insurance covers eligible savings of up to $250.000 per depositor, per insured bank for each account ownership category. Letting banks issue against uninsured deposits over the $250.000 limit so-called contingent capital bonds, bonds that a point of a crisis would be automatically transformed into riskier share equity, would mean to transform creditors into owners of a bank.

9.UK Financial Investment Ltd. (UKFI) – manages the British Government’s investments in the Royal Bank of Scotland/RBS, Lloyds Banking Group (Lloyds) and UK Asset Resolution Ltd. (UKAR), acting on behalf on HM Treasury, its sole shareholder.

10.Algeria -FDI above US$ 2 Billion each year since 2012, mainly in the hydrocarbon sector, as the country’s economy is heavily dependent on the petroleum industry. (Algeria: 15th place in terms of proven oil reserves in the world and 10th place in the world of proven gas reserves). Observers are reporting many corruption scandals involving foreign companies, although they consider the climate for international firms considering direct investments is stabilizing.

11.Chase Bank open Sunday in New York, Downtown, Flushing Main St. 10:00 am – 3:00 pm, San Francisco, Union Square, 11:00 am – 3:00 pm, other branches in Los Angeles, Dallas, Chicago may also be attending on Sunday, in Miami Chase branches seem to be closed on Sunday.

12.Founders Federal Credit Union, Lancaster, South Carolina, SC 29720 – like all U.S. Federal Credit Unions it is a not-for-profit institution owned by its members, committed to serve its members financial needs, governed by a board of volunteers. The National Credit Union Administration/NCUA, an independent U.S. Government Agency, regulates, charters and insures the Nation’s Federal Credit Unions, which have to demonstrate high standards of safety and soundness in its operations.

13.U.S. bank political appointment – President Obama nominated Allan Landon, a former community banker and Chief Executive of the Bank of Hawai, actually partner of private investment fund Community BanCapital, to a seat on the U.S. Federal Reserve’s Board, responding calls for a greater voice for Main Street in the central bank’s deliberations, concerned that Wall Street holds too much sway.

14.G7 thinking of punishing further Russia../go to 4b).

15.Founders Federal Credit Union/go to 12.

16.Chase Bank, release levy/go to smallbusiness.chron.com/remove-bank-levy-4059.html and to smallbusiness.chron.com/dispute-bank-levy-37255.html

17.Banco Santander, the Euro-zone’s biggest bank, targeting lending push after 4thQ. 2014 profit jump, facing its U.S. unit setbacks in its U.S. operations, remaining under pressure from regulators, after a former Banco Santander SA executive has been indicted for insider trading.

18.HSBC Japan Index Fund Accumulation C. is a fund launched in 1989 with a size of Pound Sterling 279 Million, available in a regular savings plan by investing just Pound Sterling 25 per month, deducting charges from income, investing the fund in companies that make up the FTSE Japan Index providing long-term capital growth.

19.Credit Repair Organizations offering help to boost your credit score and clean up your credit report, working under the ‘Credit Repair Organization Act’, a title of the ‘Consumer Protection Act’; there are many credit repair companies and there are lots of scams. Select a company with a good reputation and money-back guarantee, like SkyBlue Credit Repair, Lexington Law, Credit Repair.com, related with TransUnion.

20.Fed’s QE ended completely October 2014, remaining pending rate hike, which likely happens in the second half of this year. Go to 1read.me/U.S./EU/Euro-zone Economies: United States of America, where you will find more explanations.

21.The NFIP was launched in 1968 and Congress passed a number of laws to strengthen the program. The Homeowner Flood Insurance Affordability Act of 2014 repeals and modifies certain provisions of the Biggert-Water Flood Insurance Reform Act of 2012, making additional program changes to other aspects of the NFIP.

22.BRIC currency reserve pool $100 Billion – go to 1read.me/BRICS – Countries.

23.Countrywide Financial – has been purchased by BofA – go to U.S.Banks, 1read.me

24.Countrywide mortgage assistance – homeloanhelp.bankofamerica.com – home loan assistance – check my loan status.

25.Lloyds TSB – UK Government’s privatization plan delayed as shares in the bailed-out bank are trading below the Government’s break-even price, falling below 69p, ordering to sell the share whenever the price is above 73.6p, the level at which the state bailed out Lloyds in 2008; small investors may be granted a discount of 5p. In the wake of the ‘Brexit’ vote Britain’s Government has scrapped plans to sell stakes in Royal Bank of Scotland and Lloyds in 2016, leaving disposal plans until 2017 at the earliest.

25.a)Lloyds share savings plan maturing June 2016 – oil price declines, oil-related default fears, growth concerns and a general aversion to lower-quality bonds have combined to produce high-yield bond price declines, putting pressure on the banking sector; still ECB considers European banks far more solid than a few years ago as they have significantly strengthened their capital positions; Lloyds is attempting to streamline its business as it prepares to return fully to the private sector; the British Government has reduced its stake from more than 40% to less than 10%, with a deadline of June 2016 being set to complete the task of offloading the taxpayer’s interest; that selloff is now officially on hold and postponed until markets have calmed, as shares fell as low as 60p. and even after rising to 62.4p. the stock remains well below the Government’s bailout breakeven price of 73.6p.; full year result of the bank is due in March 2016, eventually including an additional allocation for compensation claims relating to payment protection insurance mis-selling by another 2 Billion pounds, putting in doubt hopes for a special dividend payout; however an expected positive result of Lloyds, half way through a bigger plan to close 200 branches and cut 9.000 jobs to reduce costs and take more of the business online, could put Government’s sales plans back on track; stock markets likely remain volatile in 2016, following the economy, continuing China as the epicentre of current market instability.

26.BlackBerry’s transformation into a cross-platform, security-focused software and services company advanced, reporting for the third quarter ended November 28, 2015 total revenue of $557 Million, up 14% over the previous quarter, growing the software and services revenue 183% year-over-year and 119% quarter over quarter.

27.Bank of America Merrill Lynch – one of the five largest investment banks in the U.K. paying no corporation tax at all in 2014, despite booking billions of pounds in profits, by using tax breaks and offsetting previous losses against any gains. The bank has about $8 Billion in tax assets to use against tax following the $34 Billion of losses it incurred in the U.K. in 2007 and 2008. However tax regime is changing fast and being forced to adopt to a more fit-for-purpose model, forcing foreign companies to pay more tax. BofA will post a $600 Million pretax write-down in the 4thQ. 2015 as it redeems $2 Billion of trust preferred securities, paying holders 7% to 7,28%, tied to its 2009 acquisition of Merrill Lynch, expecting to realize cash savings from lower funding costs as a results of the redemption.

28.EMU Direct Governments – predominantly in Euro denominated sovereign bonds  with a maturity of up to 10 years of the European Economic and Monetary Union/EMU countries, comprising actually 16 nations of the Euro-area; representative indices available measuring the performance of Euro-denominated Government debt of EMU nations: CITI EMU Government Bond Index/EGBI 1-3 years, Schroder International Selection Fund, SISF Euro Government Bond, Bank of America Merrill Lynch EMU Direct Government Index.

 

 

EU member States – Sanctions against Russia extended, Britain voted to leave the European Union

September 29, 2016

Joint U.S. and EU action, stepping up punitive measures targeting key sectors like energy, arms and financing sanctioning Russia’s continued illegal actions in Ukraine, undermining Ukranian territorial integrity and sovereignty, will hurt European economies slowing recovery, hitting Russian import ban European food producers, harming above all the German economy with close ties to Russia and the already stagnating Euro-zone economy. EU agreed to extend Russia economic sanctions until January 31, 2016, leaving time to enable EU to judge the compliance and full implementation of the Minsk peace agreement, planning Russia to extend the ban on Western food imports for six months starting from early August 2015, deciding the European Union in December 2015 to extend sanctions on Russia for another six months. A further six month extension of the bloc’s economic and financial sanctions against Moscow to punish Russia for the annexation of Crimea and support of separatists in eastern Ukraine likely to be agreed on by the EU at the end of June 2016. EU leaders signaled a further shift form austerity of the €uro-crisis giving member States extra time to consolidate their budgets as long as they pressed ahead with economic reforms, insisting France and Italy on a further easing of EU budget rules (3% ceiling) to stimulate growth and cut unemployment, pledging Germany for budget discipline, saying countries must move faster on reforms. Euro-sceptic and populist parties scored dramatic gains in voting 2014 for the European Parliament, however continuing pro-European centre-right and centre-left parties to control more than half of the 751 seats, forced to collaborate to get key legislation through the Parliament and into law, as they will face unprecedented challenge of noisy anti-establishment members determined to stop business as usual, saying German Chancellor Merkel the EU must create jobs to counter populist wave, demanding French President Hollande EU should concentrate on what matters, on growth and employment, adding British PM Cameron that Brussels has got too big, too bossy, too interfering, seeking with Sweden and the Netherlands a repatriation of powers from Brussels. Analysts warn of increasing political risks in Europe in 2015, as protest- and populist parties are rising. ECB said European policymakers should not give up efforts to make their economies more efficient and stick to budget rules, despite a strong protest note in European elections, moving on with structural reforms to finish what was started in 1999 and make the €uro-zone work. The €uro-zone’s overall Government deficit fell to the EU limit of 3% in 2013 from 6,2% in 2010, striking the €uro-zone’s fiscal stance the right balance between cutting debt and helping growth, however warning the IMF that the unemployment rate of around 12% was still too high. Inflation moving ever closer toward zero, a stagnating economy, a double-digit unemployment rate and new signs of reform fatigue among Euro-zone Governments are posing a serious challenge for the ECB, that it says it cannot solve alone, expressing G20 concern about Europe’s extended stagnation asking for more Government spending to stimulate growth, insisting Germany in structural reforms, strict budget controls and balanced budget, rejecting stimulus, expressing ECB and IMF the need to see countries using Government money prudently to avoid the Euro-zone slipping into its third recession since 2008, increasing pressure on Governments that have fiscal space like Germany, which posted its biggest budget surplus since reunification in the first half of 2014, asking Paris for a ‘NEW DEAL’ in Europe, expecting movements from Berlin to avert a policy clash. German Chancellor Merkel insisted that all member States must fully respect the reinforced rules of the Stability and Growth Pact, reminding the Euro-zone debt crisis has not yet been overcome and its causes have not been eliminated. ECB’s Draghi warned that no amount of fiscal or monetary accomodation can compensate for necessary structural reforms in the Euro-area, delaying France and Italy labor market reforms and to open up to more competition, failing the two countries to cut their budget deficits and debt in line with EU rules, opting EU Commission not to sanction them for missing public finance targets, giving both until spring 2015 to bring their debts and deficits in line. British PM Cameron strongly opposed nomination of Jean-Claude Juncker, the candidate of the European People’s Party, which won the European Parliament elections, as the next President of the European Commission, describing him as face of the past, while Junckers, supported by German Chancellor Merkel, says the crisis is not yet over and EU budget policy must remain as it is, posing politics rather than economics the biggest risk to the long-term endurance of the €uro, saying 48% of British voters they would currently vote to leave the EU in a referendum, while 37% would vote to stay, naming EU leaders Juncker as new EU Commission President, confirming the European Parliament his nomination by a comfortable majority, announcing Juncker Euro 315 Billion investment program to bolster European economic recovery, setting up EU a 21 Billion Euro European Fund for Strategic Investment, with the aim of drawing in 15 times that amount in private- and public – sector money to boost desperately needed jobs and growth, confirming EU Finance Ministers details of the 315 Billion Euro four-year investment plan, including an eight-member committee that will choose the projects. China will pledge a multi-Billion Dollar investment in the new infrastructure fund at a summit on June 29, 2015, in Brussels, considering the fund is going to create opportunities for China to invest in the EU, in particular in infrastructure and innovation sectors. France, Germany, Italy and Poland have each announced they plan to contribute 8 Billion Euros, while Spain and Luxembourg are pledging smaller amounts. The bloc is relying mainly on private investors and developments banks to fund projects from an initial list of almost 2000 submitted by the 28 member States, from airports to flood defenses, that are together worth 1,3 Trillion Euros. In addition the EU Commission is exploring whether the EU could become collectively a member of the $100 Billion China-led Asian Infrastructure Investment Bank/AIIB, Beijing, expecting China that European companies and Governments would take a greater interest in President Xi Jinping’s ‘One Belt, One Road’ initiative, aiming to create a modern Silk Road Economic Belt with railways, highways, oil and gas pipelines, power grids, Internet networks, maritime and other infrastructure links across Central, West and South Asia to as far as Greece. Greece, taking over the EU Presidency for the first half of 2014, criticising imposition of austerity, spending cuts and fiscal policy by Berlin and Brussels, is expecting still some more debt relief, like a further reduction of interest rates on existing loans, a new extension of the maturities and amortization schedule and some relief on financing EU structural funds, planning the €uro-zone to assure IMF it will keep funding Greece, enabling the IMF to disburse its next share of international aid to Athens, despite Greek delay in implementing 153 savings measures. Greece reached a primary budget surplus in 2014, confirming it doesn’t want a third bailout, raising €3 Billion with a coupon of 4,75%, after bringing a first sale of new Greek Government bonds more than €10 Billion of bids, backing Euro-zone Finance Ministers a precautionary ESM credit line for Greece after the country exits its bailout at the end of 2014. Greek Parliament approved budget 2015, preparing for the end of ‘an era of forced bailouts’, granting Euro-zone Finance Ministers Greece a two-month extension of the current bailout program, calling the country for early Presidential elections December 17, 2014, mounting political uncertainty, including fears Greece may exit Euro-zone, seeing European leaders no risk of contagion from Greek vote. PM Samaras failed to gather enough support for his candidate, Stavros Dimas, in a first, second and third Parliament vote, calling for national general elections to be held on January 25, 2015, suspending the IMF new disbursements of aid money until a new Government takes office, saying a Merkel ally that Euro-zone politicians are not obliged to rescue Greece as the country is no longer of systemic importance for the bloc, as Germany seems to believe an exit of Greece is manageable and the danger of contagion is limited, because Portugal and Ireland are considered rehabilitated, revising Fitch outlook on Greece to negative from stable. Greek leftist Tsipras was sworn in as new PM, after forming Government with a small Party of nationalist independent Greeks, winning Tsipras’ anti-austerity, left-wing Syriza 36,3% of the votes in general election and 149 seats in the 300-seat Parliament, just two short of an absolute majority, and Kammenos’ right-wing Party the Independent Greeks 4,8% of the votes and 13 seats, while ruling conservative coalition won just 27,8% and the extreme right Golden Dawn in third place 6,28% of the votes. Syriza’s Tsipras has pledged to renegotiate Greece’s debt arrangements with EU, ECB and IMF/amounting to €257 Billion, naming radical Yanis Varoufakis as Finance Minister, while Independent Greek leader Kammenos will take over the Defense Ministry, aiming France’s Socialist Government to facilitate Greece-Euro-zone talks. Moving to change Europe, leftist Greek Government is seeking anti-austerity allies in Spain, Italy and France, saying Greek Finance Minister he is looking for a new deal with the EU, ECB and the IMF, putting in doubt if Greece will continue to cooperate with the TROIKA and comply with its austerity program, but not calling any more for a write-off of Greece’s foreign debt, but proposing now a ‘menu of debt swaps’, making the ECB already €65 Billion available in emergency liquidity to Greek banks, as long as Athens will give compliance with the terms of the EU/ECB/IMF bailout program. The U.S. expressed support for a positive outcome of Greece-EU talks intending reaching a deal on a new aid program that would put an end to austerity and pursue necessary reforms. Greece’s negotiations with the EU failed to reach an agreement and Athens has been given time until February 20, 2015, to renew bailout-program, of which 70% would be acceptable for Greece and 30% could be replaced, announcing Greece it will submit a request to extend ‘loan agreement’ for up to six months, saying Germany no such deal was on offer, demanding that Athens must comply with the terms of its existing international bailout-program, sealing Euro-zone Finance Ministers finally a four-month extension after Athens sent a detailed list of reforms it plans to implement by the end of June 2015, returning Greece after seven years to growth, expanding its GDP by 0,8% in 2014, after shrinking by 0,4% in the final quarter of 2014, seeing the EU Commission a contraction of 1,4% in 2015. Athens is determined to loosen austerity to revive its economy. Greek Parliament elected pro-European former Minister Prokopis Pavlopoulos as new President. Fitch lowered Greece’s rating by two notches to the high-risk level of CCC down from B, saying it nevertheless expects the Government would survive its cash squeeze, cutting the rating agency Athen’s growth forecast 2015 to 0,5% from 1,5%. Berkshire’s Buffett said ‘Grexit’ ‘may not be bad’ for the Euro-zone and could be ‘constructive’ for the region. Greece confirmed loan repayment €450 Million to the IMF, while still struggling to pay other debts, and has been requested to improve package of proposed reforms in time for the meeting of €uro-zone Finance Ministers on April 24, 2015, to decide whether to release more funds to keep the country afloat. Moody’s further downgraded Greek Government bonds to junk territory, cutting rating to Caa2 from Caa1, a level that is equivalent to an extremely speculative junk bond, lowering also Greek local and foreign currency bond ceilings to B3 from Ba3, citing the increased probability that Greece may exit the €uro-zone in the event of a sovereign default, saying Greece it will default in June 2015 without aid from lenders, suggesting the $300 Million-IMF payment on June 5, 2015, is under question, allowing creditors Athens to bundle four payments due in June 2015 into a single €1,6 Billion lumpsum, which is now due on June 30, 2015. EU President Juncker declined to speak to Greek PM Tsipras after the leftist leader rejected as ‘absurd’ international creditors’ terms for a cash-for-reform deal to keep Athens from default, saying ultimate proposals are not realistic, warning not to impose humilating conditions on his country. The IMF quits Greek negotiations because of major differences, telling EU PM Tsipras to stop gambling, leaving for home also the entire Greek delegation after continuing disagreements, downgrading Standard & Poor’s Greek long term credit rating from CCC+ further into junk territory to CCC with a negative outlook, cutting also further the credit rating of Greece’s biggest four banks, reflecting the probability that Greek banks will default if Athens doesn’t reach an agreement with its creditors, discussing Senior EU officials formally for the first time a possible Greek default. Greece and creditors failed in a ‘last attempt’ to reach a deal, coming a Greek default and a possible ‘Grexit’ closer, shifting the focus now to a June 22, 2015, EU emergency summit after Greek talks collapsed, to discuss the situation of Greece at the highest political, increasing ECB again emergency liquidity for Greek banks valid until Monday, June 22, 2015, moving Greece on the road of a possible Euro-zone exit. EU leaders received new Greek reform proposals cautiously, saying German economic experts the ‘Grexit’ is the solution, raising ECB its Emergency Liquidity Assistance/ELA to Greek banks again to €89 Billion. Greek debt declared by analysts as still sustainable, but will miss debt targets set out by creditors in 2012, seeing the IMF as worst case Greek debt falling to 142,2% of GDP in 2022 from 176,7% of GDP in 2015, assuming a new bailout program of at least 3 years with concessional financing. The Euro-zone readies to deal with a Greek debt default after its other 18 members refused unanimously to extend bailout program beyond June 30, 2015, the day Greece must pay €1,6 Billion to the IMF, following PM Tsipras’s surprise announcement of a referendum to take place on July 5, 2015, on an offer from creditors that his leftist Government rejected. Greece is set to introduce capital controls, keeping from June 29, 2015, Athens stock exchange and Greek banks closed, after ECB refused to increase emergency funding to Athens, saying analysts there may be a wave of contagion, affecting peripheral Government bond spreads, eventually weakening the Euro and contributing to new market volatility. Standard & Poor’s downgraded Greece’s credit rating again from CCC to CCC-, after Athens announced it will not pay €1,6 Billion to the IMF due on June 30, 2015. Greek aid Program expired on June 30, 2015, missing Athens its June 30, 2015-payment to the IMF, finding itself effectively in default, saying the Eurogroup Athens’ stance towards its creditors would have to change before its Euro-zone partners could consider any additional financial assistance, depending on the result of the referendum on previous EU credit terms, warning the IMF Greece will need €50 Billion more in financial assistance until the end of 2018, and must reform before getting debt relief. After the referendum, voting Greeks against the new EU bailout conditions, supporting their leftist Government, PM Tsipras offered creditors a reform package, including last-minute consessions, appealing to his party’s lawmakers to back it, intending to save the country from a financial meltdown, calling France the new proposal as trustworthy and serious. Greece won a conditional agreement to receive a third bailout of €86 Billion over three years, which may still face opposition within the Greek’s coalition government, needing the authorization of the German Parliament to opening loan negotiations. According to IMF secret report Greece will need far bigger debt relief the Euro-zone partners have been prepared to envisage so far, expecting a 30-year grace period on servicing all its European debt, including new loans, and a very dramatic maturity extension, passing Greek lawmakers a tough economic package demanded by Euro-zone as part of the bailout deal, rising ECB Emergency Liquidity Assistance/ELA for Greek banks by €980 Million to nearly €90 Billion, approving European Finance Ministers €7 Billion in bridge loans, allowing Greece to pay a key obligation of €4,2 Billion to the ECB and clear its arrears of about €2 Billion with the IMF, reopening Greece its banks, deciding the European Stability Mechanism/ESM to open formally negotiations with Greece on a third bailout program worth up to €86 Billion over three years, after German lawmakers backed the new Greek bailout, seen as a last attempt to fulfill this extraordinary difficult task, raising Standard & Poor’s Greece’s sovereign credit rating by two notches to CCC+ from CCC-. Greece and its lenders reached a new up to €86 Billion bailout agreement, needing to be adopted by the Greek Parliament and approved by Euro-zone countries, while a strong first review of the implementation of measures will take place in October 2015 and any discussion of debt relief has to come later. Greece will get €26 Billion as a first tranche of the three-year bailout program, €13 Billion very early to cover its debt repayment needs and an initial €10 Billion to be set aside at the ESM to bolster the capitalization of  Greek banks, which will have to pass a stress test before receiving fresh equity, while the remaining €3 Billion of the first €26 Billion tranche will be disbursed in the coming months in return for Greek reform progress, renewing the IMF call for the Europeans to grant Athens debt relief to make its global debt sustainable as condition to study an involvement in the bailout deal, considered as indispensable by the Eurogroup. Euro-zone Finance Ministers agreed with some additional measures to the Memorandum of Understanding to lend Greece up to €86 Billion, after Greek lawmakers accepted their stiff conditions despite a revolt by supporters of leftist PM Tsipras, which may lead to a confidence vote and eventually to early elections. PM Tsipras resigned paving way for snap elections to be held on September 20, 2015, which could allow him to return to power in a much stronger position without anti-bailout rebels in Syriza to slow him down, opposing the toughest part of the latest program, including further pension cuts, more value-added tax increases and a ‘solidarity’ tax on incomes, hoping the Eurogroup that the resignation would not delay or derail implementation of the bailout package, increasing eventually support in Greece for the third Euro-zone bailout program. Greece’s interim cabinet headed by caretaker PM Vasiliki Thanou has been sworn in and the Greek Parliament has been dissolved ahead of the snap elections to take place on September 20, 2015, giving the latest opinion survey Ex PM Tsipras a lead against his opponents backing 23% of voters his Syriza party. Leftist Tsipras and his Syriza party return to power with an unexpectedly clear election victory, forming Tsipras as new PMagain a coalition Government with his former partner, the right-wing populist party of independent Greeks/ANEL, obtaining Syriza 145 seats and ANEL 10 seats, gaining a narrow majority of 155 seats of the 300-member legislature, expecting Greece’s European creditors a swift and full implementation of the bailout deal. Greece is likely to qualify for recapitalization funds for its banks by a November 15, 2015, deadline, as the ESM has up to €25 Billion earmarked for the recapitalization of the Greek banking sector, having already disposed €10 Billion to be available, ready to be wired to Greece. According to the stress tests of Greek banks they have to raise €14,4 Billion of extra capital to cover mounting unpaid loans, reaching the total of non-performing loans €107 Billion, expecting the ESM that the third bailout for Greece will be smaller than the initially envisaged €86 Billion because Greek banks need less recapitalization. Greek Parliament approved a 2016 budget, including sharp spending cuts and some tax increases to satisfy the country’s internacional lenders, at a time of growing austerity fatigue. EU Ministers explored specific measures for a possible debt relief, which could be offered to Greece, ‘if necessary’, at the end of the bailout in 2018 if the country implements all the agreed reforms; the IMF however is insisting to give Greece eventually earlier a break on its future massive debt repayments. Euro-zone Finance Ministers will release €10,3 Billion in new funds for Greece in recognition of painful fiscal reforms pushed through by PM Tsipras, agreeing also to offer Athens debt relief in 2018 if that is necessary to meet agreed criteria on its payments burden, securing an agreement with the IMF to again joining the Euro-zone in funding the bailout for Greece. Italy took over EU’s rotating Presidency for the second half of 2014, winning Renzi’s centre-left Democratic Party/PD by nearly 41% of the vote at European elections, coming not only first, but first with a margin of almost 20 points, getting chief rival anti-Establishment Five Star Movement  /M5S of Beppe Grillo only 21,2%, becoming PD, winning more votes that any other party in the EU, the second largest force in the European Parliament, pledging Renzi that EU should focus more on growth, employment and reforms. Re-elected British PM Cameron promised an in-out EU referendum before ending 2017, warning President Obama Cameron of risks if Britain exits EU, signaling Goldman Sachs European banks would leave London ‘in very short order’ if Britain voted to exit EU, saying Standard & Poor’s Britain’s top credit rating is at risk because of the planned European Union referendum, lowering the outlook on the country’s AAA rating to negative from stable. Legal protection for London’s banks will be at the heart of UK’s EU reform plans, warning British Chancellor Osborne that a failure to change Lisbon treaty would prompt Britain to leave EU, saying shortly non-€uro-zone States will have to choose between joining the €uro or leaving EU, insisting ‘we don’t want to join the €uro’. EU leaders agreed on budget deal cutting ‘payment ceiling’ to €908,4 Billion, meeting austerity demands of British PM, reducing the higher ‘commitment ceiling’ to €960 Billion for the next seven-year budget 2014-2020. PM Cameron won a surprisingly solid victory in the British general election, leaving a stunning disappointment for the opposition Labour Party and its leader, Ed Miliband, who stepped down, gaining Conservatives in the 650-seat-House 331 seats, while Labour will hold 232 seats, accepting for five more years re-elected PM Cameron mandate to form first majority Conservative Government since John Major’s surprise victory in 1992, repeating Cameron a promise to hold a referendum on the membership in the EU. Moody’s downgraded UK’s AAA rating one notch to AA1. Greece’s international lenders discussed Greek financial requirements and extrafunding needs over €32,6 Billion, agreeing to reduce Greek debt by €40 Billion to 124% of GDP by 2020, putting together a package of steps, including debt buyback from private investors providing EFSF/ESM funding of about €10 Billion, return of profits of €11 Billion and also future accounting profits on ECB’s holding of Greek bonds, a reduction of lending rates on the first Greek aid package, an extension of repayment terms by 15 years of old and new bilateral and EFSF loans and deferring EFSF loans’ interest for 10 years. Greece’s leftist PM Tsipras said the EU was ‘sleepwalking towards a cliff’, expecting a debt relief for itself to be honored by end-2016 so that the economy could recover, considering that ‘Brexit’ will either awaken European leaderships or it will be the beginning of the end of the EU. After contracting the Greek economy by 0,2% in the 1stQ. 2016, it expanded by 0,2% in the 2ndQ. 2016, expecting the EU a full year decline of 0,5% or slightly better for 2016, seeing Greece’s economy rebounding by 2,7% in 2017. The German-led European fiscal pact was signed by 25 of the 27 EU nations, with the exception of Britain and Czech Republic. The EU Commission started a European project bond program to finance infrastructure projects involving a cooperation between private stake holders and EIB, EU and member States. The permanent €uro-zone bailout fund ESM entered officially into force October 8, 2012, after the German Constitutional Court ratified with conditions treaty to establish the ESM, saying Euro-zone rescue measures and transfers of competences to Brussels exhaust constitutional framework, remaining Germany’s liability capped at €190 Billion. Euro-nations will allow ESM to leverage its capital with the same techniques as its predecessor EFSF, which failed to attract investors, hoping to boost ESM lending capacity eventually to more than €2 Trillion to bailout if necessary Spain and Italy. The IMF increased its funding of currently around $380 Billion to address global financial needs, totaling new pledges from 37 nations $456 Billion, agreeing the €uro-group to boost the bloc’s bailout lending limit to €800 Billion. Spain asked for €uro-zone help to recapitalize its ailing banks agreeing European Finance Ministers to provide up to €100 Billion, approving EU Commission payment of a rescue package of €37 Billion to bailout troubled banks and of €2,5 Billion for Spain’s planned ‘bad bank’, granting EU Spain two extra years to meet deficit reduction target. €uro-zone rescue funds will be allowed to directly recapitalize banks, not adding to national debt level, once a single banking supervisory mechanism overseen by ECB has been set up, obtaining Italy commitment that the EFSF may purchase limited amounts of Government debt provided the country sticks to its current reform program, approving leaders a €120 Billion growth package, including proposed EIB €10 Billion capital increase. The ECB announced to expand its sovereign bond-buying program reaching actually €208,7 Billion, setting initially no limits on the amounts of bonds to be purchased with remaining maturities of one to three years to bring down the interest rates of crisis nations, confirming it will not treat itself as a preferred creditor, announcing January 2015 a more than Euro 1 Trillion QE program, saying it will buy Euro 60 Billion in sovereign debt from March 2015 through September 2016 to revive Euro-zone economy, warning analysts you cannot address structural reforms with monetary policy. There was a consensus about risk sharing, meaning only 20% of purchases will be the responsability of the ECB and 80% of national central banks, buying up sovereign bonds in proportion to their ‘capital key, which would have to absorb any potential losses should a Government of the Euro-zone default. After Standard & Poor’s and Moody’s also Fitch lowered French sovereign debt rating from ‘triple A’ to ‘AA+’, agreeing EU to give France two extra years to meet EU deficit target of 3%, asking France for still more time to cut budget deficit, rejected by the European Commission, cutting Standard & Poor’s France credit rating from AA+ to AA, saying Paris is not implementing needed reforms to repair economy, unveiling French President Hollande plans to find around €50 Billion of spending cuts between 2015-2017 to help narrow budget deficit, reducing corporate charges by €30 Billion as part of a ‘responsability pact’ with employers. Shifting the ECB away from austerity, France announced in September 2014 it will not reduce its budget deficit to within EU limits until 2017, finally accepted by the EU, growing deficit steadily to 4,7% of GDP in 2016, despite having already been granted extra time to do that by 2015, although it has been expected France would set an example and show budget discipline, seen as the anchor of confidence in the European Union. Ruling Socialist lost local French elections, naming Hollande, facing the lowest popularity levels, new PM, winning Le Pen’s anti-Euro National Front with 25% of the vote European Parliament elections, becoming the strongest party in France, pushing Hollande’s ruling Socialists with only 14% into third place, winning French far-right first Senate seats, losing Hollande’s Socialist Party its majority in the Upper House to centre-right UMP. Fitch cut France’s credit grade one notch from AA+ to AA, saying Paris has fallen short in its efforts to trim fiscal deficit, lowering Standard & Poor’s, which already reduced France’s rating to AA, its expectations of a debt reduction of the country, lowering Moody’s France’s Government bond rating one notch to ‘Aa2’ with a stable outlook from ‘Aa1’ with a negative outlook, because of the country’s continuing weakness in the medium-term growth outlook. EU plans to implement the 11-nation financial transaction tax from 2014, failing its introduction EU-wide, opposed by Britain and Sweden. European leaders agreed on a supervision plan putting €uro-zone’s about 130 largest banks under the direct oversight of the ECB, which promised to put €uro-zone banks through a rigorous stress test before assuming supervisory role in November 2014, becoming French central banker Danièle Nouy €uro-zone’s new super-regulator. Italian Senate approved expulsion of Berlusconi from Parliament following his conviction for tax fraud, given for his year sentence community service. Florence mayor Renzi, who wants to remodel the left, became the new leader of Letta’s centre-left Democratic Party, voting the party in favor of urgently needed reforms, prompting Letta’s resignation accepted by President Napolitano, asking Renzi to form a new Government, who was sworn in as PM, promising to quickly enact economic reforms to get the country out of financial difficulties, announcing a sweeping fiscal reform, reducing income tax by a total of €10 Billion annually for 10 Million low and middle income workers from May 1, 2014, saying they would help economic recovery without breaking EU budget deficit limits. Standard & Poor’s downgraded Italy’s long-term credit rating due to economic weakness from BBB to BBB-, just one level above junk, with a stable outlook, expecting a growth of only o,2% for 2015, measure seen as a blow to PM Renzi, resigning President Napolitano January 14th, 2015, giving the country two weeks to find a successor, posing new risks for PM Renzi, whose candidate is constitutional court judge and one-time Christian Democratic Minister Sergio Mattarella, with a reputation of integrity, who finally was elected in a fourth vote by the Italian Parliament as new President, considered as a victory for PM Renzi. Standard & Poor’s downgraded Finland from AAA to AA+, leaving only Germany and Luxembourg with the AAA rating in the Euro-zone, maintaining Moody’s and Fitch still Finland’s AAA rating. Chancellor Angela Merkel secured a big election win, beginning her third four-year term as German Chancellor after forming a ‘grand coalition’ with the Social Democrats. Germany’s current account surplus has come under scrutinity from the U.S., the IMF and the EU, as it hits about 7% of GDP since 2007, expected to remain also in 2014 and 2015 above the EU 6% threshold, facing the ‘slow’ pace of domestic demand growth and the dependence on exports criticism, calling the U.S. Treasury on Germany to push domestic demand, importing more to boost other economies in Europe. German officials explain that the €uro-zone as a whole has a very small surplus and without the German surplus toward third countries the €uro-zone would have no surplus at all but a deficit; the U.S. deficit won’t be improved by an European one being added to it; the German economic growth has been driven mainly by domestic demand recently. EU leaders postponed a deeper discussion of the future of the Economic and Monetary Union/EMU because of no reform consensus between France and Germany and because of the more pressing migration issue, planning the European Commission to give more budget leeway to States that can prove to have suffered extraordinary costs to face the refugee crisis. German Chancellor Merkel, facing pressure from her conservative supporters as much as from opponents, called Europe vulnerable and the fate of the Euro ‘directly linked’ to resolving the migration crisis, while Berlin and Brussels continue to ask for more distribution across Europe. But Germany is counting on little help as leaders of EU co-founder France fear an anti-immigrant National Front and EU’s third largest economy Britain is consumed with its own debate on whether to just quit the European Union alltogether. Europe could face a wave of migration that may eclipse today’s refugee crisis if growing global economic troubles are getting worse. The European Union sealed a controversial deal with Turkey intended to halt illegal migration flows to Europe in return for financial and political rewards for Ankara, remaining doubts if it’s legal and workable as German Chancellor Merkel recognized, who was a driving force behind the agreement. Germany is seeking the creation of ‘safe zones’ to shelter refugees in Syria; keeping refugees on the Syrian side of the border would help Brussels and Ankara, which hosts 2,7 Million Syrian refugees, stem the flow of migrants to European shores, warning the U.N. against the plan unless there was a way to guarantee the refugees’ safety. The EU is intending to convince Britain with a new compromise reform package to accept a deal in a bid to prevent a ‘BREXIT’, saying PM Cameron he’ll hold the long-pledged referendum on the UK’s membership in the European Union on June 23, 2016, recommending to remain in a reformed EU, warning U.S. President Barack Obama during his visit to London that if Britain votes to leave the European Union it will only suffer disadvantages and could be waiting a decade for a free trade deal with the United States. British voted for EU exit, as 52% were in favor of leaving the European Union, claiming they want an independent Britain, resigning PM Cameron, plunging global markets, expected to slow further global growth. Theresa May will become British PM on July 20, 2016, succeeding Cameron, and is the new leader of the Conservative Party who will lead Britain’s negotiations to exit the European Union. British PM May will not hold a parliamentary vote on ‘Brexit’ before formally triggering Britain’s withdrawal from the EU, as a majority of the 650 lawmakers had declared themselves ‘remainders’. According to opponents elected lawmakers should review the vote before the process is started, since the EU-referendum is not legally binding. €uro-zone-19 EU Commission prediction 2015 – unemployment rate 11,2%, ECB forecast 2015 – average inflation rate 0,1%, before rising to 1,5% in 2016,  growth 2015 1,4%, increasing in 2016 to 1,7%, eventually slowing due to ‘Brexit’ by 0,5% over the next three years.

THE WORLD today!

September 29, 2016
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You will find some of the World’s most powerful people 2015 according to FORBES mentioned in ‘THE WORLD today’: Vladimir Putin (1 for the third year), Angela Merkel (2), also named Time’s Person of the year (2015) and according to FORBES the world’s most powerful women for the fifth consecutive year in 2015, followed ranking second by Hillary Clinton/former Secretary of State and Democratic Presidential Candidate 2016, Barack Obama (3), Pope Francis (4), XI Jinping (5), Janet Yellen (7), ranking fourth according to FORBES in the 2015 report of the world’s most powerful women, David Cameron (8), Narendra Modi (9), Mario Draghi (11), Li Keqiang (12), Warren Buffett (13), Salman Bin Abdulaziz Al Saud (14), Francois Hollande (16), Ali Hoseini-Khamenei (18), Benjamin Netanyahu (21), Christine Lagarde (23), according to FORBES ranking sixth in the 2105 report of the world’s most powerful women, Dilma Rousseff (37), according to FORBES ranking  seventh in the 2015 report of the world’s most powerful women, Khalifa bin Zayed Al-Nahyan (39), Ban Ki-moon (40), Shinzo Abe (41), Park Geun-hye (43), Jim Yong Kim (45), Kim Jong-un (46), Abdel el-Sisi (49), Hillary Clinton (58), Bill Clinton (64), Justin Trudeau (69), ranking tenth in FORBES 2015 report of the world’s most powerful women Michelle Obama, the wife of President Obama and twentyseventh Michelle Bachelet, the President of Chile.
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Time – Magazine picked Argentina’s President Mauricio Macri as Leader between the 100 most Influential People in the World in 2016 and there are two more Argentinians mentioned, Pope Francis as Titan and Queen Màxima as Leader. The list is divided in Pioneers, Titans, Artists, Leaders and Icons; other Leaders included, Christine Lagarde, John Kerry, Barack Obama, Vladimir Putin, Xi Jinping, Angela Merkel, Francois Hollande, Hillary Clinton, Donald Trump and Bernie Sanders.
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United States of America: U.S. President Barack Obama wins a second term, defeating his challenger Republican Mitt Romney, choosing voters to preserve the ‘status quo’ of divided Government in Washington, retaining Democrats a narrow majority in Senate and keeping Republicans majority in the House. President Obama faces tough battles in a still-divided Congress, capable of blocking his every move and is insisting in an immediate middle-class tax freeze to keep economy growing, reiterating that rich must pay more in taxes, saying House majority leader Republican Boehner that Republicans won’t agree to higher taxes. Failure to come to a bipartisan agreement will endanger the nation’s AAA credit rating – warning now also Fitch and Moody’s on U.S. downgrade, and automatic tax increases to most Americans and massive spending cuts to military and domestic programs mandated starting January 2013 by the austerity measures known as the ‘fiscal cliff’ would drive the U.S. most likely back into recession. President Obama has to address also urgent national security issues, including the nuclear standoff with Iran, the civil war in Syria, winding down of the war in Afghanistan and dealing with an increasingly assertive China. Re-elected Republican House speaker Boehner dismissed a new Obama offer that would raise tax rates on income over $400.000, raise $1,2 Trillion in new revenue and cut $930 Billion in spending over the next decade, but failed with his plan that would raise taxes on Americans earning more than $1 Million annually, reaching Senate a last-minute ‘fiscal cliff’-agreement, passing a bill raising tax rates on couples making more than $450.000 a year and on single people earning more than $400.000 a year, postponing massive spending cuts for two months allowing to prepare during this time a new savings program, making the measure its final passage in the divided Republican-controlled House of Representatives sending legislation to President Obama. The minimum-compromise avoids austerity but doesn’t resolve dangers of national default, high unemployment and U.S. debt problem, continuing discussions about spending cuts and debt ceiling, hitting the Government its $16,394 Trillion debt limit, undertaking Treasury ‘extraordinary measures’ to leave it with more cash on hand, as in a matter of weeks outflows will overwhelm inflow, nominating Obama his Chief of Staff Jacob J. Lew to be next Secretary of Treasury. The House voted to suspend temporarily Federal debt ceiling allowing the Government to borrow as needed through May 18, 2013, putting off any potential default, however including a provision that docks lawmaker’s pay if a budget blueprint is not passed by April 15, 2013, accepting Senate Democrats GOP debt-limit plan, reaching public debt $16,739 Trillion and budget deficit $1,059 Trillion nearing the end of March 2013. Fiscal talks failed to prevent automatic budget cuts, called sequestration, amounting to $85 Billion, beginning March 1, and totaling $1,2 Trillion over a decade. The House passed a bill extending funding through the second half of the current fiscal year ending September 30, approving a GOP-budget blueprint seeking $4,6 Trillion savings over 10 years without raising new taxes, hoping to reach a small surplus by 2023 through deep cuts to healthcare and social programs that aid the poor, approving Senate Democrats narrowly a $3,7 Trillion budget blueprint for 2014, aiming to reduce deficits by $1,85 Trillion over a decade, including unspecified tax rises worth about $975 Billion, beginning now the difficult task to work and agree on a budget compromise. Congress suspended debt limit until May 18 and the next day the limit automatically would be raised to the Government’s debt level at that time. Treasury could run out of funds by October 17, 2013, unless Congress agrees to raise the so-called ‘statutory debt ceiling’ of actually $16,7 Trillion, and the United States for the first time could default on loans from bond holders such as the Chinese Government, warning Congressional Budget Office working on deficit-cutting that $2 Trillion in additional savings are needed over the next 10 years just to stabilize long-term U.S. debt. The Republican controlled House passed  a short-term funding bill stripping President Obama’s healthcare law of any financing, as the Senate will not approve any legislation that defunds or delays ‘Obamacare’ and the White House would veto any bill that stripped funds from the healthcare plan. Senate passed a budget bill to avoid partial Government shutdown by October 1, 2013, however insisting House Republicans to pass budget resolution but only if President Obama’s health reforms are delayed for one year, saying President Obama the health-care law is ‘here to stay’, urging China, Japan and G20 the U.S. to prevent debt default resolving gridlock. Senate Leaders reached a bipartisan deal to end 16-day partial Government shutdown and temporarily raise U.S. debt ceiling to avert default, approving Senate and the House the measure, funding Federal agencies through January 15, 2014 and suspending enforcement of the $ 16,7 Trillion debt limit until February 07, 2014, setting stage for a possible repeat of showdown, although both sides may attempt to reach a longer-term deal by December 13,2013, remaining doubts over safety of U.S.debt. Senate Minority Leader Republican Mitch McConnell, broker of the deal with Democrats to reopen Government, openly criticized GOP tactics, pledging there will not be another Government shutdown. Leading House Republican called for the Nation’s top health official, Kathleen Sebelius, to step down if problems with President Obama’s new health care plan aren’t quickly resolved, replacing Sylvia Mathews Burwell outgoing U.S. Secretary of Health and Human Services Sebelius, opening a new chapter in the White House’s efforts to defend Obama’s signature healthcare law. Bowing to pressure, the President offered a one-year extension to the more than 4 Million people whose current health policies are being cancelled under the terms of the Affordable Care Act, a development Republicans have repeatedly attacked, passing the House a bill to allow people to keep health plans, which goes further than the fix that President Obama had previously announced, defying veto threat, delaying the Supreme Court health care law’s birth-control mandate. The Senate approved to change filibuster rule, eliminating the use of blocking tactic against most Presidential nominees, severely reducing power of GOP minority in the Senate, allowing President Obama to make appointments, most likely producing an escalation of partisan warfare. House and Senate negotiators reached a modest budget deal that would raise military and domestic spending over the next two years, shifting the pain of across-the-board cuts to other programs over the coming decade, setting discretionary spending levels at $1,012 Trillion for 2014 and $1,014 Trillion for 2015, including a plan to increase Federal debt limit, as an extension of the $16,7 Trillion debt ceiling expires February 07, 2014, making another Government shutdown unlikely, approving the House bipartisan budget bill, passing the budget agreement also Senate, sending two-year budget to President Obama, passing the House and Senate a $1,1 Trillion spending bill for the current fiscal year, sending it to the White House. Democrats are turning to minimum wage as 2014 strategy hoping to increase chances in hotly contested Congressional races, intending Republicans, despite House’s unpopularity, for Senate, needing to net six seats, blocking Senate Republicans one of Obama’s top legislative priorities, a bill to raise the Federal minimum wage to $10,10. President Obama urged in his State of the Union speech Congress to raise the minimum wage for Millions of low-income Americans, vowing to act alone on the economy embracing executive orders as the possible only route available given the hostility in Congress. The Congress approved legislation extending U.S. Federal borrowing authority for a year through March 15, 2015, bowing GOP to President Obama’s demands for a debt limit increase without any conditions, reaching actual Federal debt around $17,55 Trillion and budget deficit $562,2 Billion. Behind retreat on debt limit Republicans eye retaking Senate. Polls show that Democrats face a difficult outlook this fall due to a President with low approval ratings and voters who seem to favor a GOP-led Congress to keep the executive branch in check. Democrats will have to illustrate and persuade voters of the destructive excesses of a Tea Party rule to keep the President’s party in charge of the Upper Chamber, but a GOP-controlled Senate is possible and could lead to more Government shutdowns limiting Obama in his last two years, but a loss for Democrats in midterm elections may help Hillary R. Clinton if she runs to succeed him. The chance of Republicans winning control of the Senate have climbed to 72%, now three weeks to go to the midterm elections, pushing Democrats even harder in the key battleground States to maintain their female gender gap advantage over the Republicans. Culminating midterm elections Republicans won the Senate, strengthened their majority in the House and added to their numbers among the nation’s Governors, defeating Democrats, ending a season of discontent for President Obama and may open a period of even deeper frustration in his final two years in office, promising Republican Senate Majority Leader Mitch McConnell ‘to get things done’. Former U.S. President George W. Bush likes idea of his Republican brother and former two-term Governor of Florida Jeb Bush vs. Democrat Hillary Clinton in 2016, who is favored to win the party’s nomination if she tries again for the White House, while Jeb Bush is considering entering the Republican Presidential nomination race for 2016. House Republicans sue over Obama’s signature healthcare law, announcing to fight the President’s unilateral immigration action, after the White House unveiled overhaul of the immigration system; analysts say bet on Obama, not Congress, backing the Supreme Court Obamacare, rejecting a conservative legal challenge. Republican controlled Congress passed $1,1 Trillion spending bill, ending Government shutdown threat, sending measure to President Obama who is expected to sign it into law. The Senate confirmed Ashton B. Carter as new Defense Secretary. Republican House Speaker John Boehner announced he will step down from the speakership and leave the House at the end of October 2015, seen this shock resignation helping to reduce the chances of a Government shutdown due to lack of funding on October 1, 2015, but still remaining other fiscal challenges. U.S. lawmakers reached a deal on a two-year, more than 1-Trillion-Dollar-per-year budget, averting damaging Government shutdown, increasing also the U.S. debt ceiling to allow Government borrowing through March 2017. Democratic Presidential hopeful Hillary Clinton assailed Republican candidate Donald Trump as ‘not just unprepared’ to be President but ‘temperamentally unfit’ to hold the office, attacking Trump’s foreign policy as a threat to U.S. safety, saying if Donald Trump wins, they’ll be celebrating in the Kremlin and we cannot let that happen, warning President Obama the United States should not retreat from the world stage. House speaker Paul Ryan endorsed quietly the presumptive GOP nominee Donald Trump, amid mounting pressure that left the speaker increasingly isolated within the Republican Party.  Meanwhile the Republicans charged Clinton’s reluctance to say the U.S. is at war with Islamic State and that military intervention in Libya created a power vacuum for radical Islamists. Clinton opens up a double-digit lead over Trump, saying some 46% of likely voters they supported Clinton, while 35% said they supported Trump, and another 19% said they would not support either. Hillary Clinton has reached 2.383 delegates, enough to secure the Democratic Party’s presidential nomination, sharpening now her contrasts with the presumptive Republican nominee Trump. President Obama endorsed Hillary Clinton for President, saying ‘I don’t think there’s ever been someone so qualified to hold this office’. President Obama after Britain’s vote to leave EU: Britain and the EU will remain indispensable partners of the United States; saying Hillary Clinton, she will respect the British move. Democrat Sanders endorsed former rival Clinton for President. During the Republican convention Donald Trump was formally nominated the Republican Party’s presidential candidate, promising to restore law and order and accusing his Democratic rival Hillary Clinton as corrupt and ineffective. Donald Trump chose Governor Mike Pence of Indiana to be his running mate and vice-presidential candidate, while Hillary Clinton selected popular Virginia Senator Tim Kaine as her vice-presidential running mate, securing Hillary Clinton the Democratic Party’s U.S. presidential nomination and will become the party’s standard-bearer against Republican nominee Trump in the November 08, 2016, election, leading Clinton a Trump by 6 points according to a Reuters/Ipsos opinion poll the day after she formally accepted her party’s nomination, widening Clinton lead ahead of Trump to 12 points, according to the latest Reuters/Ipsos opinion poll, as Trump appears to have done little to improve his overall image. The latest Reuters/Ipsos poll showed Trump with 40% support versus 39% for Clinton, signaling other polls also that Clinton’s lead had shrunk. Hillary Clinton returned to campaign trail reassuring anybody about her health, showing polls a tight race for Trump and Clinton, viewing voters Donald Trump with big risks and rewards, saying he lacks the right temperament, but would bring a real change to Washington. Democratic nominee Hillary Clinton was widely seen outperforming her Republican opponent Donald J. Trump in the first presidential debate.
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United States of America: President Obama’s budget deficit rose to a postwar record of $1,297 Trillion in FY2011, decreasing to $1,089 Trillion ending FY2012 and declining further to $680 Billion in FY 2013 thanks to tax revenues and cash from Fannie Mae and Freddie Mac, dropping still more in FY 2014 ended September 2014 to $483 Billion/with a deficit-to-GDP ratio of 2,8%, rising revenues to $3,013 Trillion, falling outlays to $3,499 Trillion. President Obama has been sending a $3,9 Trillion budget blueprint for fiscal year 2015, planning a deficit of $564 Billion/3,1% of GDP, to Congress, seeking new spending to boost economic growth, pledging also to reduce further national debt by raising taxes on the wealthy and cutting payments to health providers, expecting analysts Republicans will block most of the proposals, setting up election-year clash. The U.S. fiscal year budget deficit at the end of September 2015 narrows to $439 Billion or 2,5% of GDP, the lowest level since 2008, projecting the Congressional Budget Office/CBO a fiscal 2016 deficit of $414 Billion, forecasting that public debt would grow from 74% of GDP now to about 77% in 2025. The June 2016 budget surplus was $6 Billion with receipts totaling $330 Billion and outlays of 324 Billion, while the current fiscal year-to-year deficit stood at $401 Billion. CBO’s view is that the still-growing federal debt is unsustainable and that the nation must be serious about balancing budget and reducing America’s debt. Obama proposed a $3,99 Trillion budget for fiscal year 2016 with a deficit of $474 Billion, calling for a one-time 14% tax on an estimated $2,1 Trillion in profits that U.S. companies have accumulated overseas, while imposing a 19% tax on U.S. companies’ future foreign earnings, incorporating higher spending in infrastructure and education. Lawmakers approved a $1,1 Trillion spending measure, passed to avoid a Government shutdown, that includes $680 Billion in tax breaks, scrapping a 40-year-old ban on the export of U.S. oil and easing a 35-year-old tax on foreign investment in U.S. real estate. President Obama sent his final budget request to Congress, a $4,1 Trillion proposal for fiscal 2017 beginning October 01, 2016, projecting a deficit of $616 Billion or 3,3% of GDP in the current fiscal year ending September 30, 2016, wider than the $544 Billion the Congressional Budget Office had expected, and a deficit of $503 Billion or 2,6% of GDP for the fiscal year beginning October 01, 2016. Fitch reaffirmed the U.S. triple-A rating raising outlook to stable from negative, maintaining also Moody’s the AAA-rating for the U.S., upgrading rating outlook to stable as budget deficit falls, affirming Standard & Poor’s the U.S.’s AA+ credit rating, keeping outlook stable, seeing recovery of the U.S. economy and a stronger currency. Obama’s ‘American Recovery and Reinvestment Bill of 2009’ established permanent middle-class tax cuts getting relief about 95% of taxpayers and included a ‘Buy American’ clause. President Obama signed a landmark health care reform bill into law pushed by Democrats, a plan with an estimated cost of $940 Billion aimed to guarantee affordable health insurance for most Americans providing coverage to 32 Million people, who would be otherwise uninsured, cutting the Federal deficit by $138 Billion over the first 10 years. 26 states announced legal action to block the law and a Federal judge ruled that key part of health care bill violates Constitution, filing the U.S. Justice Department a petition asking the Supreme Court to consider the constitutionality of the Obama Administration health-care overhaul, abandoning the White House a controversial part of the healthcare law dropping plans to implement a new program to provide Americans with long-term-care insurance seen as financially not viable. Seen as a win for the President, the Court backed Obama on health law, limiting ruling however Medicaid provisions. Congress repealed ‘don’t ask, don’t tell’, lifting a ban on gay men and lesbians serving openly in military, sending the bill to President Obama, who had campaigned in favor of this historic measure. The U.S. and Moscow put into force the new Strategic Arms Reduction Treaty/ START lasting 10 years, an important successor agreement replacing a key ‘Cold War’ – era nuclear disarmament treaty – reducing warheads on both sides by about 30%. The Congress approved long-awaited free trade agreements with strategic allies South Korea, Colombia and Panama, seen as a rare bipartisan achievement and passed as expected the extension of payroll tax cut and jobless benefits, maintaining Medicare reimbursement rates for doctors. The U.S. declared officially war in Iraq over, withdrawing all U.S. troops at the end of 2011, warning implicitly neighbor Iran not to interfere in Iraq, signalizing President Obama Asia as top priority, a shift popular with regional Governments wary of China’s accelerating rise. President Obama renewed oath for 2nd term, the 57th Presidential Inauguration, delivering agenda setting speech heralding a bolder leadership style, addressing the need of greater equality, immigration reform, gay rights, climate change, saying we are made for the moment and calling on Americans to seize it together. Hitting the President’s popularity a 3-year high, he pledged to fight a higher minimum wage and for a strong middle class, more Government investment in schools and clean energy, and deficit reduction through spending cuts and tax increases, pushing Congress to act on guns, immigration and climate change, announcing to open trade talks with E.U. and to return 34.000 troops from Afghanistan, about half of the U.S. force, before February 2014. Two rulings of the Supreme Court bolster gay-marriage, extending Federal benefits to same-sex couples and permitting gay marriage in California. Senate passed overhaul for immigration, setting up fight in the Republican controlled House of Representative. President Obama offered to review U.S. surveillance programs in response to mounting public concern after disclosures by National Security Agency/NSA leaker Snowden, who has been granted temporary asylum in Russia, growing anger especially in Latin America and longtime allies France and Germany over U.S. surveillance, seeking new rules for sharing intelligence, saying German groups the United States are as big industrial espionage risk as China, announcing the White House Obama was unaware as United States spied on leaders. According to a classified document provided by whistle-blower Snowden, who is prepared to co-operate with Germany, the NSA monitored phone conversations of 35 world leaders. The White House and two key members of Congress rejected Snowden’s plea for clemency, stepping up pressure to force more disclosure about the scope of the surveillance on NSA, demanding Tech giants changes to U.S. surveillance laws to restore the public’s trust in the internet, ruling a New York judge the NSA’s spying program was lawful after a Washington court found that the NSA bulk collection of telephone mega-data is likely to be in violation of the U.S. constitution, recommending Obama-panel new limits on NSA-spying, stripping NSA of power to collect phone data records, signaling President Obama change to NSA data collection, reassuring Americans and Foreigners alike that the United States will take into account privacy concerns, scaling back NSA program, banning spying on the leaders of close friends and allies, saying he will require intelligence agencies to get court permission before tapping into vast phone records database. The U.S. Government privacy board sharply rebuked President Obama over the NSA’s mass collection of American phone data, saying the program defended by Obama was illegal and ought to be shut down. The U.S. accused five China military officers of hacking into American companies to steal trade secrets, calling China indictment purely fictitious and extremely absurd. Chinese consider the U.S. has ‘double standards’ on spying, as the leaks by NSA contractor Snowden gave China grounds for accusing the U.S. of infiltrating Chinese companies and Government offices. Germany asked Berlin CIA chief of station, who coordinates secret service activity in Germany, to leave, seen as response to America’s failure to cooperate on resolving various allegations. Obama told world leaders at the U.N. he was devoting the rest of his Presidency to a negotiated end to the confrontation with Iran and creating a separate State for the Palestinians, resolving Syria conflict peacefully, as observers from the left and right criticize him as ‘President Passerby’ needing to become a participant in his Presidency! The U.S. affirmed support to its Japanese ally as China claims air space over disputed islands in East China Sea, flying two B-52s through China’s expanded ‘Air Defense Zone’, enforcing China its new air defense zone ‘escorting’ U.S. and Japan aircraft, urging U.S. to obey China’s flight rules giving flight plans when traveling through an air defense zone, extending also South Korea its air defense identification zone partially overlapping with a similar zone declared by China that has sharply raised regional tensions. President Obama outlined plans to end U.S. troop presence in Afghanistan by the end of 2016. Obama’s administration, standing up against climate change, will propose to cut carbon pollution from the nation’s power plants 30% from 2005 levels by 2030. U.S. jets and drones attacked Islamic State militants in northern Iraq to protect Americans, hundreds of thousand of Christians and members of other religious minorities at risk, declaring President Obama the U.S. has a strategic interest to push back ISIS  (Islamic State of Iraq and Syria/Abu Bakr al-Baghdadi), Islamic State militants made large territorial gains in Iraq and control a third of Syria, beginning to fight also inside Lebanon, enlisting President Obama  Allies to help destroy ISIS. The President asked Congress to authorize U.S. war on Islamic State, allowing certain ground combat operations, including rescue operations, or the use of special operations forces and the use of U.,S. forces for intelligence collection, limiting operations to three years, saying his priority is to defeat ISIS. U.S. military killed a senior Islamic State leader in Syria, forming part of a push to wipe out top commanders in the terrorist group, seeking the U.S. presence on the ground to eliminate systematically the cabinet of ISIS. President Obama announced normalizing relations with Cuba, restoring diplomatic relations after more than five decades, planning to open embassies in each other’s capitals as soon as possible, playing Pope Francis a role in changing Cuba-U.S. policies. But only Congress can lift the decades-old general commercial embargo and Republican lawmakers, controlling Congress, are expected to do everything in their power to limit President Obama’s aspirations. The U.S. led coalition/ U.S. and NATO ended formally its 13-year combat mission in Afghanistan, declaring Taliban ‘defeat’ of U.S. and its allies in Afghanistan. President Obama halted the withdrawal of forces from Afghanistan, saying he will keep 5.500 U.S. troops in Afghanistan into 2017. Following President Obama’s historic shift the U.S. and Cuba will meet in Havana to discuss restoring diplomatic relations, needing Cuba desperately the U.S. to end permanently damaging trade embargo, taking off first direct flights between the U.S. and Cuba, after the White House eased restrictions on travel to that country. President Obama and Cuban President Raul Castro met during a regional summit in Panama for the highest-level talks between the U.S. and Cuba in nearly 60 years, moving to set aside decades of Cold War hostilities, agreeing to push ahead to improve relations. The U.S. and Cuba announced to restore diplomatic relations after 54 years and reopen embassies. President Obama arrived in Buenos Aires, after his historic visit to Cuba intended to begin the reconciliation after the the Cuban Government started to open up the country, praising Argentina’s President Macri, who recognized Obama’s visit as a gesture of friendship, expecting to begin new mature relations with the United States, welcoming Obama a new beginning with Argentina, seeking to rebuild its reputation abroad, damaged during the twelve-year leftist Kirchner administration, engaging in a pending deal to settle legal battles with the holdouts, allowing the country to leave default and regain access to international financial markets. In his State of the Union address President Obama, ignoring the new majority of Republicans in the Senate, outlined areas of possible cooperation and challenged Republicans to support him on an expensive domestic agenda, promoting his plans to lifting up the middle-class, making community college free, enhance tax credits for education and child care and impose new taxes and fees on high-income earners and large financial institutions, and to approve far-reaching trade deals with Europe and Asia. President Obama declared in his final State of the Union address, after his seven years in office, that the country must not allow election-year fear and partisan distrust to put economic and security progress at risk, defending his legacy saying economy has improved.
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http://www.BarackObama.com/
“Organizing for America”
http://my.barackobama.com/neworganization/
Government web site tells you if eligible to refinance mortgage. Average 30-year-fixed mortgage rate at 3,60% in May 2016, the lowest level since May 2013:
http://makinghomeaffordable.gov/
President Obama is calling on all of us – United We Serve:
http://www.serve.gov/
President Obama’s campaign promise of giving 95% of working Americans a tax cut – Recovery Act tax cuts and savings:
http://my.barackobama.com/TaxSavings/
Standing with President Obama to pave the way for a clean energy future that: – Combats climate change, – creates a new economy powered by green jobs and – ends our dependence on foreign oil.
http://my.barackobama.com/CleanEnergyFuture/
http://my.barackobama.com/Stand-Up-Against-Climate-Change/
President Obama’s Clean Power Plan. Every single name makes a difference – make sure yours is part of it:
http://my.barackobama.com/Support-Carbon-Pollution-Standards/
Real effects of the steps President Obama and Democrats have taken to rebuild our economy:
http://my.barackobama.com/WintheFuture/
President Obama frustrated: Calling on Congress to take action on job:
http://my.barackobama.com/PresidentonJobs/
Check out our new health care app:
http://my.barackobama.com/How-You-Benefit/
An important part of Obamacare is expanding Medicaid allowing to provide affordable coverage to Millions of Americans:
http://my.barackobama.com/People-over-Politics/
President Obama’s inauguration:
http://action.2013pic.org/Inauguration/
Stand with President Obama in tackling this critical issue and tell Congress it’s time to act:
http://my.barackobama.com/Gun-Reform/
Working the next four years:
http://my.barackobama.com/Organizing-for-Action/
Support of comprehensive immigration reform:
http://my.barackobama.com/Support-Immigration-Reform/
http://my.barackobama.com/Take-this-Fight-to-the-House/
Stand with the President and support agenda we are fighting for:
http://my.barackobama.com/Finish-What-We-Started/
http://my.barackobama.com/Are-You-In/
Stand with the President – tell Congress you support real action to make college affordable for American families:
http://my.barackobama.com/College-Should-Be-Affordable/
Watch the GOP’s debate:
http://my.democrats.org/Watch-the-GOP-Debate/
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Economic outlook 2016: The World Bank lowered its global growth forecast for 2016 again to 2,4% from previously estimated 2,9%, after the world economy advanced also 2,4% in 2015, down from 2,6% in 2014, projecting that global growth could accelerate to 3,1% in 2017, while the IMF cut its growth forecast 2016 due to ‘Brexit’ uncertainty again from previously 3,2% to 3,1% and for 2017 from 3,5% to 3,4%, reducing growth projection for Britain to 1,7% for 2016 and to 0,9% for 2017. British PM Cameron resigns after ‘Brexit’ defeat and will be succeeded as PM on July 20, 2016, by Theresa May, the new leader of the Conservative Party, energizing the British move European skeptics and demands to modernize the European Union becoming more integrated, plunging global markets, suffering world stocks, expecting economists a further slowing global economic growth. India will continue to be the fastest-growing major emerging economy with a growth above 7%, while China, the world’s second biggest economy, continues to show a growth slowdown, reducing imports and demand for commodities, adding a stock market volatility that is hurting financial markets and showing an increasing tolerance to allow a weaker yuan to help its exporters, facing the world likely months of China aftershocks in 2016. China’s turmoil produced the worst start into 2016 for global financial markets, moving worried investors $8,8 Billion from funds that track stocks around the world to bond funds that target Europe and Japan. Japan and the Euro-zone are seen to continue a loose monetary policy to sustain fragile recoveries, growing Japan’s economy probably only by 0,5%, while growth in the Euro-zone may likely accelerate from around 1,5% in 2015 to nearer 2% in 2016, heading the U.S, in the opposite direction, opting the Federal Reserve in December 2015 for the first rate hike in nine years, intending to tighten monetary policy, but subsequent rate increases will be slow, particularly if China devaluates its currency at a rapid rate in 2016. Negative interest-rate policies are currently used by central banks around the world and most rates that are negative are between zero and -1%; allowing interest rates to go even further below zero could be a monetary policy tool by central banks in a situation of weak growth and very low inflation and may be a long-lasting feature in the economic landscape. The U.S. economy is expected to expand again by 2,4% in 2016, after growing at the same rate of 2,4% in 2015. Democratic Hillary Clinton will change forever Capitol Hill when she is most likely voted in on November 6, 2016, as the first female President of the United States, taking office in January 2017. The instability in the Middle East, plunging commodity prices, increasing likely the pressure on the crude price in 2016 due to additional oil supplies from sanctions-free Iran, the fifth biggest OPEC member, intending to regain lost market share, the global effect of a stronger Dollar and economic problems in some of the largest emerging markets, such as Brazil and Russia, both suffering a deepening recession, and South Africa with a slowing economic expansion, are posing risks to the world economy. OECD cut its world growth forecast to 3% for 2016, the same pace as 2015, and to 3,3% for 2017, predicting now a growth for China of 6,5% in 2016, after reaching 6,8% in 2015, and of 6,2% in 2017, for the U.S. 2% in 2016 and 2,2% in 2017, for the Euro-zone 1,4% in 2016 and 1,7% for 2017, for India 7,4% in 2016 and 7,3% in 2017, for Japan 0,8% in 2016 and 0,6% in 2017, for Germany 1,3% in 2016 and 1,7% in 2017, for the UK 2,1% in 2016 and 2% for 2017, for France 1,2% in 2016 and 1,5% in 2017, while Brazil’s economy is expected to shrink up to 4% in 2016, after contracting 3,8% in 2015, stabilizing again in 2017. The Group of 20, the world biggest economies, accounting for more than 85% of the global economy, shifted in 2014 their focus away from austerity fully on growth, vowing to lift global growth by more than $2 Trillion over 5 years.
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U.S./EU/€URO-ZONE ECONOMIES: United States of America: The Federal Reserve headed by Ben Bernanke justified renewed stimulus efforts/QE4 to boost economic recovery also in 2013 by continuing purchases of $45 Billion in long-term Treasury bonds and of $40 Billion in mortgage-backed securities a month, saying it expects to keep short-term interest rates near zero until unemployment rate fell to 6,5% or lower, providing the medium-term inflation does not exceed 2,5%, keeping Fed rates steady, deciding to continue its $85 Billion-per-month bond-buying program and with low interest rates, awaiting sustainable growth and more job creation, still at the end of October 2013 no consensus on timing for slowing pace of bond-buying stimulus, however the Fed is already seeking new ways of supporting economy that still needs help. As the Fed announced to scale back its monthly bond-buying campaign from January 2014 by $10 Billion to $75 Billion from actually $85 Billion, signaling the probability to end bond-buying stimulus in December 2014, there is a growing debate over how the Fed should signal the timing of eventual interest rate hikes. President Obama nominated Janet Yellen to replace Ben Bernanke as the next head of the Federal Reserve, confirming Senate her nomination, setting her up to take office February 01, 2014, confirming the Fed a further $10 Billion reduction in its monthly bond purchases, sticking to plan to wind down extraordinary stimulus despite recent turmoil in emerging markets, starting February 2014 buying $65 Billion in bonds per month, handing Fed Chairman Bernanke the Central Bank’s reins to Yellen. Federal Reserve chairwoman Yellen sees a slower growth, but keeping faith in recovery, allowing the Central Bank to continue reducing stimulus, cutting monthly bond-buying stimulus by another $10 Billion to $55 Billion in March 2014, to $45 Billion at the end of April 2014, to $35 Billion in June 2014, to $25 Billion at the end of July 2014 and further to $15 Billion in September 2014, ending as expected in October 2014 its QE after spending over $3 Trillion in its six-year bond-buying program, maintaining interest rates near zero, seen by most economists a likely increase by mid 2015, projecting a slightly more aggressive path of rate hikes for 2016, suggesting low inflation and a weakening global economy that policymakers may be in no hurry to hike borrowing costs, seeing most financial analysts now the Fed holding off until at least September 2015 before raising interest rates for the first time since 2006, warning the IMF saying the Fed should delay a rate hike until the first half of 2016, until there are signs of a pickup in wages and inflation. The Federal Reserve recognized for the first time this year that U.S. economy is expanding, saying shale production was steady, seeing traders a greater chance for a rate hike in September 2015 as labor market seems to be stabilizing. The Fed held interest rates steady near zero, avoiding a rate hike in September 2015, probably influenced by the recent market turmoil in China, which added to global economy worries, saying Fed chair Yellen she expects the long-anticipated rise in interest rates to begin gradually at the end of 2015 to avoid an abrupt rate hike later, but mentioning that economic ‘surprises’ could lead to a change of this plan. Fed delays rate hike again amid low inflation and global economic worries, remaining the near-zero interest rate in place since December 2008, but sees a moderate expansion considering a December 2015 rate rise. The Fed decided in December 2015 its first rate hike in nine year, raising the range of its benchmark overnight interest rate by 25-basis points, or by a quarter of a percentage point, to between 0,25% and 0,50%, ending a lengthy debate about whether the economy was strong enough to withstand higher borrowing costs. The 25-basis point rate hike is considered as a tentative beginning to a gradual tightening circle and the next move will be especially monitoring inflation, which remains mired below target. The Fed left key U.S. interest rate unchanged at a range of 0,25% to 0,5% in January 2016 and March 2016,   citing still existing global economic risks, while the median forecast by Fed members of the monetary policy committee is 0,875% by the end of the year, and the median projection for 2017 is 1,875% within a range of 1,625% to 2,75%. The Fed continues in September 2016 to leave rates unchanged, however saying that risks to the U.S. economic outlook had diminished, opening the door to a resumption of monetary policy tightening possibly at the end of 2016. U.S. unemployment rate remained for the third month at 4,9% in August 2016, adding American companies just 151.000 jobs, after an upwardly revised 275.000 surge in July 2016, declining first-time jobless claims to seasonally adjusted 254.000 for the week ended September 24, 2016. The Conference Board Consumer Confidence index increased 4,4 points in August 2016 to 101,1 from 96,7 in July 2016, rising the Present Situation index from 118,8 to 123.0, while the Expectations index improved from 82.0 in July 2016 to 86.4 in August 2016. The Conference Board Leading Economic Index for the U.S. declined 0,2% in August 2016 to 124.1, following a 0,5% increase in July 2016 and a 0,2% gain in June 2016. U.S.- consumer spending, which accounts for about 70% of the U.S. gross domestic product, rose 0,3% in July 2016 after gaining 0,5% in June 2016, increasing at a 4,4% annual rate in the 2ndQ. 2016, surging personal income 0,4% in July 2016 after rising 0,3% in June 2016, increasing savings to $794,7 Billion from $776,2 Billion in June 2016. The overall U.S. consumer price index/CPI in August rose 0,2% after being unchanged in July 2016, increasing the CPI 1,1% in the 12 months through August 2016 after surging 0,8% in July 2016, climbing the so-called core CPI in August 2016, without food and energy prices, 0,3% after gaining 0,1% in July 2016, surging 2,3% in the 12 months through August 2016 after advancing 2,2% in July 2016. The so-called core Personal Consumption Expenditure/ PCE price index (the Fed’s preferred inflation measure), excluding food and energy prices, rose 0,1% in July 2016 after a similar gain in June 2016, increasing the core PCE 1,6% in the 12 months through July 2016 after advancing by the same margin every month since March 2016. The core PCE is expected to rise 0,2% in August 2016, after increasing 0,1% in both June and July 2016, which would take the year-on-year gain to 1,7%. According to the Institute for Supply Management /ISM its Index of Factory Activity /PMI decreased 3,2% in August 2016 to 49,4% from 52,6% in July 2016, falling the Production Index 5,8% to 49,6% from the reading of 55,4% the month before, declining the New Orders Index 7,8% to 49,1% from the reading of 56,9% registered in July 2016, dropping the Employment Index 1,1% to 48,3% from 49,4% in July 2016. The ISM Non-Manufacturing Index/NMI decreased 4,1% in August 2016 to 51,4% from 55,5% in July 2016, declining the Non-Manufacturing Business Activity Index substantially to 51,8%, which is 7,5% lower than the July 2016 reading of 59,3%, falling the Non-Manufacturing New Orders Index 8.9% to 51,4% from a reading of 60,3% in July 2016, dropping the Non-Manufacturing Employment Index 0,7% to 50,7% from the July 2016 reading of 51,4%. The ISM business barometer dropped 4,3 points to 51.5 in August 2016. U.S. automakers finished 2013 the best in six years with light-vehicle sales reaching 15,6 Million units, up 7,6% from 2012, ending U.S. car-makers the year 2014 strong, helped by falling gas prices, increasing full year sales to 16,52 Million units, expecting analysts 2015 sales may reach about 17,2 Million units, after January 2015 sales were already projected at an annual rate of 16,56 Million vehicles, slowing however February 2015 sales due to tough winter weather conditions to an estimated annual sales pace as low as 16,16 Million units, recovering to an annualized sales rate of around 17,05 Million vehicles in March 2015, while auto sales disappointed in April 2015, declining annual sales rate to 16,5 Million vehicles, recovering auto sales in May 2015, rising to a seasonally adjusted annual rate of 17,71 Million units, slowing to about 17,16 Million units in June 2015, reaching an annualized sales rate of 17,55 Million vehicles in July 2015, keeping the auto industry on pace for the best year since 2000, increasing auto sales to a seasonally adjusted annual pace of 17,81 Million units in August 2015 helped by Americans’ ceaseless demand for pickup trucks, the strongest sales since July 2005, growing auto sales 15,8% in September 2015 from a year ago, reaching October 2015 sales the highest level since October 2001, estimating analysts a light-vehicle sales pace of 17,7 Million, up 13,6% from a year ago, the fastest rate in more than a decade, considering GM that U.S. auto sales are on pace to end 2015 topping the 1999 record of 17,8 Million vehicles sold, increasing auto sales 1,4% in November 2015 to 1,32 Million vehicles, which is seen as a record for any November as on a seasonally adjusted annualized basis sales were at estimated 18,19 Million vehicles, down from a 18,24 Million level in October 2015, increasing December’s 2015 auto sales 9% to deliver a 17,34 Million annual pace, rising full year 2015 U.S. sales 5,7% to a record of 17,47 Million cars and light trucks, breaking the mark of 17,41 Million vehicles in 2000, slipping January 2016 auto sales 0,3% to 1,15 Million cars and light trucks, but were still best auto sales in a decade, reaching seasonally adjusted annualized sales 17,58 Million units, surging U.S. auto sales 6,9% in February 2016 to 1,34 Million units, taking the annualized selling rate to 17,5 Million units, up 1,1 Million units from a year earlier, falling the annualized selling rate in March 2016 to disappointing 16,46 Million light vehicles, showing automakers mostly weaker sales gains than analysts estimates, recovering U.S. light vehicle sales in April 2016 as sales totaled 1,51 Million up 3,6% from a year ago, reaching a seasonally adjusted annualized rate of 17,40 Million units, weakening U.S. auto sales in May 2016 declining monthly sales to 1,54 Million, 6% lower than a year ago, reaching annualized selling rate 17,37Million cars, down from 17,8 Million a year earlier, surging annual auto sales pace to estimated 17,88 Million units in July 2016 from a 16,61 Million-unit rate in June 2016, falling auto sales 4,2% in August 2016 to a seasonally adjusted annual rate of estimated 16,98 Million units, declining sales of Ford 8,8%, dropping GM’s sales 5,2%, posting sales of Fiat Chrysler Automobiles an increase of 3%, decreasing sales of Toyota 5% and those of Volkswagen 9,12%. GM’s worldwide sales rose 2,9% to 9,29 Million vehicles in 2012 and to 9,71 Million cars and trucks in 2013, while Toyota’s worldwide sales 2012 increased 23% to 9,75 Million vehicles, regaining the title as No.1 in global auto sales, remaining the world’s top selling car maker in 2013, selling 9,98 Million vehicles, and also in 2014 with sales of 10,23 Million vehicles, reporting Volkswagen/VW, occupying third place in 2012 and 2013 global sales of 9,07 Million units and 9,5 Million light vehicles respectively, surpassing in 2014 with worldwide sales of 10,14 Million units a GM, which announced full-year sales of 9,92 Million cars. Toyota Motor said its global group sales fell 0,8% in 2015 from a year earlier to 10,15 Million vehicles, taking the crown as the world’s top car-maker for the fourth straight year. Toyota’s global production declined 2% in 2015 from the prior year to 10,08 Million units. German rival Volkswagen sold 9,93 Million vehicles in 2015, down 2% from the previous year, as Chinese market slowed and the company’s cheating diesel emissions deterred customers. Despite ‘dieselgate’ Volkswagen becomes top-selling car-maker as Toyota slips, reporting Toyota that its global sales declined 0,6% in the first half of 2016 to 4.992 Million vehicles worldwide, down from 5.021 Million in the first six months of 2015, while Volkswagen said it delivered 5.116 Million vehicles from January to June 2016, a 1,5% increase. June 2016Auto sales in China, the world’s largest auto market, rose to 23,49 Million vehicles in 2014, up 6,9% from 2013, growing sales in the first eight months of 2015 just 2,6%, compared to an increase of nearly 4% in the U.S.. U.S. overall retail sales, which account for about 30% of consumer spending, declined 0,3% in August 2016, following an upwardly revised 0,1% gain in July 2016, previously estimated flat. E-commerce is accounting for 10% of U.S. retail spending annually, posting retail sales an annual gain of just 2,1% in 2015, the worst performance since 2009, after advancing 3,9% in 2014. The U.S. annual inflation rate 2012 fell to 2,07% from 3,2% in 2011, declining further in 2013 to 1,5%, dropping for all of 2014 to 0,8% and for all of 2015 to 0,7%, declining to 0,8% year-on-year in July 2016, down from 1% in June 2016 and May 2016, increasing to 1,1% year-on-year in August 2016. U.S. trade deficit for all of 2015 increased to 531,5 Billion up from $508,3 Billion in 2014, reaching imports 2.761,8 Trillion and exports 2.230,3 Trillion, continuing trade with China in 2015 and also 2016 with the largest deficit. U.S. GDP rose 2,8% in 2012, 2,2% in 2013, expanding 2,4% for all of 2014, after slowing to a 2,2% annual pace in the 4thQ. 2014, down from a 5% annual rate in the 3rdQ. 2014, expanding U.S. GDP also by 2,4% for all of 2015, after growing at an annualized rate of an upwardly revised 1,4% in the 4thQ. 2015, increasing household consumption, which accounts for almost 70% of the economy, at a revised 2,4% annualized rate, still feeling the U.S. economy China’s slowdown. U.S. GDP increased at a revised 1,1% annual rate instead of the previously estimated 0,8% in the 1stQ. 2016, softening consumer spending, while a strong Dollar continued to undercut exports, expanding the U.S. economy at a revised 1,4% annual rate in the 2ndQ. 2016, rising consumer spending at a 4,3% annual rate in the second quarter 2016. ***Europe: The 28-nation European Union GDP grew by 0,1% in 2013 and by estimated 1,4% in 2014, after expanding by 0,4% in the fourth quarter of 2014, growing GDP by 0,5% in the 1stQ. 2015 and by 0,4% in the 2ndQ. 2015, or year-on-year by 1,9%, making EU28 up about 30% of the world economy, declining the unemployment rate to 8,9% in January 2016, dropping the annual inflation rate 2014 to 0,6% from 1,5% in 2013, contracting the 19-nation €uro-zone economy by 0,5% in 2013, expanding by estimated 0,9% in 2014, after growing GDP by 0,3% in the fourth quarter of 2014, cutting ECB its growth forecast for 2015 to 1,4% and to 1,7% for 2016, reporting the €uro-zone a growth of 0,5% for the 1stQ. 2015, slowing to 0,4% in the 2ndQ. 2015, or year-on-year by 1,5%, expanding GDP by 0,3% in the 3rdQ. 2015, or by 1,6% year-on-year, lowering the European Union its growth outlook for the Euro-zone to 1,6% for 2016 and to 1,8% for 2017, after an estimated 1,6% GDP expansion in 2015, cutting the OECD growth forecast for 2016 to 1,4% and for 2017 to 1,7%. The Euro-zone GDP grew better than expected 0,6% in the 1stQ. 2016, holding the annual growth steady at 1,6%. The €uro-zone annual consumer inflation dropped to 0,4% in 2014 from 1,3% in 2013, turning inflation rate negative in December 2014 contracting by 0,2%, rising by 0,2% year-on-year in December 2015 and by upwardly revised 0,3% in January 2016, falling Euro-zone inflation by 0,2% in February 2016, while year-on-year inflation was revised up from 0,7% to 0,8%, the minus 0,2% inflation rate for February 2016 was confirmed. The Euro-zone inflation remained also negative in April 2016, declining by 0,2% year-on-year, from -0,1% in March 2016, driven by a drop in energy prices, falling 8,6% after dropping 8,7% in March 2016, projecting the ECB currently an average annual inflation rate of just 0,2% for 2016 and of 1,6% for 2017. Consumer prices in the Euro-zone rose 0,2% in July after gaining 0,1% in June 2016, leaving negative territory. Euro-zone unemployment rate decreased further to 10,2% in March 2016 from 10,3% in February 2016, reaching the lowest level in nearly five years. The ECB reduced its key rate in November 2013 to 0,25% from previously 0,50%, cutting to fight deflation risks in June 2014 its already record low main refinancing rate to 0,15% and its deposit rate to negative, from 0,50% to -0,10%, outlining a four-year €400 Billion scheme giving banks that have been holding back credit due to looming stress test in September and December of 2014 an incentive to increase lending to businesses in the €uro-zone, saying it will move further to persuade banks to lend, preparing also for possible future purchases of asset-backed securities to support small businesses. The ECB said Ukraine crisis threatens EU recovery, seeing an uneven recovery in the Euro-zone and worried about the bloc’s declining inflation, announced deflation fighting measures in September 2014, a surprise cut of its key rate to a new record low of 0,05% from previously 0,15%, increasing its negative deposit rate for banks form 0,10% to 0,20%, reducing its marginal lending facility or emergency borrowing rate from 0,40% to 0,30%, and decided to begin as soon as in October 2014 to buy asset backed securities/ABS from banks, granting as projected new four-year loans to banks at a fixed rate of 0,15%, which can borrow up to Euro 400 Billion in cheap targeted long-term funds/TLTRO, to stimulate lending to businesses and households and smaller firms, helping to improve the fragil Euro-zone economy, stressing the ECB that its revival needs structural reforms by Governments. The ECB said it is committed to use the tools at its disposal to bring inflation back to just under two percent, remaining its monetary policy accommodative for a long time, maintaining its interest rates unchanged at just 0,05%, after it began to buy covered bonds by mid-October 2014 and ABS in the fourth quarter of 2014 to bolster flagging Euro-zone recovery, saying it is ready to take more policy action if needed, expecting market traders ECB will purchase a total of Euro 200 Billion of ABS and covered bonds over a year, agreeing EU leader to create a strategic investment fund that could generate up to 315 Billion Euros in private- and public – sector money to fund jump-starting growth, and if all the money is raised and spent it could provide the 28-nation EU with roughly an additional 0,7% of GDP in investment per year over three years. ECB’s Draghi  opened the door for a wider QE to rescue stagnating Euro-zone economy, saying excessively low inflation had to be raised quickly and that the ECB would reassess the impact of its monetary stimulus early in 2015, leaving key rate unchanged at record low of 0,05%. The ECB has set itself a goal of expanding its balance sheet, buying assets from banks and others in return for cash it hopes will be pushed into the economy by up to 800 Billion Euro, or even 1 Trillion Euro, backing European Court Adviser ECB debt buys, amid strong opposition from Germany, saying ECB’s QE program is compatible in principle with basic EU Treaty, announcing ECB its new Euro 1,140 Trillion QE program, saying it will buy Euro 60 Billion in sovereign bonds from March 2015 through September 2016 to revive Euro-zone economy, maintaining its record low key rate unchanged at 0,05% also in March 2015, announcing it will begin with its stimulus plan buying bonds on March 9, 2015, falling the Euro to an 11-1/2 year low against the Dollar. The bond-buying program was approved despite opposition from Germany’s Bundesbank and concerns in Berlin that weaker countries may delay further necessary structural reforms, saying you can’t address structural reforms with monetary policy. There was a consensus about risk-sharing, meaning that only 20% of purchases would be the responsability of the ECB and 80% of national central banks, buying bonds in proportion to their ‘capital key’, which would have to absorb any potential losses should a Government of the Euro-zone default on its debt. ECB left interest rates unchanged at record lows in September and October 2015, but is expected to open the door to further stimulus measures to head off risks to the Euro-zone posed by deflation and China’s faltering growth, weakening also other emerging markets. The ECB cut in December 2015 deposit rates for commercial banks from minus 0,2% to minus 0,3%, now intending to run its quantitative easing program, the €1,1 Trillion bond buying scheme, until March 2017 or beyond if necessary. The ECB left in January 2016 its benchmark refinancing rate on hold at 0,05% and deposit rate at minus 0,3%, leaving the door open for fresh monetary easing in March 2016. To push Euro-zone growth and fight low inflation the ECB reduced in March 2016 all three of its key interest rates, increasing its bond-buying program by €20 Billion to €80 Billion per month, cutting its benchmark refinancing rate for the first time to zero from previously 0,05%, lowering the deposit rate deeper into negative territory to minus 0,4% from minus 0,3% to stop banks amassing funds at the ECB and instead pump the money into the Euro-zone economy, trimming its marginal lending rate, which banks use to borrow from the ECB overnight, to 0,25% from 0,3%, suggesting the ECB defending its super-loose policy designed for crisis time, that there would be no further rate cuts. The ECB left in April 2016 its benchmark refinancing rate at zero and its deposit rate at minus 0,4%, continuing to help boost inflation and growth, announcing that it will add from June 2016 investment-grade bonds from non-bank corporates with a maturity of up to 30 years to its 1,5 Trillion-Euro asset purchasing program. The ECB announced it will begin purchasing investment-grade corporate bonds from June 8, 2016, while until now asset-buying plans have focused on government bonds, saying it wanted Britain remain a EU member and that economic recovery in the Euro-zone is gradually proceeding. The bank insisted it will not hesitate to act to ensure the currency bloc’s economy remained on a growth path and consumer prices would climb back to its annual inflation target of 2%. After Britain’s vote for EU exit the ECB and other Central Banks calmed markets assuring they would supply sufficient funds to avoid any liquidity problems, saying ECB that Britain’s decision to leave the bloc could reduce Euro-zone growth by as much as 0,5% over the next three years. Central Banks stepped up market supervision to an unprecedented degree around Britain’s shock vote to leave the EU, demanding updates from major trading desks every six hours throughout the week ending July 02, 2016. The ECB kept in July 2016 its interest rate and policy plans unchanged saying the immediate stress caused to markets by the ‘Brexit’ had been contained. ECB kept in September 2016 its rates unchanged, maintaining also its monetary easing policy on hold, saying it was looking for options to continue its asset-purchasing program.
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BRICS-COUNTRIES: Developing BRIC countries Brazil and Russia are commodity producers and beneficiaries of higher commodity prices, while India and China are both commodity consumers.Brazil:  Brazil replaced Britain as the world’s sixth largest economy, after the U.S., China, Japan, Germany and France, slowing growth rate in 2012 to 0,9% raised to 1,5%, down from 2,73% in 2011, expanding GDP 1,9% in the 4thQ. 2013 over the same quarter of the previous year, down from 2,2% in the third quarter of 2013, contracting GDP by 0,2% in the 1stQ. 2014 and by 0,6% in the 2ndQ. 2014, falling into recession, growing GDP 0,1% in the 3rdQ. 2014, leaving Brazil recession, expecting economists a GDP increase of only 0,2% for 2014. The IMF cut its growth forecast for 2015 several times, projecting a contraction of 3,5% for 2016, while the OECD estimates that Brazil’s GDP will shrink by 4% in 2016, stabilizing eventually in 2017. Brazil fell again into recession after shrinking its economy by 0,8% in the 1stQ. 2015 and by 2,1% in the 2ndQ. 2015, contracting its GDP by 1,7% in the 3rdQ. 2015 and by 1,4% in the 4thQ. 2015, shrinking Brazil’s economy by 3,8% for all of 2015, reaching the country’s nominal budget deficit 10,8% of GDP in January 2016, the highest on record, downgrading Standard & Poor’s Brazil’s sovereign credit rating from BBB-minus to BB-plus, the highest junk rating, with a negative outlook, loosing the country its investment-grade, followed by Fitch, downgrading Brazil’s debt to junk status, cutting rating to BB+ with a negative outlook. Brazil’s annual inflation stood at 9,53% in August 2015, expected to slow near the official 4,5% target by the end of 2016. Standard & Poor’s cut Brazil’s sovereign credit rating further to BB from BB+, downgrading the country still deeper into junk territory, followed by Moody’s cutting Brazil’s sovereign rating to Ba2, downgrading also Fitch Brazil still further into junk territory cutting its sovereign debt rating from BB+ to BB, with a negative outlook a week before a Senate vote is expected to lead to the ouster of unpopular leftist President Dilma Rousseff. Brazil’s economy shrank by impressive 5,4% year-on-year in the first quarter of 2016. Russia: Russia, the energy giant, saw its economy expanding by 3,44% in 2012, down from 4,3% in 2011, growing its GDP just 1,3% in 2013, slashing economists growth forecast for 2014 to zero, down from Russia’s target of 2%, because of U.S. and EU sanctions after Russia’s Crimea annexation, shrinking Russia’s economy 0,5% in the 1st.Q. 2014, still growing by 0,9% year-on-year, reporting for the 2ndQ. 2014 that year-on-year growth slowed to 0,8% and further to o,7% in July 2014, marking likely recession, expecting the IMF still a growth of 0,2% for 2014, announcing Russia its GDP will contract in 2015 by 0,8% and eventually up to 3% due to dropping oil prices and sanctions imposed on Moscow over its rule in Ukraine, causing a weakening Ruble, predicting analysts zero growth for 2014, an economic contraction between 4% and 5,5% in 2015 and of 3% in 2016, resuming the Ruble its slide, forecasting the IMF Russia’s economy will contract by 3,5% in 2015, while the World Bank expects Russia’s economy may shrink less sharply, falling GDP by 2,7% in 2015, seeing a growth of 0,7% in 2016 and of 2,5% in 2017, shrinking Russia’s GDP by 3,7% in 2015, the biggest decrease since 2009, falling foreign direct investment 92%, suffering the country’s oil-dependent economy from declining crude prices as well as Western sanctions over its role in the Ukraine crisis. India: New estimates pushed India’s GDP growth to 6,9% for fiscal year 2013-14 and to 7,2% for fiscal year 2014-15 ending March 2015, reporting the country that its GDP expanded by 7,5% in the 1stQ. 2015, but revised growth of the previous quarter down to 6,6% from previously estimated 7,5%, projecting the IMF growth will accelerate to 7,3%, down from previously estimated 7,5% in 2015-16, giving Standard & Poor’s the country a negative outlook due to high debt and fiscal deficit, which declined to 4,5% of GDP at the end of March 2014. The Asian Development Bank had revised India’s growth forecast upwardly to 6,3% in 2015, saying the country’s economy is showing a turnaround with Modi’s election, becoming the fastest growing emerging economy of the world. India’s economy grew at an annual rate of 7% in the 2ndQ. 2015, after expanding by 7,5% in the 1stQ. 2015, slowing the services sector, growing Asia’s third largest economy by a 7,4% annual rate in the 3rdQ. 2015. India’s growth was 7,2% in 2014-15 and 7,6% in the 2015-16 fiscal year that ended in March 2016, growing GDP 7,9% year-on-year in the first quarter of 2016 after gaining 7,2% in the last quarter of 2015, slowing growth to 7,1% year-on-year in the 2ndQ. 2016. China: China’s GDP growth slowed to 7,7% in 2013, down from 7,8% in 2012, and further to 7,3% in 2014, mentioning China’s Central Bank economic growth may slow to between 6,9% and 7,1% in 2015, predicting the IMF China’s economic growth will slow to 6,8% in 2015 and to 6,3% in 2016, declining China’s annual economic growth to a six-year low of 7% in the 1stQ. 2015, expanding GDP also at an annualized rate of 7% in the 2ndQ. 2015, growing the country’s economy just 6,3% according to the median estimate of 11 economists, instead of the officially reported 7%, helping to explain why Chinese policy makers have stepped up stimulus and the move to boost exports with a weaker yuan. A further deceleration in the second half could see a full-year expansion of estimated just 5,8%. China’s growth target for 2016 may be in the range of 6,5% to 7%, dipping the country’s growth below 7% for the first time since the financial crisis, as its GDP expanded by only 6,9% in the 3rdQ. 2015 from a year ago, declining growth to 6,8% in the 4thQ. 2015, growing the country’s economy in the full year of 2015 just 6,9%, forecasting the OECD a growth of 6,5% for 2016 and of 6,2% for 2017. China’s Central Bank sees the country’s growth slowing to 6,8% in 2016, projecting China in its new five-year plan draft an annual growth of 6,5% until 2020. China’s growth stabilized at 6,7% year-on-year in the 1stQ. 2016, following the 6,9% expansion in 2015. The 4 BRIC countries invited in 2010 South Africa to join the group, accounting roughly for 42% of the world’s population and representing a combined GDP of $14,9 Trillion, launching plans for a joint development bank. The BRIC nations agreed to establish a $100 Billion currency stabilization fund, committing China $41 Billion, Brazil, Russia and India $18 Billion each, and South Africa $5 Billion. Russia invited Argentina to the sixth BRICS summit July 15, 2014, in Fortaleza/Brazil, to be confirmed by Brazil as host country, supporting Brazil, India and South Africa Argentina’s bid to join the club, while Russia and China are pending to express their views, saying Russian Foreign Minister Lavrow BRICS states did not discuss a formal enlargement of the union. Challenging Western dominance over global finances, leaders of Brazil, Russia, India, China and South Africa launched a $100 Billion development bank, setting up also a currency reserve pool of $100 Billion, beginning the bank with a suscribed capital of $50 Billion, equally funded by the five members, who will have equal voting rights, with an initial total of $10 Billion in cash put in over seven years and $40 Billion in guarantees, expected to expand the capital to $100 Billion within the next couple of years. The contingency currency pool will be held in the reserves of each BRICS country and can be shifted to another member to cushion balance-of-payments difficulties, contributing China $41 Billion, Brazil, India and Russia $18 Billion each and South Africa $5 Billion.
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MIST-COUNTRIES: Newly industrializing economies/NIE =Mexico, Indonesia, South Korea and Turkey – faster developing than BRIC-COUNTRIES, MINT-GROUP: Mexico, Indonesia, Nigeria and Turkey, CIVETS-COUNTRIES: Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa, CNIPB-NATIONS: China, Nigeria, India, Philippines and Bangladesh, emerging economies with high growth rates averaging 5% to more than 7%, not including BRIC-COUNTRIES Brazil and Russia showing both a slow growth of around 2%.
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Countries with a leadership provoking dangerous conflicts posing biggest threats to world peace: Iran launched two Qadr missiles which could hit targets 1.400 km away and were designed to be able to hit Israel; the missiles were stamped with the Hebrew words ‘Israel should be wiped from the pages of history’. The White House said it is reviewing reports and would determine an appropriate response, underlining the missile tests a rift in Iran between hard-line factions opposed to normalizing relations with the West, but apparently missile tests do not violate the terms of the recent historic nuclear deal between Tehran and six major powers. Iran rejected as ‘unrealistic’ a report by the U.N. that criticized its ballistic missile launches, conducted by the country’s elite Revolutionary Guards Corps/IRGC, as unconsistent with its nuclear deal with world powers, accusing Tehran the U.S. of failing to meet its commitments under the nuclear deal, reporting the German spy service that Iran has been trying to acquire nuclear technology in Germany and that certain forces in Iran may be intending to undermine the nuclear deal. Four of Iran’s Islamic Revolutionary Guard Corps/IRGC vessels ‘harassed’  U.S. destroyer USS Nitze near the Straight of Hormuz, by conducting a high speed intercept and closing within a short distance of the U.S. warship. The incident would have led to a diplomatic protest, but the U.S. does not have diplomatic relations with Iran. The USS Squall patrol craft fired three warning shots from a .50 caliber gun in the northern Golf after three Iranian vessels showed a behavior described as ‘unsafe, unprofessional and not routine’, coming one Iranian vessel within 200 yards/193 meters of a U.S. ship, saying Iran’s Defense Minister: if an American ship enters Iran’s maritime region it will definitely get a warning, we will monitor them and, if  they violate our waters, we will confront them. So called laser weapon system shoots a 30-kilowatt laser over a distance of several miles, planning the Navy to build more and bigger lasers and potentially outfit all its front-line warships with them, meeting and defeating eventually Iran’s Islam Revolutionary Guard Corps speedboats. A U.S. Navy coastal patrol ship changed course after a fast-attack craft from Iran’s Islamic Revolutionary Corps came within 100 yards/91 meters of it in the central Gulf; it was at least the fourth such incident in less than a month and there have been 31 similar interactions with Iranian ships already this year. The U.S. has still serious differences with Iran over its ballistic missile program and over conflicts in Syria and Iraq. The U.S. North Korea has a large stockpile of short-range missiles and is developing long-range and intercontinental missiles. The Pentagon said it had not seen the country demonstrate a capability to miniaturize a nuclear warhead, after it conducted its fourth nuclear test on January 06, 2016, claiming it had set off a miniaturized hydrogen bomb, disputed also by South Korea. The United States warned North Korea it would consider ‘other’ options, which could include new sanctions or security steps, if the country continued nuclear y ballistic missile testing. North Korea said it would further strengthen self-defensive nuclear weapons capability, in quality and quantity, in a decision adopted in a rare Workers’ Party congress. The U.S., Japan and the U.N. condemn new North Korean missile tests with the Musudan intermediate-range missiles, apparently ending like four previous launches in failure, calling Japan’s Defense Minister the move a ‘grave provocative act’ in light of international security. The U.N. secretary-general Ban Ki-moon is deeply troubled by North Korea’s recent missile launches, after one of the rockets landed in or near Japanese-controlled waters for the first time, saying such actions seriously undermine regional peace and stability. North Korea fired a submarine-launched ballistic missile toward Japan, seen by Japan’s PM as ‘unforgivable’, posing a grave threat to Japan’s security. Japan, China and South Korea agreed to urge North Korea to refrain from provocation and follow U.N. Security Council resolutions. The members of the U.N. Security Council deplore all Democratic People’s Republic of Korea ballistic missile activities. North Korea fired three ballistic missiles into the sea off its coast, as leaders of the group of 20 major economies held a summit in China, North Koreas’s main diplomatic ally. The United Nations Security Council will discuss the latest missile launches in coming days. North Korea conducted  fifth and largest nuclear test, saying South Korean President Park Geun-hye that North Korean leader Kim Jong Un was showing ‘maniacal recklessness’ in completely ignoring the world’s call to abandon his pursuit of nuclear weapons, while Japan`s PM Abe declared that nuclear test, if confirmed, could not be tolerated and that Japan would protest strongly to Pyongyang.
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U.S. BANKS: During the global financial crisis Lehman Brothers filed for Chapter 11 bankruptcy protection owing a record $639 Billion to creditors in the U.S., Europe and Asia. Barclays Bank purchased Lehman’s core US-broker-dealer-operations in a $1,75 Billion deal, turning itself into a universal bank, and Japan’s largest brokerage Nomura acquired Lehman’s flagship operations in Asia including its equities operations and investment banking in Europe and the Middle East. After bankruptcy judge approved payback plan Lehman Brothers exits bankruptcy protection in March 2012 starting on April 17 to distribute about $65 Billion of asset value left to creditors who had asserted more than $300 Billion in claims, totaling expected repayments to Lehman clients more than $100 Billion.***Goldman Sachs raised $7,5 Billion in public offers and received an investment from Berkshire Hathaway purchasing $5 Billion in preferred shares, getting warrants for another 5 Billion in common stock. The bank bought back after receiving regulators’ permission the preferred shares it sold to Berkshire Hathaway paying $1,64 Billion for Warren Buffett’s help and reported for the 2ndQ. 2013 to $1,93 Billion or $3,70 per common share, posting 3rdQ. 2013 earnings of $1,4 Billion attributable to shareholders or $2,88 per share, dropping 4thQ. 2013 profit 21% as revenue from fixed-income trading fell 11% to 25,3% of total revenue in 2013 from 48% at its peak in 2009, reaching 4thQ. 2013 net income for common shareholders $2,5 Billion or $4,60 per share, declining total revenue including an accounting adjustment to $8,78 Billion, posting for the 1stQ. 2014 net earnings of $2,03 Billion or $4,02 diluted earnings per common share on net revenues of $9,33 Billion, and for the 2ndQ. 2014 an overall profit of $2,04 Billion or $4,10 a share, generating a net revenue of $9,13 Billion, up 6% from $8,61 Billion in the period a year earlier, growing investment banking 15%, jumping profit in the 3rdQ. 2014 50%, rising net income attributable to common shareholders to $2,14 Billion or $4,57 per share, increasing total revenue 25% to $8,39 Billion, falling overall net income hit by weak fixed-income trading 7% in the 4thQ. 2014 to $2,17 Billion or $4,38 per share, declining overall revenue 12% to $7,7 Billion. The S.E.C. sued Goldman Sachs for securities fraud, off-loading risk of sub-prime home loans and commercial mortgages misleading investors, agreeing the bank to pay a record $550 Million to settle charges. Revised deal over warrants issued during financial crisis will make Warren Buffett’s Berkshire Hathaway a major shareholder in Goldman Sachs. Goldman Sachs offloaded its remaining $1,1 Billion stake in Industrial and Commercial Bank of China/ICBC. Posting its best quarterly earning in five years, Goldman Sachs rose in the 1stQ. 2015 its net earnings to $2,84 Billion increasing diluted earnings per common share to $5,94, on net revenues of $10,62 Billion, ranking first in worldwide announced and completed mergers and acquisitions for the year-to-date, and also in worldwide equity and equity-related offerings and common stock offerings for the year-to-date. Goldman Sachs 2ndQ. 2015 profit fell to a nearly four-year low on weak bond trading and legal provisions, posting net earnings of $1,05 Billion and diluted earnings per common share of $1,98, declining net revenues nearly 1% to $9,07 Billion, declining profit for a second straight quarter in the 3rdQ. 2015, plunging net income applicable to common shareholders 38% to $1,43 Billion and diluted earnings per common share of $2,90 on net revenue of $6,86 Billion compared to $8,39 Billion a year ago, informing of an annualized return on average common shareholders’ equity of 7% for the third quarter of 2015. Goldman Sachs said it reached a $5 Billion agreement to settle claims it misled mortgage bond investors during the crisis, cutting the deal its 4thQ. 2015 earnings by about $1,5 Billion, reporting a 71,8% fall in net income applicable to common shareholders to $574 Million or $1,27 per share, its smallest quarterly profit in more than 4 years, declining net revenue 5,4% to $7,27 Billion. Goldman Sachs was the worst performer in the Dow Jones Industrial Average in 2016, reporting for the 1stQ. 2016 a drop in profit of 56,3%, posting a net income of $1,14 Billion or $2,68 a share, declining revenue 40% to $6,34 Billion, reporting for the 2ndQ. 2016 a net income applicable to common shareholders of $1,63 Billion or $3,72 a share, declining overall revenue 13% to $7,932 Billion, continuing the bank to cutting costs to boost profits as the outlook for interest rates and revenues have gotten tougher. ***Morgan Stanley reported for the full year of 2013 earnings per diluted share of $1,43 on net revenues of $32,4 Billion, after falling 4thQ. 2013 net income for common shareholders to $133 Million or 7 cents a share, including earning per share amounts legal expenses of $1,2 Billion or $0,40 per diluted share, posting for the 1stQ. 2014 income from continuing operations to Morgan Stanley of $1,5 Billion or $0,72 per diluted share on net revenues of $8,9 Billion, and for the 2ndQ. 2014 a net income attributable to common shareholders of $1,86 Billion or 94 cents a share, up from $803 Million or 41 cents per share a year earlier, rising revenue 1% to $8,6 Billion, ranking the bank second globally in mergers-and-acquisitions, posting for the 3rdQ. 2014 income from continuing operations applicable to Morgan Stanley of $1,7 Billion or $0,84 per diluted share on net revenues of $8,9 Billion, indicating a strong performance in wealth management with pretax margin of 22% and a record revenue per financial advisor, reporting for the 4thQ. 2014 an income from continuing operations applicable to Morgan Stanley of $1,0 Billion or $0,47 per diluted share on net revenues of $7,8 Billion, saying full year 2014 net revenues reached $34,3 Billion and earnings per diluted share from continuing operations $2,96. For the 1stQ. 2015 income from continuing operations applicable to Morgan Stanley was $2,4 Billion or $1,18 per diluted share on net revenues of $9,9 Billion, mentioning the bank a strong performance in equity sales & trading and improved results in fixed income & commodities, falling 2ndQ. 2015 net income applicable to Morgan Stanley 9% from a year earlier, earning $1,67 Billion down from $1,82 Billion, or $0,85 per diluted share, compared with $0,92 in the same period of last year, rising total net revenue to $9,74 Billion from $8,61 Billion. Morgan Stanley had suspended in 2008 discussions about increasing the participation of the China Investment Corp/CIC, a shareholder with a 9,9% stake, after Mitsubishi UFJ Financial Group offered to pay $9 Billion for a 21% stake in the US bank and $3,5 Billion to take over 100% of the Union Bank of California, merging the Japanese bank its security subsidiary with Morgan Stanley’s Japanese securities operations. Morgan Stanley closed the final chapter of its $9,4 Billion purchase of the brokerage Smith Barney from Citigroup acquiring the remaining 35% of the business, now known as Morgan Stanley Wealth Management , at a previously established price of $4,7 Billion at the end of June 2013, maintaining as the brokerage-dealer designation ‘Morgan Stanley Smith Barney’, going all of the income from the unit now to Morgan Stanley. Morgan Stanley’s profit attributable to shareholders fell 42,4% in the 3rdQ. 2015 due to the impact of slow trading and the weakness in its investment management unit, warning  the bank that there is little hope for a quick turnaround in its key trading business given the persistence of global growth concerns, reporting net income applicable to Morgan Stanley of  $1,0 Billion or $0,48 per diluted share on net revenues of $7,8 Billion, and excluding Debt Valuation Adjustment/DVA net revenues of $7,3 Billion and earnings per diluted share of $0,34, swinging from a loss to profit in the 4thQ. 2015 compared to a year ago, reporting a net income of $908 Million or 39 cents a share applicable to common shareholders on revenue of $7,86 Billion excluding accounting adjustments, announcing a new strategic plan for improving profitability even more. Morgan Stanley reported for the 1stQ. 2016 a net income applicable to Morgan Stanley of $1,1 Billion or 0,55 per diluted share on net revenue of $7,8 Billion and for the 2ndQ. 2016 a net income applicable to Morgan Stanley of $1,6 Billion or $0,75 per diluted share on net revenues of $8,9 Billion, underscoring Wall Street’s biggest banks their ability to navigate today’s lower for longer interest rate environment and recent uncertainties in global markets.***Citigroup: Reshaping its structure, isolating its money losing operations into a new unit called Citi Holdings, keeping its healthy key businesses in an unit called Citicorp, the financial giant sold its 64% stake in Japanese Nikko Asset Management to The Sumitomo Trust & Banking Corp for about $795 Million after it sold its Japanese brokerage business Nikko Cordial Securities and other parts of Nikko Citigroup’s Japans operations for about $5,76 Billion to Sumitomo Mitsui Financial Group/SMFG as well as its Japanese trust bank NikkoCiti Trust & Banking Corp  for about $200,7 Million to Nomura Trust & Banking Corp, obtaining vital capital injections. Citigroup converted preferred shares and trust-preferred securities into new common stock, including $33 Billion from private holders and $25 Billion out of the $45 Billion invested by the Government, which left the U.S. with the largest ownership stake of about 27% or 7,7 Billion shares, repaying $20 Billion of  the remaining Tarp funds, selling off Treasury the total of its 7,7 Billion common shares making a profit for taxpayers on the rescue of $12,3 Billion. Citigroup, the nation’s third largest bank, posted for the 2ndQ. 2013 a net income to $4,2 Billion or $1,34 per share, declining 3rdQ. 2013 profit to $3,23 Billion or $1,00 a share on revenue of $17,88 Billion, posting for the 4thQ. 2013, excluding accounting adjustments and one-time items, earnings of $2,60 Billion or 82 cents a share, slipping adjusted revenues to $17,78 Billion, falling bond trading 15%. Citigroup reported for the 1stQ. 2014 a net income of $3,94 Billion or $1,23 per diluted share on revenues of $20,12 Billion, and for the 2ndQ. 2014 a sharp decline in its earnings, agreeing to pay $7 Billion to settle a Government investigation into mortgage backed securities, showing a net income of $181 Million or 3 cents a share, well below the year-ago period’s $4,2 Billion or $1,34 a share, dropping revenue 5,6% to $19,3 Billion, posting a stronger than expected 3rdQ. 2014 net income of $3,4 Billion or $1,07 per share on revenue of $19,6 Billion, pulling out of consumer banking in 11 markets, including Japan and Egypt, trying to slim down to cut persistently high costs, falling Citigroup’s net income on legal settlements in the 4thQ. 2014 86% to $350 Million or $0,06 per share on revenues of $17,8 Billion. Citi’s CEO Pandit resigned after board clash abruptly, taking the helm Mike Corbat. Citigroup reported its highest quarterly profit in nearly eight years, showing efforts to streamline its business progress, posting for the 1stQ. 2015 a net income of $4,8 Billion or $1,51 per diluted share on adjusted revenue falling 2% to $19,81 Billion, reporting for the 2ndQ. 2015 a big jump in earnings thanks to much lower legal costs and slightly higher revenues, showing a net income of $4,8 Billion or $1,51  per share on revenues of $19,47 Billion, rising net income in the 3rdQ. 2015 to $4,29 Billion or $1,31 per share on total net revenue of $18,69 Billion, declining 18% operating costs, making up for the fall in revenue amid increased market volatility and pending Fed rate hike, reporting Citigroup for the 4thQ. 2015 a profit of $3,34 Billion or $1,02 per share, increasing revenue 3% from a year earlier to $18,46 Billion, and excluding accounting adjustments earnings were $1,06 per share and adjusted revenue was $18,64 Billion, reaching full-year 2015 earnings $17,2 Billion, Citigroup’s biggest profit since 2006, when it earned $21,5 Billion, but shares dropped 6,4% on concerns about falling oil prices and trouble in China, considering Citigroup’s important exposure to international markets, including Asia. Citigroup’s 1stQ. 2016 net income declined 26,6% to $3,5 Billion or $1,10 per share, but beating tumbling earnings expectations, dropping revenue 11,4% to $17,56 Billion, reporting for the 2ndQ. 2016 a net income of $4,0 Billion or $1,24 per diluted share on revenues of $17,55 Billion.***Wells Fargo, the largest U.S. residential mortgage lender and the world’s largest bank by market value, closed a $15,8 Billion stock deal to buy all of Wachovia Corporation, becoming the nation’s biggest bank by stock market value reaching $178 Billion, about $70 Billion more than Citigroup and some $8 Billion more than JP Morgan Chase, but Wells Fargo has still fewer deposits than its closest competitor. Wells Fargo posted for 2012 a net income of $18,9 Billion and a record diluted EPS of $3,36 on revenues of $86,1 Billion, reporting for the 1stQ. 2013 earnings of $5,17 Billion or 92 cents a share, for the 2ndQ. 2013 a net income of $5,5 Billion or 98 cents a share, rising 3rdQ. 2013 net income to $5,6 Billion or 99 cents per share, posting also for the 4thQ. 2013 $5,6 Billion in net income or $1,- per share, declining revenue to $20,7 Billion, totaling 2013 annual earnings around $21,9 Billion, winning the title as most-profitable U.S. bank, held until now by J.P. Morgan Chase. Wells Fargo announced a record 1stQ. 2014 net income of $5,9 Billion, up 14% from a year ago, or diluted earnings per share/EPS of $1,05, declining revenue to $20,6 Billion, down from 21,3 Billion, reporting for the 2ndQ. 2014 earnings of $5,7 Billion or $1,01 per share, slipping revenue to $21,1 Billion, declining mortgage revenue 39% as lending volume dropped due to rising rates, cutting into demand to refinance home loans, falling mortgage volume of Wells Fargo more than the overall U.S. market average in percentage term, posting for the 3rdQ. 2014 a net income for common shareholders of $5,73 Billion or $1,02 per share and for the 4thQ. 2014 of $5,38 Billion or $1,02 per share, growing revenue to $21,4 Billion, up 3,3% from a year ago. Wells Fargo reported for the 1stQ. 2015 a net income of $5,8 Billion or $1,04 diluted earnings per share, increasing revenue 3% to $21,3 Billion, falling net income for the 2ndQ. 2015 to $5,36 Billion or $1,03 per share, from $5,42 Billion a year earlier, surging revenue 1% to $21,32 Billion, showing a rise in its 3rdQ. 2015 profit, helped by the purchase of commercial real estate loans worth $9 Billion from General Electric/GE, reporting $5,8 Billion in net income or diluted EPS of $1,05 on revenue of $21,9 Billion, making the bank $55 Billion of home loans in the third quarter, saying cost cutting efforts helped to mitigate the impact of weak revenue in three of its four main businesses, posting a 4thQ. 2015 profit that was unchanged from a year earlier, as revenue increased less than 1%, reaching net income $5,71 Billion or $1,03 per share on revenue of $21,6 Billion. Wells Fargo was the only large U.S. bank to become ‘significantly’ more important to the global financial system in recent years, rising its systemic importance, reporting for the 1stQ. 2016 a net income of $5,5 Billion and diluted earnings per share of $0,99, rising revenue 4% to $22,2 Billion. Wells Fargo’s problem loans, mainly to oil and gas companies, rose to nearly $30 Billion as of March 31, 2016, from about $18,5 Billion at the end of 2015, while the remaining $290,5 Billion of the bank’s commercial and industrial loan portfolio was classified as ‘pass’. Wells Fargo posted for the 2ndQ. 2016 a profit of $5,56 Billion or $1,01 a share on revenue of $22,16 Billion. U.S. lawmakers called for Wells Fargo & Co. chief John Stumpf to resign and a top House Democrat demanded the bank to be broken up because it is too big to manage, as Wells Fargo staff opened checking, savings and credit card accounts without customer say-so for years to satisfy managers’ demand for new business, according to a $190 Million settlement with regulators reached early September 2016.***Bank of America bought Merrill Lynch for about $50 Billion, making the U.S. bank which also purchased troubled mortgage giant Countrywide the second largest financial institution in the world. BofA, the biggest U.S. mortgage servicer, raised $18,8 Billion in fresh capital, posting for the full year 2011 a net income to common shareholders of $85 Million or 1 cent a share, increasing net income 2012 to $4,2 Billion or $0,25 per diluted share on revenue of $84,235 Billion, jumping net income for the 1stQ. 2013 to $2,62 Billion or 20 cents a share and for the 2ndQ. 2013 to $4 Billion or 32 cents per diluted share, reporting 3rdQ. 2013 net income attributable to common shareholders of $2,22 Billion or 20 cents a share, rising 4thQ. 2013 net income for common shareholders to $3,18 Billion or 29 cents a share, increasing revenue 14% to $22,3 Billion, declining mortgage losses. BofA reported a 1stQ. 2014 net loss of $276 Million or $0,05 per diluted share on revenue of $22,8 Billion, including results litigation expenses of $6 Billion (Pretax), lasting the bank’s mortgage pain longer than expected, coming mainly from settlements linked to mortgages that Countrywide made during the housing boom and sold to investors. BofA’s improvement helps one investor in particular: Billionaire Warren Buffett who purchased in 2011 through his investment company Berkshire Hathaway $5 Billion in preferred shares and warrents, expiring 2021, from the bank, when investors were panicking about its mortgage holdings. which agreed to sell 23,5 Billion shares reducing its stake in China Construction Bank to 1%, gaining $5,1 Billion, using proceeds to raise capital of Bank of America Corp. BofA reduced its stake in China Construction Bank to 1% selling 23,5 Billion shares, gaining $5,1 Billion, using proceeds to raise capital of Bank of America Corp., announcing plans to save $8 Billion per year, selling its remaining stake in China Construction Bank/CCB raising $1,47 Billion. The purchase of Countrywide Financial Corp. in 2008 has cost BofA more than $45 Billion in write-downs and legal settlements. BofA will pay $9,3 Billion to Fannie Mae and Freddie Mac to settle mortgage bond claims, losing also a fraud trial on claims related to defective mortgages sold by its Countrywide unit, having most likely to award up to $848,2 Million, the gross loss Fannie Mae and Freddie Mac suffered on the loans. Bank of America profit fell 43% in the 2ndQ. 2014, after the bank posted $4 Billion of pretax litigation expenses linked to mortgage disputes, dropping net earnings for common shareholders to $2,3 Billion or 19 cents per share, down from $3,58 Billion or 32 cents a share a year earlier, shrinking revenue to $21,8 Billion. BofA reached a record $16,65 Billion settlement with the U.S. Government to resolve mortgage probes, paying $9,65 Billion in cash and providing $7 Billion in help to struggling homeowners and communities. Bank of America’s net income before preferred stock dividends fell to $168 Million on revenue of $21,4 Billion, representing a loss of $0,01 per share after preferred dividends, including result Department of Justice/DoJ costs of $5,3 Billion (pretax) or $0,43 per share (after tax), saying the bank it has moved past the worst of its legal settlements linked to the financial crisis, paying at least $70 Billion to resolve disputes on home loans since 2010. In a revision Bank of America tripled its 3rdQ.2014 loss to $232 Million, or 4 cents a share, due to forex legal costs related to global investigation into foreign exchange trading at major banks. Bank of America’s 4thQ. 2014 profit was hurt by low interest rates, falling profit 11% to $3,05 Billion or 25 cents per share, decreasing revenue 13% to $18,73 Billion, reporting the bank for all of 2014 a net income of $4,8 Billion, a drop of nearly 60% from $11,4 Billion in 2013. As legal expenses declined Bank of America posted a better than expected 1stQ. 2015 net income of $3,4 Billion or 27 cents per share attributable to common shareholders, falling overall revenue, excluding adjustments, 5,9% to $21,42 Billion, reporting for the 2ndQ. 2015 a strong overall net income of $5,32 Billion or $0,45 diluted earnings per common share on adjusted revenue of $22,345 Billion, as expenses fell to their lowest since the financial crisis. BofA showed a 3rdQ. 2015 profit, compared with a year-earlier loss, making a net income of $4,5 Billion or $0,37 per diluted share, declining total revenue 2,4% to $20,91 Billion. The bank has paid more than $70 Billion in legal expenses since 2008, dropping for the third quarter to $231 Million from $6 Billion a year earlier. Bank of America reported a 4thQ. 2015 income of $3,3 Billion or $0,28 per share on revenue net of interest expense of $19,8 Billion, totaling full year 2015 net income $15,9 Billion or $1,31 a share, the highest annual net income in nearly a decade. BofA reported for the 1stQ. 2016 a profit of $2,68 Billion or earnings of $0,21 per share on revenue declining to $19,51 Billion, and for the 2ndQ. 2016 a profit of $4,23 Billion or $0,36 a share, falling revenue 7% to $20,4 Billion, planning the bank more cost cuts as earnings slide.***JP Morgan Chase bought the troubled fifth largest U.S. investment bank Bear Stearns and acquired almost all of Washington Mutual/ WAMU, with $307 Billion in assets the nation’s largest savings and loan and among the worst hit by the housing crisis, creating a nationwide retail franchise rivaled only by Bank of America, which lost the title as the U.S. nation’s biggest bank as JP Morgan Chase passed BofA’s $2,2 Trillion in assets. JP Morgan Chase reported for 2012 a record profit of $21,3 Billion or $5,20 per share on full-year revenues of $99,9 Billion, cutting JP Morgan’s board CEO Dimon’s pay by 50% citing failures of management in relation with $6,2 Billion in losses from risky derivatives bets last year, rising the bank’s 1stQ. 2013 overall net income to $6,53 Billion or $1,59 per share, increasing 2nd.Q. 2013 net income to $6,5 Billion or $1,60 a share, on revenues of $26 Billion, reporting a third-quarter loss of $380 Million or 17 cents a share after ‘painful’ $9,2 Billion legal costs, signaling reports that JP Morgan Chase and the Justice Department reached a $13 Billion settlement that resolves several legal issues for the bank, after news media announced that the regulator of Fannie Mae and Freddy Mac reached a $5,1 Billion settlement with JP Morgan Chase over mortgage securities, of which $4 Billion had been seen as counting toward the $13 Billion amount, and that the bank agreed to a separate deal paying $4,5 Billion to settle claims by investors who lost money on mortgage-backed securities before the collapse of the U.S. housing market. J.P. Morgan Chase was already hit by $920 Million fine for ‘unsound practices’ relating to $6,2 Billion losses in 2012, agreeing also on a $100 Million settlement over those ‘London Whale’ trades, admitting its traders acted recklessly, nearing a more than $2 Billion deal with Federal Authorities to settle a case tied to Madoff’s Ponzi scheme. JP Morgan Chase posted a 7,3% decline in 4thQ. 2013 net income reaching $5,28 Billion or $1,30 a share, including a charge due to legal costs of 27 cents a share, dropping revenue to $24,1 Billion, falling full year 2013 net earnings to $17,9 Billion, falling overall net income for the 1stQ. 2014 19% to $5,27 Billion or $1,28 per share, down from $6,53 Billion or $1,59 per share a year ago, declining net revenue 8,5% to $22,99 Billion, standing total assets at $2,48 Trillion up from $2,42 Trillion at the end of 2013 declining net income 8% in the 2ndQ. 2014 to $5,99 Billion or $1,46 per share, down from $6,5 Billion or $1,60 per share in the same quarter of 2013, shrinking revenue 3% to $24,45 Billion suffering mortgage banking in the quarter, reporting a lower than expected 3rdQ. 2014 profit of $5,6 Billion or $1,36 a share, rising revenue to $24,2 Billion, saying the bank it may breach its annual expenses target of $58 Billion in 2014 due to increasing operating costs and legal expenses, falling JP Morgan Chase profit 6,6% for the 4thQ. 2014 hit by legal costs, exceeding $1 Billion, dropping net income to $4,93 Billion or $1,19 per share, declining revenue 2,3% to $23,55 Billion, totaling legal costs for 2014 $2,9 Billion compared to $11,1 Billion recorded in 2013, claiming Chief Executive Dimon banks “under assault”. JP Morgan Chase posted a 1stQ. 2015 net income of $5,9 Billion or $1,45 per share on revenue of $24,8 Billion, reporting a stronger-than-expected 2ndQ. 2015 rise in profit, helped by a drop in legal and restructuring expenses, surging net income applicable to common shareholders to $5,776 Billion or $1,54 per share, declining net revenue 3,2% to $24,531 Billion, rising 3rdQ. 2015 net income 22% to $6,8 Billion or $1,68 per share on overall net revenue falling 6,4% to $23,5 Billion on weak trading, reporting adjusted earnings of $5,4 Billion or $1,32 per share, and ROTCE of 12%, excluding tax benefits, legal expense and net reserve releases, increasing 4thQ. 2015 profit 10,2% as expenses from litigation and employee compensation shrank, surging net income to $5,43 Billion or $1,32 a share and revenue 1% to $23,75 Billion. J.P. Morgan Chase reported for the 1stQ. 2016 a better than expected net income of 5,52 Billion or $1,35 per share on revenue of $24,08 Billion. J.P. Morgan Chase said its criticized loans to the oil and gas industry more than doubled to $9,7 Billion at the end of March 2016, while the overall criticized loans increased to about $21,2 Billion from $14,6 Billion at the end of 2015. J.P.Morgan Chase posted for the 2ndQ. 2016 a net income of $6,2 Billion, compared to $6,3 Billion for the second quarter a year ago, reporting earnings per share of $1,55, beating the average analysts estimates, rising net revenue 3% to $25,2 Billion. ***In accordance with Basel III the Federal Reserve wants to place big U.S. banks under stricter capital requirements, saying more regulatory capital needed for periods of market stress. To comply with a new Fed rule the eight biggest U.S. banks (JP Morgan Chase, Citigroup, Bank of America, Wells Fargo, Goldman Sachs, Morgan Stanley, Bank of New York Mellon and State Street Corp) must raise additional $120 Billion, expected to meet the shortfall by issuing long-term debt, some requirements to be met by January 1, 2019, while more stringent requirements have to be met by January 1, 2022.
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TIGHTER REGULATIONS: After EU regulators insisted in the necessity to increase transparency in the $700 Trillion over-the-counter/OTC privately traded derivatives markets (about ten times the GWP/2011=$69,11 Trillion), dominated by many of the world largest banks and linked to the global credit crisis, banks agreed to an European clearing mechanism for European Union-based credit default swap/CDS contracts, acting as buyer to every seller and as seller to every buyer, absorbing losses in the event of default, crafting the U.S. rules for a stricter control of OTC derivatives making its trading safer and more transparent, to be negotiated in the future through exchanges or central clearing houses regulated by the Security Exchange Commission/SEC and the Commodity Future Trading Commission/CFTD, approving U.S. regulators new rules governing how swaps are traded, completing a long delayed effort to further improve control of derivatives trading. The International Swaps and Derivatives Association /ISDA and 18 major banks that dominate the financial derivatives market will allow from January 2015 regulators to apply temporary stays to prevent a rush to close derivatives contracts if a bank runs into trouble, giving them time to ensure that critical parts of a bank, such as customer accounts, continue smoothly while the rest is wound down or sold off in an orderly way, intending to end financial watchdogs ‘too big to fail’ scenario. European leaders negotiated a new model for financial supervision creating three new agencies starting to operate beginning 2011 to monitor banks, insurance companies and trading on markets, the European Banking Authority/EBA-London, the European Securities and Markets Authority/ ESMA-Paris and the European Insurance and Occupational Pensions Authority/EIOPA-Frankfurt, complemented by the European Systemic Risk Board monitoring potential threats to financial stability and a European System of Financial Supervisors checking quality and consistency of national regulatory authorities. The Obama administration supported an overhaul of the U.S. financial regulatory system/Wall Street Reform to protect consumers and avoid risky practices, giving the Federal Reserve new oversight powers, controlling the SEC rating agencies. U.S. regulators approved the long-delayed Volcker rule, a specific section and major element of the Dodd-Frank Wall Street Reform and Consumer Protection Act, generally banning banks from proprietary trading or speculative trading for their own profits, aimed at cutting risk-trading, measure to be followed by the European Union, preventing a repeat of the taxpayers bailouts, seeking also to put an end to portfolio hedging, trades supposedly designed to protect against losses held in a broad portfolio of assets, but that could be used as veiled speculation.
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GERMANY/FRANCE/UK/SWITZERLAND/RUSSIA/JAPAN/CHINA/INDIA: Germany: The German Government completed the total nationalization of troubled Hypo Real Estate, one of Europe’s biggest commercial property lenders, transferring the bank €210 Billion in risk positions and non strategic assets to a ‘bad bank’.  The Hypo Real Estate Nationalization Bill created the contingency initiative called Special Fund for Financial Market Stabilization/ SoFFIN for an amount of up to €500 Billion to control the troubled mortgage lender and safeguard the overall German banking system, creating a ‘bad bank’ plan, estimating the Government that German banks may have as much as €230 Billion worth of toxic assets in their books. SoFFIN has been reactivated and extended until the end of 2014 making available loan guarantees reaching €400 Billion and direct credits of up to €80 Billion to help German financial institutions, allowing a smooth transition to the planned European bank-rescue fund starting probably in 2015. Like big U.S. banks also German banks will be asked to make emergency plans to prevent collapse if they faced serious problems, emphasizing that they could not count on Government help. Germany’s economy expanded by 0,4% in 2012, dropping GDP growth to 0,1% in 2013, accelerating to 1,6% in 2014 and to 1,7% in 2015, expanding by 0,7% in the 1stQ. 2016 and by 0,4% in the 2ndQ. 2016, projecting the EU Commission a growth of 1,6% for 2016 and for 2017. Germany’s trade surplus hit a new record high in 2015 of €247,8 Billion compared with €214 Billion in 2014, as a weaker Euro is driving foreign demand for German goods, jumping exports 6,4% to €1.195,8 Billion and climbing imports 4,2% to €948,1 Billion, increasing exports from Germany to EU States to €693,9 Billion, including the Euro-zone with €435 Billion, and rising German imports from EU States to €621,6 Billion, including the Euro-zone with €426,5 Billion, surging exports to non-EU States to €501,9 Billion and imports from non-EU States to €326,5 Billion. German public debt fell to 74,7% of GDP in 2014, projected to drop further to 71,5% in 2015, rising budget surplus to 0,7% of GDP in 2014, achieving Germany a budget surplus of €12,1 Billion in 2015 to be devoted on the country’s migrant influx, reaching about 1,1 Million in 2015, with 800.000 new arrivals predicted for 2016, seeking the country also a balanced budget in 2016, remaining unemployment rate in December 2015 at 6,3%, a more than 25-year low, growing annual inflation by 0,4% in April 2015, up from 0,3% in March 2015, remaining flat in September 2015 and October 2015, projecting the German Central Bank consumer prices will rise 0,5% in 2015 as wages increase, rising to 1,8% in 2016 and further to 2,2% in 2017. Deutsche Bank raised €10,2 Billion increasing its share to a controlling stake above 50% in Postbank, buying also one of Europe’s oldest private banks Sal. Oppenheim, reporting a net loss of €2,1 Billion for the 4thQ. 2015 on revenue of about €6,6 Billion, and a net loss of about €6,7 Billion for all of 2015, largely due to restructuring charges and money set aside to cover legal costs, expecting full-year 2015 revenue to reach around €33,5 Billion. Deutsche Bank had announced a major change in strategy, to sell off its Postbank subsidiary and achieve annual savings of €3,5 Billion by 2020, however failed to convince investors. Deutsche Bank shares slumped to a record low after a report that trading clients had withdrawn excess cash and positions held in the largest German lender; the immediate cause of Deutsche’s crisis is a fine, disputed by Deutsche, of up to $14 Billion by the U.S. Department of Justice over its sale of mortgage-backed securities. Reversing policy after the Japanese nuclear debacle Germany’s coalition decided to go nuclear-free by 2022, closing immediately eight of its oldest reactors and to phase out the nine remaining operating facilities over the next decade. Former East German civil-rights activist Joachim Gauck was elected as German President replacing Christian Wulff. Chancellor Angela Merkel secures big third election win, putting results support for her Conservative bloc at 41,5%(311 seats), the best showing in 20 years, obtaining center-left Social Democrats/SPD a distant second place with 25,7%(192 seats), suffering Merkel’s allies in the outgoing Government, the Free Democrats/FDP, a humiliating exit from Bundestag failing to win with 4,8% the 5% needed to enter Parliament, beginning Mrs. Merkel her third four-year term as German Chancellor after forming a ‘grand coalition’ with the Social Democrats. Germany rejected U.S. Treasury’s criticism on the country’s export focused policies, saying the trade surplus reflect the strong competitiveness of the German economy and the international demand for quality products from Germany, coming recrimination at a moment of growing outrage in Germany over U.S. NSA surveillance programs, seen in Berlin as an intention to shift debate away from spying. ***France: France’s GDP grew by 0,4% in 2014, after expanding by just 0,1% in the 4thQ. 2014, growing by 1,1% in 2015, projecting the OECD the country’s GDP will expand by estimated 1,2% in 2016 and 1,5% in 2017. The country’s public dead reached 95,0% of GDP in 2014, projected to increase to 96,4% of GDP in 2015, while budget deficit stood at 4,0% of GDP in 2014, expected to decline to 3,8% of GDP in 2015. New French President socialist Fancois Hollande promised to shift burden of hardship to the rich and soft current prescription of German-led austerity, winning socialists historic absolute Parliament majority. Ruling Socialist lost local French elections and majority in the Senate, taking the anti-EU National Front of Marine Le Pen control of 11 towns across the country plus one district in Marseille, facing Hollande the lowest popularity levels of any President in the 56-year-old Fifth Republic, naming Hollande new PM, announcing spending cuts and a reduction of labor charges. Due to ‘Brexit’ effect and a dropping Pound France overtakes Britain for the fifth place on the list of the world’s biggest economies, with the Pound falling below €1,17 the British economy is now equivalent to €2.172 Trillion compared to France’s official GDP of €2.182 Trillion in 2015.  ***United Kingdom/Britain: The British Government nationalized part of UK’s banking system, buying up to Pstg.50 Billion preference shares or other interest bearing shares in 7 big UK banks, granting Pstg.250 Billion of loan guarantees up to three years and another Pstg.100 Billion in short-term liquidity. The Royal Bank of Scotland/RBS, the Halifax Bank of Scotland/ HBOS and Lloyds TSB more urged to be recapitalized participated in the program, owning British taxpayers 70% of RBS and 43,5% of Lloyds, creating the British Government the UK Financial Investments Ltd/UKFI to control its stakes in financial institutions, while Barclays and HSBC raised capital from private investors to avoid conditioned Government support. The British Government increased its rescue package by another Pstg.100 Billion adding new measures, such as an insurance against a fee to protect financial institutions against future defaults on mortgage and other loans. The British Government has begun to sell of its stake in bailed out Lloyds Banking Group. Britain’s economy grew by 1,7% in 2013 and by upwardly revised 3% in 2014, expanding GDP by 0,6% in the 4thQ. 2015, growing the economy upwardly revised 2,3% in 2015 and 0,4% in the 1stQ. 2016, forecasting the OECD a growth of 2,1% for 2016 and of 2% for 2017. U.K. public debt reached 89,4% of GDP in 2014, expected to rise slightly to 89,9% of GDP in 2015, while budget deficit stood at 5,7% of GDP in 2014, projected to decline to 4,5% of GDP in 2015. Standard & Poor’s downgraded Britain’s triple A rating to negative, cutting Moody’s and Fitch Britain’s AAA rating one notch to AA1. Ending 13 years of Labor Party rule the leader of the Conservative Party David Cameron became new Prime Minister forming a coalition with Liberal Democrats, resigning defeated Gordon Brown. The UK economy grew just 0,3% in the first quarter of 2015, dealing a potential blow to PM Cameron, with May 7, 2015, election only over a week away. PM Cameron won a surprisingly solid victory in the British general election, leaving a stunning disappointment for the opposition Labour Party and its leader, Ed Miliband, who stepped down, gaining Conservatives in the 650-seat House 331 seats, while Labour will hold 232 seats, accepting re-elected PM Cameron mandate to form the first majority Conservative Government since John Major’s surprise victory in 1992. PM Cameron resigns after Britain voted to leave the EU, announcing to step down in Ocober 2016, seeking EU leaders swift ‘Brexit’ negotiations to end any uncertainty which is fuelling euro-skeptic forces in their own countries, saying they cannot begin until Britain formally notifies the EU it is planning to exit. Standard & Poor’s stripped Britain of its last remaining top-notch credit rating, slashing it by two notches from AAA and warning more downgrades could follow. Fitch and Moody’s rate Britain at one notch below AAA. Theresa May is due to take over as PM from Cameron, after her only rival for the Conservative Party leadership, Andrea Leadsom, withdrew from the race; she will be installed in Number 10 by Wednesday evening, July 13, 2016, and is due to lead Britain into talks to leave the European Union. The British economy grew by 0,6% in the 2ndQ. 2016 after gaining by 0,4% in the 1stQ. 2016.***Switzerland: UBS posted a net loss attributable to shareholders of CHF2,511 Billion or negative diluted earnings per share of CHF0,67 in 2012, reporting for 2013 a full-year adjusted profit of CHF 4,1 Billion and a full-year net profit attributable to UBS shareholders of CHF 3,2 Billion or diluted earnings per share of CHF 0,83, proposing the Board of Directors a dividend increase of 67% to CHF 0,25 per share for 2013. Swiss Parliament approved in 2010 the U.S.-UBS tax treaty lifting the veil on the country’s traditional banking secrecy, however the Lower House of Parliament rejected in June 2013 a Government bill allowing Swiss banks to deal directly with the U.S. Department of Justice to settle past legal issues over suspected tax evasion by Americans. Credit Suisse reported for 2013 a full-year core pretax income of CHF 4,461 Billion, up from CHF 1,888 in 2012, proposing the Board of Directors a cash distribution of CHF 0,70 per share for 2013 free of Swiss withholding tax. Credit Suisse finalized a deal with U.S. authorities to settle charges of helping Americans evade taxes by hiding their assets in secret bank accounts. The Swiss National Bank/SNB gave up on currency peg, leaving behind three-year-old efforts to prevent the Euro from trading below 1,20 franc, sending the Swiss currency soaring, which may mean “Swiss Made” more expensive, coming the decision to scrap its minimum exchange rate of 1,20 franc per Euro just one week before the ECB is expected to unveil January 22, 2015, bond-buying program to counter deflationary pressures, which may weaken the Euro further.***Russia: Russia showed with rising energy prices, a strengthened financial sector, an improved investment climate and diversifying its economy signs of recovery, surging its gold and foreign exchange reserves to around $515 Billion, the world’s fifth-largest, however dropping to $361,6 Billion as Western sanctions against Russia for its role in Ukraine and crashing oil prices hurt the country’s economy, announcing the Central Bank it will boost reserves to around $500 Billion over the next years. Helping to finance budget deficit the Russian Government plans to issue ruble denominated bonds preparing a privatization program over 5 years worth some $40 Billion to sell minority stakes in about 900 State controlled companies. The Government sold 7,6% of Sberbank, retaining control over the largest Russian bank keeping 50% plus 1 share. The Russian Government, said it still owes 25 Trillion Rubles/$785 Billion to the public from lost Soviet savings, signing Putin an order to halt payments on the notes until at least 2015. The Russian Federation’s debt in national and foreign currency reached $545,1 Billion at the end of 2011 or 29% of GDP and would rise to about 55% of GDP if the outstanding Soviet debts were included. The actual national debt to GDP ratio is estimated to stand at 10,4% of GDP, not including outstanding Soviet debts. Russia’s budget deficit reached 3,7% of GDP (1,05 Trillion rubles/ US$19,2 Billion) at the end of May 2015, targeting the Central Bank a budget deficit of about 3% ending 2015. Prime Minister Vladimir V. Putin, whose United Russia party lost its two-thirds majority in DUMA, continuing still as the strongest political power, won overwhelmingly re-election for six years to the Russian Presidency and was sworn in, taking previous President Medvédev Putin’s place as Prime Minister heading also the United Russia Party. Russian Band Pussy Riot was convicted of hooliganism and sentenced to two years in prison, marching opposition against Putin. After endless negotiations a Ministerial Conference finally accepted Russia as a WTO member. President Putin pledged $13,6 Billion from the National Welfare Fund for new infrastructure projects. Economists are concerned about Russia’s already weak economy hit by sanctions from the United States and Europe due to the Russian Crimea annexation, losing the ruble against the Dollar, making imports more expensive, pulling investors Billions of Dollars out of Russia, dropping the Russian stock market wiping out Billions in market capitalization, cutting Standard & Poor’s Russia’s credit rating from BBB to BBB-, just one step above the so-called ‘junk’-level, lowering its outlook from stable to negative, escalating the most serious East-West crisis since the end of the ‘Cold War’, excluding Western G7 nations President Putin of Russia from the Group of 8, suspending his Government’s 15-year participation in the diplomatic forum and further isolating his country. G7 energy ministers will meet to discuss ways to bolster the countries’ collective energy security, considering the great dependence on Russian oil and gas supplies in nations like Germany and Italy, getting EU about a third of its natural gas supplies from Russia, which could reroute some of the supplies to Asia, while Europe may find it not easy to obtain alternatives to these deliveries. Russia and energy hungry China reached a $400 Billion 30-year gas supply deal, opening up a new market for Russia State-controlled Gazprom, receiving a $25 Billion prepayment under the supply deal, as it risks losing European customers over the Ukrainian crisis. Putin created ex-Soviet trade bloc, the Eurasian Economic Union, with Kazakhstan and Belarus. Moody’s downgraded Russia on sluggish economic growth and weakening Ruble from Baa1 to Baa2 and to Baa3, cutting the rating further by one step to Ba1, a ‘speculative’ or junk grade, keeping a negative outlook on the country’s rating, cutting Fitch Russia´s sovereign credit rating to BBB- from BBB, one notch above junk status, keeping a negative outlook, downgrading Standard & Poor’s Russia’s sovereign credit rating from BBB- to BB+, or below investment grade, with a negative outlook, as growth prospects continue weakening, announcing the Russian Central Bank the country is working to establish its own rating agency, saying that Western rating agencies are downgrading Russia out of political reasons. Dropping oil prices and Western sanctions led to collapsing the Russian currency, which lost nearly 60% of its value against the U.S. Dollar, hitting inflation 11,4% for the year 2014, declining annualized inflation to 15,8% in May 2015, down from 16,4% the prior month, lowering Russia its inflation forecast for 2015 to 11,9% from 12,2%, reaching net capital outflows from Russia $154,1 Billion in 2014, up from $61 Billion in 2013, slowing to $32,6 Billion in the first quarter of 2015, down from $72,9 Billion the previous three months, estimating the Russian Central Bank net outflows will total about $131 Billion for all of 2015. As Western banks refuse to lend, many analysts assume the State will need to help Russian companies repay their $550 Billion in foreign debt, fearing pessimists that even Russia’s foreign exchange reserves of actually about $375 Billion will eventually run out, having Russian companies and banks to repay up to $109 Billion in foreign debt in 2015.***Japan: Japan’s public debt mountain exceeds 243,2% of GDP, while budget deficit 2013 reached 9,2% of GDP, urging the IMF to take measures to reduce debt. Acknowledging that its global economic status is declining Japan said it will work to open up the country, redoubling efforts to forge free trade agreements, turning trade focus to China and South Korea. Quake-hit Japan approved a budget blueprint 2012/13 of $1,16 Trillion that includes record high spending aggravating its debt problem raising pressure to increase taxes, expanding its economy by 1,6% in 2013, showing the inflation-adjusted data a zero growth for 2014, after expanding by an annualized 1,5% in the fourth quarter of 2014 leaving recession, lowering the Bank of Japan its growth outlook for the fiscal year April 2014-March 2015 to 0,5%, down from 1%, revising Japan sharply growth up for the 1stQ. 2015 from initially estimated 0,6% to 1%, or from an annualized rate of 2,4% to now 3,9%. After a slowing second quarter 2015, Japanese analysts cut growth forecast for the fiscal year ending March 2016 to 1,21% down from 1,66%, persisting weakness in corporate and household spending, predicting the IMF for Japan a growth of 0,6% in 2015 and of 1% for 2016, returning Japan to its fourth technical recession in five years in the 3rdQ. 2015, shrinking its economy an annual 0,8% after a 0,7% contraction in the 2ndQ. 2015. However the revised 3rdQ. 2015 data showed an annualized GDP growth of 1% instead of the previously announced o,8% annual contraction, and a 2ndQ. 2015 economic contraction of only 0,5% instead of the previously estimated decline of 0,7%, shrinking Japan’s economy by 1,4% in the 4thQ. 2015, following a revised 1,3% gain in the 3rdQ. 2015, falling private consumption, which makes up 60% of the output, 0,8% quarter-on-quarter, predicting the OECD a growth of 0,8% for 2016 and of 0,6% for 2017. Japan’s economy expanded by a revised annualized rate of 2% in the 1stQ. 2016, up from previously estimated 1,7%, slowing to an annualized rate of only 0,2% in the 2ndQ. 2016, likely delaying planned tax hike next year and rolling out additional fiscal stimulus worth at least 5 Trillion yen/$45,76 Billion, while the Bank of Japan may ease policy further to bolster growth and control inflation. Japan’s 2ndQ. 2016 growth was revised upwardly to a 0,7% annualized rate from a preliminary reading of 0,2%. Abe raised sales tax to 8% from 5% in 2014, which pushed the economy into recession, forcing the Government to delay a second tax hike to 10% by 18 months. Japan’s jobless rate stood at 3,2% in January 2016. Due to increasing energy bills surging after the Fukushima crisis, and a sharp decline in the yen, Japan’s trade deficit reached 10,86 Trillion yen in 2013, nearly doubling deficit of 5,62 Trillion yen of 2012, growing to a record 12,781 Trillion yen in 2014, rising imports 5,7% to 85,89 Trillion yen and increasing exports 4,8% to 73,11 Trillion yen. Japanese national debt has topped 1.000 Trillion yen/ about $10,42 Trillion in June 2013, rising its net external assets to a record 366,86 Trillion yen at the end of 2014, as a weaker yen boosted the value of overseas holdings, making the country the world’s biggest creditor nation for 24 years in a row, followed by China with 214,3 Trillion yen and Germany with 154,7 Trillion yen, growing Japan’s external debt to 578,42 Trillion yen. Following ECB and the Fed also Japan’s Central Bank announced fresh monetary easing extending asset-buying by €97 Billion to €778 Billion, adopting 2% inflation target, continuing unprecedented stimulus saying it will double its holdings of Government bonds and  double money supply until 2014 to bolster growth of the world’s 3rd-largest economy. Japan’s jobless rate stood unchanged at a 3,3%-low in May 2015. The core consumer price index/CPI, which includes oil products but excludes volatile fresh food prices, remained unchanged in January 2016 from a year earlier due to falling fuel costs, following a 0,1% rise in December 2015, dropping more than expected in March 2016, declining 0,3% from a year earlier, the most since April 2013, adding to evidence that the nation is still struggling to break free of deflation, as the Central Bank board meets to decide whether to expand still more monetary stimulus. Liberal Democrats, Japan’s opposition party, won a landslide election victory, becoming its hawkish leader Shinzo Abe Prime Minister for a second time, unveiling a $116 Billion economic stimulus package to lift real economic growth by 2% and create 600.000 new jobs, forecasting for the fiscal year beginning in April 2013 a growth rate of 2,5%, offering G7 tacit approval for weaker yen raising hopes the world’s third largest economy could awaken from its long slumber. To help improve public finances PM Abe rose consumption tax from currently 5% to 8% in April 2014, deciding to put off a second tax hike to 10% planned for October 2015 until April 2017, raising concerns how Japan will curb its huge public debt. Japan plans to postpone proposed sales tax hike for a second time, until October 2019, confirming that it would stick to its aim of achieving its primary budget-balancing target in fiscal 2020 despite to the likely tax hike delay, needing the country two things: more tax revenue and more economic growth. Abe’s ruling bloc won a decisive victory in an Upper House election, securing control of both Houses of Parliament for up to three years, cementing his grip on power allowing him to proceed with his ambitious plan for economic growth. Abe envisions a resurgent Japan taking a more assertive leadership role in Asia to counter China’s power. Standard & Poor’s cut Japan’s long-term sovereign credit rating from ‘AA-‘ with a negative outlook to ‘A+’ with a stable outlook, while Moody’s downgraded Japan’s credit rating to Aa3 from A1, giving the rating a stable outlook, downgrading Fitch Japan’s long-term sovereign credit rating to A, on a stable outlook, failing the country to take steps in this fiscal year’s budget to offset delay in a second sales tax increase to reduce public debt, at twice the size of its economy. Japan’s ruling coalition with PM Abe won comfortable re-election, saying economy is No.1 priority. Japan announced a new stimulus package worth more than $266 Billion to boost the world’s number three economy, seen as a response to Britain’s vote last month to exit the European Union.***China: China put into force a massive stimulus initiative of $586 Billion, including heavy infrastructure investments, tax cuts and low interest rate loans, accelerating growth contributing to the region’s stabilization, surpassing Germany as the world’s biggest exporter, overtaking the U.S. as the biggest energy consumer and probably also as the biggest oil importer, passing Japan to become the world’s second largest economy, slowing GDP growth to 7,8% in 2012 from 9,24% in 2011 and, hitting a 14 year-low, to an annualized rate of 7,7% in 2013, declining growth further to 7,3% in 2014, rating Moody’s China with Aa3 and a stable outlook, forecasting a GDP expansion of 6,8% for 2015 and 6,3% in 2016 in line with the IMF, saying China its GDP totaled more than $10 Trillion in 2015, with the services sector accounting for half of the GDP, expanding the country’s economy by 6,8% in the 4thQ. 2015 from a year earlier, down from 6,9% in the 3rdQ. 2015, and the full year 2015 growth was just 6,9%, forecasting the OECD a growth of 6,5% for 2016 and of 6,2% for 2017, projecting China in its five-year plan draft presented to the National People’s Congress/NPC an annual growth of 6,5% until 2020. Standard & Poor’s kept its AA- on China’s sovereign debt, however lowered outlook from stable to negative, highlighting surging debt and questioning the Government’s ability to enact reforms, leaving the door open for a future downgrade if credit increases at a significantly faster rate than the nominal GDP growth. That is the level the country’s debt is rated by Moody’s, which also lowered its outlook on China’s debt to negative. China approved $113,24 Billion worth of infrastructure projects intending to bolster slowing growth, rising China’s consumer price index/a main gauge of inflation to 1,6% year-on-year in December 2015 and further to 1,8% year-on-year in January 2016. China’s public debt to GDP ratio is reported to have reached 22,4% in 2013, saying the IMF China’s Government debt is now around 50% of GDP, while fiscal deficit to GDP ratio was estimated to stand at 2,5%. China’s exports grew 7,9% year-on-year in 2013 to $2,21 Trillion, while imports rose 7,3% to $1,95 Trillion, totaling imports and exports $4,16 Trillion, up 7,6% from a year earlier and slightly below the Government’s target of 8%, leaving China with a trade surplus of around $260 Billion, up 12,8% from a year ago, increasing trade with the EU, China’s biggest trade partner, 2,1% year-on-year to $559,1 Billion, reaching China’s exports to the EU $339 Billion, while imports from the EU totaled $220,1 Billion, rising trade with the U.S., China’s second-biggest trade partner, 7,5% year-on-year to $521 Billion, exporting China $368,4 Billion worth of goods to the U.S., while importing from the U.S. $152,6 Billion. China surpassed the U.S. to become in 2012 the world’s biggest trading nation, with imports and exports totaling $3,87 Trillion, while the U.S. trade of goods reached $3,82 Trillion, growing China’s GDP 2012 yuan 51,93 Trillion/$8,3 Trillion compared to the U.S. GDP of $15,6 Trillion. China’s combined exports and imports rose by about 3,4% in 2014 from a year earlier, short of the official trade growth target of 7,5% for 2014. Foreign Direct Investment/FDI in the Chinese mainland increased 5,25% year-on-year in 2013 reaching $117,59 Billion, coming $3,35 Billion from the United States and $7,21 Billion from the European Union, declining FDI from Japan to $7,06 Billion. China’s total investment in overseas non-financial sectors rose 16,8% year-on-year in 2013 to $90,17 Billion. Steering China’s economy away from a double-digit export led growth to a more sustainable expansion of its domestic consumption will be a top priority of the Government, ensuring retail sales to maintain an annual increase of 15% during the five-year plan 2011-2015 and reach 32 Trillion yuan/$5,08 Trillion by 2015. In an drive to liberalize the country’s financial system, China’s Central Bank announced allowing financial institutions to decide their own lending rates following commercial principals, launching a new benchmark lending rate for commercial banks in a bid to make interest rates more market-oriented, reducing for a second time bank reserve ratios to boost bank lending and combat slowing economic growth, cutting interest rates again in a very short period, lowering its benchmark one-year lending rate by 25 basis points to 4,35%, reducing also the reserve requirement ratio for banks by 50 basis points to 17,5%, after economic growth in the 3stQ. 2015 cooled to 6,9%, highlighting that China’s economy is under persistent pressure from soft demand at home and abroad. As Chinese stocks tumbled for a second day, the People’s Bank of China/PBOC cut its one-year benchmark lending rate again by 25 basis points to 4,6%, reducing by the same amount its one-year benchmark deposit rate to 1,75%, easing reserve requirements by 50 basis points to 18% for most big banks, expecting the measure would help to inject about 650 Billion yuan/$101 Billion into the economy, lowering required reserve ratio by another 0,5% points to a reserve ratio of 17% for most banks in a further effort to cushion its economic slowdown. Beijing plans to lift Government spending to 17,15 Trillion yuan ($2,74 Trillion) in 2015, up 10,6% from 2014. The yuan fell to its lowest against the dollar in almost three years after a surprise devaluation, setting the Central Bank its official guidance rate down  1,9% to 6,2298 yuan per dollar, declining China’s currency another 1,3% reaching a four year low, weakening the yuan for a third consecutive day, falling 4,4% over the last three days, and the yuan may be allowed to slide even further to support China’s slowing economy and help the country’s exporters, as there are reported voices within the Chinese Government wanting to push the yuan still lower, suggesting pressure for an overall devaluation of almost 10%. New Chinese leadership under CPC General Secretary Xi Jinping, confirmed by the People’s Congress as President replacing Hu Jintao, urged party leaders to build a clean Government, maintain self-discipline and professional conduct, calling for an acceleration in economic restructuring and the advancement of innovation. China’s People’s Congress named Li Kequiang as new Prime Minister, replacing Wen Jiabao, saying the country will target a smaller role for the State. China plans to relax one-child policy as part of reforms package and to abolish its extrajudicial ‘re-education through labor’ detention system, improving social welfare programs and easing migration restrictions for the tens of Millions of rural residents attemting to put down roots in cities. China will set up 5 private banks in 5 different places on a trial basis, before extending the practice to more places, as part of an ambitious reform package, representing a further opening up of the country’s banking sector. China and Japan, the world’s second and third largest economies, unveiled important deals to tighten finance ties, supporting Japan the sale of bonds denominated in China’s yuan, buying Japan’s Government eventually up to $10 Billion worth of yuan-bonds, agreeing also to encourage the use of their own currencies in bilateral trade, dealing in the future largely without using the U.S. Dollar, agreeing China, Japan and South Korea to press ahead with purchase of each others Government bonds. The $100 Billion China-led Asian Infrastructure Investment Bank/AIIB, Beijing, approved 57 nations as founder member, and is regarded by some analysts as rival for the IMF, the World Bank and the Asian Development Bank/AIB. Cash-rich China is with 30,34% its largest shareholder, followed by India with 8,52% and Russia with 6,66%, Germany and South Korea. China, as new global player, is already testing the U.S. dominance in Latin America offering the region $250 Billion in investment over the next decade, while Chinese companies are pouring money into Africa. China will pledge a multi-Billion Dollar investment in Europe’s new 315 Billion Euro-infrastructure fund, expecting it will create opportunities for China to invest in the EU in infrastructure and innovation sectors. China is expecting that European companies and Governments would take a greater interest in President Xi Jinping’s ‘One Belt, One Road’ initiative, aiming to create a modern Silk Road Economic Belt with railways, highways, oil and gas pipelines, power grids, Internet networks, maritime and other infrastructure links across Central, West and South Asia as far as Greece. BRIC nation China established already with BRIC member countries Brazil, India, Russia and South Africa a $100 Billion Development Bank and a $100 Billion Currency Reserve Pool, aiming to challenge Western dominance over global finances. China dropped the one-child policy, allowing all families to have two children to counter aging population, expecting that this initiative will help to boost the country’s economic growth rate by about 0,5%.***India: India is the world’s largest arms importer, procuring weapons in relation with its tense relationship with Pakistan and seeing China increasingly as potential threat, keeping its position as the world’s leading arms importer in 2015, standing the country’s imports of weaponry at 14% of the world’s total, twice as much as second -placed Saudi Arabia. Its trade deficit for fiscal year 2015/16 narrowed to $118,5 Billion, declining exports 15% to $261,1 Billion and dropping imports 15,3% to $379,6 Billion. India’s public debt reached 67,59% of GDP, rising 2012/2013-budget deficit to 5,2%, targeting for 2013/2014 a reduction to 4,8%, reporting that its fiscal deficit 2014-15 has been contained at 4% of GDP, moving within the country’s financial targets, standing its external debt at $426 Billion at the end of 2013. The country’s gold and foreign exchange reserves stood at $350,4 Billion for the week ended February 20, 2016. The Indian rupee dropped to a record low against the dollar, rushing capital out of India and other emerging markets, avoiding investors markets seen as riskier reacting on negative current accounts and fiscal deficits. India raised its short-term lending rate to 7,5% seeking to tame inflation, even as the country struggles with an economic slow down, rising India’s Consumer Price Index-based annual inflation to 5,76% in May 2016 up from 5,39% the month before. India’s public debt to GDP ratio was reported to reach 66,7% in 2013, while budget deficit to GDP ratio stood at around 4,5%. Hindu nationalist Narandra Modi, leader of the opposition Bharatiya Janata party/BJP, swept to a landslide election win, giving him the strongest mandate of any Indian leader since 1984, meaning a crushing defeat for the governing Congress party and its 43-year-old scion Rahul Gandhi, who accepted alongside his mother, Sonia, the party’s President, responsability for the defeat, winning BJP 275 seats, leading in seven more, becoming the first party to cross the 272-mark in thirty years, totaling with 282 seats 10 more than the majority required to rule, heading with its allies for a comfortable tally of around 337 seats. Corporate India hopes incoming Government under PM Modi will boost economic growth and create jobs, heralding a ‘golden era of change’. A World Bank report ranks India ahead of Japan and after the United States and China, on basis of purchasing power parity as the world’s third largest economy. India regained its ‘stable’ rating from Standard & Poor’s in a validation of Modi’s ambitious agenda of economic and fiscal reforms, after its ‘BBB-minus’ rating was cut to ‘negative’ in April 2012, while Moody’s raised India’s rating outlook to positive from stable, affirming Baa3 rating, keeping Standard & Poor’s India’s sovereign rating at the lowest investment grade of ‘BBB-minus’ and a stable outlook, saying factors such as its sound external position were offset by low income and weak public finances.
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U.S. HOUSING MARKET: Home prices: The 20-city composite gained 5,1% in June 2016 from a year earlier, compared to 5,3% year-over-year in May 2016. Sales of previously occupied homes rose in May 2016 to a more than nine-year high amid low mortgage rates, gaining 1,8% to an annual rate of 5,53 Million, after April’s 2016 sales pace was revised down to 5,43 Million units. New single-family home sales, which account for 7,8% of the housing market, fell 6% in May 2016 to a seasonally adjusted annual rate of 551.000 units after April’s 2016 pace was cut to 586.000 but still rose 12,3% from March 2016, while the median sales price of a new home was $294.000 in May 2016. Privately-owned housing starts fell more than expected in August 2016, decreasing 5,8% to a seasonally adjusted annual pace of 1,142 Million units, down from 1,211 in July 2016, rising year-on-year 0,9%, while privately-owned housing units authorized by building permit dipped 0,4% in August 2016 to a 1,139 Million-unit rate down from 1,15 Million in July 2016, which is 2,3% lower than a year ago. The National Association of Realtors pending home sales index, based on contracts signed in July 2016, increased 1,3% to its second highest reading in over a decade of 111.3, from downwardly revised 109.9 in June 2016 and is now 1,4% higher than July 2015 (109.8). The National Association of Home Builders/Wells Fargo sentiment index stood at 62 in November 2015, down from a decade-high 65 the month before. The Federal Housing Finance Agency, the regulator of Fannie Mae and Freddie Mac unveiled a new program aimed at homeowners who are paying their mortgages on time, but whose loan-to-value/LTV ratios are too high to qualify for traditional programs. The Homeowner Affordability and Stability Plan’, a mortgage loan-modification program, pledged up to $75 Billion providing incentives to lenders to change terms of loans to make them more affordable to struggling homeowners, reducing interest rates to as low as 2% with payments reaching 31% of their income, and allowing four to five Million homeowners to refinance their mortgages into loans with cheaper payments through Fannie Mae and Freddie Mac, increasing the guarantee against losses on the mortgage investments of the two Government controlled mortgage giants to $200 Billion each, rising also the size of their portfolio limits from $850 Billion to $900 Billion. To fight the foreclosure another plan encourages homeowners who have not been rescued through a loan modification program paying them some cash to sell their houses for less than the balance of the mortgages, compelling lenders to accept that deal forgiving the difference between the market price of the property and what they are owed. The Obama Administration pumped $3 Billion into its Hardest Hit Fund/HUD intended to assist unemployed homeowners at risk of foreclosure not to lose their homes. Fannie Mae and Freddie Mac seized by the Treasury Department and put into a Government conservatorship run by the Federal Housing Agency reported substantial losses in 2009 and 2010. The two mortgage giants, becoming both profitable again in 2012, after a combined bailout of $187,5 Billion, will have paid back about $202,9 Billion in dividends by the end of March 2014, and could send about $179,2 Billion in profits to taxpayers over the next ten years if the terms of the bailout remain intact. President Obama had reiterated support to wind down Fannie Mae and Freddie Mac, calling for a continued but limited Government role to backstop the U.S. mortgage market, as part of a strategy to replace ultimately the two mortgage giants with a private sector alternative, announcing the leaders of the Senate Banking Committee an agreement on legislation to wind down Government-owned mortgage financiers, jump-starting a long-standing debate that could still take years to resolve. According to reports some $2 Trillion of the $6 Trillion in U.S. mortgages and home-equity loans that were securitized during the height of the housing bubble from 2005 to 2007 are likely to go into default, causing the housing bust ultimately losses of $1,1 Trillion on those bonds to be absorbed by bondholders and partly by banks. U.S. regulators reached an $8,5 Billion settlement to resolve  claims of foreclosure abuses with 10 major lenders, including JP Morgan Chase, Bank of America, Citibank and Wells Fargo, allowing homeowners to benefit from mortgage relief. Separately Bank of America agreed to pay $11,6 Billion to Fannie Mae to settle claims over troubled mortgages, mostly loans issued by the bank’s Countrywide Financial subsidiary, seeking the bank to settle dispute over more than $1,4 Billion in faulty mortgages with Freddie Mac, Freddie saying BofA should have to take back.
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BASEL III/G20/G8/G7/GCC/APEC/IMF/WORLD BANK/FSB/U.N./WTO/North Korea/Iran/POPE FRANCIS/URUGUAY-MARIJUANA/UKRAINE/VENEZUELA: The Basel Committee on Banking Supervision advanced on Basel III, announcing higher global minimum capital standards to create a more secure financial system, agreeing on transitional arrangements for implementing gradually starting in 2013 and ending in 2019 new standards rising levels of minimum common equity/risk weighted assets/RWAs from actually 2% to 3,5% on January 1, 2013 to 4% on January 1, 2014 and to 4,5% on January 1, 2015 and of Tier 1 capital/RWAs from actually 4% to 4,5% on January 1, 2013 to 5,5% on January 1, 2014 and to 6% on January 1, 2015, remaining total capital/RWAs at 8% from January 1,2013 through 2015, requiring a counter-cyclical capital conservation buffer to be phased from January 1, 2016 to January 1, 2019 when it must reach 2,5%, rising minimum common equity/RWAs to 5,125%/2016, 5,75%/2017, 6,375%/2018 and 7%/2019, increasing Tier 1 capital/RWAs to 6,625%/ 2016, 7,125%/2017, 7,875%/2018 and 8,5%/2019, growing also total capital/RWAs to 8,625%/2016, 9,125%/2017, 9,875%/ 2018 and 10,5%/2019.***The Financial Stability Board/FSB published for the G20 nations an update of the group of global systemically important 28 banks, classifying Citigroup, Deutsche Bank, HSBC and JP Morgan Chase as the financial institutions with the highest risk level, needing 2,5% of additional common equity loss absorbency as a percentage to risk-weighted assets, inviting national authorities to begin to apply requirements to local banks. The Basel Committee eased new global bank liquidity rules giving banks four more years, until 2019, to build up cash buffers, widening the range of assets banks can put in the buffer to include shares and retail mortgage-backed securities (RMBS) as well as lower rated company bonds. Global banking regulators also agreed to ease a new capital rule due in 2018, the way that a leverage ratio is compiled, in order to boost lending and support the world economy recovery. The Basel III leverage ratio, currently set at 3%, is calculated by dividing a bank’s Tier 1 capital to its “exposure measure”, which includes both on-balance sheet and off-balance sheet risks. The proposal expands reporting requirements for derivatives included in the leverage ratio calculation, bridging differences between procedures in the U.S., Britain and the European continent. The FSB estimates that the world’s biggest banks may need to raise as much as $1,2 Trillion to meet new rules by financial regulators.***During the global finance crisis former President Bush invited leaders of developed and developing countries to a G20-meeting, participating Argentina, Australia, Brazil, Britain, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, United States, also the European Union, IMF, World Bank and United Nations, approving to reinforce international cooperation to boost growth policies according to domestic conditions.*** Gulf Corporation Council/GCC finance ministers proposed a joint response after a sharp decline in oil prices left their economies vulnerable threatening their financial sector and above all government and privately funded projects across the region as the United Arab Emirates/UAE property prices fell.*** The 21 APEC member economies, including the United States, Canada, Australia, Japan, China, Russia, Chile, Peru and Mexico, accounting for 49% of world trade and representing 55% of the global gross domestic product, agreed to increase efforts to stimulate recovery and economic growth. ***China with the world’s largest foreign exchange reserves, falling to just under $3,19 Trillion in August 2016, suffering record declines attempting to halt slide in the yuan and stabilize financial markets, held $1,2443 Trillion in U.S. debt per April 2016, while Japan’s holdings rose to $1,143 Trillion in April 2016, with foreign exchange reserves at around $1,243 Trillion. China’s Government proposed to replace the present U.S. Dollar dominated currency system, expanding the role of the ‘Special Drawing Rights’ of the IMF  based on a basket of currencies -US$, Yen, €uro and Pound Sterling-creating a new reserve currency disconnected from individual nations, increasing Chinese efforts to promote the use of their local currency internationally, switching to the yuan for its foreign trade, offering other BRIC countries yuan loans, wishing to establish the yuan as reserve currency, widening the yuan’s daily trading band against the US Dollar from 0,5% to 1%, doubling trading band, allowing to rise or fall 2% from a daily midpoint rate, entering China’s currency into the top 10 of most frequently traded international currencies for the first time, agreeing the European Central Bank and China on a currency swap deal, a move designed to encourage global use of yuan. The IMF staff recommended the yuan to be included in the fund’s Special Drawing Rights reserve-currency basket, alongside with the U.S. Dollar, Euro, Pound and Yen, giving the fund’s board its final approval admitting the yuan into its benchmark currency basket at the end of November 2015, obtaining China’s currency a 10,92% share as global reserve-currency. Last set in 2010 the basket was 41,9% Dollar, 37,4% Euro, 11,3% Sterling and 9,4% Yen, and the inclusion of the Yuan with a 10,92% share changes the weights of the currencies in the basket, which are calculated to make export volumes less important and financial flows more important, and new weightings are: 41,73% for the Dollar, 30,93% for the Euro, 8,33% for the Yen and 8,09% for the British Pound. China is the world’s largest exporter, lags other countries in financial transactions and the Yuan is not yet a fully convertible currency. China plans to take a giant step toward making the yuan more convertible, allowing the currency to be traded with few restrictions in and later in 2015 also outside its free trade zones, saying Chinese Central Bank chief that he sees the yuan as international currency by 2020 on deepening reforms. ***G20 nations pledged $1,1 Trillion tripling available IMF funds immediately to $500 Billion and later to $750 Billion, creating the IMF additional $250 Billion in ‘Special Drawing Rights’, providing $100 Billion to the World Bank and other multilateral development banks and increasing world trade financing available for cross-border trade by $250 Billion through export credit agencies in each country.***G20 leaders announced that the ‘Financial Stability Forum/ FSF’ will be replaced by the new ‘Financial Stability Board/FSB’, including as members all the G20 countries, Spain and the European Commission, to collaborate with the IMF avoiding through early warnings future macroeconomic and financial risks, creating stricter capital requirements for banks revamping risk management and accounting systems, strengthening regulations of financial sector and control of systemically important financial institutions, including hedge funds and credit rating agencies, taking action against tax havens, implementing limits on bank pay and bonuses and call on accounting standard setters to work urgently on a common international approach to dealing with toxic assets on the balance sheet. World leaders agreed to expand the role of G20 as a global forum for economic cooperation taking a lead in global recovery and decided to fundamentally reform the banking system, tightening regulation on complex financial instruments and to limit bonus pay. G20 Finance Ministers and Central Bank Governors pledged to fight against tax evasion and to put growth before austerity, seeking to revive a global economy that remains too weak, acknowledging the benefits of expansive policies in the U.S. and Japan, highlighting the recession in the €uro-zone and a slowdown in emerging markets.***G8 leaders condemned North Korea’s nuclear test and missile launches, watching outside world after North Korean dictator’s sudden death transition to his third son and heir apparent Kim Jong-un as new leader of the isolated nation. The execution of Kim Jong-un’s once powerful uncle may signal a power struggle, raising fear of instability. ***Iran: Tehran made it clear it had no intention to stop uranium enrichment, adopting the U.N. Security Council pushed by the U.S. drastic new Iran sanctions, activating Iran the reactor at the Russian built Bushehr nuclear power plant operating under IAEA supervision and unveiling its first home made unmanned long-range bomber drone capable of launching missiles and torpedoes, set to gain also more influence in Iraq with the departure of U.S. combat forces. EU agreed to ban Iranian oil imports, escalating confrontation with Iran over its nuclear program, preferring U.S. a diplomatic solution, maintaining a military option on the table, winning overwhelmingly moderate cleric Hassan Rowhani Iran’s presidential election, giving a decisive victory to Iranians calling for a change. Iran said it will allow IAEA inspectors to enter long-unseen nuclear sites, seeking Tehran to show co-operation after initial failure of Geneva nuclear talks, reaching negotiators an interim deal with Iran to halt nuclear program for six months coming into force January 20, 2014, seen as a first good step, remaining enrichment issues, easing Western sanctions helping to revive Iran’s economy, facing a longer term agreement major challenges, opening Iran contacts with oil majors after nuclear accord. Iran nuclear talks have been given an extension from the actual deadline July 20, 2014 until November 24, 2014 for a long-term deal to reach a peaceful solution, ending sanctions against Iran in exchange for curbs in its nuclear program. President Obama wrote a letter about Islamic State militants, a common enemy in Syria and Iraq, to Iran’s powerful religious leader Ayatollah Ali Hoseini-Khamenei, coming as the November 24, 2014, deadline nears in nuclear negotiations between the U.S. and Iran, as well as five other world-powers, describing a shared interest between the U.S. and Iran in fighting Islamic State militants and stressed that any cooperation on that would be largely contingent on Iran agreeing to the nuclear deal. It seems that it’s impossible to reach a nuclear deal with Iran before ‘final’ deadline November 24, 2014, and world-powers set a new target date, extending deadline to July 1, 2015, aiming Western officials to secure an agreement on the substance of a final accord by March 2015. Iran and six world powers will resume negotiations during the last week of March 2015 seeking to break a deadlock over sensitive atomic research and lifting of sanctions, still within the end-March 2015 deadline for a political framework agreement and a full nuclear deal by June 30, 2015. The U.S. considered negotiators have made enough progress to extend self-imposed March 31, 2015 deadline to come up with a broad political understanding, however seems to be also prepared to ‘walk away’ from Iran nuclear talks if a nuclear accord with Iran can’t be produced. Iran and world powers reached a general understanding for a final nuke deal by June 30, 2015, limiting Tehran’s nuclear program and ending most sanctions imposed on the country. Iran’s President said the framework for a nuclear deal was just the first step toward building a new relationship with the world, hoping Saudi Arabia that a final settlement of the nuclear dispute would ‘strengthen the stability and the security of the region and the world’, as the deal seemed to include valuable safeguards – it’s about verification and if they don’t comply the boycott will be reimposed, which is a reassuring result. Israel’s PM Netanyahu insists that the powers negotiating with Iran must add a new demand that Tehran recognize Israel’s right to exist, as a final deal would threaten the survival of Israel. After missing June 30, 2015-deadline nuclear talks will continue to reach a wide-ranging nuclear deal, as Iran and six world powers set again a new July 13, 2015-deadline, remaining main differences on the pace and timing of sanctions relief from Iran and on the nature of monitoring mechanisms to ensure Tehran complies with the deal, saying the U.S. it can’t wait forever, if the tough decisions don’t get made, it is absolutely prepared to call an end to this. The U.S. reported Iran talks progress, saying the White House the U.S. negotiating team would stay in Vienna as long as negotiations remain useful, reaching the U.S. and six major world powers a nuclear deal, facing skeptics, as agreement must now overcome opposition of reluctant conservatives in Congress, rejecting Israel’s Government the deal.***G20 agreed on the historic IMF reform, allowing to transfer 6,4% of voting power to dynamic emerging-market and developing countries by the fall of 2012 doubling the fund’s quotas standing currently at $328 Billion, keeping industrialized nations with 57,7% the majority while emerging economies obtain 42,3%, becoming China with a quota exceeding 6% behind the U.S. and Japan the fund’s third most powerful member, ahead of Germany (5,6%), France, Britain and Italy, giving also a bigger stake and more voting rights to Russia, India and Brazil to form part of the 10 largest shareholders, surrendering Europe 2 seats on the 24-member executive board, retaining the U.S. with a quota of 17,68% its voting power as important decisions require a super-majority of 85%. The IMF failed to agree on vote reforms, delaying agreement on quota formula until 2014, criticizing G20 Finance Ministers and Central Bankers the U.S. Congress on failure to pass IMF reforms, giving the U.S. until year end 2014 to ratify long-delayed reforms, threatening to move forward without it if it fails to do so. During the annual IMF meeting in Peru in October 2015 member countries demanded end of U.S. blockade of quota and governance reforms agreed to five years ago, passing the U.S. Congress within a major U.S. spending measure the long-delayed measure that implements changes agreed in 2010 to the IMF’s voting weights, the so-called quota reforms.***During his Asia tour and first visit to India, President Obama announced trade deals worth almost $15 Billion between American and Indian companies, renewed in Indonesia his call for expanding ties with moderate Muslim world and attended the APEC meeting in Japan, confirming a new commitment to Asia as a strategic center of power. President Obama signed a trade and co-operation agreement with President Dilma Rousseff to strengthen ties with Brazil, visiting also Chile and El Salvador.***G8 leaders agreed to update nuclear safety standards after Japanese nuclear power plant debacle, implement global minimum standards for internet, and offered economic aid programs of up to $40 Billion to Egypt and Tunisia to continue transformation into democracies supporting the ‘Arab spring’ in North Africa and the Middle East, coming $10 Billion in form of bilateral aid from G8 members, $20 Billion from international financial institutions and $10 Billion from Saudi Arabia, Qatar and Kuwait. ***French Finance Minister Christine Lagarde was named as the first woman to head the IMF after its managing director Strauss-Kahn resigned being indicted by a grand jury of New York on criminal sexual-assault charges, finally dismissed by a State judge. The World Bank selected U.S. nominee Jim Yong Kim as new President.***On his fifth trip to Southeast Asia President Obama made a historic visit to Myanmar as part of a strategic move to shape new relationships deepening competition with China over influence in the region.***North Korea: The international community condemned DPRK’s satellite launch, violating U.N. Security Council Resolution 1874 banning North Korea to launch ballistic missiles, confirming the country its 3rd. nuclear test, scrapping North Korea armistice that ended war with South Korea in retaliation for new U.N. sanctions backed by China, threatening to attack U.S. mainland, Hawaii and Guam, saying the U.S. it remains committed to the security of its allies in the region, deploying its second guided-missile destroyer and moving a sea-based missile-tracking radar platform close to North Korea, saying U.S. commander the U.S. is capable to intercept a ballistic missile launched by North Korea if it decides to strike, offering U.S. and South Korea to return to negotiations with North Korea to reduce tensions, agreeing China and U.S. to cooperate on North Korean crisis, reaching North and South Korea a deal on the joint industrial zone Kaesong.***85-year-old Pope Benedict XVI retired after nearly 8 years, the first Pontiff to abdicate in 600 years, becoming Pope Emeritus after retirement. 76-year-old Argentine Cardinal Jorge Mario Bergoglio was elected 266th Pope, the first South American Pope, and will be known as Pope Francis (Francisco), who is calling for big changes in the Roman Catholic Church, meaning Catholics should be unafraid of new ways of proclaiming the Gospel and new ways of thinking about the Church, naming Time Magazine Pope Francis its Person of the Year 2013.***The U.N. approved global arms treaty, the first international treaty regulating global arms trade.***Uruguay is the first country in the world where it is becoming legal to cultivate and consume marijuana, selling probably at a most affordable price of around $1,- a gram, expected to enter into force by mid-2014 after the Senate approved to legalize the drug in an effort to explore alternatives in the drug war. U.S. State Colorado marijuana users welcomed January 01, 2014, with legal access to the drug, descriminalising also Washington marijuana use, saying banks across the U.S. no to marijuana money, legal or not, fearing that Federal Authorities and Law Enforcement Authorities might punch them.*** Ukraine: Ukraine Government survived a no-confidence vote, as the battle between Russia and the EU to win the country continues, persisting furious protesters to oust leaders, after President Yanukowych suspended talks on signing a trade and integration pact with the European Union, supporting closer economic ties with Moscow, preventing it to move closer to the EU, however backing Yanukowych call for compromise talks with protesters, suggesting EU agreement could be signed in spring 2014 if Europe could give Ukraine better financial conditions, offering Russia to buy $15 Billion of Ukrainian Government bonds and to cut gas prices helping to save Ukraine $2 Billion a year, if the country joins a Moscow-led custom union. Ukrainian President offered top posts to opposition leaders, who declined offer seen as an intention to divide protest movement, announcing to keep on negotiating and continue to demand early elections, resigning Ukranian PM as Parliament repealed restrictive protest laws, seen by the opposition ‘as small steps to victory’. Ukraine announced nationwide ‘anti-terrorist’ crackdown after growing escalation of ongoing violence, preparing U.S. and Europe sanctions, signing President Yanukowych a peace deal with the opposition accepting constitutional reform reducing Presidential powers and early presidential election, voting lawmakers to allow the release of his imprisoned rival, former PM Tymoshenko. Ukraine Parliament voted to remove Yanukowych, who fled Kiew denouncing coup, leaving a divided Ukraine, setting lawmakers early election for May 25, 2014, saying acting President Turtshinov Russia must recognize Ukraine’s ‘European Choice’, as Moscow recalls its ambassador, calling Ukraine for urgent, much needed international financial aid, as disposed Russian backed Yanukowych’s bailout deal with Moscow is considered doubtful. Ukranian authorities issued an arrest warrant for disposed Yanukovych accusing him of ‘mass killing’ of civilian protesters. Kremlin says Ukranian instability threatens Russian interests, backing Moscow openly separatist-minded groups in Ukraine’s Crimean Peninsula that serves as the naval base for Russia’s Black Sea Fleet, and a violent confrontation between pro-Moscow protesters and demonstrators supporting the new Ukranian authorities could force Russia to act. Putin ordered combat readiness drills putting 150.000 Russian combat troops on high alert in the western area of Russia bordering Ukraine, as Crimea protests leave one man dead, approving Russian Senate Putin’s request to send troops to Ukraine, after Russian Black Sea Fleet troops seized control of the Crimea peninsula cheered by the Russian majority, demanding Ukranian navy surrender, a charge that Russia denied, warning Obama Russia not to use force in Ukraine, meeting the U.N. Security Council over Ukraine crisis. Ukraine mobilized for war, readies for invasion by Russia, appealing to NATO for help, threatening President Obama to ‘isolate Russia’ warning that the country could be forced to leave the G-8 group, visiting Secretary of State Kiev offering $1 Billion in U.S. loan guaranties to Ukraine, saying Putin he would only use force in Ukraine as a last resort, easing Ukraine-Russia tensions, recovering international markets. Russian forces remain in control of Crimea and continue to surround Ukranian military facilities, suspending the U.S. military ties to Russia, a day after calling off trade talks. The EU is ready to provide €11 Billion of financial support to Ukraine over the next couple of years, a deal tied with the IMF, promising also Germany bilateral financial help, confirming Japan $1,5 Billion aid offer. Crimean Parliament voted in favor of joining Russia and its pro-Russian Government held a referendum on the decision on March 16, 2014, calling pro-Russian leader on Ukranian troops to leave Crimea, declaring G7 group in a statement that referendum on Crimea’s future is a violation of international law. While the U.S. imposed new sanctions over crisis, placing visa restrictions on Russian officials who have taken steps to undermine Ukraine’s territorial integrity, the EU suspended negotiations on a more liberal visa regime for Russians, stopping work on a comprehensive new agreement on relations between Russia and EU, pulling out of all preparations for the G8 summit in Sochi in June, warning of sanctions if Russia does not change course. Crimea declared independence from Ukraine after official referendum results showed that 96,77% of Crimean voted to join Russia, sending its Parliament a formal application to the Kremlin to join the Russian Federation as a new Republic, signing Putin a decree recognizing Crimea as a Sovereign State, defying U.S. and EU sanctions, including asset freezes and travel bans on officials from Russia and Ukraine, reaching relations between Russia and the West their lowest point since the ‘Cold War’, imposing Russia retaliatory sanctions on nine U.S. officials and lawmakers, including Republican House Speaker Boehner. President Putin signed Crimea annexation treaty, calling Crimea an ‘integral’ part of Russia, refusing Ukraine to recognize treaty, warning that conflict with Russia has entered into a ‘military stage’. Under Pressure from Russian troops and local forces Kiev announced plans to evacuate all of its military personnel and their families from Crimea relocating them in the mainland of Ukraine, signing Putin final Crimea reunification treaty, while Ukraine signed an association agreement with the EU. President Obama and the leaders of the biggest Western economies agreed to exclude President Putin of Russia from the Group G8, suspending his Government’s 15-year participation in the diplomatic forum and further isolating the country, announcing G7 nations that the summit meeting planned for Sochi, Russia, will now be held in Brussels, without Russia’s participation. The U.N. General Assembly overwhelmingly affirmed Ukraine’s territorial integrity and deemed the referendum that led to Russia’s annexation of the Crimean Peninsula illegal, voting 100 countries in favor, 11 opposed and 58 abstentions, however no party is obliged to take any action as General Assembly resolutions are non-binding. The IMF endorsed a $17 Billion stabilization loan to Ukraine, unlocking other additional aids of around $15 Billion over the next two years. Putin called Obama to discuss a U.S. proposal for a diplomatic solution to Crimea crisis, urging Obama to withdraw Russian troops from Ukrainian border, saying Russia it has no intention to invade eastern Ukraine, storming pro-Russian demonstrators Government buildings in three eastern Ukrainian cities, claiming Donetsk activists independence, growing fears of a repeat of the the ‘Crimea scenario’, announcing Kiev that Putin was orchestrating ‘separatist disorder’, saying Putin he hopes for positive Ukraine talks next week between Russia, Ukraine the EU and U.S., however warning European leaders of gas supply cuts over Ukraine’s $2,2 Billion gas debt, accusing the U.S. that Russia is using energy as a ‘tool of coercion’. Ukraine’s PM offered to boost local powers in the regions in an effort to undercut pro-Russia separatists, asking to send U.N. peacekeeping troops to the east of the country where pro-Russia militias are defying deadline set by Kiev, launching military operations to retake facilities seized by pro-Russia militants. Russia, the United States, EU and Ukraine concluded a diplomatic pact that commits Russia and Ukraine to ease tensions, agreeing that illegally armed groups must be disarmed and seized facilities must be returned to the legitimate owners, granting amnesty to members of armed groups who leave seized buildings, urging current Government in Kiev to start a dialogue with the country’s regions on a constitutional reform and to discuss Russia’s concerns over the rights of Russian-speaking population in Ukraine, holding early Presidential election on May 25, 2014, cautiously endorsed by Putin, calling on pro-Russia separatists to postpone the scheduled May 11, 2014, referendum on the independence of the Donetsk region from Kiev, saying Russia has pulled back its troops from the Ukraine border, refusing separatists to delay referendum on the creation of ‘people’s republics’, voting 89% of those who turned out in the Donetsk region and 96% of voters in the Luhansk region for self-rule, defending Kiev, calling referendum a criminal farce, its military anti-terrorist operations, complicating the vote of self-rule efforts to establish order and could deepen divisions that threaten to tear the country apart. Europe and the U.S. condemned the vote, saying they would not recognize results, declaring leaders of eastern Donetsk and Luhansk independence, meaning both regions will not participate in Ukraine’s May 25 Presidential election, calling the Kremlin for a dialogue between Kiev, Donetsk and Luhansk addressing needs of all the country’s regions, beginning Ukraine unity talks but without separatists. Armed pro-Russian separatists in eastern Ukraine had previously rejected deal to disarm until Kiev Government stepped down, imposing the United States and Europe additional sanctions against Russia, targeting more Russian officials and companies linked to Putin’s inner circle, followed by Japan. Approaching Ukranian Presidential election, Ukraine’s richest man, Tycoon Akhmetov sides with Kiev authorities, calling on thousands of workers at his plants across the east of Ukraine to attend workplace protests against armed separatists movement. The Organization for Security and Cooperation in Europe/OSCE has sent a team of more than 1.000 observers to monitor Sunday 25 Presidential election, signaling Putin he will recognize Ukraine poll, respecting the choice of Ukrainian people, claiming Pro-European Billionaire, confectionary magnate Petro Poroshenko victory with around 53,70 of the vote, well ahead of former PM Yulia Timoshenko with just over 13% in the second place, winning his close ally ex-world boxing champion Vitali Klitschko election to become mayor of Kiev. The newly elected President Poroshenko vowed to crush the revolt in the east of Ukraine once and for all, getting more than 50 rebels killed, retaking Ukraine’s military airport seized by rebels in Donetsk. G7 leaders, meeting in Brussels without Russia, threatened Moscow of more sanctions if Putin does not help to restore stability in Ukraine. Putin, meeting Poroshenko at D-day commemoration ceremonies in France, called for an immediate ceasefire, saying he expected Poroshenko to show ‘state wisdom’ and ‘goodwill’, stressing Poroshenko in his inaugural address that his country would never give up Crimea and would not compromise on its path towards closer ties with Europe. Russia cut off gas supplies to Ukraine in a dispute over unpaid bills, which could present risks to EU gas supplies in the long-term, taking Ukrainian forces full control of the border with Russia, after pro-Russian rebels shot down a military transport plane killing 49 troops. The EU signed a historic free trade and political cooperation agreement with Ukraine, after Georgia and Moldova ratified similar deals, alarming Moscow concerned about losing its influence over former Soviet republics. The U.S. elevated sanctions against Russia, targeting a series of large banks and energy and defense firms, severely restricting access to American debt markets for top Russian companies, while Europe, imposing for the first time economic sanctions, will block new loans to Russia from the European Investment Bank and the European Bank for Reconstruction and Development, targeting draft with further EU sanctions state-owned Russian banks, energy, defense sectors and sensitive technologies, excluding vital gas sector, saying EU Putin failed to take steps to resolve the crisis peacefully, facing mounting pressure after Malaysian Flight MH17 was shot down with a Russian BUK surface-to-air missile over eastern Ukraine controlled by pro-Russian separatists. There are increasing fears that European sanctions could hurt Euro-zone’s economic recovery. Ukrainian President Poroshenko said that Russian troops had entered his country in support of pro-Russian rebels, which mounted a sudden and successful counteroffensive, capturing key coastal town of Novoazovsk, deteriorating situation in region of Donetsk, worsening military conflict. In an intention to end conflict, Ukraine reached a cease-fire agreement with pro-Russian rebels, backed by Putin, seeking separatists according to a senior rebel leader still a formal split from Ukraine. The U.S. stepped up sanctions hitting Russia’s Sberbank, the country’s largest bank, and Rosteco, an important conglomerate, by limiting their ability to access the U.S. debt markets, banning also cooperation with Russian oil firms on energy technology and services by companies including Exxon, Mobil Corp. and BP, imposing the EU also new economic penalties, including restrictions on financing for some State-owned companies and asset freezes on leading Russian politicians, threatening Russia with retaliation. A draft would allow Russia to seize foreign assets in response to Western sanctions over the Ukrainian crisis, even if they are subject to international immunity, which in case of its approval by the Russian Parliament would further escalate conflict. Ukrainian President Poroshenko signed a law granting three-year limited self-rule status to certain territories in the separatist-minded Luhansk and Donetsk regions. President Poroshenko secured a big election win for pro-European parties in Ukraine, showing that people are backing his plan to end separatist conflict, his pro-Western course and democratic reforms, saying Russia it will recognize the results of Ukraine’s Parliamentary elections. Leaders of Russia, Ukraine, France and Germany reached a deal that includes detailed provisions for the autonomy of the breakaway regions, and as such it’s more likely to lead to a lasting political solution. German Chancellor Merkel called the Minsk agreement as a ‘glimmer of hope’, while observers consider the deal as the ‘end of the beginning’ of the Ukraine crisis. Pro-Russian rebels announced they would not observe the truce at Debaltseve, an important Government-held railway junction, where Ukrainian troops remain trapped under fire, pulling Ukrainian troops out of the strategic, besieged town, falling in the hands of separatists. Kiev is accusing Russia of sending more tanks and troops into eastern Ukraine and that they were heading towards the southern coast, expanding their presence on what could be the next battlefront, raging fighting across the country’s east despite efforts to revive truce. IMF is set to approve a new $17,5 Billion bailout of crisis-hit Ukraine, which would be part of about $40 Billion in assistance from the international community. G7 leaders agreed to keep existing sanctions against Russia in place until Moscow and Russian-backed rebels in eastern Ukraine fully respect a ceasefire negotiated in Minsk in February 2015, warning they could escalate sanctions if needed, claiming Russia also Kiev must still fully implement the peace deal. EU agreed to extend Russia economic sanctions until January 31, 2016, allowing time for the EU summit in December 2015 to assess whether the terms of the Minsk agreement have been met, because of a year-end deadline for Kiev to recover full control over its border, saying Moscow it has already taken an extension of the measures into account in its economic planning and considers to extend the ban on Western food imports for six months starting early August 2015.***U.S. Secretary of State Kerry said Venezuela crackdown on protesters, with more people dead, is unacceptable, as the demonstrations against the Maduro Government continue to grow, urging activists more protests after dozens are arrested in street battles between Government forces and protesters, condemning also EU violence, approving U.S. more sanctions on Venezuelan officials guilty for human right violations, worsening economic crisis, declaring the White House Venezuela as a threat to the U.S. national security. ***Ninth World Trade Organization Conference in Bali – WTO confirms first global trade reform since its creation is ready for agreement by Ministers from the body’s 159 member countries, however WTO failing to reach a global deal to standardize custom rules, blocked by India’s demands for concessions on agricultural stockpiling. The World Trade Organization adopted finally the first worldwide trade reform in history on November 27, 2014, after years of stalemate, months of deadlock and a final day’s delay following an eleventh-hour objection, saying India that food security for its Million of poor had been safeguarded, confirming proponents that streamlining the flow of trade will add as much as $1 Trillion and 21 Million jobs to the world economy.*** Leaders of G20 agreed to boost global growth adding an extra 2,1% above current predictions by 2018, monitoring IMF and OECD the implementation of G20 measures, calling G20 for strong and effective action to address climate change with the aim of adopting a protocol (post Kyoto protocol) with legal force at an U.N. climate conference in Paris in 2015, announcing the U.S. and Japan contributions for a total of $4,5 Billion to the U.N. Green Climate Fund to help developing nations, assuming Turkey the rotating G20 chairmanship in 2015 and will include climate change in its G20 agenda, followed by China heading G20 in 2016, plummeting ties between West and Russia to a new low over the crisis In Ukraine, leaving Russian President Putin as the first leader summit, pledging leaders also to crack down on tax avoidance. German officials think, we need to prepare ourselves for a prolonged conflict in which Russia will use all its means at its disposal, returning into a sort of second Cold War. Argentina, in technical default it doesn’t accept, continuing its legal dispute with New York Judge Griesa and the holdouts, welcomed a G20 call to include in international sovereign bonds strengthened pari passu and collective action clauses aimed at making restructuring agreements binding on all bondholders. Climate change: UN climate talks in Lima reached a deal under which Governments commit to reducing its rate of greenhouse gas emissions, submitting national plans by an informal deadline of March 2015 to form the basis of a global agreement to be signed in Paris in December 2015, proposing the United States a 26-28% cut from 2005 levels by 2025, while the European Union is looking to reduce emissions by at least 40% from 1990 levels by 2030, announcing Japan to cut its greenhouse gas emissions by 26% by 2030 from 2005 levels, saying officials they would prefer to use 2013 as a baseline, which would imply a higher reduction target. The Paris summit aims to finalize a long-term agreement to limit global temperature rises to 2 degrees Celsius (3,6 Fahreinheit) above pre-industrial times, resolving G7 leaders to wean their energy-hungry economies off carbon fuels, marking a major step in the battle against global warming, reaching 195 nations a historic climate accord, committing to limit the global average temperature rise to below 2 degrees Celsius (3,6 degrees Fahrenheit) to pre-industrial levels, while aiming to meet the more ambitious target of below 1,5 degrees, the number called for by many small island states. The world has already warmed by almost 1C, which has cause major problems in dry developing countries, and the current promises on the table would rise temperature between 2,7 and 3,7 degrees Celsius. The targets outlined in the Paris agreement involving 195 countries will require $16,5 Trillion of spending on renewables and efficiency through 2030, according to the International Energy Agency/IEA. Record 175 countries signed the Paris Climate Agreement, the first universal action plan intended to mitigate the impact of climate change holding the  rise in global average temperature below 2 degrees Celsius, level compared to pre-industrial level. The Agreement will enter into force once 55 countries representing at least 55% of global emissions have formally joined it. The European Union, a top emitter, said the EU wants to be  in the ‘first wave’ of ratifying countries. China, the world’s top carbon emitter, announced it will do everything to ratify the Paris Agreement before the G20 summit in China in September 2016. The United States also confirmed it intends to join the Agreement still in 2016.
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‘ARAB SPRING’: Egypt: Unrest forced Egypt’s President Mubarak to step down, handing over power to the ‘Supreme Council of the Armed Forces’, becoming Muslim Brotherhood’s Mohammed Morsi the first democratically elected President in Egyptian history, approving Egypt a new Islam-backed constitution, however losing Morsi support among the population, granting Egypt court appeal for ex-President Mubarak ordering retrial, removing military Morsi replacing him with the head of the country’s Constitutional Court, Adly Mansour, who was sworn in as Egypt’s interim President, naming former Finance Minister Hazam Al Beblawi as PM, and opposition leader Mohammed El Baradei as Vice-President for Foreign Affairs, planning quick elections, pledging Saudi Arabia $5 Billion and UAE 3 Billion to Egypt, calling Morsi-backers for mass protests, ordering Egypt prosecutors arrest of Islamist leaders, freezing assets of Morsi backers, getting Morsi under investigation including murder, deepening struggle between Islamists and the new Government over Egypt’s political future, storming Egyptian forces protest camps of Morsi backers widening death toll surpassing 638, condemning President Obama violence saying the U.S. will cancel joint military exercises, getting arrested Mohamed Badie, spiritual and supreme leader of Muslim Brotherhood, charged with inciting violence, releasing court former President Mubarak from prison to be transferred to a military hospital, placed under house arrest, inflaming already highly volatile mood in Egypt further, surviving Egypt’s Interior Minister an assassination attempt, escalating crackdown on Morsi backers as Egypt court bans Muslim Brotherhood seizing its assets, seizing another high-ranking Brotherhood leader and adviser to Morsi, completing the jailing of Muslim Brotherhood’s top leaders, getting Morsi trial delayed as removed ex-President rejects Egypt’s court authority, ending Government Egypt post-Morsi state of emergency, opting more than 90% of voters to ratify Egypt’s third constitution, a redrafted version of Morsi’s Muslim Brotherhood constitution, endorsing military possible Presidential run of popular army chief Abdel-el-Sisi, who led ousting of Morsi. Egypt signed ‘anti-protest law’ restricting public protests, requiring Egyptians to seek permission to protest ahead of an event, making legal demonstrations almost impossible, declaring Muslim Brotherhood a terrorist group, arresting at least 23 supporters on suspicion of belonging to a terrorist organisation. Egypt Government resigned paving way for the army chief and Defense Minister el-Sisi to seek Presidency, counting the country on the financial aid of Gulf States, deeply suspicious of the Muslim Brotherhood, naming President Adly Mansour, appointed by the army and in office since Morsi’s removal, former Housing Minister and Mubarak political party member, Ibrahim Mahlab, as PM. An Egypt court sentenced 529 members of the outlawed Muslim Brotherhood and another 683 to death, rebuking the U.S. the decision of such mass trials. Former army chief al Sisi and former Parliamentarian leftist politician Hamdeen Sabahi are the only candidates for May’s 2014, gaining el Sisi 96,1% of legal votes and was declared Egypt’s next President. Egypt sentenced Mubarak to three years in jail, however dismissing Egyptian Court now all charges against former President Mubarak and his two sons, announcing Egypt prosecutor’s office it will appeal Mubarak acquittal, ordering Egypt´s High Court retrial in Mubarak case, opening the way for a release from jail for the former President. An Egyptian court has begun the retrial of former President Mubarak and his sons for alleged embezzlement charges and sentenced the trio to three years in jail, also fined $16 Million. Former President Muslim Brotherhood leader Morsi was sentenced to 20 years in prison, seeking Egyptian court death penalty, including 106 supporters, in connection with a 2011-mass jail break, while a final ruling is expected to be made on June 2, 2015. The Cairo Criminal Court confirmed Mursi’s death sentence, handing the death penalty also to the general guide of the Muslim Brotherhood, now banned as a terrorist organization, and four other Brotherhood leaders, as more than 90 others were sentenced to death in absentia, describing the Brotherhood rulings as ‘null and void’, calling for a popular uprising on June 19, 2015. President Sisi, a close ally to the U.S., said the judiciary is independent and made it clear that the death sentences are all preliminary, expressing the White House, the U.N. and the E.U. deep concerns about the politically motivated sentences. Egypt will hold long-awaited Parliamentary election starting on October 18-19, 2015, after three years without Parliament, when a court dissolved the democratically elected main chamber, dominated by the now-banned Muslim Brotherhood, planning a second round of voting in the two-phase election on November 22-23, 2015.***Tunisia: The assassination of leftwing opposition leader Brahmi, the second such killing this year, set off violent antigovernment protests in Tunisia, considered the birthplace of the ‘Arab Spring’, plunging the country and its Islamist-led Government under PM Larayedh again into crisis, which finally agreed to resign handing power to caretaker cabinet to prepare for elections to safeguard a democratic transition, preparing Tunisia to adopt the country’s new post-revolution constitution, signing it into law, one of the last steps to full democracy, winning anti-Islamist Essebsi Tunisia’s Presidential vote, enabling him to consolidate power with his main Secular Party, already controlling Parliament, saying he is open to Islamist coalition, approving Tunisia’s Parliament a unity Government led by Secular Party and including its Islamist rivals, seen as the country’s latest step in its transition to full democracy. Gunmen in military uniforms stormed Tunisian Bardo museum inside the heavily guarded Parliament compound, killing at least 21  people, among them 17 foreign tourists, considered the attack on such a high-profile target as a serious blow for the small ‘Arab Spring’ country that relies heavily on tourism, claiming Islamic State responsability for the Tunis attack, which is consistent with the group’s actions.***Sunni ruling family of Bahrain banned all protests.***Syria: The U.S. increased financial and economic sanctions against Syria followed by the EU, topping Syrian refugees in Turkey 100.000, becoming France the first Western country to recognize Syrian rebel coalition as legitimate leader of Syria, granting Turkey, followed by Britain and six Gulf nations recognition of the united Syrian opposition, expressing more than 100 countries and organizations their support for the anti-Assad movement, endorsing a newly formed insurgent coalition forming opposition Government, selecting Ahmed Assi Al-Dscharba as new President, sending the U.S. and Germany Patriot missiles and troops to Syrian border in Turkey, reaching Syrian estimated death at least 115.000, taking opposition Syria’s Arab League summit seat, citing U.S. use of poison gas/Sarin by Syria to provide military support to rebel fighters needing heavy weaponry, threatening Syria with retaliation after Israel’s airstrikes on Damascus targeting arms for Hezbollah, retaking Assad forces backed by Lebanese fighters from the militant group Hezbollah strategic border town Qusair, preparing to launch an assault on key rebel stronghold Aleppo, agreeing EU to lift arms embargo on Syria to support the opposition forces, vowing Russia to supply advanced antiaircraft missile systems to Assad regime amid a push for peace talks, pledging ‘Friends of Syria group’ meeting in Qatar necessary military support for rebels to end the ‘imbalance’ in Assad’s favor. The Pentagon is exploring actions against Syria designed to ‘deter and degrade’ Assad’s ability to launch chemical weapons, opposing Russia and China punitive military strike against Syria, saying NATO the use of chemical weapons in Syria ‘cannot go unanswered’, warning Iran that an attack on Syria would lead to retaliation on Israel, supporting France U.S. call for action, while Germany will not participate in Western strikes against Syria, voting British Parliament against military intervention in Syria, advancing U.S. war plans without key ally U.K., promising Kerry ‘limited and tailored response’, accusing that in Assad’s chemical attack 1429 people were killed, including 426 children, insisting President Obama the U.S. should take military action, but seeking approval of Congress first. Top-U.S. Republicans back Syria strike, opposing most U.S. public any Syria intervention, saying U.N. Secretary General Ban Ki-moon that use of force is only legal when it is in self-defense or with Security Council authorization, ending G20 in St. Petersburg with no consensus on Syria strike, backing EU ‘clear and strong’ response but wants U.N. report before any military action in Syria is taken. Russia backed a demand by U.S. Secretary of State Kerry, who suggested that Syria surrender its chemical munitions within a weak, calling Russian Foreign Minister Lavrov for international supervision of chemical stockpile, a proposal welcomed by Syria, providing a first indication that a diplomatic solution to the international standoff may be posible, moving crisis now to the United Nations to decide how to enforce the surrender and destruction of Syria’s chemical weapons arsenal, warning the U.S. and Western allies they would not allow Russia or Damascus to play for time, it has to be swift, it has to be real and it has to be verifiable, taking Syria steps to join the Convention on Chemical Weapons, the international treaty signed by most countries renouncing the use of chemical munitions, reaching U.S. and Russia Syria weapons agreement, committing Syria to provide a comprehensive list of its chemical weapons within a week, allowing international inspectors into the country by November 2013 and to destroy its stockpile of chemical weapons by mid-2014, remaining U.S. prepared to act if diplomacy fails, informing U.N. rockets filled with sarin gas killed a large number of civilians in Syria on August 21, 2013, saying Russia no proof Assad was behind chemical attack, accepting Syrian Government that civil war has reached stalemate with neither side having enough strength to win, planning to call for ceasefire at Geneva talks, confirming Syria it has some 1.000 tons of chemical weapons in its arsenal, returning U.N. inspectors to Syria. According to U.N. Security Council resolution Syria will have to destroy its chemical weapons production facilities by November 2013 and completely dismantle its arsenal of poison gases and nerve agents by mid-2014, confirming inspectors that Syria’s chemical weapons production facilities have been rendered ‘inoperable’ a day before November 1, 2013 deadline. Prospects for a Syria peace conference ending the two-and-a-half-year civil war are looking difficult, after key opposition leaders are insisting they would not take part if any regime members will participate, demanding that Assad’s departure was essential, saying defiant Assad he was ready to run for re-election in 2014, reporting news media that Assad’s regime tortured and executed more than 11.000 prisoners. U.N. announced that Syria Government and opposition representatives will meet on January 22, 2014 in Geneva to discuss peaceful transition, rescinding U.N. Iran’s invitation to Syrian peace conference, after the U.S. demanded to withdraw offer, drawing protest from Russia, Syria’s main backer, as Syrian opposition threatened to pull out, ending the first and second round of Geneva peace talks with no progress to stop civil war, that has left more than 191.000 people dead, saying U.N. mediator Assad-Government refuses to discuss transition of power. The U.S. and UK suspended nonlethal aid to Syrian opposition, concluding that some of it had fallen into the hands of extremist Islamic fighters after seizing Western-backed rebel weapons warehouses. Led by Saudi Arabia, tired of waiting for the United States to lead on Syria, countries intend to strengthen support for Syrian rebels. Syria announced Presidential election for June 03, 2014, defying al-Assad, whose term ends on July 27, 2014, opposition, expecting to run and win another seven-year term in office, extending his grip on power, calling opposition Presidential poll a ‘parody of democracy, declaring Syria al-Assad as victor and re-elected President in civil war election, securing 88,7% of the votes restricted to the parts of Syria under the control of his forces. Russia’s PM Medvedev said his country is in a new Cold War with the U.S. and its allies, even as Russia, Europe and the U.S. are suggesting they are seeking cooperation to end Syria’s civil war, resolve the armed stand-off in eastern Ukraine and make progress toward lifting European economic sanctions against Russia. ***Protesters in Jordan denounced King Abdullah II, demanding swift reforms or an end of the monarchy.***Saudi ArabiaSaudi king Abdullah bin Abdul Aziz Al Saud announced $36 Billion worth of social benefits increasing spending further including $67 Billion on housing to maintain order in the oil-rich kingdom, where demonstrations are strictly prohibited by law, demanding influential Saudi intellectuals far-reaching political and social reforms moving toward a constitutional monarchy, challenging Saudi clerics reforms proposed by the king, allowing the monarch for the first time women to vote.***Popular uprising in Libya turned into an armed conflict overthrowing Qaddafi’s regime taking over power a National Transitional Council/NTC organized by the opposition, proclaiming after Qaddafi’s death formally the country’s liberation, voting Libyans in first free elections in decades claiming Liberal Party lead. Libyan Parliament approved new cabinet of 29 Ministers of Prime Minister Ali Seidan, granting Oman asylum to Qaddafi family. ***President Obama announced to support the ‘Arab Spring’, helping democracy movements in the Middle East and North Africa, promising $2 Billion in loan guarantees and debt forgiveness for Egypt and measures to stabilize Tunisia’s economy, signaling he wants to move forward with peace negotiations between Israel and Palestinians mentioning two sovereign States with secure borders in a possible deal based on 1967 borders rejected by Israel, submitting Palestinian Authority formally application for Palestinian statehood to Ban Ki-moon, the U.N. General Secretary, changing U.N. Assembly Palestine’s ‘entitity’ status to ‘non-member state’, recognising implicitly its sovereignty. U.S. Secretary of State Kerry is optimistic saying July 2013 goal is peace deal between Israelis and Palestinians within 9 months, however suspending Israel peace talks in response to a reconciliation deal between rival Palestinians groups Fatah and Hamas, agreeing to form a unity Government, signaling Palestinian President Abbas that he remains committed to troubled U.S. backed peace talks, saying the unity Government agreed with militant Hamas group, considered by Israel and the United States as a ‘terrorist’ group, would recognize Israel. During his three-day trip to the Middle East Pope Francis  invited Israeli and Palestinian leaders to the Vatican for peace talks, which collapsed just one month ago, accepting both the invitation for next month. Israel launched an offensive on July 8, 2014, to halt missile salvoes out of the Gaza Strip by Hamas, the dominant group in the coastal territory, claiming fighting already more than 1.500 lives. Sweden officially recognized the State of Palestine, hoping its Government it ‘will show the way for others’. The Hague-based International Criminal Court/ICC will open a preliminary investigation into possible war crimes in Palestinian territories, becoming the Palestinians formally member of the ICC on April 1, 2015, saying court the jurisdiction would date back to June 13, 2014, heightening tensions with Israel, afraid of indictments against officials. Israel’s PM Netanyahu retreated from his pre-election stance ruling out an independent Palestinian State, reopening again door to Palestinian State, apparently aimed at calming U.S. criticism triggered by his comments. Vatican to recognize Palestinian State, referring informally to the nation as Palestinian State in a new treaty of a bilateral commission between the Vatican and Palestine authorities. *** In an unprecedented decision Saudia Arabia declined to take rotating seat on U.N. Security Council, accusing it of double standards and reflecting its annoyance with the Security Council’s record on Syria and the Palestinian-Israeli conflict.
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EU/€URO-ZONE/EUROPEAN DEBT CRISIS: ECB – exchange reference rates 09/29/16 –
1,-€uro/€ = US Dollar/USD  +1,1221, Pound sterling/GBP -0,86138, Swiss Franc/CHF -1,0876, Japanese Yen/JPY +113,88 and Chinese Yuan Renminbi/CNY +7,4820. The Euro declined since March 2014 nearly 10% against the Dollar and 5% against a basket of major currencies, favoring companies with revenues outside of Europe, helping the devaluation Euro-zone exporters, signaling especially France and Italy the importance of a more competitive Euro to the future of the European economy, producing the ‘Brexit’ a new weakness of the bloc’s currency. The U.S. Dollar gained 10,5% in 2015 versus the currencies of the United States’ main trading partners. Sanctions imposed by the U.S. and Europe against Russia will hurt European economies, dropping European stocks and hitting Russian import ban European producers, extending the European Union in December 2015 sanctions on Russia for another six months.***German Chancellor Merkel, facing pressure from her conservative supporters as much as from opponents, called Europe vulnerable and the fate of the Euro ‘directly linked’ to resolving the migration crisis, continuing Berlin and Brussels to ask for more distribution across Europe. But Germany is counting on little help, as leaders of EU co-founder France fear an anti-immigrant National Front and the third largest EU economy Britain is consumed with its own debate on whether just to quit the European Union alltogether. Growing global economic woes could set Millions on the road to Europe, which could face a wave of migration that may eclipse today’s refugee crisis. The EU is intending to convince Britain with a compromise reform package to accept a deal in a bid to prevent a ‘BREXIT’, saying PM Cameron he’ll hold the long-pledged referendum on the UK’s membership in the European Union on June 23, 2016, recommending to remain in a reformed EU. British voted to leave EU, tumbling world stocks, having Britain two years to renegotiate its relationship with the EU, saying EU President Tusk on behalf of the 27 leaders of the remaining EU countries: We are determined to keep our unity of 27. Scotland and Northern Ireland voted overwhelmingly for remaining in the EU, resurfacing talk of Scottish and Northern Irish independence. EU leaders are not in a forgiving mood after the British vote to leave and may refuse to give the UK a favorable deal as a warning to other countries thinking about exiting the EU. For Britain, afraid of a deeper EU integration affecting the issue of sovereignty, and seeking more independence, the process of leaving the EU could be highly disruptive leading to short-term economic pain and may cause Britain to become marginalized. For the EU the ‘Brexit’ could represent a new impulse to become more integrated, emerging ultimately stronger and more prosperous, calling German politicians for improvements to the EU’s processes to speed up decision making and boost its appeal among citizens. Resigning British PM Cameron will be succeeded by Theresa May on Wednesday 20 of July 2016, who became the new leader of The Conservative Party and will lead Britain’s negotiations to exit the European Union. British PM May will not hold a parliamentary vote on ‘Brexit’ before formally triggering Britain’s withdrawal from the European Union, as a majority of the 650 lawmakers had declared themselves ‘remainders’. According to opponents elected lawmakers should review the vote before the process is started since the EU-referendum is not legally binding***Euro-skeptic and populist parties scored dramatic gains in voting for the European Parliament 2014, however continuing the mainstream parties to control more than half of the 751 seats, but facing from now on unprecedented challenges from noisy anti-establishment members determined to stop business as usual, warning analysts of increasing political risks in Europe in 2015. The pro-Europeans, the Group of the European People’s Party/EPP (Christian Democrats) winning 213 seats in the new Parliament, the Group of the Progressive Alliance of Socialists and Democrats/S&D gaining 191 seats and the Alliance of Liberals and Democrats for Europe/ALDE with 64 seats, will be forced to collaborate in order to get key legislation through the Parliament and into law, still making any new treaty on deeper €uro-zone integration more difficult, obtaining the Greens/European Free Alliance-Greens/EFA 52 seats, the European Conservatives and Reformists/ECR 46 seats, the European United Left/Nordic Green Left-GUE/NGL 42 seats and the Europe of Freedom and Democracy Group/EFD 38 seats, posing politics rather than economics the biggest risk to the long-term strengthening of the €uro. Former Luxembourg Prime Minister Jean-Claude Juncker, the candidate of the EPP, winning the European Parliament elections, and frontrunner as the next President of the European Commission, faced a strong opposition of British PM Cameron, demanding a more reform-oriented leader, saying Juncker the crisis is not yet over and budget policy must remain as it is, nominating EU leaders Juncker as new EU Commission President, confirmed with a comfortable majority by the European Parliament. Poland’s centre-right Prime Minister Donald Tusk will become President of the European Council, replacing Belgian Herman Van Rompuy, while Italy’s Foreign Minister Federica Mogherini will replace UK’s Catherine Ashton as EU’s new High Representative of Foreign Affairs and Security Policy. EU leaders signaled a further shift from austerity of the €uro-crisis giving member States extra time to consolidate their budgets as long as they pressed ahead with economic reforms, pushing the incoming European Commission President Juncker an investment program of about Euro 300 Billion to revive the European economy, agreeing EU leaders to create a strategic investment fund that could generate up to 315 Billion Euros in private- and public -sector money to upgrade infrastructure, jumpstart the EU’s sluggish economies and ignite growth, confirming EU Finance Ministers details of the 315 Billion Euros four-year investment plan, including an eight-member committee that will choose projects. China will pledge a multi-Billion Dollar investment in the new infrastructure fund at a summit on June 29, 2015 in Brussels, considering the fund is going to create opportunities for China to invest in the EU, in particular in infrastructure and innovation sectors. France, Germany, Italy and Poland have each announced they plan to contribute 8 Billion Euros, while Spain and Luxembourg are pledging smaller amounts. The bloc is relying mainly on private investors and development banks to fund projects from an initial list of almost 2000 submitted by the 28 member States, from airports to flood defenses, that are together worth 1,3 Trillion Euros. In addition the EU Commission is exploring whether the EU could become collectively a member of the $100 Billion China-led Asian Infrastructure Investment Bank/AIIB, Beijing, expecting China that European companies and Governments would take a greater interest in President Xi Jinping’s ‘One Belt, One Road’ initiative, aiming to create a modern Silk Road Economic Belt with railways, highways, oil and gas pipelines, power grids, Internet networks, maritime and other infrastructure links across Central, West and South Asia to as far as Greece. EU job talks in Milan were overshadowed by budget divisions, pressing France and Italy for an easing of budget restrictions to stimulate growth and cut unemployment, insisting Germany on budget discipline (EU’s 3% ceiling), saying countries must move faster with structural reforms, wanting ECB and IMF that countries use Government money prudently to avoid the Euro-zone slipping into its third recession since 2008, increasing pressure on governments that have fiscal spaces like Germany, Europe’s biggest economy, which posted its largest budget surplus since reunification in the first half of 2014, defending Berlin its drive for balanced budget and the rejection of stimulus. Paris expressed its desire for reform recommendations and a ‘NEW DEAL’ in Europe, expecting movements from Berlin. German Chancellor Merkel insisted that all member States must fully respect the reinforced rules of the Stability and Growth Pact, reminding the Euro-zone debt crisis has not yet been overcome and its causes have not been eliminated. EU leaders postponed a deeper discussion of the future of the Economic and Monetary Union/EMU until December 2015 because of no reform consensus between Germany and France and because of the more pressing migration issue, planning the European Commission to give more budget leeway to States that can prove to have suffered extraordinary costs to face the refugee crisis. ***The IMF offered a new more flexible Precautionary and Liquidity Line/PLL as insurance for nations, giving countries with relatively good economic policies access to credit for six months, boosting its own bailout fund of actually $380 Billion to be able to address global financing needs over the next two years, totaling new commitments from 37 nations $456 Billion in additional emergency lending capacity, refusing the U.S. and Canada to take part. As of August 2012 the IMF had program arrangements with 10 countries in Europe totaling about €124,06 Billion.***Moving EU closer to a fiscal union the new German-led EU fiscal pact to fix the root causes of €uro-zone’s debt crisis, includes automatic sanctions for countries with budget deficits above 3% of GDP, reducing new debt to 0,5% of GDP and committing each nation to adopt in its constitution a ‘debt brake’ preventing it from running persistently budget deficits. With the exception of Britain and the Czech Republic, 25 of the formerly 27 EU member States signed the new European fiscal compact with balanced budget rules in national legislation. ***EU lawmakers backed new powers for the EU Commission to check Euro-zone countries’ draft budgets to verify if they are in line with EU rules, asking for changes if they are not, to prevent another sovereign debt crisis.***Croatia voted to become the 28th member of the European bloc on July 1, 2013, while Latvia satisfied EU requirements and is the 18th nation to adopt the €uro, using the single currency as from January 1, 2014, while Turkey’s EU membership bid remains pending, giving ECB green light for Lithuania to join the €uro-zone as its 19th member on January 1, 2015.***EU Commission chief Barroso signaled that EU’s focus on austerity has hit the limits of public acceptance, mentioning Governments could be given more leeway if they were struggling to get their budget deficits within the required ceiling of 3% of GDP, obtaining 7 countries additional time to comply with fiscal adjustments, shifting EU priority on structural reforms to boost growth.***European leaders flexibilized access to €uro-zone rescue funds, signaling a step towards a banking union, enabling €uro-zone rescue funds to directly recapitalize banks without the money going via Governments and adding to national debt levels once a single banking supervisory mechanism overseen by the ECB has been set up, breaking progressively the vicious link between sovereigns and banks, waiving the so-called preferred status for the bailout fund on the €100 Billion rescue of Spanish banks over private claims, obtaining Italy a commitment that the rescue fund will, if called by Rome, purchase limited amounts of Government debt on open markets, provided the country sticks to its current reform program, approving also a growth package worth €120 Billion, including redirecting €55 Billion to €80 Billion of EU funds for job creation, promoting a €10 Billion capital increase of EIB to provide additional €60 Billion in loans and creating €5 Billion in project bonds for infrastructure. Finland has insisted on collateral from both Greece and Spain in exchange for rescue loans and considers to block the decision which allows the rescue funds to purchase Government bonds in the open market, fearing making access to rescue funds more and more easy will reduce efforts of crisis Nations to attend necessary reforms and increasing bailouts may produce soon a shortfall between demand and available resources. ***EU leaders agreed on historic budget deal, cutting the ‘payment ceiling’ for the next seven-year budget from €942,8 Billion to €908,4 Billion, meeting British PM Cameron’s austerity demand asking for a limit of €900 Billion, and reducing the higher ‘commitment ceiling’ from €993,6 Billion for the last budget from 2007-2013 to €960 Billion for the budget 2014-2020, reaching EU Governments and the European Parliament a political agreement on the European Union’s spending plan. EU Finance Ministers agreed on a €135,5 Billion budget for 2014, 6,5% less than in 2013.***After meeting with President Hollande, Mrs. Merkel eased her push for a Federalist Union in favor of an Inter-Governmental approach to integration that France has long supported, saying that she sees no need in the next few years to give up more powers to the Commission in Brussels. Dutch Finance Minister Jeroen Dysselbloem was elected to replace resigning Luxembourg Premier Jean-Claude Juncker and reconfirmed for a new term as €uro-Group chief. Dutch Maarten Verwey is heading the new Structural Reform Support Service/SRSS, which will assist also the Greek Government to implement the reforms agreed with the €uro-Group. ***Finance Ministers of the formerly 27 EU-States approved the introduction of the new financial transaction tax in the 11 nations which are backing it, among them Austria, France, Germany, Italy, Portugal and Spain, as efforts failed to implement the tax EU-wide, blocked by Britain fearing it would drive financial businesses out of London and opposed by Sweden, planning EU 11-nation financial transaction tax from 2014, suggesting a rate of 0,1% for trading stocks and bonds and of 0,01% for derivatives, confirming the European Union that the proposed tax starting 2014 complies with EU and international laws. However due to a strong opposition of financial institutions EU is set to weaken transaction tax, evantually reducing expected proceeds considerably, pledging France and Germany to approve first measures to introduce the new tax in 11 nations before the European elections on May 25, 2014.***The EU agreed to initiate a pilot program on European project bonds 2012/13, making a cooperation between private stake holders and the European Investment Bank/EIB , EU and the member States on infrastructure projects easier, setting the EU aside €230 Million in guarantees to attract a total of €4,6 Billion of investment. ***Re-elected British PM Cameron promised citizens a vote before the end of 2017 whether to exit the EU, calling for a full EU treaty renegotiation, warning Goldman Sachs European banks would leave London ‘in very short orden’ if Britain voted to exit EU. President Obama warned Cameron of risks if Britain exits EU, saying he should fix the country’s relationship with the bloc before taking any steps to leave, warning Standard & Poor’s that Britain’s top credit rating is at risk because of the European Union referendum, lowering the rating agency outlook on the country’s AAA rating to negative from stable. Nigel Farage’s Eurosceptic UK Independence Party/UKIP, which advocates immediate withdrawal, defeated in European Parliament vote 2014 the opposition Labour Party and PM Cameron’s Conservatives. ***Greece began its EU Presidency for six months, declaring that the imposition of austerity, spending cuts and fiscal policy by Berlin and Brussels could no longer be tolerated, considering most EU leaders that the worst of the crisis is over, ending the pressure to take tough measures, seeing a new wave of Euro-scepticism, saying they are sufficiently unpopular already, fearing a surge for extreme-left, -right and anti-EU parties in the European Parliament elections in May 2014.***E.U. and the U.S. began to negotiate a trade agreement, hoping it can be finalized in about two years, expecting U.S. Senators to open up Europe to American farm products, clearing France the E.U. to launch the ambitious but delicate free-trade talks, after E.U. members accepted to exclude for the time being cultural industries, sealing E.U. y Canada a trade pact, paving way for Europe for an even bigger deal with the United States, however hurting NSA related spy claims trade talks, urging German Chancellor Merkel European nations to speed up negotiations for a Transatlantic Trade and Investment Partnership/TTIP with the U.S.. China and the EU are beginning to work on a ‘roadmap’ for bilateral cooperation until 2020, ranging from aerospace and counter-piracy to urbanization and energy, discussing also the feasibility of a free-trade agreement, working towards the goal of increasing China-Europe trade to $1 Trillion by 2020.***EU cleared for talks with tax havens to fight against tax evasion.***Standard& Poor’s, Moody’s and Fitch downgraded France from AAA to AA+, losing also Austria its AAA rating, cutting further ratings of Italy, Spain, Portugal, Cyprus, Malta, Slovakia and Slovenia, keeping Germany, Finland, Netherlands and Luxembourg their AAA rating, downgrading Fitch and Moody’s more Euro-nations and European financial institutions, lowering Moody’s outlook for Germany, six German States and 17 German State-backed regional banks, Luxembourg and Netherlands from stable to negative, cutting triple-A rating of €uro rescue fund by one notch to ‘AA1’, downgrading Moody’s Slovenia further into junk territory. Standard & Poor’s downgraded Finland from AAA to AA+, leaving the rating agency only Germany and Luxembourg with the AAA rating in the Euro-zone, maintaining Moody’s and Fitch still the AAA rating for Finland, but lowering both outlook from stable to negative, meaning the country could be downgraded in the near future by the two rating agencies, downgrading Moody’s after Fitch Finland, losing its last top credit rating, cutting the country’s debt rating to Aa1 from Aaa, expecting a weak growth over the coming years as well as the deterioration in its fiscal position.***According to European Banking Authority/ EBA stress test systemically relevant European banks need additional capital of €115 Billion and EU lenders will have to comply gradually with the Basel III requirements, allowing Governments to introduce stricter capitalization rules to improve protection against a new financial crisis. EBA will determine guidelines for the planned ECB asset quality review and the subsequent stress test once a new law setting up the ECB as banking supervisor is adopted, delaying the bloc’s next round of stress test until 2014. EU lawmakers approved the creation of a single banking framework for the €uro-zone allowing ECB the supervision of around 6.000 banks in the 18 countries of the monetary union, agreeing to hand the ECB from November 2014 direct oversight of €uro-zone’s at least 130 largest banks, all major cross-border lenders and State aided institutions, with assets of more than €30 Billion or representing more than a fifth of a State’s national output, enabling also ECB to intervene with smaller lenders and borrowers at the first sign of troubles. Europe decided how to share the cost of bank collapses, stipulating the plan that shareholders, bondholders and depositors with more than €100.000 should share the burden of saving a bank, after taxpayers across much of Europe had to pay for a series of deeply unpopular bank rescues. The EU took the final step to complete a banking-union with the creation of an agency to wind down or revamp failing €uro-zone banks, but there will be no joint Government back-up to pay the costs of closures. The accord means that the ECB has the means to shut banks it decides are too weak to survive. There will be established a common backstop, raising banks themselves via a levy a war chest of up to €55 Billion over eight years, leaving the new authority largely dependent an national rescue schemes in the meantime, conceding Germany that the ESM €500 Billion bailout fund could be used as a last resort for rescuing failed banks if Governments did not have enough money, injecting up to a total of €60 Billion into troubled lenders. The new ECB bank supervisory board will be headed by French Central Banker Daniele Nouy, Secretary of the French Prudential Supervisory Authority, warning the €uro-zone’s new super-regulator that some of the region’s weakest lenders have no future and should be allowed to die. The ECB promised to put €uro-zone banks through a rigorous stress test before assuming its supervisory role in November 4, 2014 and will public the results of the so-called asset quality review/AQR including 130 banks on October 26, 2014. Of the 130 European banks checked 25 failed the stress test showing a total of Euro 25 Billion in shortfalls in their capital, having 12 banks already raised Euro 15 Billion, enough to make up their shortfalls, leaving still 13 banks needing Euro 10 Billion of new money. Alongside Italy, facing initially the biggest challenge with 9 of its banks falling short, having Monte dei Paschi di Siena the largest capital hole to fill at Euro 2,11 Billion, and other three Italian banks still needing to raise funds, there are also banks from Greece (2), Ireland (1), Austria (1), Cyprus (1), Slovenia (2) and Portugal (1), Belgium (1), which have to make repairs. Analysts say that 36 firms would have failed if new capital rules were fully applied, lagging the Euro-zone behind countries outside the bloc in implementing the Basel III capital rules that are due to come into force in 2019. ECB, which became supervisor in November 2014, announced it will include in its EU stress test 2016 the most relevant 50 to 60 top Euro-zone lenders, after 130 Euro-zone banks were tested in 2014. Italy is in talks with the EU to study a plan to recapitalize Italian lenders with public money limiting losses for bank investors, before the stress test, a move which could help Italian lenders at risk of failing the last round of European stress tests, for which results are due on July 29, 2016. Italy has to address €360 Billion of bad debt weighing on its banks, signaling markets again serious problems at the country’s number-three lender and the world’s oldest bank, Banca Monte dei Paschi di Siena. ECB supervisor confirmed that properly regulated and controlled State support for banks in the Euro-zone can be justified though the intervention needs to be used sparingly. According to the EU wide stress test 2016 of 51 banks covering around 70% of banking assets across the European Union the EU banking sector has significantly shored up its capital base in recent years and made headway in fixing their balance sheets, being better equipped to handle stress than two years ago; the stress test will inform supervisors’ ongoing review of banks and guide their efforts to maintain capital in the system and support the ongoing repair of balance sheets, providing the test exceptional transparency to foster market discipline. Italy’s Monte dei Paschi (BMPS.MI), Austria’s Raiffeisen (RBIV.VI), Spain’s Banco Popular (POP.MC) and two of Ireland’s main banks came out with the worst results. Raiffeisen said it was aware of its capital situation and that it was implementing for some time appropriate measures to strengthen its capital basis, while Banco Popular clarified that the EBA tests had not included the 2,5 Billion Euro-share issue it completed in May 2016 to clean up toxic retail assets. Italy’s largest lender, UniCredit (CRDI.MI) was also among those banks which fared badly, and it said it will work with European Central Bank supervisors to assess what it needed to do after the stress test. Germany’s biggest banks, Deutsche Bank (DBKGn.DE) and Commerzbank (CBKG.DE) were also among the 12 banks with the weakest reading, along with British rival Barclays (BARC.L), showing that Deutsche Bank still has far to go in a revamp it launched in 2015, and saying Commerzbank’s chief risk officer the bank is robust and stress resistant. Monte Dei Paschi confirmed that it had finalized a plan to sell of its entire portfolio of  non-performing loans and had assembled a consortium of banks to back a € 5 Billion capital increase. Of the banks tested 37 are based in the Euro-zone and supervised by the ECB, which said the results reflected progress in repairing balance sheets. The €uro-group head warned about the size of the fines being imposed on European banks by U.S. authorities, calling them as ‘much to high’ for EU banks, after U.S. authorities sanctioned BNP Paribas over alleged violations with $8,9 Billion, which will almost wipe out BNP’s entire 2013 pretax income of about €8,2 Billion.***U.S. Treasury declined to label China as ‘currency manipulator’, while the Fed’s QE1/2/3/4 measures are also criticized for aiming to weaken the Dollar, rising global currency tension, saying Japan’s new PM Abe the country must defend itself against attempts of other Governments to devalue their currencies by ensuring the yen weaken as well, recommending G7 and G20 faster moves toward more market-determined exchange rate systems and exchange rate flexibility to reflect underlying fundamentals, avoiding currency manipulation, calling France for a weaker €uro to help French exports, considering the €uro trading around 1,35 as too strong, hurting also peripheral €uro-zone nations such as Spain and Italy.***EU urged Spain and Italy to redraft their tax and spending plans on risk breaching €uro-zone debt rules in 2014. Ireland became after Greece the second €uro-nation to apply formally for EU/ ECB/ IMF help and the first to use the EFSF, obtaining an emergency aid package of €85 Billion to support state finances/€50 Billion and stabilize banks/ €35 Billion. Ireland’s budget deficit fell to 7,2% in 2013 and further to 4,1% of GDP in 2014, projected to decline to 2,8% in 2015, reaching public debt 123,7% of GDP, easing to 109,7% of GDP in 2014, expected drop slightly to 107,1% in 2015, expanding its economy by 0,3% in 2013 and 4,8% in 2014, targeting the country a growth of 3,6% in 2015, extending EU loan maturities by 7 years, leaving Ireland the bailout program run by Europe and the IMF on December 15, 2013. ***Spain’s unemployment rate stood at 25,1% in May 2014, shrinking its GDP by 1,2% in 2013, expanding the country’s economy by 1,4% in 2014, increasing growth forecast for 2015 to 2,8% and for 2016 to 2,5%, upgrading Fitch the country’s credit rating, growing the country’s economy by 0,9% in the 1stQ. 2015 and by 1% in the 2ndQ. 2015. Spain had announced plans to sell a 30% stake in the national lottery, privatize partially airports in Madrid and Barcelona and for a partial State-takeover to recapitalize its troubled savings banks, requesting €uro-zone help to bailout its ailing banks, agreeing €uro-zone Finance Ministers to provide up to €100 Billion, authorizing the EFSF to buy Spanish debt in the primary or secondary market with unused funds of the banking aid program. The Spanish Government requested finally only €37 Billion for its struggling banks, adding €2,5 Billion for its planned ‘bad bank’ , approving EU Commission payment of €39,5 Billion. Spain wanted to avoid a formal sovereign aid program, seeking to break the link between sovereigns and banks, and will receive EFSF/ESM money for the recapitalization of banks through its Fund for Orderly Bank Restructuring/ FROB, confirming Spanish Government to impose heavy losses on investors of nationalized banks. Spanish budget deficit rose to 10,6% of GDP in 2012, declining to 7,1% in 2013 and further to 5,8% of GDP in 2014, targeting the Government a reduction to 4,5% in 2015, needing two extra years until 2016 to meet EU’s public deficit limit of 3%. After approving austerity measures worth €16,5 Billion, a tough austerity budget to produce savings of €27 Billion and further spending cuts of  €10 Billion, reforming education- and healthcare systems, Spanish Government announced a fourth austerity package worth €65 Billion over two and a half years, including sales tax increase from 18% to 21%, rising drastic savings measures until 2014 further to €102 Billion, unveiling budget proposal 2013 with a new severe round of spending cuts of €40 Billion. Spanish public debt reached 93,9% of GDP in 2013 and rose to 97,7% of GDP in 2014, projecting the Government a further increase to 100,4% in 2015, saying ratio may peak at around 101% in 2016. Spain’s economy shows alarming deflation signs, dropping prices in March 2014 to -0,2% from 0,1% the previous month. Spain’s PM Rajoy rejected corruption claims and calls to resign, announcing after Ireland also Spain it would leave bailout money program.***EU/ IMF/ECB approved a bailout package worth €78 Billion for Portugal, agreeing the nation on a wide-ranging privatization program of €5,3 Billion and tax increases. Portugal’s budget deficit reached 4,9% of GDP in 2013, dropping to 4,5% of GDP in 2014, declining to 3% in 2015, projected to rise to 3,4% in 2016 and to 3,5% of GDP in 2017, expanding its GDP by 1,7% in 2015, decline to 3,1% in 2015, growing its public debt-to-GDP ratio to 130,2% in 2014, decreasing to 128,2% in 2015, expected to reach 128,5% in 2016, declining slightly to 127,2% in 2017, signaling the €uro-group more flexibility in the terms of its bailout memorandum, extending fiscal adjustment period and the application of the EU deficit limit of 3% of GDP one year until 2015, lengthening loan maturities by 7 years. Portugal returned to capital markets swapping successfully short for longer-dated debt, growing its economy again, confirming that it would exit EU/IMF bailout program on May 17, 2014, .***Italy with a public debt exceeding € 2 Trillion, standing at 132,1% of GDP in 2014, expected to reach 133,1% of GDP in 2015, before declining to 131,9% of GDP in 2016, the world third largest after the U.S. and Japan and €uro-zone’s third largest economy, facing another year of recession, contracting its economy in 2013 by 1,9% and in 2014 by 0,4%, after stagnating in the 4thQ. 2014, extending its record-length recession, growing GDP by 0,3% in the 1stQ. 2015, slowing to 0,2% in the 2ndQ. 2015, reaching jobless rate 12,6% and youth unemployment 43%, approved emergency austerity measures worth some €100 Billion, predicting the EU Commission that Italy’s economy will show a weak growth of 0,6% in 2015, rising to 1,3% in 2016. The Italian Government approved an emergency budget containing tax rises and spending cuts totaling €30 Billion and €80 Billion in growth measures, including the sale of Government property, issuing preferential bonds for infrastructure projects, reforming labor market, confirming new cuts to save €26 Billion over three years, delaying  new sales tax increase until after the first half of 2013. 87-year-old President Napolitano, re-elected by Italian lawmakers for a second term, nominated centre-left party/PD deputy leader moderate Enrico Letta as Prime Minister, who formed a Government uniting left and right ending political stalemate, becoming rising 5-Star movement of comic Grillo the largest opposition party. EU will end a so-called excessive deficit procedure on Italy’s public spending imposed in 2009, warning that the country can’t relax fiscal discipline and has to put its economic house in order, cutting Standard & Poor’s again Italy’s rating, saying the country’s economic prospects are getting weaker. Italy’s top court confirmed prison sentence of former PM Berlusconi and ordered an appeals court to review length of ban from public office, which banned Berlusconi from holding public office for two years, breaking up Italian Government after centre-right leader Berlusconi announced to pull out his 5 ministers, calling for fresh elections. Berlusconi backed down on threat to topple Government saying to support ruling coalition after being confronted with a rebellion in his own party, winning Letta a Senate confidence vote, leaving Berlusconi, afraid to lose his Senate mandate, greatly weakend. Berlusconi’s centre-right PdL party split into the rebranded ‘Forza Italia’, Berlusconi’s original political movement, breaking away from Italian Government, and the new ‘Nuovo Centrodestra’ formed after defection of a group led by Interior Minister Alfano, which defied Berlusconi remaining in Letta’s coalition Government, ensuring enough support in Parliament for Letta. As expected Italian Senate approved expulsion of four-time PM Berlusconi from Parliament due to tax fraud conviction, given for his year sentence community service, winning PM Letta vote on his 2014-budget, reinforcing his coalition Government, voting Berlusconi’s Forza Italia against the so-called ‘Stability Law’. Florence mayor Matteo Renzi, putting distance from the old-style left, became the new leader of Letta’s centre-left Democratic Party, the largest bloc in Italy’s fragile ruling coalition, voting the party in favor of urgently needed reforms, prompting Letta’s resignation accepted by President Napolitano, asking Renzi to form a new Government in an election free process. Renzi was sworn in and confirmed as PM by Italian Senate, promising to enact electoral and economic reforms to get the country out of financial difficulties, announcing a sweeping fiscal reform, reducing income tax by a total of €10 Billion annually for 10 Million low and middle income workers from May 01, 2014, saying they would help economc recovery without breaking EU budget limits, targeting a budget deficit of 2,9% of GDP in 2014, down from 3% in 2013. Standard & Poor’s downgraded Italy’s long-term credit rating due to economic weakness from BBB to BBB-, just one level above junk, with a stable outlook, expecting a growth of only 0,2% in 2015, measure seen as a blow to PM Renzi. Italy´s 89-year-old President Napolitano resigned January 14th, 2015, giving the country two weeks time to find a successor, posing new risks for PM Renzi, whose candidate is constitutional court judge and one-time Christian Democratic Minister Sergio Mattarella, with a reputation for integrity, who was elected in a fourth vote by Italian Parliament as new President, considered as a victory for PM Renzi.***Cyprus became the 5th EU member to request bailout mainly for its struggling banks, confirming the IMF a three-year loan of €1 Billion and providing €uro-zone partners €9 Billion, including the unprecedented bailout deal a contribution to the cost of rescue of €5,8 Billion from depositors in Cyprus banks, rejected by the country’s Parliament. EU officials reached a last-minute agreement committing Cyprus to overhaul its financial institutions and to merge its two largest banks, the Bank of Cyprus and the insolvent Laika Bank, using deposits over €100.000 in both banks, which are not guaranteed by the State under EU law to resolve Laiki’s debts and recapitalize the Bank of Cyprus through a deposit/equity conversion, meaning a one-time contribution of 37,5% will be charged on deposits over €100.000 and senior bondholders in Laiki Bank would be wiped out and those in Bank of Cyprus would have to make a contribution to collect the total of €5,8 Billion. Losses could grow another 22,5%, up to 60%, if experts determine that Bank of Cyprus needs further capitalisation.***The latest EU-China summit ended with the promise that China will continue to support Europe, its largest trading partner, but criticized the bloc for keeping arms embargo and its reluctance to recognize China’s full market economy status.***Relying debt crisis nation’s financial institutions increasingly on the exceptional support of the ECB, including probably weaker banks exposed to be winded down, its President Mario Draghi eased collateral requirements further providing even unlimited three-years funds, taking Euro zone lenders in three-year loans at ECB’s key rate of 1% € 489,19 Billion in December 2011 and another €529,5 Billion in February 2012, meaning the long-term refinancing operation/ LTRO totaling more than €1 Trillion also a rescue package for debt crisis nations, guarantying ECB unlimited liquidity provisions to banks as long as needed, at least until July 9, 2013. Seen as a small sign that debt crisis is easing, nearly 300 banks will repay earlier as expected about €137 Billion of cheap three-year funds. The ECB spend €208,7 Billion in its Securities Markets Program/ SMP, purchasing on the secondary market sovereign debt from Greece/€30,8 Billion, Ireland/€13,6 Billion, Portugal/€21,6 Billion, Italy/€99 Billion and Spain/43,7 Billion, remaining reluctant to be lender of last resort to Governments. After rising borrowing costs for Spain and Italy to record highs, ECB chief Draghi announced that the central bank is ready to renew the Government-bond-purchase program, conditioned that a country first asks to use the European bailout fund agreeing to certain conditions, setting no limits on the amounts of bonds to be bought with remaining maturities of one to three years on the secondary market until interest rates fall to a reasonable level, seeking the involvement of IMF to help set conditions for individual countries, treating the ECB itself not as a preferred creditor as to not drive other buyers away. Anticipating a critical hearing before the German Constitutional Court regarding €uro-rescue policy, ECB explained that bond-purchase program covers only bonds with remaining maturities of one to three years, not exceeding any purchase more than half of a bond issue, limiting additional posible bond-buying from Italy, Spain, Ireland and Portugal to a total amount of €524 Billion.***China’s Dagong Global Credit Rating accused his three dominating Western rivals to be politicized and becoming too close to the clients they were assessing, downgrading the U.S.-credit rating adding a negative outlook because of doubts about the American intention to repay debts, cutting rating again from ‘A’ to ‘A-‘, saying there is still no long-term solution to U.S. debt. The EU wants more control of credit rating agencies through the European Securities and Market Authority/ ESMA, approving the European Parliament stricter rules making rating companies more accountable for mistakes, seen as another important step towards financial stability, demanding more transparency when rating sovereign States, respect timing regulation on sovereign ratings and justify the timing of publication of unsolicited ratings, limiting owning stakes, blocking any investor from owning stakes of more than 5% in more than one rating company, giving investors the right to sue rating companies. EU already cleared the way for credit rating competition agreeing to require companies to rotate agencies and in turn encourage ratings competitors to enter the market. EU’s markets watchdog ESMA threatened rating firms denouncing ineficienties in the way they rank sovereign bonds.***EU Finance Ministers agreed on a temporary mechanism to stabilize the Euro establishing an emergency safety net of €500 Billion, including the European Financial Stability Facility/EFSF with €440 Billion in credits/ guarantees of up to three years from €uro-nations to extend financial assistance to troubled €uro-nations and a balance of payment facility of the EU Commission, the European Financial Stability Mechanism/ EFSM increased to €60 Billion open to all EU countries, with complementary loans from the IMF reaching €250 Billion, rising the total to €750 Billion, creating a special purpose vehicle based in Luxembourg to make the €440 Billion available to the formerly 17 €uro-zone members. The €uro-zone bailout funds, the  EFSF and the permanent ESM have been made more flexible, allowing to give States ‘precautionary credit lines’ before they were shut out of the markets, lend Governments money to recapitalize struggling banks and to buy up bonds of highly indebted nations in the secondary market in ‘exceptional’ circumstances and subject to ECB approval. Financial and political problems in Greece, Italy and Spain made leverage efforts of downgraded EFSF like insuring new bonds issued by distressed €uro-zone Governments offering investors first-loss guarantees from 20% to 30% more difficult, deciding €uro-zone leaders that the EFSF and the future permanent ESM will be managed by the ECB.***EU leaders approved an amendment to the EU-treaties when expiring the temporary €uro-zone’s rescue facility/EFSF, backing constitutionally the creation of a permanent €uro-safety-net, called European Stability Mechanism/ESM for member countries in crisis, replacing the EFSF/€440 Billion and the EFSM/60 Billion, and including the IMF participation of €250 Billion the total available for troubled nations would reach €750 Billion. €uro-nations will finance the ESM paying €80 Billion in cash to give the fund with a capital stock more credibility, pledging also €620 Billion in guarantees or callable capital for a total of €700 Billion to ensure a lending capacity of €500 Billion. In case that a country would appear to be insolvent it has to negotiate a comprehensive restructuring plan with its private sector creditors, including a standstill, extension of the maturity, interest rate cut and/or ‘haircut’, before it can obtain additional assistance through the ESM, urging Germany that EU nations need an ‘Insolvency Statute’. Accordingly debt issued from the moment the ESM enters into force will include collective action clauses/CAC’s forcing bondholders to accept restructuring measures if necessary. €uro-zone leaders signed off the €500 Billion permanent rescue fund ESM, allowing a private sector involvement/PSI according to IMF rules, deciding that only countries which previously ratified the new fiscal pact may request credits. Following demands to increase Euro-zone debt ‘firewall’ to €1 Trillion, €uro-zone Finance Ministers agreed to boost the bloc’s emergency funding to roughly €800 Billion, making unused €240 Billion of EFSF money as a kind of emergency reserve available for another year until mid-2013. Euro-nations will allow the ESM to leverage its capital with the same techniques as its predecessor the EFSF, whose leverage efforts failed as investors remained cautious, hoping to boost ESM lending capacity eventually to more than €2 Trillion to be able to bailout if necessary Spain and Italy, opposing German politicians to give the ESM a banking license allowing it to obtain ECB funding. Germany’s highest court ruled that a Parliamentary panel of nine lawmakers to decide on €uro-zone aid was largely unconstitutional and that Germany must convene all 620 members of its Parliament to approve most emergency measures to be taken by the €uro-zone’s rescue fund. German Parliament ratified ESM and the fiscal compact, backing the Constitutional Court the treaty to establish the ESM, however attaching as a key condition a requirement for parliamentary approval of any increase in the agreed-upon German contribution of €190 Billion (27,15% – €22 Billion in cash and €168 Billion in callable capital), considering judges the framework of the constitution to be largely exhausted when it comes to further transfers of competences to Brussels, launching Euro-zone the ESM officially October 8, 2012. The actual German limit of liability to rescue the Euro amounts to €310 Billion, including Euro-stability-facilities EFSF/EFSM/ESM and other related commitments.***€uro-zone Finance Ministers decided that bailout loans to Greece, Ireland and Portugal can be improved, cutting interest rates to about 3,5%/3,9% and extending repayment periods to a minimum of 15 years and even up to 30 years with a grace period of 10 years. Greece received a first financial aid package of €110 Billion, coming €80 Billion from Euro-zone members and €30 Billion from the IMF, approving €uro-zone Finance Ministers a second bailout of €130 Billion to cover financial needs until 2014, including a private sector involvement/PSI designed to cut current Greek debt from €350 Billion by €107 Billion reducing it from 170,6% in 2011 to about 120% of GDP by 2020. €uro-zone Finance Ministers released €94,5 Billion in new Greek bailout funds after authorizing already €30 Billion for the payment of sweeteners to support the private sector bond-swap and €5,5 Billion to pay off accrued interest to investors. According to the Institute of International Finance/IIF private creditors took a debt cut of 53,5% facing an overall loss of around 75% if they bought old bonds at their face value, exchanging their holdings of Greek bonds against new ones with a maturities of 11 and 30 years under English law with a coupon of 2% until 2015, increasing to 3% until 2020, of 3,65% in 2021 and then of 4,3% from 2022 through 2042, receiving holders of new bonds GDP-linked securities for annual payments of up to 1% beginning 2015 according to Greek economic growth in excess of specified targets. Private creditors held about €206 Billion in Greek debt of which €177,5 Billion were under Greek law, tendering bondholders €152 Billion of Greek-law bonds or 85,8%, activating Greece collective action clauses/CACs on these bonds to force all holders to sign up for the swap, while out of a total of €28,5 Billion in Greek bonds issued under foreign law or by State-owned companies guaranteed by Greece, €20,3 Billion were also tendered, informing Athens that it reached a participation rate of 96,9% worth about €199 Billion, representing bond holdouts not agreeing to the debt exchange around 3% of the privately held debt. The International Swaps and Derivatives Association/ ISDA declared Greek debt swap as ‘credit event’, triggering bond insurance/CDS payments of $3,362 Billion setting value of 21,5% of par for Greek bonds meaning CDS will have to pay as loss compensation $2,64 Billion or $78,5 cents on the Euro to settle contracts. Protecting its Greek bond portfolio worth €55 Billion bought in the secondary market at discounted prices paying about €43 Billion, the ECB had exchanged bonds at their face value for new ones, planning to distribute profit made through the technical operation to the 17 Euro-zone central banks to lend it on to the EFSF, allowing €uro-zone Governments to reduce bailout interests for Greece from actually 3,5% to 2%. National European central banks holding  €12 Billion more of Greek bonds bought at a discount agreed to give up profits and to pass those gains back to the Greek Government. The successful private sector involvement/ PSI bond swap exchanged every 100 Euros of old bonds with 31,5 Euros of new Greek bonds and 15 Euros of top-rated EFSF bonds with a two-year maturity, a near cash-equivalent for which the the EFSF committed up to €30 Billion provided as sweeteners out of the second Greek bailout package, which includes €23 to recapitalize Greek banks. The IMF approved a loan worth €28 Billion to Greece over a four year period as part of the second international bailout package, withdrawing still available €10 Billion of the first bailout package, covering the IMF loan part of Greece’s financial needs of €21 Billion until the first quarter of 2016. There will be a permanent European team in Athens monitoring Greece’s implementation of ‘Troika’s’ austerity measures and bailout money will prioritize Greek foreign debt repayment. Greece’s GDP shrank by 6,8% in 2012 and by 3,9% in 2013, returning after seven years to economic growth, expanding its economy in 2014 by 0,8%, after contracting by 0,4% in the final quarter of 2014, showing revised data that there was no growth or decline in economic output in the 1stQ. 2015 instead of the previously reported 0,2% contraction, announcing Greece a 0,8% growth based on seasonally adjusted flash estimates in the 2ndQ. 2015, shrinking its economiy by 0,9% in the 3rd.Q. 2015, or year-on-year by 1,1%, seeing the EU Commission a contraction of 1,4% in 2015. Jobless rate averaged around 24,5% in 2014, with youth unemployment above 55%. Greek Parliament approved a five-year austerity package totaling €78 Billion including an ambitious privatization program which may reach €19 Billion until 2015, and passed additional budget savings of €3,3 Billion for 2012 to unlock the second bailout package. Greek Parliament passed a new austerity package of €13,5 Billion and approved the austerity budget 2013. Greece’s international lenders discussed Greek budget deficit and financial requirements, including how to finance extra funding needs over €32,6 Billion, about €13,5 Billion until 2014, as a result of granting Athens 2 years more to reduce budget deficit and an application of the EU deficit limit of 3% of GDP only from 2016 onwards, reaching an agreement which will allow to release next aid tranche of €34,3 Billion, amount which would increase to around €49,1 Billion, considering installments due until march 2013. The agreement is expected to reduce Greek debt by €40 Billion to 124% of GDP by 2020, coming close to IMF’s  ambition of a debt-to-GDP ratio of 120% until 2020, putting together a package of steps including a debt buyback  from private investors at about 35 cents in the Euro using EFSF/ESM funding of around €10 Billion, a reduction of lending rates especially of the first Greek aid package, returning profits of €11 Billion and also future accounting profits to Greece on ECB’s holding of Greek bonds bought at a deep discount in the secondary market, an extension to repayment terms by 15 years of the old and new bilateral and EFSF loans and deferring EFSF loans’ interest for 10 years. There remains still a financial gap for 2015 and 2016 and according to the IMF the €uro-group made a binding promise to reduce Greek public debt below 110% by 2022, re-establishing Greek debt sustainability, doing more to help if Greece fully complies with its commitments, admitting the IMF it has made ‘mistakes’, underestimating the damage austerity would cause to the €uro-zone country, finding the IMF another funding gap of €10,9 Billion for 2014 and 2015 due to weak growth and a sluggish pace of reform, insisting that European Government must help. Germany’s Finance Minister Schaeuble said Greece will need a third bailout after 2014, which could be worth around €10 Billion according to the Greece Government with no new austerity conditions attached, however telling PM Samaras long-suffering Greeks that the country finally may not require third bailout. Greek public debt reached 175,1% of GDP in 2013, rising further to 177,1% in 2014, projected to increase to a record high of 180,2% in 2015, while budget deficit stood at 12,7% of GDP in 2013, declining to 3,5% of GDP in 2014, expected to decrease to 2,1% of GDP in 2015. Greece offered private investors through a modified Dutch auction a range from a minimum of 30,2% to 38,1% and a maximum of 32,2% to 40,1% of the principal amount, exceeding committments of €31,9 Billion its €30 Billion debt buyback target, paying on average at a third (33,8 cent) of their face value. After the successful debt buyback €uro-zone Finance Ministers released disbursement of €34,3 Billion, receiving Greece another €14,8 Billion in the first quarter of 2013. Moderate Left party withdraw from Greece governing coalition, retaining Government a slim majority of 153 seats out of a total of 300 in Parliament, arresting Greece 15 members of the Neo-Fascist Party Golden Dawn. including the party leader facing criminal charges. Greek Parliament approved budget 2014, reaching the country a small budget surplus before interest payments at €812 Million in 2013, planning a primary budget surplus of €2,96 Billion in 2014. China revealed the creation of a €3,6 Billion fund to help Greek shipping companies buy Chinese made vessels, planning the Chinese state owned container terminal operator COSCO, which has a 35-year concession to operate Greece’s main port Piraeus a deal worth €3,4 Billion, to increase its investment allowing by 2015 to move 3,7 Million containers a year. Greek Parliament approved budget 2015 preparing the end of an era of forced bailouts, granting Euro-zone Finance Ministers Greece a two-month extension of current bailout program, calling the country for early Presidential elections December 17, 2014, mounting political uncertainty including fears Greece may exit Euro-zone, failing PM Samaras to gather enough support for his candidate, Stavris Dimas, in  the first, second and third Parliament vote, calling for national general elections to be held on January 25, 2015, suspending the IMF new disbursements of aid money until a new Government takes office, saying a Merkel ally Euro-zone politicians are not obliged to rescue Greece as the country is no longer of systemic importance to the single currency bloc, as Germany believes that an exit of Greece is managable and the danger of contagion is limited, because Portugal and Ireland are considered rehabilitated. Fitch has revised the outlook on Greece’s long-term foreign and local currency Issuer Default Ratings/IDR to negative from stable, affirming the IDR’s at B. Greek leftist Tsipras was sworn in as new Greek PM, after forming Government with a small right-wing Party the Independent Greeks, winning Tsipras’ anty-austerity left-wing Party Syriza 36,3% of the national vote in the general election, obtaining 149 seats in the 300-seat Parliament, just two short of an absolute majority, and Kammenos’ Independent Greek Party 4,8% of votes and 13 seats, while the ruling conservative coalition won just 27,8% and the extreme right Golden Dawn 6,28% of the votes. Greece’s total debt reaches €322 Billion, comming €257 Billion from EU/ECB/IMF and €65 Billion from private investors; Tsipras is set to renegotiate massive bailout agreements with the TROIKA, naming radical Yanis Varoufakis as new Finance Minister, while Independent Greek leader Kammenos will take over the Defense Ministry. In a move to change Europe, Greece leftist Government is looking for anti-austerity allies in Spain, France and Italy, as Germany clarified it will maintain its position, demanding from the new Greek Government compliance of its financial agreements with the TROIKA, saying the new Greek Finance Minister Greece will not cooperate with the TROIKA and comply with its austerity program, explaining later that Greece is looking for a new program and a new deal, calling not any more for a write-off of Greece’s foreign debt, but proposing a ‘menu of debt swaps’, making the ECB already available €65 Billion in emergency liquidity to Greek banks, as long as Athens will give compliance with the terms of the EU/ECB/IMF bailout program. The U.S. expressed support for a positive outcome of ongoing Greece-EU talks on reaching a deal on a new aid program that would put an end to austerity and pursue necessary reforms. Greece’s negotiations with EU failed to reach an agreement, and Athens has been given time until February 20, 2015, to renew bailout-program, of which 70% would be acceptable for Greece and 30% could be replaced, announcing Greece’s leftist Government it will submit a request to extend ‘loan agreement’ for up to six months, saying Germany no such deal was on offer, demanding that Athens must comply with the terms of the existing international bailout-program, sealing Euro-zone Finance Minister finally a four-month extension, after Athens sent a detailed list of reforms it plans to implement by the end of June 2015. Athens is determined to loosen austerity to revive its economy. Greek Parliament elected pro-European former Minister Prokopis Pavlopoulos as new President. Fitch lowered Greece’s rating by two notches to the high-risk level CCC down from B, saying it nevertheless is expecting the Government would survive its cash squeeze. Warren Buffett/CEO of Birkshire Hathaway Inc. said ‘Grexit’ ‘may not be bad’ for the Euro-zone and could be ‘constructive’ for the region. Greece confirmed loan repayment €450 Million to the IMF, while still struggling to pay other debts, and has been asked to improve a package of proposed reforms in time for the meeting of €uro-zone Finance Ministers on April 24, 2015, to decide whether to release more funds to keep the country afloat. Moody’s further downgraded Greek Government bonds  to junk territory, cutting rating to Caa2 from Caa1, a level that is equivalent to an extremely speculative junk bond, lowering Moody’s also Greek local and foreign currency bond ceilings to B3 from Ba3, citing the increased probability that Greece may exit the €uro-zone in the event of a sovereign default, saying Greece it will default in June 2015 without aid from lenders, suggesting the $300 Million-IMF payment on June 5, 2015, is under question, allowing creditors Athens to bundle four payments due in June 2015 into a single €1,6 Billion lumpsum, which is now due on June 30, 2015. EU President Juncker declined to speak to Greek President Tsipras after the leftist leader rejected as ‘absurd’ international creditors’ terms for a cash-for-reform deal to keep Athens from default, saying ultimate proposals are not realistic, warning not to impose humilating conditions on his country. The IMF quits negotiations with Greece because of major differences, warning EU PM Tsipras to stop gambling, leaving for home also the entire Greek delegation after continuing disagreements, downgrading Standard & Poor’s Greece’s long term credit rating further from CCC+ to CCC with a negative outlook, cutting also further the credit rating of Greece’s biggest four banks, reflecting the probability that Greek banks will default, if Athens doesn’t reach an agreement with its creditors, discussing Senior EU officials formally for the first time a possible Greek default. Greece and creditors failed in a ‘last attempt’ to reach a deal, nearing a possible default and a ‘Grexit’, shifting the focus now to a June 22, 2015, EU emergency summit after Greek talks collapsed, to discuss the situation of Greece at the highes political level, moving the country still closer to a possible Euro-zone exit. EU leaders received new Greek reform proposals cautiously without taking any decision, saying German economic experts that a ‘Grexit’ is the solution, raising ECB its Emergency Liquidity Assistance/ELA to Greek banks again to €89 Billion. Greek debt seen by analysts still as sustainable, but will miss debt targets set out by creditors in 2012, seeing the IMF as worst case Greek debt falling to 142,2% in 2022 from 176,7% in 2015, assuming a new bailout program of at least 3 years with concessional financing. The Euro-zone readies to deal with a Greek debt default after refusing its other 18 members unanimously to extend bailout program beyond June 30, 2015, the day Greece must pay €1,6 Billion to the IMF, following PM Tsipras’s surprise announcement of a referendum to take place on July 5, 2015, on an offer from creditors that his leftist Government rejected. Greece is set to introduce capital controls, keeping from June 29, 2015, Athens stock exchange and Greek banks closed, as ECB refused to increase emergency funding to Athens, and analysts are worried that there will be a wave of contagion affecting peripheral Government bond spreads, eventually weakening the Euro and contributing to more market volatility. Standard & Poor’s downgraded Greece’s credit rating again from CCC to CCC-, after Athens announced it will not pay €1,6 Billion to the IMF due June 30,2015. Greek aid program expired on June 30, 2015, saying the Eurogroup Athens’ stance towards its creditors would have to change before its Euro-zone partners could consider any additional financial assistance, depending on the result of the referendum on previous EU credit terms, missing Greece its June 30, 2015, payment to the IMF, finding itself effectively in default, warning the IMF Greece will need about €50 Billion more in financial assistance untol the end of 2018, and must reform before getting debt relief. After the referendum, voting Greeks to reject new EU bailout conditions, supporting their leftist Government, PM Tsipras offered creditors a reform package, including last-minute concessions, appealing to his party’s lawmakers to back it, intending to save the country from a financial meltdown, calling France the new proposal as trustworthy and serious, making a positive evaluation. Greece won a conditional agreement to receive a third bailout of €86 Billion over three years, conditioned that the Greek Parliament approves the entire program passing the first laws, before the German Parliament would be able to authorize the opening of loan negotiations, helping Euro-zone partners Athens probably with bridge-loans, saying the Greek’s Government junior coalition partner, the right-wing Independent Greeks Party, it cannot back the agreement between Greece and its European creditors, describing the proposed deal as a German-led ‘coup’, disclosing IMF secret report that Greece will need a far bigger debt relief than the Euro-zone partners have been prepared to envisage so far, expecting a 30-year grace period on servicing all its European debt, including new loans, and a very dramatic maturity extension, passing Greek lawmakers a tough economic package demanded by the Euro-zone as part of the bailout deal, rising ECB Emergency Liquidity Assistance/ELA for Greek banks by €980 Million to nearly €90 Billion, approving European Finance Ministers €7 Billion in bridge loans, allowing Greece to pay a key obligation of €4,2 Billion to the ECB and clear its arrears of about €2 Billion with the IMF, reopening Greece its banks, deciding the European Stability Mechanism/ESM to open formally negotiations with Greece on a third bailout program worth up to €86 Billion over three years, after German lawmakers backed new Greek bailout, seen as a last attempt to fulfill this extraordinary difficult tusk, raising Standard & Poor’s Greece’s sovereign credit rating by two notches to CCC+ from CCC-. Greece and its lenders reached a new bailout agreement worth up to €86 Billion, which must be adopted by the Greek Parliament and approved by Euro-zone countries, while a strong first review of the implementation of measures will take place in October 2015, coming any discussion of debt relief later, getting Greece €26 Billion as first tranche of the three-year bailout program, €13 Billion very early to cover its debt repayment needs and setting aside at the ESM an initial €10 Billion to bolster the capitalization of Greek banks, which will have to pass a stress test before receiving fresh equity, while the remaining €3 Billion of the first €26 Billion tranche will be disbursed in the coming months in return for Greek reform progress, renewing the IMF call for the Europeans to grant Athens debt relief to make its global debt sustainable, as condition to study any involvement in the bailout deal, seen as indispensable by the Eurogroup. PM Taipras resigned paving way for snap elections to be held on September 20, 2015, which may allow him to return to power in a stronger position without anti-bailout rebels in Syriza to slow him down, opposing the toughest parts of the latest program, including further pension cuts, more value-added tax increases and a ‘solidarity’ tax on incomes, hoping the Eurogroup that the resignation would not delay or derail implementation of the bailout package, increasing eventually support in Greece for the third Euro-zone bailout program. Greece’s interim cabinet headed by caretaker PM Vasiliki Thanou has been sworn in and the Greek Parliament has been dissolved ahead of the snap elections to take place on September 20, 2015, giving the latest opinion survey Ex PM Tsipras a lead against his opponents with 23% of voters backing his Syriza party. Tsipras and his Syriza party return to power with an unexpectedly clear election victory, forming Tsipras as new PM again a coalition Government with his former partner, the right-wing populist party of independent Greeks/ANEL, obtaining Syriza 145 seats and ANEL 10 seats, giving the new Greek coalition Government a narrow majority of 155 seats of the 300-member legislature, expecting Greece’s European creditors a swift and full implementation of the bailout deal. Greece is likely to qualify for recapitalization funds for its banks by a November 15, 2015, deadline, depending mainly on financial sector reforms, as the ESM has up to €25 Billion earmarked for the recapitalization of the Greek banking sector, having already €10 Billion disposed to be ready to be wired to Greece. According to the results of the stress tests of Greek banks they have to raise €14,4 Billion of extra capital to cover mounting unpaid loans, reaching the total of non-performing loans €107 Billion, expecting the ESM that the third bailout for Greece will be smaller than the initially envisaged €86 Billion, since banks showed they need less recapitalization. Greek Parliament approved a 2016 budget, including sharp spending cuts and some tax increases to satisfy the country’s international lenders, at a time of growing austerity fatigue. Greece’s leftist PM Tsipras said the EU was ‘sleepwalking’ towards a cliff’, expecting a debt relief  deal for itself to be honored by end-2016, so that the economy could recover, considering that ‘Brexit’ will either awaken European leaderships or it will be the beginning of the end of the EU. After contracting Greek economy by 0,2% in the 1stQ. 2016, it expanded by 0,2% in the 2ndQ. 2016, expecting the EU a full year decline of close to 0,5% or slightly better for 2016, seeing Greece’s economy rebounding by 2,7% in 2017.***Europe is challenged to deepen integration and coordination on financial, economic and social policies to increase competitiveness, harmonizing taxes, wage bargaining, vacations and the retirement age, curbing effectively debts, approving the European Parliament six directives reforming the Growth and Stability Pact tightening the control of national budgets (€uro-zone limit 3% of GDP) and of national debts (€uro-zone limit 60% of GDP) to detect problems early to act in time, introducing tougher budgetary rules to ensure deficit cutting measures. The new economic policy package, including a commitment to insert until 2012 a debt limit into the constitution, is named the €uro Plus Pact or the Six Pack of legislative measures, running on an intergovernmental basis for €uro-zone members and was joined by all EU nations with the exception of Britain, Sweden, Hungary and the Czech Republic. Germany’s constitution is already limiting the country’s budget deficit to 0,35% of GDP or to about €10 Billion until 2016, allowing States no debts at all as from 2020.***France: French budget 2013 unveiled ‘unprecedented effort’ to fund €36,9 Billion in savings and included 75% supertax on the rich, which has been declared unconstitutional by the French Constitutional Council, freezing total Government spending, standing public debt at 93,5% of GDP and budget deficit at 4,3% of GDP in 2013, higher than the Government’s target of 4,1%, getting France like Spain two extra years to meet EU deficit target of 3%, however asking for still more time rejected by the European Commission, needing to comply with long overdue reforms of pension system and labor markets, cutting Standard & Poor’s France credit rating from AA+ to AA, saying Paris is not implementing needed reforms to repair economy, climbing French unemployment rate to nearly 11% at the end of 2013. Moody’s lowered France’s Government bond rating by one notch to ‘Aa2’ with a stable outlook from ‘Aa1’ with a negative outlook, saying that the country is showing a continuing weakness in the medium-term growth outlook. As the ECB shifted away from austerity, France said in September 2014 that it will not reduce its budget deficit to within EU limits until 2017, finally accepted by the EU, growing steadily to 4,7% of GDP in 2016, despite having already been granted extra time to do that by 2015, although it had been expected France would set an example and show budget discipline, seen as the anchor of confidence in the European Union, allowing EU Commission France to align a budget deficit of 4,1% of GDP in 2015, remaining shortfall off-target. French economy may weaken further due to its dependency on the difficult south European market. French President Hollande making changes to his failed proposal for a 75% top tax on the rich, calls now to shift burden of the payment from individuals to businesses that pay salaries over €1 Million, approving Parliament plans to find around €50 Billion of spending cuts between 2015-2017 to help narrow budget deficit, reducing French Government corporate charges by €30 Billion as part of a ‘responsability pact’ with employers, losing the President’s Socialist Party over 150 towns, most of them to the opposition centre-right, in local French elections, naming Hollande, facing the lowest level of popularity, new PM. Le Pen’s Eurosceptic far-right National Front scored a stunning first victory in European Parliament elections, becoming with 25% of the vote the strongest party in France, winning the centre-right opposition UMP with almost 21% the second place, while President Hollande’s Socialists gained only 14%, calling French PM Valls the breakthrough of Le Pen a political ‘earthquake’, winning far-right first Senate seats, losing President Hollande’s Socialist Party its majority in the Upper House to centre-right UMP. Fitch cut France’s credit grade by one notch from AA+ to AA, saying the country’s efforts to trim fiscal deficit have fallen short, lowering Standard & Poor’s, which already reduced France’s rating to AA, its expectations of a debt reduction of the country.***Germany is resisting the idea of a shared liability, issuing joint European Government bonds/€uro-bonds, short-term €uro-bills or Stability Bonds, socializing risk and responsibility, suggested to cover deficits of €uro-members up to a predetermined percentage of GDP, as long as member States pursue their own fiscal policy and a deeper fiscal union has not been reached. The German Council of economic experts proposed a debt redemption fund, saying such a fund would be in conformity with the German Constitution, to place €uro-zone member States’ debts in excess of 60% of GDP, forming a new mutualised bond market worth some €2,3 Trillion, arranging redemptions within 25 years, pledging each country a specific tax to provide the cash, while crisis nations Greece, Portugal and Ireland, receiving actually bailout aid would not be able to participate. ***Germany banned uncovered short-selling of €uro-zone Government bonds, credit default swaps based on those bonds and of shares from Germany’s leading financial institutions, extending legal prohibition to all uncovered sales, saying that speculations in financial markets are fuelling the €uro-zone’s debt crisis, announcing the EU new financial market regulations tightening rules on naked short-selling and dealing with naked CDS’s, largely banning this sort of operations on Government bonds of all EU nations as from November 2012.***German authorities agreed to regulate banking, imposing as a contribution to the costs of financial stability a levy of 15% of the annual net profit on financial institutions to finance a bank restructuring fund overseen by the Federal Authority for Financial Market Stabilization/ FMSA, which is also controlling SoFFIN and Germany’s ‘bad banks’. Taking effect beginning 2011 the fund, which is expected to raise about €1 Billion a year, will handle troubled banks to avoid at an early stage that a bank becomes insolvent, reducing the reliance on State bailouts.***€uro- zone’s public debt rose to 92,6% in 2013, up from 90,6% in 2012.
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GOLD Price  -US$1.323,63  –  09/29/16 –  Goldman Sachs increased its average price forecast 2015 for the yellow metal to US$1.262,-, up from US$1.200,-, rising Goldman analysts gold price estimates for the next 12 months again, but kept their bearish outlook on the metal.
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Estimated global mined gold output stood at 2.860 tonnes in 2014, up from 2800 tonnes in 2013, increasing production in China to a new record high of 450 tonnes, up from 430 tonnes in 2013, remaining the world’s biggest gold producer for 8 years since 2007, followed by Australia 270 tonnes, Russia 245 tonnes, the United States 211 tonnes, Canada 160 tonnes, Peru 150 tonnes and South Africa 150 tonnes. The largest proven and probable ore reserves are in South Africa, the United States (Nevada, Alaska, California, Colorado, New Mexico, Utah), Russia, Canada, Brazil, Ghana and Zimbabwe; total reserves are estimated at 60.000 tons. Central banks and supranational institutions hold around 32.000 tonnes of gold, continuing central banks to be net buyers of gold in 2013, however declining their purchases to 369 tonnes, 32% less than in 2012. More than 105.000 tonnes are in private hands, around 22.000 tonnes in coin and bullion and exceeding 83.000 tonnes in jewellery. The 10 largest official gold holders are: United States/ 8.133,7 tonnes, Germany/3.387,2 tonnes, IMF/2.814,1 tonnes, Italy/2.451,9 tonnes, France/2.435,4 tonnes, China/1.054,1 tonnes (it last disclosed in April 2009, considering financial analysts the People’s Bank of China may actually have increased its holdings to 1778,5 tonnes/January 2016, Switzerland/1.040,1 tonnes, Russia 873,6 tonnes, boosting holdings to 1415,2 tonnes/at the end of 2015, making the country the seventh biggest holder of gold reserves, Japan 765,2 tonnes, Netherlands/612,5 tonnes. China with the world’s largest foreign exchange reserves, falling to just under $3,19 Trillion in August 2016, was the world’s largest gold market in 2013, reaching its annual demand to 1.066 tonnes, while India’s demand rose 13% to 975 tonnes. Globally consumers bought 3,864 tonnes of gold in 2013, 21% higher than in 2012. Global jewellery demand rose 17% to 2.209 tonnes in 2013, while investment in bars and coins was up 28% to 1.654 tonnes. Demand from the technology sector remained with 405 tonnes steady in 2013, compared to 407 tonnes in 2012. Demand for jewellery increased in 2013 by 29% to 669 tonnes in China and by 11% to 613 tonnes in India, while Chinese investment in gold bars and coins was up 38%, rising 16% in India. The world gold demand 2013 was 3,756 tonnes, 15% lower than in 2012. India regained from China in 2014 the top spot as the world’s biggest gold consumer, driven by robust jewellery demand, reaching Indian total consumer demand for gold jewellery and investment 842,7 tonnes, compared with 813,6 tonnes by China, although demand slowed in both countries from record levels in 2013. India’s gold jewellery demand rose 8% in 2014 to an all-time high of 662 tonnes, while China’s jewellery demand declined 33% from 2013, and China’s gold investment demand halved  in 2014 from a year earlier. Gold trade is seen as a chief driver of economic diversification in the Gulf region and particularly in Dubai, reexporting into the vigorous Arab markets. Wordlwide investment via gold-backed exchange-traded funds/ETF saw a net outflow of 881 tonnes as investors continued to reassess their portfolios. Total gold supply for the year 2013 was 4,340 tonnes, down 2% compared to 2012. 2013 was the ‘year of the consumer’ for gold, as consumers around the world took advantage of lower prices to stock up on the precious metal.
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WTI CRUDE OIL   +US$47,83/BRENT CRUDE OIL  +US$49,24  (oil price level still declining, expected global oil prices to recover very slowly over the next few years, stabilizing again at a higher price level, falling U.S. oil prices to a 2003 low below $27,- per barrel on January 20, 2016, anticipating the market a rise in Iranian exports after the lifting of sanctions) – 09/29/16 The two top-world oil producers, Saudi Arabia and Russia, agreed to freeze oil output at near-record levels, considering observers that accord likely won’t succeed in tackling the global surplus, as other big producers form not part of the deal, reminding that Iran is determined to raise production. OPEC, which pumps about 35% of global oil supplies, abandoned output ceiling of 30 Million b/d in place since 2011, saying it will keep pumping as much as it does now, about 31,5 Million b/d, effectively endorsing limitless output, meaning now every member for itself, confirming the Iranian Oil Minister it’s just ceilingless, following the example of Saudi Arabia pumping and pumping until external rivals, such as Russia and U.S. shale drillers are squeezed out of market share. Oil prices fell further after Saudi Arabia cut prices on exports to the United States in a move to compete with North American shale production, which requieres higher prices to remain competitive with conventional oil production, refusing to reduce its production levels, preferring to allow the market to stabilize on its own, seen Saudi Arabia punishing with low oil prices also Russia and Iran for their support of Assad’s regime in the Syrian civil war. OPEC is finding that an intensifying battle for market share, worsened by deep regional differences between Saudi Arabia and Iran, is driving it further apart, warning the IEA the world could ‘drown in oversupply’ of oil in 2016 with the lifting of sanctions against Iran, allowing the country to add its exports to the global glut. OPEC reached a historic deal to limit production, saying it would reduce output to 32,5 Million barrels per day from current production of 33,24 Million barrels per day, conducing to an increase of oil prices.
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The International Energy Agency/IEA reduced its 2016 estimate for global oil demand growth, which now stands at 1,17 Million barrels per day, following a five-year high of 1,6 Million barrels per day in 2015, cutting its call on OPEC crude for 2016 by 100.000 barrels per day to 31,7 Million barrels per day, a figure which is lower than OPEC’s February 2016 output of 32,61 Million barrels per day. According to the IEA demand growth is likely to reach 1,3 Million barrels per day in 2017, a similar level at which it estimates growth for 2016. OPEC increased projections for the amount of crude it will need to pump in 2016 by about 200.000 barrels a day to 30,3 Million, estimating that total oil consumption will hit a new record of 95,41 Million barrels per day in 2017, increasing world oil demand by 1,15 Million barrels per day from 2016 levels. Saudi Arabia, the group’s biggest producer and the world’s largest exporter of crude, reported that it cut output by 50.000 barrels a day to 10,14 Million in December 2015, reaching its average output in 2015 a record of 10,17 Million barrels a day, producing 10.673 Million barrels per day of oil in July 2016, up from 10.55 Million barrels in June 2016. OPEC cut 2016 estimates for non-OPEC production by 110.000 barrels a day, seeing the group still non-OPEC supply expanding slightly in 2016, while the IEA predicted that oil production will fall by 750.000 barrels a day to 57,0 Million barrels a day. OPEC reduced 2016 estimates for the U.S. supply by 103.000 barrels a day, projecting the U.S. total oil output at 13,97 Million barrels a day, forecasting that total U.S. output of crude and natural gas liquids may fall another 0,5% to 12,47 Million barrels a day in 2016, saying the decline is driven by the fall in prices which has curted spending. Slowing U.S. output combined with signs of strengthening demand could contribute to a reduction in the imbalance of oil-market fundamentals. The U.S. projected that global petroleum and liquid fuels supply will grow year-over-year by 1,7 Million b/d in 2014 and 1,4 Million b/d in 2015, expecting in 2014 a record high supply growth of petroleum and liquid fuels of 1,9 Million b/d in countries outside OPEC, with the U.S. accounting for more than 50% of the total growth. Total world oil demand 2014 averaged 90,91 Million b/d, compared to 89,86 Million b/d in 2013, shrinking OECD countries demand in 2014 by estimated 0,19 Million b/d to 45,60 Million b/d, becoming China the world’s top oil importer after shale revolution is reducing U.S. need to import crude. Monthly U.S. crude oil production surpassed ending 2014 net crude oil imports, which fell below 7 Million b/d in the 4thQ. 2014, while U.S. crude oil production reached about 8 Million b/d in the last quarter of 2014. Oil demand 2014 by China averaged 10,40 Million b/d. The U.S. is enjoying a gas and oil boom thanks to shale gas and shale oil produced mostly from the Bakken shale formation in North Dakota and Montana, the huge expanse of oil-bearing rock, and the Eagle Ford one in Texas, importing also increasingly heavy crude, known as bitumen found primarily in Canada’s Alberta Province, becoming for the first time in decades a net exporter of petroleum products, such as jet fuel, heating oil and gasoline. According to a report of the International Energy Agency/IEA the shale oil boom means the United States may overtake Saudi Arabia and Russia as the world’s largest oil producers by 2020, becoming the largest global producer of natural gas already by 2015. Driven by high prices and new drilling methods/ hydraulic fracturing/fracking, the U.S. production of crude oil (around 6,4 mb/d in 2012) and other liquid hydrocarbons, including natural gas liquids and biofuels, is expected to have reached already around 11,4 Million b/d in 2013. According to the IEA China passed the United States as the world’s largest net oil importer with 6,3 Million b/d in September 2013, using China 10,9 Million b/d of oil and other liquids, producing 4,6 Million b/d, while the U.S. production was 12,5 Million b/d and the consumption by Americans reached 18,6 Million b/d, importing to fil the gap 6,1 Million b/d. Growing production from unconventional sources of oil – tight oil, oil sands and biofuels – is expected to be the sole cource of the next growth in the global oil supply to 2020. NON-OPEC country Russia, a net oil exporter, raised oil output in 2013 to a post-Soviet era high of 10,51 Million b/d, buoyed by high prices and exports to China, hitting in 2014 a post Soviet record high of 10,6 Million b/d, as crude prices fell dramatically, climbing Russian production of crude and a light oil called condensate 2,1% to 10,912 Million barrels a day in March 2016, beating the previous high of 10,910 Million barrels a day in January 2016, rising Russian oil exports 10% to 5,59 Million barrels a day. Its December 2013 production averaged 10,63 Million b/d, while Saudia Arabia kept its output steady at around 9,7 Million b/d in October and November 2013. Russian energy giant, State-controlled Rosneft bought in a $55 Billion deal all of TNK-BP, selling BP its share for about $27 Billion, and AAR, belonging to a group of 4 Russian billionaires, its participation for about $28 Billion, becoming BP with a future stake of 19,75% in Rosneft its second largest shareholder, keeping Russia BP’s technical expertise and international clout. Rosneft, already the top oil company in the world’s biggest producing country, will be pumping more oil and gas than its global U.S. competitor Exxon Mobil. Canada has about 175 Billion barrels of recoverable bitumen from oil sands with today’s technology and Alberta oil sands with an estimated total bitumen reserve between 1,7 Trillion and 2,5 Trillion barrels, more than the total OPEC oil reserves of about 900 Billion barrels, are for decades not considered  part of the world’s oil reserves because the oil there wasn’t economically extractable at prevailing prices but could become the most important source of new oil in the world in coming years, buying PetroChina, Asia’s largest oil and gas company, and Sinopec, a Chinese State controlled company, full ownership stakes and participations in important oil sands projects in Alberta, urging the Government of Canada to approve a pipeline to Canada’s Pacific coast so that tankers can ship oil sands crude to China. China National Offshore Oil Corporation/CNOOC revealed to acquire Canada’s NEXEN, obtaining access to giant oil- and gas fields, approving Canada and the U.S. regulators the $15,1 Billion bid, paving way for the largest Chinese foreign adquisition, taking Sinopec a 49% stake of the North Sea oil production of Canada’s Talisman Energy paying $1,5 Billion. China’s State-owned oil companies spent since 2009 $92 Billion in oil and gas assets in countries from the U.S. to Angola and the country is expected to produce about 3 mb/d abroad in 2015 up from 1,5 mb/d in 2011. There are also expectations Arctic may hold as much as 90 Billion barrels or 13% of the world’s undiscovered oil and 30% of the world’s undiscovered gas reserves. NON OPEC country Brazil’s newly discovered deep-water ‘pre-salt’ oilfields like Tupi, Lara and Guará, located in an area of 800 sq km offshore 16.400 feet below sea level, which may contain between 50 Billion and more than 100 Billion barrels, could transform the country into one of the major oil-producing and -exporting countries, announcing the state-controlled PETROBRAS the discovery of 65 Million barrels in the Barracuda oil field 100 km off the coast of Rio de Janeiro and that it will invest about $224 Billion over the next 5 years to increase oil output, turning to China, Brazil’s biggest trade partner, for cash, signing a loan agreement of $10 Billion with the China Development Bank and a 10 year pact for delivery of up to 200.000 barrels a day of crude oil to Chinese companies. PETROBRAS filed for a record global stock offer of $67 Billion to finance part of its ambitious offshore plans to turn Brazil into a major oil exporter, making Brazil’s Congress PETROBRAS sole pre-salt operator. Brazil auctioned the pre-salt Libra oilfield, off Rio de Janeiro’s coast, containing estimated 8 Billion to 12 Billion barrels of recoverable oil to a consortium led by Petrobras including France’s Total, Anglo-Dutch Shell and China’s state-owned CNOOC and CNPC, expecting to increase Brazil’s oil output once it reaches peak production from 2,1 mb/d to 3,5mb/d. Oil output in Mexico is also slowing down, facing the state owned oil company PEMEX a chronicle lack of cash and of technical capacity for deep water exploration and production. Concerns over Venezuela’s socialist revolution delay one of the biggest biddings to explore oil fields, called the Carabobo auction, competing Chinese, Russian, Indian, Colombian and Brazilian state oil companies with oil majors Shell, BP, Chevron, Total, Eni and Statoil for access to the Orinoco belt with a huge potential of tar-like extra-heavy crude, requiring the Venezuelan state oil company Petróleos de Venezuela/PDVSA at least a 60% share in each project, getting partners at most a 40% share, but will have to provide a 100% financing, announcing Venezuela deals with Russia and China with investments up to $36 Billion producing until 2012 about 900.000 barrels a day from the heavy oil deposits Junin 4, Junin 6 and Carabobo. China agreed to invest $20 Billion in two Iranian oil fields projected to produce
700.000 b/d. Exxon Mobil and Russian oil giant Rosneft agreed to explore oil and gas in the Arctic Kara Sea and in the deep waters of the Black Sea, two of the most promising  and least explored sea offshore areas globally, giving the U.S. access to potentially huge oil and gas fields in Russia’s Arctic Sea shelf and Russia stakes in Exxon’s operations in the Gulf of Mexico and Texas, raiding Russian officials the Moscow office of BP, whose hopes ended of developing Arctic offshore oilfields with Russia. The world is not running out of oil, the biggest threat to the future of supplies is the lack of spare production capacity worldwide to cover a shortfall. Shortfalls are caused by oil rich countries such as Nigeria, Kuwait, Venezuela, Iran and Iraq, where politics has stymied production growth. Saudi Arabia is completing the development of its giant Khursaniyah field, complying with a huge expansion program to increase its production capacity of about 12,5 Million b/d, producing currently around 9 Million b/d, leaving 3,5 Million b/d as spare capacity, expected to rise its crude production capacity by 2020 to 15 Million b/d with an export potential of 10 Million b/d. OPEC member Iraq, with the world’s fourth largest proven oil reserves estimated to stand at 143,1 Billion barrels, is opening its giant key producing oilfields to British and US companies to restore its oil infrastructure, seeking to raise output to an average of 3,7 mb/d in 2013, producing 3,2 mb/d in February 2013, and may be able to match its 1979 output record of 3,8 mb/d. OPEC’s proven crude oil reserves estimates rose 12,1% to 1,19 Trillion barrels or to 81,3% of the world’s proven crude reserves in 2010, led by Venezuela with 296,5 Billion barrels surpassing Saudi Arabia with 264,5 Billion barrels, Iran with 151,1 Billion barrels and Iraq with 143,1 Billion barrels, showing BP statistics Venezuela still with 211,2 Billion barrels in conventional oil reserves, avoiding unconventional oil reserves such as Venezuelan heavy crude of the Orinoco Belt.
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2015/2016

January 1, 2016

A very happy and successful New Year for the great WordPress team and to all readers of 1read.me – Wulf Werle

Aus aktuellem Anlass …

November 16, 2015

Quelle: Aus aktuellem Anlass …

Die Anderen

December 14, 2014

Ein gutes Rezept, aber wir leben in einer Gemeinschaft und es besteht wahrscheinlich immer eine gewisse Abhaengigkeit von anderen Menschen, denen wir sicherlich versuchen auch zu helfen und zu verstehen.

Gescheuchten Igel

Manchmal fand sie ihn in Büchern. Ihn und sich. Nicht als Liebesgeschichte, sondern als Menschen, denen das Wichtigste war, das Leben zu leben und dies nicht auf Kosten anderer Menschen zu tun. In Büchern, in denen Charaktere die Welt beobachten und Schlüsse aus ihr ziehen.

Doch die Wahrheit war wohl: Während sie ein träumende Realistin war, war er ein antriebsloser Träumer. Und als solcher gescheitert. Schuld daran hatten immer die anderen. Hatten sie aber nicht.

(Es könnten Charaktere aus Rastlos sein. Sind es aber nicht.)

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Vergissmeinnicht

November 16, 2014

Das ist der natuerliche Weg der Menschen vom Kind in das Alter und irgendwann geht dann das Leben zu Ende, wenn es nicht durch ein ploetzliches Ereignis schon frueher aufhoert. Wir sollten rechtzeitig versuchen das Beste aus dem Leben zu machen, das Leben zu geniessen und grundsaetzlich die Mitmenschen zu achten.

Gescheuchten Igel

Jeder Mensch muss sterben. Auch du. Bald vielleicht schon. Doch du weißt es nicht. Du weißt gar nicht, dass du sterben kannst. Denn du weißt nichts. Nichts.

Vor zwei, drei Jahren da flackerte noch manches Mal kurz etwas in dir auf und man meinte ein Erinnern zu sehen. Doch war es das? Oder war es nur die eigene Hoffnung, dass der Mensch, den man einmal kannte, durch die Krankheit noch nicht vollständig zerstört sein durfte?

Fünfzehn Jahre Krankheit haben sich durch dein Gehirn gefressen: Bis zu welchem Zeitpunkt war noch Mutter, Schwester, Oma, Mensch in dir und wann ist der letzte Teil deiner Erinnerungen, deines Ichs, deines Lebens gestorben? Ich weiß es nicht.

Aber ich erinnere. Dich. Mich. Mich an dich. Immer.

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Der Weg

November 14, 2014

nicht in die Vergangenheit blicken, sondern realistisch nach vorne schauen; Schuld hat nicht die eventuelle Arbeitslosigkeit, voraussichtlich mehr das Fehlen einer verantwortungsbewussten Planung!

Gescheuchten Igel

Als die Keule der drohenden Arbeitslosigkeit über mir schwebte, wollte ich es erst nicht wahrhaben: Nach vierzig Jahren sollte ich das verlieren, was mir Sicherheit und Spaß brachte? Ja, wirklich, auch vierzig Jahre später mochte ich meine Arbeit. Und ich war gut darin, erhielt Anerkennung und Lob und Prämien. Und nun hatte meine Firma zerstört, was wir Mitarbeiter aufgebaut hatten? Wie konnte das sein?

Und dann, dann glaubte ich, mich verkriechen zu müssen. Arbeitslos. Ein Wort, das ich nie mit mir in Verbindung gebracht hatte. Arbeitslos. Ich? Ich, die arbeiten wollte, die viel zu leisten bereit war, ich sollte arbeitslos werden? Wie würde das auf andere wirken, wenn ich erzählte, ich sei arbeitslos? Und würde ich das überhaupt erzählen wollen? Angst hatte ich: Davor, dass mein Geld im Alter vielleicht trotz privater Altersvorsorge nicht reicht. Davor, dass mein Leben nicht ausgefüllt ist ohne das tägliche Arbeitspensum. Davor, dass mir Zuhause…

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Light Trees and Bay Lights

October 22, 2014

Great photo, nice to enjoy it!

Matt on Not-WordPress

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Under Golden Gate

October 6, 2014

Golden Gate: I always remember San Francisco dreaming of the impressive Golden Gate crossing into the Californian Wine Land!

Matt on Not-WordPress

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