Commission president Barroso proclaimed recently, that austerity has reached its limits. As money doesn’t come to budgets just as a gift from the heaven, the conclusion is simple: you will have to contribute more to your governments.

Slovak citizen have an advantage, as they can see the lie about the austerity quite easily. They just need to look around. For example a small village of Oslany bought a cleaning car for 400 000 euro from European funds to keep clean its 14 km of roads. For such money and with the current gold price, they could for example lay an 80cm-wide golden strip through the entire length of their local roads.

Viac o →Barroso: From now on we spend your money at full blast – Fiat Euro! 17/2013

Commission president Barroso proclaimed recently, that austerity has reached its limits. As money doesn’t come to budgets just as a gift from the heaven, the conclusion is simple: you will...

Cyprus still counting. Slovenians and Greeks got more time. Netherlands turned around. Try the Central Banker simulator.

We’ve been promising that we will leave Cyprus alone in the last issues of Fiat Euro but the guy always comes back with some interesting news. The originally required rescue amount of 16 billion suddenly turned out to be at least 21 billion euros. Main reason for this is the unexpected big flight of deposits just before the banks’ closure. Thanks to this, the unfortunate depositors who did not manage to move their savings will have to bear even higher losses than originally estimated. Instead of 5.5 billion the current amount is 8.3 billion euro. One would get annoyed by this! Cyprus is trying to ease the anger of those foreign depositors who lost more than 3 million by offering them the EU passport. Quite an expensive piece of paper, what do you think?

Viac o →Each minute counts! – Fiat Euro 16/2013

Cyprus still counting. Slovenians and Greeks got more time. Netherlands turned around. Try the Central Banker simulator. We’ve been promising that we will leave Cyprus alone in the last issues...

For the southern European states, the crisis will become this summer as characteristic as the sandy beaches, sun, or fruit di mare for the dinner. And maybe some northern neighbours will join the party.

The Cypriot stories slowly but surely disappear from the front pages. Capital controls persist and country will probably face a double-digit recession, which will stay around for some time. The initial outrage about the fact that some well-informed managed to transfer their money from their accounts before the agreement on participation of depositors on the bank losses came to the daylight – fades away. The investigation has been suspended for now. But let’s leave the miserable Cyprus and make a Eurotrip.

Viac o →Sun, sea, slump – Fiat Euro! 15/2013

For the southern European states, the crisis will become this summer as characteristic as the sandy beaches, sun, or fruit di mare for the dinner. And maybe some northern neighbours...

Cyprus revealed cards. Politicians will have less space for their legs. Spiral of lies by a French (ex)minister. Who’s next?

Cypriot Odyssey is coming to the second act. The thunderous storm calmed down. Now the more quite but also more painful part is taking stage. Troika is complete with all its three members. The last one to come, IMF, will cover approximately 1 out of the 10 billion. The rest will come from the ESM. Three quarters of rescue funds will be used to refinance the old debt, the rest shall be added as a new debt.

There is no loan without a proper memorandum with all the terms and conditions. The Cypriot is really a comprehensive one. The essential condition is the health state of the public finances. Country is supposed to reach a budget surplus of 4% GDP by 2017. This sounds just as real as a trip to Jupiter. Country has been running 4-6% deficits in recent years. Fall of the finance industry and financial loss of many companies that used to have accounts in the stricken banks will only deepen the recession in which Cyprus already is. In order to meet the deficit condition, Troika drafted almost 25 pages of detailed sub-conditions. You can find totally expected ideas such as corporate income tax rate increase from 10 to 12.5% or increasing the retirement age. There are some cherries nevertheless – for instance cancelation of politicians’ right to travel first class when taking intra-continental flights.

Viac o →Who’s next for the haircut? – Fiat Euro! 14/2013

Cyprus revealed cards. Politicians will have less space for their legs. Spiral of lies by a French (ex)minister. Who’s next? Cypriot Odyssey is coming to the second act. The thunderous...

Crisis on Cyprus brought new tailwinds in the sails of the crisis in Europe and fully opened the question which had only been cautiously considered behind the scenes until now – how to deal with European banks? But first things first

ECB announced almost two weeks ago that it would cease providing help for the Cypriot banks via a pump machine called ELA. Country badly hit by the crisis and also by the losses in Greece had to act promptly to avert the imminent fall of the local banking sector. Due to a combination of various official and unofficial reasons, Troika decided that unlike Spain, the losses from Cypriot banks shall be born not only by the European taxpayers via the ESM but, at least partially, also by the depositors in the Cypriot banks.

Viac o →We shall hear more about Cyprus – Fiat Euro! 13/2013

Crisis on Cyprus brought new tailwinds in the sails of the crisis in Europe and fully opened the question which had only been cautiously considered behind the scenes until now...