Mish's Global Economic Trend Analysis

Violent Protests in Greece; 6 Cabinet Members Resign; LAOS leader "I Would Rather Starve Than be Under German Jackboot"; Controversy Over Missing Paragraphs

Posted: 10 Feb 2012 10:50 PM PST

Imagine you are asked to sign a document but three pages were missing. Further imagine the documents you were asked to sign were written in English but you only speak Greek. Would you sign?

That is exactly the predicament Greek officials were placed in by the Troika. Here is the story sent to me by Demetri Kofinas at Capital Account.

Hello Mish

George Karatzaferis leader of LOAS political party gave a speech today addressing why he refused to sign this latest agreement. In his speech, he said that he asked for a translated document of the agreement so that he could read it and sign it since his English is not as good as Papademos'.

When he got a copy, it was not only smaller than the English version, but was also missing pieces, including the last paragraph! He refused to sign it because he felt pressured and wants more time.

Youtube has a video of Karatzaferis where he compares the documents. At the 11:35 mark he translates the last paragraph for the listeners, which was not provided to him in the translated copy that he was to read.

The video is in Greek so not many can understand it. Moreover, the video was somewhat garbled and some things do not easily translate, so I do not have a good account of the missing paragraphs, but it is clearly absurd that anything should be missing.

"I Would Rather Starve Than be Under German Jackboot"

Facing down protests, dissent, Greece vows to push through austerity warns of default 'chaos'

Greece's future in the eurozone came under renewed threat Friday as popular protests again turned violent and dissent grew among its lawmakers after European leaders demanded deeper spending cuts.

The country's beleaguered coalition government promised to push through the tough new austerity measures and rescue a crucial euro130 billion ($170 billion) bailout deal after six members of the Cabinet resigned.

Prime Minister Lucas Papademos promised to "do everything necessary" to ensure parliament passes the new austerity measures that would slap Greeks with a minimum wage cut during a fifth year of recession. He also promised to replace any other Cabinet members who did not fully back his efforts.

Earlier Friday, the small right-wing LAOS party in Papademos' coalition said it would not back the new measures and four of its officials in the cabinet resigned, including the country's transport minister. Two Socialists cabinet members have also quit.

LAOS leader George Karatzaferis said rescue creditors had humiliated Greece.

"Of course we do not want to be outside the EU, but we can get by without being under the German jackboot," he said. "I would rather starve."

6 Cabinet Members Resign

Reuters reports Anger in Greece as parliament to vote on bailout

Greek lawmakers will vote this weekend on a controversial austerity bill that Athens needs to avoid a messy default but which is fuelling a domestic political and social crisis that has brought thousands of Greeks out on the streets in protest.

The cabinet approved the draft bill late on Friday - paving the way for a new multi-billion euro bailout and a debt-cut plan - after another day of rocky politics where six cabinet members resigned over the additional austerity demands.

Violent Protests in Greece

Please consider Greek premier says default would lead to 'chaos'

Greece's future in the eurozone came under renewed threat Friday as popular protests again turned violent and dissent grew among its lawmakers after European leaders demanded deeper spending cuts.

In central Athens, clashes erupted outside Parliament between dozens of hooded youths and police in riot gear. Police said eight officers and two members of the public were injured, while six suspected rioters were arrested.

The violence broke as more than 15,000 people took to the streets of the capital after unions launched a two-day general strike that disrupted transport and other public services and left state hospitals running on emergency staff.

Scores of youths, some in gas masks, used sledge hammers to smash up marble paving stones in Athens' main Syntagma Square before hurling the rubble at riot police.

Note the irony of that last headline. It should be perfectly clear Greece is already in a state of dysfunctional chaos. That said, things can always get worse, and they will.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Petroleum 3-Month Rolling Average Turns Sharply Lower; Negative Shipping Rates; Collapse in Global Trade

Posted: 10 Feb 2012 09:36 AM PST

On February 6, I noted (with huge thanks to reader Tim Wallace) a Huge Plunge In Petroleum and Gasoline Usage.

Tim used weekly numbers, which show, much week-to-week volatility. Instead, I proposed using rolling three-month averages, compared to the same three months in prior years.

Today I received some updated charts that are much easier to see precisely what is happening.

Gasoline Usage Last Three Months vs. Last Three Months Prior Years

click on any chart for sharper image

Gasoline Usage by Quarter Ending December 2011

Petroleum Usage by Quarter Ending December 2011

Wallace writes "Gasoline and petroleum demand recently has plunged more than at any time in the recession. When you see petroleum usage back to numbers in the 1990's, you know there is serious economic trouble no matter what the talking heads say."

Wallace willing, each month I will post the "Petroleum Rolling Three-Month Average Index". Hopefully we can get a derivative of that first chart, "Percent Change From a Year Ago".

At the end of February the comparison will be December - January - February vs. the same three months in prior years.

Negative Shipping Rents

Amazingly, shipping rates have dropped so low, shippers will pay you to ship, just to get the cargo vessels to better locations.

Bloomberg reports Charter Rates Go Negative

Glencore International Plc paid nothing to hire a dry-bulk ship with the vessel's operator paying $2,000 a day of the trader's fuel costs after freight rates plunged to all-time lows.

The vessel will haul a cargo of grains to Europe, putting the carrier in a better position for its next shipment, he said.

"Our other option was to stay in the Pacific and earn poor revenues or ballast to the Atlantic and pay the fuel ourselves," Rodley said. Ballasting refers to sailing without a cargo. Charles Watenphul, a spokesman for Glencore, declined to comment in an e-mailed response to questions.

Charters for the so-called backhaul routes that reposition ships to the Atlantic Ocean region from the Pacific are falling to the lowest since indexes started, exchange data show. Rents for Capesize ships that haul ore and grain on backhaul routes were at minus $7,342 a day, the lowest since that index began in 1999, exchange data show.

D/S Norden A/S, Europe's biggest publicly trading commodity shipping company, said Feb. 3 it hired a Supramax vessel at no cost other than fuel charges, its first such transaction in a quarter century.

Baltic Dry Index - $BDI

The Baltic Dry shipping index (a measure of shipping costs) was down 32 days in a row before turning up on Tuesday.

The Harper-Peterson Shipping Index is also in dismal shape.

Many ships came online in the last couple years but a plunge this deep cannot be blamed entirely on new ships added.

Rather, the huge dropoff in gasoline and petroleum usage in the US, coupled with falling shipping rates, a drop in Japanese Exports Three Consecutive Months, and a European Recession poised to get much worse, makes a strong case that a collapse in global trade is underway.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

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Friday, February 10, 2012

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis

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