Hundreds of foreign spies in Brussels, European diplomatic agency warns

European Commission building

 

According to Die Welt, the EEAS estimates that “approximately 250 Chinese and 200 Russian spies” are operating in Brussels. Most of these intelligence officers are allegedly embedded in their countries’ embassies, trade missions, cultural centers and other outreach facilities in the Belgian capital. There are also many intelligence operatives from Western agencies, including those of the United States, as well as from Iran, Turkey and Morocco, among other foreign nations. The report in Die Welt adds that the EEAS advised European Union diplomats to avoid certain establishments in the European Quarter of Brussels, which are believed to be heavily frequented by international spies. Among them are “a popular steakhouse and café” that are “within walking distance of the Berlaymont building” —the headquarters of the European Commission. The same building houses the offices of the EEAS. Continue reading

The Size of Corporate Debt One Rung Above Junk Has Never Been Greater, Warns Louis Gave

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Louis Gave at Gavekal Research says the greatest source of potential instability in the years ahead lies with the massive growth of the U.S. corporate debt market, particularly at the BBB-rated (near junk) level. Continue reading

Italy and Poland in talks on anti-EU league

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Polish ruling party chief Jaroslaw Kaczynski seldom meets foreign visitors (Photo: pis.org)

 

Poland and Italy’s right-wing rulers are to cement their “special relations” at a meeting in Warsaw, in what could make a new anti-EU league a major force in the next European Parliament (EP).

The meeting, between Polish ruling party chief, Jaroslaw Kaczynski, and Italian interior minister and deputy prime minister Matteo Salvini, on Wednesday (9 January) is to discuss Poland’s membership in Salvini’s new EP group, according to Italian daily La Repubblica. Continue reading

All or Nothing

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BERLIN/LONDON/PARIS/ROME (Own report) – London’s government crisis escalated yesterday under the pressure of Berlin and the EU’s unaccomplishable Brexit requirements. Prime Minster Theresa May has barely survived a vote of confidence, which was ultimately triggered by the so-called backstop. Brussels insists on a regulation, which could indefinitely subjugate Great Britain to a customs union, without an option for a unilateral withdrawal and erect a trade border between two areas of the United Kingdom. These provisions are in Germany’s interests, but they will plunge Great Britain into chaos. The current government crisis in France is largely due to the austerity programs imposed by Berlin on Paris – while refusing to make any concessions at the EU level. In France and Great Britain, the extreme right is profiting, like in Italy, where Berlin’s drastic austerity dictates, have already crushed the traditional political establishment.

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Italy: A Brewing Storm Within the EU

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Over the last couple of years, the main challenge to EU cohesion has been Brexit, with the media sharply focused on the negotiations and all relevant developments. Since the release of the draft withdrawal agreement, largely perceived as a victory for the EU, those who support the European project and believe in a strong leadership from Brussels have projected confidence and optimism for the future. According to these voices, the divisions caused by the rise of nationalism and populism in the past years are healing, the relationship between member states is normalizing, while a future of stability and harmony awaits.

However, such a vision might prove naive, as it discounts a much greater risk to the EU than Brexit ever was: the political and economic powder keg that is Italy. Continue reading

Merkel Protégé Suggests Naval Blockade of Russian Vessels

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(Photo Credit: Sandro Halank via Creative Commons 3.0)

 

G7 foreign ministers release their own statement of condemnation against the Kremlin.

In an interview with Reuters today, German politician Annegret Kramp-Karrenbauer, the Christian Democratic Union leadership front-runner and protege of Chancellor Angela Merkel, said the European Union and U.S. should consider a full blockade of all Russian vessels at their ports in response to the Kerch Strait incident. Continue reading

Cyprus and Greece to create EU spy academy

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Athens: new academy to provide ‘training in intelligence disciplines’ (Photo: Barcex)

 

EU defence and foreign ministers have agreed to create a joint intelligence training school and to develop new hardware, including drones and electronic warfare technology, as part of plans for what could one day be an “EU army”.

The “Joint EU Intelligence School” will “provide education and training in intelligence disciplines and other specific fields to EU member states intelligence personnel”, the EU Council said in a press release after ministers met in Brussels on Monday (19 November).

The project is to be led by Cyprus and Greece – two traditionally Russia-friendly states – at a time of heightened tension over Russian espionage operations in Europe and the Western Balkans, including assassination attempts in the UK and in Montenegro.

The EU foreign service already has a joint intelligence capability called IntCen. Continue reading

European Central Bank In Panic Mode as Economy Stalls

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The eurozone could not borrow from the momentum of the U.S. economy in the third quarter as economic growth slumped to a tepid 0.2% , the slowest rate in more than four years. With the 19-nation currency bloc beginning to stagnate, and the heavyweights failing to post significant gains, Brussels is in panic mode, likely leaning on the European Central Bank (ECB) for further stimulus.

Economists originally anticipated growth of 0.4%. But global trade woes, tumbling business confidence, Italian distress, and the gradual dissipation of an accommodative monetary policy all contributed to the poor numbers in the July-September period. Continue reading

The EU’s ‘Internal Enemies’

BERLIN (Own report) – In view of the conflict between Brussels and Rome over Italy’s national budget, the German establishment is increasing its demands to resolutely fight the “internal enemies” of the EU. The Union must “now be vigorously defended,” wrote a leading German daily. The Italian government coalition is “not worth risking the country’s fate.” The Italian government is being put into question, because it refuses to continue to submit to German austerity dictates. Berlin’s dominance over the EU is also being met with mounting protests in other member countries. Poland and Hungary are not the only countries, where controversies are intensifying. Anger at Berlin is also growing in France. Jean-Luc Mélenchon, the founder of “La France insoumise,” who, with almost 20 percent, barely missed making the run-offs in the 2017 presidential elections, has now called for “France to withdraw from all EU treaties.” The German elite’s reaction is becoming more hostile.

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Italy Declares War on Merkel and the EU

Italy Declares War on Merkel and the EU

 

If there were ever any doubts that the leaders of the Euroskeptic coalition that now runs Italy has a plan to defy the European Union its proposed budget should quell them. Both Deputy Prime Ministers, Luigi Di Maio of Five Star Movement and Matteo Salvini of The League, were adamant about locking horns with European Union leadership over all issues of sovereignty between now and May’s European Parliamentary elections.

Their budget proposal which included both tax cuts and universal income blew past the EU budget limit of 2.0% of GDP, coming in at 2.4%. It has put their Finance Minister, Giovanni Tria, in a difficult position because Tria doesn’t want to negotiate this budget with Brussels, preferring a less confrontational, read more pro-EU, approach. Continue reading

The ECB on the Verge of Collapse?

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The European Central Bank (ECB) will aid Italy with an EU rescue program if the country or its banks are in financial turmoil because they are taking the view that Italy has become an “occupied” country and that Germany has conquered Europe imposing austerity and its view of inflation upon the whole of Europe without firing a shot. While the spin is that the ECB is making Italy a test case to demonstrate that Europe and its mechanisms work, in reality, it is a realization that the ECB cannot save Italy’s financial institutions because austerity has created the greatest economic depression perhaps in economic history. Continue reading

ECB Hands Italy An Ultimatum: ‘Obey EU Budget Rules Or We Won’t Save You’

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With the Washington Post stepping up to put a floor under US stocks Thursday afternoon by reporting that President Trump would meet Chinese President Xi Jinping at next month’s G-20 summit (while the headline soothed the market, it doesn’t change the fact that, as with everything involving the Trump administration, this too remains subject to change), investors have apparently overlooked the latest ominous headlines out of Italy. To wit, Reuters reported that the ECB won’t come to Italy’s rescue if its government or banks run out of cash unless the Italian government first secures a bailout from the European Union. Of course, this would almost certainly require that the populist coalition end its ongoing game of fiscal chicken with Brussels and abandon its  dreams of lowering the retirement age and extending a basic income to the Italian people – policies that would effectively secure a political future for M5S and the League. 

In effect, the ECB’s latest trial balloon is tantamount to blackmail: Either the Italians agree to fall back in line and obey European budgetary guidelines, or the central bank will sit back and watch as bond yields surge, providing the ratings agencies even more ammunition to cut Italian debt to junk – effectively guaranteeing a Greece-style banking crisis as the liquidity taps are turned off. Continue reading

Poll: AfD Now Germany’s Second-Most Popular Party

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(Photo Credit: Alternative for Germany)

 

A little more than one year after becoming the first “far-right” party to win seats in the Bundestag in more than 50 years, the AfD is now officially the opposition to Merkel’s “grand coalition,” which required alliances with not only Bavaria’s Christian Social Union and the Social Democratic Party to hold a majority of seats. A new poll has placed AfD one point ahead of the SDP in terms of generic support. Continue reading

Europe Launches War On Italy’s Fiscal Plans: Warns Of Debt “Explosion”, Threatens Savers

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In the aftermath of Italy’s defiant announcement that it would expand its 2019 budget deficit to 2.4% of GDP, above both the initial proposal from finmin Tria which was 1.6%, and also higher than the European “redline” of 2.0%, the question was how would Europe respond to this open mutiny by Italy.

The answers started to emerge on Friday, when European Parliament head Antonio Tajani said that fiscal targets set by Italy’s eurosceptic government were “against the people” and could hit savers without creating jobs.

“I am very concerned for what is happening in Italy,” said Tajani, who is a center-right opposition politician in Italy and close ally to former Prime Minister Silvio Berlusconi. The budgetary plans “will not raise employment but will cause trouble to the savings of the Italians,” Tajani said. Continue reading

All Euros Gravitate To Germany

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The Euro has been around for almost 20 years. The Russian transfer ruble survived 25 years. As GEFIRA explains, the two currencies have something in common: they were and are not a success story…

The introduction of the transfer ruble was intended to enable free trade between the countries of the Eastern bloc. The creation of the common clearing system led to the exchange rates for the East German mark, zloty, forint, lev, and even the Mongolian tugrik being arbitrarily fixed by the Soviet Union, regardless of the purchasing power of the national currencies. In the 1960s, the Bulgarian lev was 20% undervalued and the Polish zloty about 45% overvalued. Since the transfer ruble was not yet convertible into Western currencies, it remained an illusion and a means by which the Soviet Union could enrich itself and save its budget at the expense of its satellite states: the Russians bought raw materials, goods, food for convertible currencies in the West and sold them to their “socialist friends” for transfer rubels. The international bank for economic cooperation, which sat in Moscow and handled all transactions in the transfer ruble, swept the real trade surpluses and deficits under the carpet. With the political change the common settlement currency came to to an end, and it turned out that the Soviet Union owed huge sums to its “brothers”. Continue reading