US Economy; Complete disconnect between Wall Street and Main Street - by RM

Question, who or what is behind the major disconnect between Wall Street and reality, with stocks going up on the Dow for the past 4 days.Today by even more than 500 points, and this while economies are tanking all around the world, and while as many as 30% of the US workforce remains 
unemployed ?

Some companies obviously are making excessive profits as a result of the present emergency situation, but in no way is Wall Street a reflection of the state of the US economy, as President Trump likes to brag about.

The above is, however another clear indication of the great disparity between "the have and have nots" in the US and has to be remedied by an aggressive and progressive new Democratic government, before it destroys the USA from within.

EU-Digest

Britain: EU bosses order Britain to "Pack your bags and get out now"

EU bosses ordered Britain: “Pack your bags and get out now.”

The strongly worded message in the wake of Thursday’s Leave vote was designed to stop a domino effect of EU exits and calm the ­frenzied money markets.

Far-right groups in France and Holland seized on the result to demand their own exit referendums.

In Brussels, EU chiefs said they “regret but respect” our decision and that the UK must remain “a close partner”.

But in a clear sign of the battles ahead, a statement from bosses including European Council boss Donald Tusk and European Commission president Jean Claude Juncker called on the UK to start Brexit ­immediately. It said: “We now expect the government to give effect to this decision of the British people as soon as possible, however painful that process may be.

“Any delay would unnecessarily prolong uncertainty.”

There are around 1.2 million British born people living in EU countries without visas, according to figures provided by the UN. Around 800,000 are workers and their dependants.

The European Commission, presently employs 1,000 U.K. nationals as civil servants across its various departments.

Also for the soon to become redundant former British EU citizens Brexit now means an uncertain future of either getting visas,work permits, going home, or worse case scenario, becoming a refugee themselves requesting asylum in the EU? 

EU-DigestBritain: EU bosses order Britain to "Pack your bags and get out now"

EU Migrant Crises: The economics behind Europe’s migrant crisis - by Mohamed A. El-Erian

Fleeing economic and social miseries of home countries

As our Eurostar train zipped from London through the Chunnel to Paris, I couldn't help thinking about the thousands of migrants languishing on both sides of the English Channel. Once again, national and regional political systems are struggling to cope with a mounting human tragedy whose spillover effects involve disruptions to commerce, and all this is stoking a political crisis.

The economics of the Channel migrant crisis are quite clear, being basically about supply, demand and regulatory failures. They also shed light on the potential solutions, though they will take time to materialize.

The supply of migrants to Europe is fueled by waves of people fleeing the economic and social misery of their home countries — and, in some case, political oppression, persecution and violence.

They do so in hopes of a better future for themselves and their children. The temptation for some to try and make it all the way to the U.K., often after a perilous sea crossing and a fraught trip through western Europe, is amplified by the attractiveness of an economy with low unemployment, comprehensive social services and a country where many already know the language. 

Although the supply of migrants has increased, the demand for migrant labour has gone the other way. Tougher laws have made it harder and more dangerous for employers to hire undocumented workers. And with a European unemployment rate of more than 10 per cent, the demand is further damped. 

This imbalance in supply and demand isn't one that can be sorted out by the markets' normal equilibrating mechanism. The market-clearing wage — that is, the price that would lower the migration incentive while facilitating the absorption of those still inclined to risk life and limb — is well below the minimum wage prevailing in Europe; and any meaningful reduction in the wage would involve significant and unacceptable social disruptions to local populations in Europe.

Read more: The economics behind Europe’s migrant crisis: MIGRANTS

Crime in trhe EU: The Netherlands Falls Victim to Violent Crime - by Sierra Rayne

With the recent news that the Dutch goverment will be prosecuting Geert Wilders, the leader of the Party for Freedom, for hate speech once again, even a cursory review of what is happening in the Netherlands reveals why Wilders is so concerned. His nation is becoming unrecognizable and deteriorating rapidly.

Over the past 20 years, the violent crime rate has increased an astounding 83 percent in the Netherlands. Almost all of this increase took place before 2005 -- indeed, since 2005 there has been a slight decline in the Dutch violent crime rate, but the levels are still astronomical compared to those seen in the early to mid-1990s.

Between 1993 and 1995, the Dutch unemployment rate increased sharply but the violent crime rate was essentially unaffected. From 1995 to 2011, the unemployment rate fell from 7.1 percent to just 2.5 percent, and the violent crime rate exploded upwards. Since 2008, the jobless rate has increased rapidly, but the violent crime rate has declined modestly -- albeit still at nearly twice 1993 levels.

Real per capita GDP has fallen 5 percent since 2008, and violent crime also declined, whereas from 1993 to 2005 the real per capita GDP increased by almost 30 percent while the violent crime rate also increased 111 percent. 

Attempting to assign causation for an increasing violent crime rate on increased per capita wealth generation would be inconsistent with the general experience among wealthy nations over this time frame (aka, invalid).

Changes in income inequality also won't explain the massive increase in the Dutch violent crime rate during the last two decades. The income shares for the top 10 percent and top 1 percent have hardly changed over this period.

What has changed in a consistent manner with the Dutch violent crime rate is the percentage of population that is classified as "international migrant stock"

Read more: Blog: The Netherlands Falls Victim to Violent Crime

Britain dodging EU laws and UK taxpayers now face huge bill from EU jobless - by Alison Little

European Union rules require a member state where a foreign worker has paid National Insurance Contributions (NICs) to reimburse the person’s home country for certain benefits, mostly Jobseeker’s Allowance, paid when they return.

Britain insists it will hand over the cash only where the person has paid NICs here for long enough to qualify for the benefits had they stayed in the UK and been unemployed.

But a group of Eastern European countries has signalled they will work together to step up pressure on the UK to bow to a non-legally binding recommendation from an EU committee that states should reimburse each other regardless of their own rules.

The Czech Republic said it was working with Hungary, Slovakia and Poland who all claim Britain owes them millions.

Czech Minister of Labour and Social Affairs Michaela Marksova yesterday  said her country had received just £800,000 from Britain in payments for unemployed returning Czechs when it was owed an estimated £3 million.

In a radio interview she accused UK authorities of dragging their heels and dodging their EU responsibilities.

Read more: UK taxpayers face huge bill from EU jobless who go home | UK | News | Daily Express

Europe Is Sick - Changing Course Towards A Social Europe - by Reiner Hoffmann:

Joseph Stiglitz, who won the Nobel Prize in 2001 for his work on how markets work inefficiently was once asked about his opinion on austerity measures. “It reminds me of medieval medicine,” he said. “It is like blood-letting, where you took blood out of a patient because the theory was that there were bad tumours. And very often, when you took the blood out, the patient got sicker. The response then was more blood-letting until the patient very nearly died.” He drew the conclusion: “What is happening in Europe is a mutual suicide pact!”

Jospeh Stiglitz is right. The manner in which the crisis is dealt with is likely to be of far-reaching significance to Europe and to the rest of the world. Therefore, it’s about the correct decision on the future direction: On the one hand a Europe based on the logic of commerce and competition or on the other hand a Social Europe that tackles the crisis in solidarity and does not leave the young out in the rain when the going gets tough!

I believe that even the Germans do not live on an isolated island of the blessed. We cannot remain indifferent to how the people in those countries who are affected the most by the crisis are suffering. In the long term, things will only go well for us if they are going well for our neighbours too.

Undoubtedly, we do not need an over-regulated EU which wants to ban the serving of olive oil in dipping bowls or wants to regulate the physical appearance of fruit and vegetables. 

What we need are better regulated financial markets and we need banks which serve the real economy and are useful for industry. We do not need banks rewarding managers with substantial cash-bonuses for short-term gains, filling up balloons with air and then letting it out again – and getting the European taxpayer to pick up the bill.

Ten Eurozone countries have committed to introducing the proposed European Union financial transaction tax (FTT) by 2016. The FTT and the step towards the creation of a European banking union are major developments for dealing with the current problems. However, it’s not enough! We need further EU action on combating tax avoidance and tax evasion. A competitive approach to cutting company taxes we cannot and will no longer afford in Europe.

What worries me is that little discussion appears to focus explicitly on the costs of economic crises in terms of human lives. The crisis management strategy adopted by politicians, comprising austerity mandates and cuts in wages, pensions and welfare payments, has not only led to a downward spiral in economic terms, but is also having a devastating impact on citizens. Social risks are increasing and individuals and families are under constant worry. 

Unemployment – particularly among the young – is sky-high, living standards are falling and signs of the crisis range from soup kitchens in Athens to Portugal’s crowds protesting in the streets against austerity.

If unemployment was a country it would be, with 19,2 million inhabitants, the fifth biggest in the EU. In the US, Greece, Italy, Spain, the UK and elsewhere in Europe there were more than 10,000 additional suicides from 2007-2010, a figure that is over and above historical trends, with the largest rises concentrated in the worst performing economies. 

Greece is in the middle of a public health disaster: HIV, TB, and malaria epidemics will now cost more to control than they would have been to prevent. An increase in infant and child mortality was observed in Portugal. In Italy, the education system is falling down. In about half of Italian school buildings, including universities, pieces of plaster are falling off the ceiling, water penetrates walls and floors are giving way. And the youth unemployment rate in Spain has increased to over 50 percent.

The European election results clearly reveal that Europe is ill (to steal the title of an essay by Perry Anderson in the London Review of Books). The symptoms of this illness are apparent – but what can we do to bring Europe out of intensive care? To relief Europe from the consequences of the neoliberal arbitrariness and lack of commitment?

Special weight must be given to German politics. The coordinates in the new grand coalition have shifted from centre-right to centre-left. This is an important change of direction. The grand coalition is marginally more pro-European and less keen on forcing austerity onto the Eurozone.

There is a big difference between therapeutic fasting and strangulation of the patient. The one contributes to recovery the other leads in the best case to a coma. Andreas Fischer-Lescano, Professor at the Centre of European Law and Politics (ZERP) at Bremen University presented a legal opinion on the EU’s austerity policy. According to him, the EU’s austerity policy is unlawful.

Read more: Reiner Hoffmann: Changing Course Towards A Social Europe

Dutch PM Rutte Says Netherlands in Difficult Times, Unemployment to Rise - by Fred Pals

The Netherlands is going through extraordinarily difficult economic times and unemployment will continue to rise for some time, Prime Minister Mark Rutte said.

Dutch PM Mark Rutte

“Radical changes will come to the Netherlands,” Rutte said in a lecture in Amsterdam yesterday. “We stand for fundamental choices, and we need to make the right ones.”

The government will unveil a plan to save 6 billion euros ($7.9 billion) in parliament on Sept. 17. That’s on top of a four-year, 16 billion-euro austerity package approved in November when Rutte took office.

The Dutch economy, in its third recession since the financial crisis started in 2008, shrank 0.2 percent in the second quarter.

Rutte’s government, which comprises his Liberal Party and the Labor Party, stands at an all-time low in the polls.

The coalition would only retain 32 of the 150 seats in parliament if elections were held now, a drop of 47 seats, according to a survey published by polling agency Peil.nl on Aug. 25. The Labor Party would have 12 seats, while Rutte’s Liberal Party would get 20 seats, according to the poll.

Read more: Rutte Says Netherlands in Difficult Times, Unemployment to Rise - Bloomberg