On Sun, 7 Feb 2010 23:55:07 -0800, "azotic"
wrote:
snip
Indeed the euro is in deep doodo this morning.

http://www.reuters.com/article/idUSTOE61704V20100208

The vortex is sucking in Japanese stocks.

http://www.businessweek.com/news/201...talks-end.html
http://www.reuters.com/article/idUSTKW00680220100208
==========
This is like watching a train wreck in slow motion.

Information continues to bubble to the surface as to just how
badly the books have been cooked. In this particular case with
the help of Goldman-Sachs. [Apparently there are many other banks
playing the same games, most using the taxpayers' bailout money]

From Germany
http://www.spiegel.de/international/...676634,00.html

02/08/2010
Greek Debt Crisis
How Goldman Sachs Helped Greece to Mask its True Debt
By Beat Balzli

snip
Goldman Sachs helped the Greek government to mask the true extent
of its deficit with the help of a derivatives deal that legally
circumvented the EU Maastricht deficit rules. At some point the
so-called cross currency swaps will mature, and swell the
country's already bloated deficit.
snip
Creative accounting took priority when it came to totting up
government debt.Since 1999, the Maastricht rules threaten to slap
hefty fines on euro member countries that exceed the budget
deficit limit of three percent of gross domestic product. Total
government debt mustn't exceed 60 percent.

The Greeks have never managed to stick to the 60 percent debt
limit, and they only adhered to the three percent deficit ceiling
with the help of blatant balance sheet cosmetics. One time,
gigantic military expenditures were left out, and another time
billions in hospital debt. After recalculating the figures, the
experts at Eurostat consistently came up with the same results:
In truth, the deficit each year has been far greater than the
three percent limit. In 2009, it exploded to over 12 percent.

Now, though, it looks like the Greek figure jugglers have been
even more brazen than was previously thought. "Around 2002 in
particular, various investment banks offered complex financial
products with which governments could push part of their
liabilities into the future," one insider recalled, adding that
Mediterranean countries had snapped up such products.

Greece's debt managers agreed a huge deal with the savvy bankers
of US investment bank Goldman Sachs at the start of 2002. The
deal involved so-called cross-currency swaps in which government
debt issued in dollars and yen was swapped for euro debt for a
certain period -- to be exchanged back into the original
currencies at a later date.

snip
But in the Greek case the US bankers devised a special kind of
swap with fictional exchange rates. That enabled Greece to
receive a far higher sum than the actual euro market value of 10
billion dollars or yen. In that way Goldman Sachs secretly
arranged additional credit of up to $1 billion for the Greeks.

This credit disguised as a swap didn't show up in the Greek debt
statistics. Eurostat's reporting rules don't comprehensively
record transactions involving financial derivatives. "The
Maastricht rules can be circumvented quite legally through
swaps," says a German derivatives dealer.

In previous years, Italy used a similar trick to mask its true
debt with the help of a different US bank. In 2002 the Greek
deficit amounted to 1.2 percent of GDP. After Eurostat reviewed
the data in September 2004, the ratio had to be revised up to 3.7
percent. According to today's records, it stands at 5.2 percent.

snip


Unka George (George McDuffee)
...............................
The past is a foreign country;
they do things differently there.
L. P. Hartley (1895-1972), British author.
The Go-Between, Prologue (1953).