The financial travails of the Greek government go on, and will do so for some time even in the best of scenarios. So at least one thing is fixed: simple arithmetic quite clearly shows a noticeable imbalance in that country’s public financial resources and the amounts it customarily spends. Unfortunately, all other considerations surrounding that predicament and how best to address it seem to be stuck in a kaleidoscope-like flux.

Take for example the blogpost found on this site a couple weeks ago: there, resort to the IMF to assist Greece out of its bind was unthinkable, and the proposed solution – suggested by no lesser figure than the current German Finance Minister Wolfgang Schäuble – was instead to set up some sort of Monetary Fund within the institutions of the European Union. You can scratch that now; according to no less than Bundeskanzlerin Angela Merkel (who of course outranks Schäuble), IMF involvement would be perfectly OK and, if there is to be some sort of within-the-EU Monetary Fund, then it certainly won’t be able to appear in time to have anything to do with solving the Greek case. Oh, and another point I made was that the preferred technique so far of EU heads-of-government for dealing with the Greek situation was simply to issue declarations of support without actually doing anything to back them up, and that is also no longer completely true. Mind you, it’s not that the EU leaders now are trying to back them up; it’s that some, such as Bundeskanzlerin Merkel, don’t even want to talk about it any more, including shutting Greece’s problems off of the agenda for another EU summit meeting scheduled to be held next week.

But it gets even worse, as we see in an article in today’s issue of the Dutch business newspaper Het Financiële Dagblad. Merkel now is willing to countenance IMF involvement, but Nicolas Sarkozy still insists publicly that that is out of the question. Furthermore, the French President (together with Jose Manuel Barroso, Chairman of the European Commission) does want to talk about Greece at next week’s summit, at least to the extent of issuing another ringing declaration that the country will not be let down by its EU brother-states – thereby accomplishing a lowering of its borrowing costs, at least for a while.

Unfortunately, it seems that an IMF team has already been called in to take a look at the Greek situation, according to this HFD piece. Plus, the suspicion remains (although it is mentioned elsewhere, not here) that Sarkozy mainly wants to shut out the IMF in order to deny credit/glory to that organization’s head, Frenchman Dominique Strauss-Kahn, who might well run in 2012 to replace Sarkozy as French president. But this now-open disagreement on fundamental aspects of how to deal with the situation between the heads of the EU’s two leading states can only worsen investor confidence in Greece’s finances, and thereby the situation as a whole.

Here in the Netherlands we also have a prominent financial sector, dominated by a handfull of internationally-operating banks (e.g. ABN Amro, ING, even Rabobank) for which the value of the assets of any single one alone exceeds the national GDP. It follows that developments here over the past six months or so have more-or-less echoed the more-prominent financial travails in, say, the US or Great Britain: overindulgence in promising new asset-classes – often involving American real estate – which then turn out to be “toxic,” concerns over solvency, government injections of capital through one means or another, and in general some rather poor performance on the part of financial executives when it comes to sober risk analysis and maintaining their institutions’ very financial viability.

What is also not missing from the Dutch experience is the phenomenon that has gotten much of the American and British public exercised in recent weeks, namely that of financial executives walking away with huge monetary bonuses in the face of what is commonly understood as the meaning of “bonus” (“paid over and above base salary to reward extraordinary performance”) and the glaring absence of any merit that would justify them. (more…)

It’s coming on Christmas, but it’s also coming on the end of 2008, and so it’s time to look ahead to 2009. Economically, things do not look good. The leading Dutch business newspaper Het Financiële Dagblad has already picked up on remarks from Vice President-elect Joe Biden that will be televised later today on This Week with George Stephanopoulos that the US economy is in danger of “absolutely tanking.” (You can get the run-down in English plus a brief video of their interview here.)

Right, but what about closer to (the €S) home, what about the Netherlands’ economy? Also from Het Financiële Dagblad, we get some good news straight from the Dutch premier Jan Peter Balkenende that he is confident that the strong character of the Dutch will get them through the hard times. (more…)

From the leading Dutch business newspaper Het Financiële Dagblad comes a report about an encouragement pronouncement from current OPEC chairman Chakib Khelil (OPEC Chairman Khelil Sees Oil Price Sharply Falling).

According to Khelil, the price-per-barrel of over $140 that we recently saw for oil was “abnormal.” (more…)

We’re immediately back today to the “Polish guest-worker” theme, and this time in an established EU-land where the gates for such labor have not been thrown wide open with last May’s accession of the ten new member-states (logical, as that’s going to be the case for every “older fifteen” member-state we talk about other than Ireland), namely the Netherlands. Nonetheless, it seems that the spectre of Polish labor is making its presence felt here, too, as Martin Visser reports in one of those rare on-line articles from the leading Dutch business newspaper, Het Financiële Dagblad, that you’re allowed to read in exchange for free registration on the site (Union Fears the Invisible Poles). (more…)

You know that has to be true when the hardest-liner on the side of making France pay a fine for its flouting of the 3%-of-GDP budget deficit limit, Dutch finance minister Gerrit Zalm, finally throws in the towel. That he is now doing so is clear from an interview published in today’s Het Financiële Dagbald (subscription required). The scheduled meeting next Monday evening of EU finance ministers, long thought to be a setting for confrontation, will now merely be a formality as the lenient stance proposed by EU Economic and Monetary Affairs Commissioner Perdo Solbes is approved. Even though for him personally Monday’s meeting is sure to be, as the article puts it, “a long and unpleasant session,” in the end Zalm himself might even vote to approve Solbes’ proposal, if only to head off even more-lenient treatment of the French that some may use that occasion to advance. (more…)

OK, we’ve heard from the sanctimonious but idealistic Danish Left. (That’s the entry from earlier today, below; with the zany way that weblogs work, you get to read that afterwards, unless you switch over there right now.) Now for last week’s Madrid Conference of Iraqi donors from the cynic’s point of view – what you could call the “pay-to-play” outlook. (That “pay-to-play” concept I’ve now run across in connection with the California recall election, and just recently having to do with the upcoming election for Philadelphia’s mayor – which I am definitely not interested in. You should get a good idea of what it means from what follows.)

Let’s start with Die Zeit . . . (more…)

One big piece of current news in the Netherlands is the release of a comprehensive report from the Centraal Planbureau (CPB) on “The Future of Europe.” That “Central Plan Bureau,” despite its name, does not occupy itself with any sort of economic planning – i.e. in the socialist sense (as in the old Soviet Gosplan) of presuming to choreograph the national economy by calculating how that economy should work to achieve given national objectives, and then issuing instructions to economic actors about what they are to do. Rather, it is roughly the equivalent, say, of America’s National Bureau of Economic Research, except that the CPB is not private but rather publicly-funded, organizationally being part of the Dutch Ministry of Economic Affairs. Nonetheless, the CPB claims that it is quite objective and independent in the research it performs and conclusions it draws, even if it is formally part of the government.

Back in 1992 the CPB produced, and released to the public, its “Scanning the Future” report, a long-term study of the future of Europe and of the Netherlands based upon a general-equilibrium economic model it had developed, called “Worldscan.” “Scanning the Future” was built around four different long-term scenarios of how the future might look, depending on what assumptions you adopted. Like that earlier report, the just-released “Four Futures of Europe” – written in English – is also constructed around four long-term scenarios. (more…)

Can I write some more about that last week’s “European Council” (i.e. summit of European heads-of-state/government) in Brussels? There is at least one loose end to tidy up – interesting enough in itself to prompt an essay from Die Zeit.

There were a few other things that happened in Brussels, besides Jacques Chirac representing Germany for a day, and everybody reciting for the umpteenth time their stand on the draft Constitution. For one thing, the assembled leaders also approved the creation of a new European agency to coordinate immigration controls at the EU’s expanded borders. But of greater interest is the “growth initiative” that also constituted part of the summit’s business. That was mainly what the EU leaders talked about Thursday afternoon, after their no-progress talks on the draft Constitution of that morning. (more…)

If the Dutch on-line press is any indication, opinion in the Netherlands over the results of the just-completed European summit in Brussels (which was supposed to make progress towards a final European Constitution) is no higher than in France (covered in the following entry). Indeed, these articles offer some key updates to developments. (more…)