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Markets News Afternoon: Irish shares dip; Finance ministers push Greeks on further cuts; O'Leary wants to meet Coughlan on 300 Dublin Airport jobs - - doesn't say what he's looking for
By Finfacts Team
Feb 15, 2010 - 4:32:39 PM
Jean-Claude Juncker , President of Eurogroup - Jean-Claude Trichet, President of the European Central Bank and Didier Reynders, Belgian Minister of Finance, pictured in Brussels, Monday, Feb 15, 2010.
US markets are closed Monday for the Presidents' Day public holiday.
Greece: The European Commission's new economic affairs commissioner said today that Greece should take more measures to cut its budget deficit against the backdrop of reports that Greece was aided by US investment bank Goldman Sachs to hide its swelling deficit by using swaps instruments.
“We expect that in due course the Greek government will take the necessary additional measures,” European Union Economic and Monetary Affairs Commissioner Olli Rehn told reporters in Brussels today before a meeting of EU finance chiefs. Greek Finance Minister George Papaconstantinou said his task was like changing “the course of the Titanic.”
Finance ministers of Eurozone nations, known as the Eurogroup are meeting to review Greece’s deficit plan as investors seek a public bailout to support Greece's sovereign debt.
Luxembourg’s Jean-Claude Juncker, who is head of the Eurogroup, said the ministers need reassurance that Greece can reach the target.
“Greece will have to make sure it cuts its deficit by 4% of GDP for 2010. We have to check if that’s possible or not,” Juncker told reporters in Brussels.
Greece’s deficit is at 12.7% of GDP (gross domestic product last year) - - the highest in the EU,
German economist, Otmar Issing, a former member of the European Central Bank’s executive board, writes in the Financial Times today that: "Thanks to the euro, Greece has enjoyed long-term interest rates at a record low. But instead of delivering on its commitment at the time of entry to reduce public debt levels, the country has wasted potential savings in a spending frenzy. The crisis with which it is now confronted is not the result of an “external shock” such as an earthquake, but the result of bad policies pursued over many years. Bailing out Greece would reward such behaviour and create moral hazard of a dimension hardly seen before."
European Union leaders are likely to stand pat on Greece until April when it will review whether the country can rollover its debt, Nick Beecroft from Saxo Bank said Monday. The failure of leaders to do something means that the Greek problems will spread into the euro area, he added. Ralph Silva from SRN joined the discussion:
Ryanair
Ryanair today published a letter it had sent to Minister for Enterprise, Mary Coughlan TD, in which Ryanair’s Michael O’Leary has offered to meet with the Tánaiste tomorrow afternoon, to explain the one or two simple steps which this Minister for Enterprise could take over the coming days to secure this investment and win these 300 engineering jobs for Dublin.
Ryanair did not disclose what it is seeking from the Government.
Ryanair’s Stephen McNamara said: “At a time when 800 former SR Technics engineers are on the dole, it is remarkable that this Minister for Enterprise has failed to do the one simple thing which is required to win a multi-million euro investment from Ryanair and which would create up to 300 jobs in the large Hangar 6 facility at Dublin Airport. Ryanair is now the world’s largest international airline, with a fleet of 210 aircraft and is one of the few airlines capable of filling this large Hangar 6 facility. We can create and sustain hundreds of well paid engineering jobs.
“Perhaps the only way to cut through the fog of this issue is to explain to the Tánaiste personally the simple steps she needs to take which would win this business back from two other competing European airports/Govts. Ryanair hopes that the Tánaiste will take up Michael O’Leary’s offer, after all what has she to lose, except perhaps another 300 jobs.”
Discussing the things the Fed could do to take out the excess stimulus, with Robert Froehlich, The Hartford; Dan Fitzpatrick, Stockmarket Mentor and Peter Morici, University of Maryland:
In Europe, the Dow Jones Stoxx 600 has risen 0.22% Monday.
In Dublin, the ISEQ has dipped 1.65%.
CRH has lost 1.65%; AIB has declined 9.33% and BoI has dropped by 6.75%.
On the New York Mercantile Exchange, oil for March 2010 delivery is trading at $74.25 up 16cents from Friday's close. In London, Brent crude for March delivery is trading at $72.85 a barrel.
Currencies
The euro is trading at $1.3591 and at £0.8679.
For live currency updates, check the right-hand column of the Finfacts home page.The dollar traded at a record low $1.6038 per euro on July 15, 2008.
As the Eurogroup prepares to push for Greek reforms, Par Magnusson of Danske Bank shares his outlook for the embattled economy, with CNBC's Anna Edwards:
