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Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: Joan Osland Graffius who wrote (193591)	9/25/2002 3:09:20 AM
From: Tommaso	Respond to of 436258

"At 7,683 the Dow has fallen nearly 1,200 points in just one month, " I was calling for 1800 point drop in that month! What's wrong with you folks? Make it 600 down today and I'll forgive you.

To: Joan Osland Graffius who wrote (193591)	9/25/2002 5:05:05 AM
From: maceng2	Respond to of 436258

EU retreats as nations risk budget breakdown By Lea Paterson, Economics Editor timesonline.co.uk (Joan, thanks for coffee link..pb.) BRUSSELS yesterday acknowledged for the first time that four of Europe’s largest economies were in grave danger of breaching its tax and spending rules, as the credibility of the EU’s Stability and Growth Pact (SGP) suffered another serious blow. In what amounted to a huge policy climbdown, the European Commission said that France, Germany, Italy and Portugal were all at risk of breaking through the SGP’s tough spending limits this year, and that it was abandoning its drive to persuade eurozone governments to balance their budgets by 2004. The Commission said that it would be urging eurozone governments to balance their budgets by 2006 at the latest, with weak economic growth cited as the chief reason for the change of policy stance. Romano Prodi, Commission President, denied suggestions that the shift in any way altered the rules of the SGP. Brussels officials said that they would still seek action against those eurozone governments whose budget deficit breached 3 per cent of national income. However, Signor Prodi admitted that Germany, France, Italy and Portugal were all “dangerously close if not already above the 3 per cent threshold”. The new Commission guidelines reflected “complicated and different” circumstances, he said. Analysts said that the rapid deterioration in the public finances of eurozone governments would provide the SGP with its biggest test, and was likely to trigger a reform of the controversial tax and spending rules. David Walton, of Goldman Sachs, said: “Europe’s Stability and Growth Pact needs to be reformed to restore its credibility. It does not need to be abandoned — its underlying principles are sound, but the implementation is not.” The SGP was originally introduced to safeguard the value of the euro amid concerns that the single currency could be undermined by spiralling European government debt. The SGP states that euro-zone governments should keep their budget deficits at less than 3 per cent of gross domestic product (GDP), and gives the EU power to levy punitive financial penalties on those that breach this ceiling. The SGP says eurozone governments should aim to balance their budgets in the medium term — a clause that until yesterday was interpreted by the Commission as achieving budget balance by 2004. The Commission’s new budget deficit guidelines — set to be discussed by EU finance ministers in Luxembourg next month — state that eurozone governments should aim to return to balanced budgets by 2006. A Commission spokesman said: “(The balanced budget goal) is established on the basis of a certain economic scenario, so given that we are significantly revising our economic forecasts, this will have an impact on some budget deficits.” Brussels officials said the Commission was now expecting eurozone growth of about 1 per cent this year, down from an earlier estimate of 1.4 per cent. They said the eurozone was not now expected to achieve the 3 per cent growth initially forecast for 2003.