British embassies in eurozone told to create plans to extract ex-pats in post-Euro riots

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    Nov 27, 2011 7:00 PM GMT
    http://www.telegraph.co.uk/news/politics/8917077/Prepare-for-riots-in-euro-collapse-Foreign-Office-warns.html

    As the Italian government struggled to borrow and Spain considered seeking an international bail-out, British ministers privately warned that the break-up of the euro, once almost unthinkable, is now increasingly plausible.

    Diplomats are preparing to help Britons abroad through a banking collapse and even riots arising from the debt crisis.

    The Treasury confirmed earlier this month that contingency planning for a collapse is now under way.

    A senior minister has now revealed the extent of the Government’s concern, saying that Britain is now planning on the basis that a euro collapse is now just a matter of time.

    “It’s in our interests that they keep playing for time because that gives us more time to prepare,” the minister told the Daily Telegraph.

    Recent Foreign and Commonwealth Office instructions to embassies and consulates request contingency planning for extreme scenarios including rioting and social unrest.

    Greece has seen several outbreaks of civil disorder as its government struggles with its huge debts. British officials think similar scenes cannot be ruled out in other nations if the euro collapses.

    Diplomats have also been told to prepare to help tens of thousands of British citizens in eurozone countries with the consequences of a financial collapse that would leave them unable to access bank accounts or even withdraw cash.

    Fuelling the fears of financial markets for the euro, reports in Madrid yesterday suggested that the new Popular Party government could seek a bail-out from either the European Union rescue fund or the International Monetary Fund.

    There are also growing fears for Italy, whose new government was forced to pay record interest rates on new bonds issued yesterday.

    The yield on new six-month loans was 6.5 per cent, nearly double last month’s rate. And the yield on outstanding two-year loans was 7.8 per cent, well above the level considered unsustainable.

    Italy’s new government will have to sell more than EURO 30 billion of new bonds by the end of January to refinance its debts. Analysts say there is no guarantee that investors will buy all of those bonds, which could force Italy to default.

    The Italian government yesterday said that in talks with German Chancellor Angela Merkel and French President Nicolas Sarkozy, Prime Minister Mario Monti had agreed that an Italian collapse “would inevitably be the end of the euro.”

    The EU treaties that created the euro and set its membership rules contain no provision for members to leave, meaning any break-up would be disorderly and potentially chaotic.

    If eurozone governments defaulted on their debts, the European banks that hold many of their bonds would risk collapse.

    Some analysts say the shock waves of such an event would risk the collapse of the entire financial system, leaving banks unable to return money to retail depositors and destroying companies dependent on bank credit.

    The Financial Services Authority this week issued a public warning to British banks to bolster their contingency plans for the break-up of the single currency.

    Some economists believe that at worst, the outright collapse of the euro could reduce GDP in its member-states by up to half and trigger mass unemployment.

    Analysts at UBS, an investment bank earlier this year warned that the most extreme consequences of a break-up include risks to basic property rights and the threat of civil disorder.

    “When the unemployment consequences are factored in, it is virtually impossible to consider a break-up scenario without some serious social consequences,” UBS said.
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    Nov 27, 2011 7:32 PM GMT
    Posted a video describing and predicting riots in the Europe in this thread, but for those who don't want to go to the political area, here is the video.

    http://www.realjock.com/gayforums/1981422

    Nigel Farage: Trapped Inside an Economic Prison
  • shutoman

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    Nov 27, 2011 8:26 PM GMT
    Oh for the love of God! If you take your news from The Daily Telegraph and Nigel Farage what do you expect?

    Have you ever met a hardcore eurosceptic like Farage? They get very indignant if you accuse them of xenophobia: but feed them a few whiskies and after 40 minutes they're foaming at the mouth about 'bloody Germans, French, Italians, Polish (insert European race here). This happen every time; it would be hilarious were they not so vitriolic.

    Nobody doubts the shadow over the Euro - but can't you get a proper politician to talk about it? UKIP would rather see Europe in economic chaos than the euro remain for the non-UK! I think that's a weird set of priorities.
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    Nov 27, 2011 8:35 PM GMT
    shutoman saidOh for the love of God! If you take your news from The Daily Telegraph and Nigel Farage what do you expect? ....

    Like him or not, what he describes seems accurate as do the predictions. Is it possible that his unpopularity with some results from the message versus the messenger? Is the messenger too blunt for some tastes?
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    Nov 27, 2011 8:38 PM GMT
    shutoman saidOh for the love of God! If you take your news from The Daily Telegraph and Nigel Farage what do you expect?

    Have you ever met a hardcore eurosceptic like Farage? They get very indignant if you accuse them of xenophobia: but feed them a few whiskies and after 40 minutes they're foaming at the mouth about 'bloody Germans, French, Italians, Polish (insert European race here). This happen every time; it would be hilarious were they not so vitriolic.

    Nobody doubts the shadow over the Euro - but can't you get a proper politician to talk about it? UKIP would rather see Europe in economic chaos than the euro remain for the non-UK! I think that's a weird set of priorities.


    Do you trust the Economist? Or the fact that the article from the Telegraph cites Foreign Office officials? Date line in the Economist is yesterday: "The crisis in the euro area is turning into a panic and dragging the zone into recession. The risk that the currency disintegrates within weeks is alarmingly high"

    http://www.economist.com/node/21540259

    Now an even bigger calamity is looking likelier. The intensifying financial pressure raises the chances of a disorderly default by a government, a run of retail deposits on banks short of cash, or a revolt against austerity that would mark the start of the break-up of the euro zone.

    The German government can probably shrug off a failed auction: it likes to price its bonds as richly as it can, and occasionally cannot sell all it would like, even in untroubled times. Still, the timing is awful, and other governments are not so lucky: the contrast between Germany’s borrowing costs and those of other euro-zone sovereigns is stark (see chart 1). European banks are dumping the bonds of the least creditworthy, and other assets, in an attempt to conserve capital and improve cashflow as a full-blown funding crisis looms. Governments are promising ever more severe budget cuts in the hope of pacifying bond markets. The direct result of these scrambles is a credit crunch and a squeeze on aggregate demand that is forcing Europe into recession. Add the indirect effects on the confidence of consumers and businesses, and the downturn will be deep.
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    Nov 27, 2011 10:45 PM GMT
    Embassies are always supposed to be preparing contingency plans for evacuating citizens in worst case scenarios.

    More fear-mongering from the right.
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    Nov 27, 2011 11:43 PM GMT
    intentsman saidEmbassies are always supposed to be preparing contingency plans for evacuating citizens in worst case scenarios.

    More fear-mongering from the right.


    I'm curious - how do you see this as a left or right issue?

    "Britain is now planning on the basis that a euro collapse is now just a matter of time." A bit different than just run of the mill contingency planning.
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    Nov 27, 2011 11:54 PM GMT
    riddler78 said
    intentsman saidEmbassies are always supposed to be preparing contingency plans for evacuating citizens in worst case scenarios.

    More fear-mongering from the right.

    I'm curious - how do you see this as a left or right issue?

    "Britain is now planning on the basis that a euro collapse is now just a matter of time." A bit different than just run of the mill contingency planning.

    1. Because it was posted here by you, an extreme right-winger who only posts things that you think support your own conservative political agenda.

    2. Because the source of the article is the conservative Telegraph. And UK tabloids are about as authoritative and reliable as our own US supermarket rags.
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    Nov 28, 2011 12:16 AM GMT
    Art_Deco said
    riddler78 said
    intentsman saidEmbassies are always supposed to be preparing contingency plans for evacuating citizens in worst case scenarios.

    More fear-mongering from the right.

    I'm curious - how do you see this as a left or right issue?

    "Britain is now planning on the basis that a euro collapse is now just a matter of time." A bit different than just run of the mill contingency planning.

    1. Because it was posted here by you, an extreme right-winger who only posts things that you think support your own conservative political agenda.

    2. Because the source of the article is the conservative Telegraph. And UK tabloids are about as authoritative and reliable as our own US supermarket rags.


    And what of the reference to The Economist? I've posted many articles about technology, travel, economics and politics and you have even laughably suggested that I am some Republican plant. But on this point are you going to be so irresponsible as to suggest that because I posted it, it must be wrong? This could have horrible ramifications for anyone travelling or holding Euros or even living in any of these countries.

    That said, I can understand how you feel the need to dismiss what I post given how I have repeatedly pointed out how disturbingly devoid of fact or reason your posts generally are. Admittedly I have also been one of the first to point out that you are one of the prime examples that age does not confer wisdom on this site.
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    Nov 28, 2011 7:17 PM GMT
    Does this mean I need to rethink my plans to travel to Spain, Germany, and Belgium next fall? If not, should I look into the newly re-minted Spanish peseta, Belgian franc, and German deutsche mark? icon_eek.gif

    But on a serious note, my family in Belgium and Germany have told me that they would welcome a return to the franc and mark; a return to having their fellow Belgians and Germans back on their money; and a restored sense of national pride of sorts.
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    Nov 29, 2011 1:19 PM GMT
    The situation is continuing to deteriorate.

    http://online.wsj.com/article/SB10001424052970204262304577067773051290122.html?mod=WSJ_hp_MIDDLETopStories

    Italy Pays Record Yields at Bond Auction

    "The sheer size of Italy's economy and bond market has taken the crisis to a whole new level and has been a key factor in the reassessment of the risks of a break-up of the bloc," said Nicholas Spiro, managing director of Spiro Sovereign Strategy, a consultancy specializing in sovereign credit risk. "Never before has the threat of an Italian default been more real."
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    Nov 30, 2011 4:58 AM GMT
    intentsman saidEmbassies are always supposed to be preparing contingency plans for evacuating citizens in worst case scenarios.

    More fear-mongering from the right.


    And now the Guardian is posting about the fears within the UK government and contingency planning surrounding the collapse of the Euro - particularly fears that there will be a run on the banks:

    http://www.guardian.co.uk/politics/wintour-and-watt/2011/nov/29/georgeosborne-autumn-statement-20111

    The Guardian is not known as a particularly conservative paper (which is really understating the case).

    Also - more here:
    http://www.theatlantic.com/business/archive/2011/11/how-can-europe-possibly-save-itself/249248/