Squeeze Greece or find funds yourselves, euro chief warns

In the wake of the Greek election, one thing is clear: No party or coalition of parties is in control. More elections are coming, but will the results be any different? In the meantime, the next disbursement of Greece bailout funds is at risk, and Greece faces being unable to meet pension, salary and debt commitments next month. Please consider Greece braces for a repeat of elections

MADRID – Spain’s conservative prime minister is preparing a package of small measures — such as tax breaks for young entrepreneurs — to stimulate the economy even as he vows to stick to budget cuts. Prime Minister Mariano Rajoy, whose popularity has plummeted after a year in the job, will announce the steps on Feb. 20 in his first State of the Union address in an effort win back public trust after severe spending cuts.

Saxo bank chief economist Steen Jakobsen pinged me with an interesting set of comments regarding Italian interest rates....World has Major Funding GapOur estimation shows that on the 2012 interest payment alone Italy now needs to find additional 10 billion EUR to pay for the rise in interest rates.Some independent trading houses have calculated that the combined funding need for Spain and Italy combined (banks, and national debt) is 400-500 billion EUR per year for next two to three years.

ATHENS — Ratings agency Fitch upgraded its sovereign credit rating for Greece by one notch on Tuesday, citing the country’s progress in cutting its budget deficit and the receding risk of its eurozone exit. After nearly crashing out of the euro last year and coming under attack for stalled reforms, Greece has won praise in recent months from its international lenders for getting back on track and pushing through unpopular austerity measures.

When it comes to the main sovereign story of 2011 and 2012, namely the endless bailout of Greece, now in its third iteration, the conventional wisdom is that courtesy of the near elimination of the country's private sovereign debt and the fact that its official foreign debt held by benevolent taxpayer funded globalist powers (IMF, ECB, EFSF) has been mostly converted into a zero-coupon, perpetual piece of paper, the country is fine.

The International Monetary Fund and European Union are demanding further austerity measures from Greece as the price for a bailout, according to a top Greek labor union official.

The very instant the Greek "Unity Government" formed it was divided. Antonis Samaras, the leader of Greece’s New Democracy Party, one of the three coalition parties that formed the government says he will not sign a document demanded by the IMF before it will release the next tranche. That's not all, Samaras actually wants to rework the agreement. Neither will fly (at least with Greece receiving the next tranche of money), and tensions fester.