Bershidsky on Europe: Ugly Dawn in Greece
Here's today's look at some of the top stories on markets and politics in Europe:
Anti-Nazi protests erupt in Greece
Thousands of Greeks throughout the country protested against the activities of the extreme right party Golden Dawn after one of its supporters killed a popular hip-hop artist. Pavlos Fyssas, also known as Killah P, got into an argument with Golden Dawn sympathizers outside a cafe, and one of the right-wingers stabbed him in the chest. Golden Dawn, an anti-immigrant, extreme nationalist party got into parliament for the first time last year, and its support has been growing steadily. The party's aggressive supporters have been involved in several violent incidents overlooked by police. The killing was the last straw for many Greeks, though Golden Dawn said it had nothing to do with Fyssas's death. The Greek events are a warning to ultranationalist parties gaining influence in other parts of crisis-battered Europe, notably in the Netherlands and in France: They are playing with fire, and their xenophobia may easily lead to street violence.
EU and IMF tell Cyprus to prepare for further turbulence
The European Commission and the International Monetary Fund have published the first reviews of Cyprus's $13.4 billion bailout. EU experts raised their unemployment forecast for this year from 15.5 percent to 17 percent. The IMF also said that the effects of Cyprus' banking crisis on the real economy could be worse than expected. These are natural effects of the demise of the country's banking sector, with one of the two largest banks closed down, the other forcing clients to take a 47.5 percent haircut on their deposits and smaller banks still closing or merging to survive. Cyprus is a country where small business dominates the economy, and there is almost no credit available to these enterprises now, so they can only shrink and lay off workers. Cypriot entrepreneurs are paying for the sins of their banks, and the international bailout provides little help for them.
Richard Branson brings mobile rental to France
Richard Branson, the founder of Virgin Group, dressed as Che Guevara for a Paris press conference announcing the launch of Virgin Mobile France. The terms Branson offered his customers struck some of the competitors as untenable. The operators offers a mid-range Android smartphone for rent at less than $27 per month, including unlimited calls and SMS - and 10 Gigabytes of data traffic. The operator promises to replace the phone every two years. This generosity is all the more surprising given that Virgin Mobile France is a virtual operator: It has no network of its own, renting bandwidth from the competition. "Traditional" mobile operators' margins are clearly too fat, and that creates opportunities for "guerrillas" like Branson in most European countries.
Berlusconi loses first vote on Senate expulsion
An Italian Senate committee voted down an appeal by former prime minister Silvio Berlusconi not to expel him following a tax fraud conviction. The vote went 15-1 against Berlusconi, and the expulsion process will now proceed. Realizing that he will probably be stripped of political office, 76-year-old Berlusconi has nevertheless vowed to stay in politics: "I will always be with you, at your side, expelled from parliament or not." He did, however, stop short of saying that his party would withdraw from the ruling coalition, toppling the government of Enrico Letta. Berlusconi said his ministers would fight within the government to "stop the fiscal bombardment that is bringing families and businesses to their knees," meaning a planned VAT increase pushed by the European Union. This is welcome news: at least Berlusconi seems unwilling to plunge Italy into a full-scale political crisis for selfish reasons.
Spanish government looking for ways to allow smoking in mega-casino
U.S. billionaire Sheldon Adelson has demanded an exemption from Spain's tough anti-smoking law as a condition of going ahead with his $22 billion project to build a casino complex, Eurovegas, in the Madrid suburbs. Smoking bans are known to be bad for casinos, and in many U.S. states and some European nations gambling establishments are exempt from them. There are signs that the Spanish government would rather grant Adelson's wish than risk losing the huge investment and the prospect of new jobs that goes with it. Health Minister Ana Mato told the parliament that ministers were looking for "formulas" that can make the necessary health protection "compatible" with job creation.
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Leonid Bershidsky at email@example.com