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France and Germany have given themselves until the end of January to reach a fiscal union strengthened the euro area, a project that could go through the quarantine of several countries and has generated negative reactions Monday from members of the single currency.

According to sources familiar with the exchanges between Paris and Berlin, the two countries are considering a revision to bypass formal European Treaty – a process that would last 18 months as a minimum – by working on a mini-treaty outside the Community more flexible and quicker to implement.

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A year ago the head of state has big plans for the G20 in Cannes, hoping to legitimize its position as world leader and presidential candidate. But on the eve of the summit, Nicolas Sarkozy saw his hopes dashed. The European Council President Herman Van Rompuy, Nicolas Sarkozy and Angela Merkel in Brussels.

It must have been a great moment for France. And especially to Nicolas Sarkozy. Arriving to obtain the presidency of the G20 and G8 in 2011, with the help of his friend Gordon Brown, the head of state hoped to do two things at once: to become the great president of the International that he has always dreamed of being, and credibility for election in 2012. "In a way, it is served by the crisis," he said in November 2010, so do not hide its ambitions.At the time the French president harbored grandiose plans for the world economy: reforming the international monetary system (set the dual problem of the dollar and the yuan), limit the volatility of commodity prices, agricultural, or modernize the governance world. It will not happen, or not much. Already because of Nicolas Sarkozy's ambitions were too ambitious … But also because since November 2010, things have changed for France and its President.

Europe is no longer inspires confidence

It seems a long time since Germany and France landed at the G20 with the design, a bit peremptory, to moralize the financial world. At the time – at the G20 London in particular – the plight of the markets appeared to be the cause of all evil in the world economy.Today, on the verge of drowning, Europe assumed the costume of the responsibility for the crisis, wasting less time than it takes to say its capital credibility.

And it is likely that the G20 is a great opportunity for other states to remind him. All actors have to say good conscious "support and rebalance the global economy face significant risk of deterioration," for most, nothing can be done before that Europe treats his own evils. It is for this reason that the Europeans, Nicolas Sarkozy in the lead, have both hastened to find a solution for Greece. Alas, the great promises of the European Union will not be at the rendezvous.

Tuesday, to everyone's surprise, the Greek Prime Minister George Papandreou decided to submit the European Agreement on Greece in the popular referendum and drawing a large question mark over the future of the euro area.

Wall Street opened in fall Monday after two weeks of gains, weighed down by a statement by the German Finance Minister Wolfgang Schäuble that the next EU summit will not produce a definitive solution to the debt crisis.

In early trade, the Dow yielded 0.59% (56 points) at 11,575 points.The Standard & Poor's, wider, fell by 0.62% (7.5 points) to 1217 points while the Nasdaq composite lost 0.64% (17 points) in 2650.

Germany warned Monday against the dream "unrealistic" to see the European Summit of 23 October Sunday settle the debt crisis in the euro area, keeping the pressure on banks to grant a discount over important Greek debt.

Wall Street was completed Friday a second consecutive week of gains, seeing the S & P 500 gaining over 8% on the hope of curbing the euro area's debt crisis and the global economy avoid a recession.

But a barometer of manufacturing activity in New York Monday revived fears about the U.S. economy.

The Empire State index of the Federal Reserve of New York stood at -8.48 in October, its fifth consecutive month in negative territory, while the market expected a slightly less marked contraction (-4.00) from -8.82 in September.

Industrial production has in turn increased by 0.2% in September, as expected, the manufacturing sector offsetting a decline in the utilities.

Citigroup gained 1.2% at the opening after reporting a profit increase in the third quarter.The bank has indeed had to be provisioned are less clear for its losses from toxic assets, while benefiting from an accounting gain that banks can reap when financial markets are turbulent.

Wells Fargo lost 5.6% after posting a profit rise in third quarter but have just missed the consensus of analysts.

The growth in world oil demand will grow less than expected in 2011 and will accelerate next year, predicted Wednesday the U.S. Agency for Energy Information (EIA).

The EIA, which has already significantly reduced its forecast last month, has not made this time only a small adjustment with growth forecast revised down 50,000 barrels per day (bpd).

The agency now predicts an increase in demand of 1.32 million bpd to 88.4 million bpd this year and an increase of 1.44 million bpd in 2012.

These figures are higher than the predictions of the International Energy Agency, based in Paris, which expects growth of only 1.25 million bpd.

The Organization of Petroleum Exporting Countries (OPEC) has plans to increase the demand limited to 880,000 bpd in 2011 and an increase of 1.19 million bpd next year.

The EIA notes that if the supply of oil is still subject to a number of uncertainties, which she attributed to the instability in the Middle East, demand will continue to be penalized by the jolting of the economy.

"The downside risks dominate as fears continue to weigh on the pace of global recovery, the debt crisis continues in the European Union and other governments still face the challenge of deficits," said the EIA in its report.

The stock markets in the euro area settle in the green Thursday at midday, driven by financial stocks boosted by a voting majority in the margin of the German Parliament the reform of financial stability in Europe.

However, progress is limited. If the ratification of strengthening the powers of EFSF (European Financial Stability Fund) is acquired in Germany, this vote does not dispel the differences that oppose European leaders on how to deal effectively with the debt crisis in the euro area, report professionals.

Around 12:20, the CAC 40 index, which made the yo-yo in early trading, rises above 3000 points.The index gained 0.84% ​​to 3020.70 points and 3033.38 and 2974.98 changes between.

The euro also benefits the vote in the Bundestag and is trading around 1.3642 dollars against 1.3536 late Wednesday.

In Paris, BNP Paribas (6.27%), Societe Generale (4.67%) and Credit Agricole (3.75%) are leading the CAC 40 increases as the Stoxx Banks (+ 1.92%) is the leading sector gains in Europe.

L'Oreal (-1.48%) shows the largest drop in the Paris index, weighed down by the statements of Reuters Clarins boss who said he is worried about the economy in Europe this year and next year .

"These comments (Clarins) are negative for L'Oreal, which makes 40% of its sales in Europe," said one trader.

Exchanges of Frankfurt and Milan won respectively 0.57% and 1.28%.EuroStoxx 50 index of the core values ​​of the euro area is 0.96%. Outside the eurozone, London yields 0.31%

"We continue to believe that the news of recent days are not particularly encouraging. We are seeing some convergence between the political leaders of the EMU (Economic and Monetary Union)," say the strategists rate of Societe Generale in their daily note .

The performance of the German government bond (Bund) is relaxed to 10 years by 1.0 basis points to 1.97%.

The favorite candidate in the primary socialist believes that the rising tax burden is unavoidable. The effort must be "shared", he says. François Hollande at a rally in Rennes on 27 september 2011.

François Hollande, the favorite in the polls primary PS, said Tuesday that it would "necessarily" increase the tax burden on Tuesday at a meeting in Rennes, defending his plan to re-create 60,000 jobs in education evening mobilization teacher. "There will necessarily be a rising tax burden," said the elected Corrèze to 2,000 people, noting that taxes, fees and expenses had increased by Nicolas Sarkozy (44% against 43% of GDP according to him) while the head of state promised to reduce the "four points" in 2007.

"If this effort is not shared, there will be no recovery," he added.He lampooned the tax on soft drinks recently proposed by the government: "Why sugar? Why not salt? And the salt tax would be reinvented." The evening of a day of action in education, Francois Hollande has again defended his plan to re-create 60,000 jobs in education in five years: "I prefer a plan for education (to) a plan for prisons "he said, referring to the recent announcement by the Head of State to create 30,000 prison places.

While European politicians opposing the idea of ​​issuing Eurobonds to respond to the crisis of sovereign debt, China could affect their development.

Europe is the first export market of China, which has clearly said he was in his interest to avoid a financial collapse that could cause a global recession.

China also wants to diversify its foreign reserves to reduce the share of U.S. government bonds, and did not wait for the deterioration in the sovereign rating of the United States last month to start doing.

"European countries are facing problems of sovereign debt.We have said countless times that China wants to give a hand and we will continue to invest (in Europe), "said Premier Wen Jiabao during the 'Summer Davos Forum' week last in the Chinese city of Dalian.

But he also said that the major developed economies were healthier fiscal position and urged Europe to make a reciprocal gesture by granting China the status of market economy.

Europeans have so far been reluctant to make this concession, given the exchange rate regime of the yuan, state control of Chinese industry and commercial litigation, intellectual property, for example.

Upon entry to the World Trade Organization (WTO) in 2001, China agreed to a covenant which provided that she would not have the status of market economy in the world before 2016.Beijing has long called for this status to be granted in advance, as that would provide better protection against anti-dumping duties including the EU.

"A crisis is an opportunity"

"Europeans have not been sufficiently sensitive to the needs of China," said Etienne Reuter, a consultant who was representing the EU in Hong Kong and Japan.

China also wants the EU to lift an arms embargo imposed in 1989 after the crushing of the "Beijing Spring".

Privately, EU officials who manage the debt crisis remember that China is one of the few large foreign investors continue to buy bonds of countries in the euro area in the secondary market.

China thinks it also has also taken a large share of bonds rated triple-A issued by the European Financial Stability (EFSF) to support Greece, Ireland and Portugal as part of programs helps set up by the EU and the International Monetary Fund.

For Beijing, the problem is rather that there is not enough paper issues rated triple A European response to the request.Yields on German government bonds and UK safe haven to which have turned many investors are thus fell below the rate of inflation.

"It is in the interest of China that the euro area is stable with the creation of Euro-bonds, but China may have an impact on the decision of the European countries I doubt," said however Xu Bei, a Chinese economist who works in Paris for the French bank Natixis investment.

"In the Chinese mentality, a crisis is always an opportunity.The Chinese word for crisis has two characters: one meaning danger, the other opportunity, "says she.

In the short term, she says, it would make sense for China to buy the Italian Treasury bonds, which are active in Europe among the more volume and more liquid while providing an attractive return "if Excluding a scenario of extreme crisis. "

SECURE INVESTMENT

There is clearly a debate within the Chinese leadership on the pros and cons of going to the assistance of Europe.

Forum in Dalian last week, an adviser to the Chinese central bank, Daokui Li said that China should refrain from buying large volumes of European bonds.

In its edition for abroad, the People's Daily, for its part says that China should not act alone but work with other creditors, including the IMF, and ask that the euro area investment guarantees.

"Faced with latent systemic risk for European debt, China should both take the role of responsible great power but must also make security a prerequisite for an investment," said an editorial in Xiangyang Li, researcher international relations at the Chinese Academy of Social Sciences.

According to Etienne Reuter, Wen Jiabao wants to open China further and support the conservative voice of Europe, but among the other leaders argue that Beijing must be careful not to get too involved in other countries.

Chinese public opinion, at least as reflected by the blogs on the internet, look for caution on the issue of investment in Europe is for its part Bei Xu.

As for David Bowers, the financial advisory firm Absolute Strategy Research, the Committee is unlikely that China will take strategic initiatives to scale before the change of the management team in 2012, which should be reflected in particular by replacing Hu Jintao and Premier Wen Jiabao.

"The people that the Chinese are dealing, it is the Germans.Triple A is a nation like China, mercantile like China, and the Chinese could help them avoid making the taxpayers bear the German "a heavy burden, he said.

China is becoming the next two years the largest trading partner of Germany instead of France, noted David Bowers.

"They (the Chinese) will have to wait until Germany is clearer about what she wants in Europe," he said.

Moody's Investors Service downgraded Wednesday Societe Generale and Credit Agricole up a notch, and extended monitoring of BNP Paribas, adding that any downgrading of the rating on BNP would probably also limited to one notch.

The rating agency had placed the banks under review with negative implications on June 15, citing their exposure to Greece.

Experts had said that the notes were ripe for a downgrade due to higher borrowing costs in the context of sovereign debt crisis of several of the euro area.

In a context of deterioration of refinancing, Moody's said its concerns about the structural difficulties of the profiles of liquidity and financing banks had intensified.

For Credit Agricole, Moody's reduced the rating of the long-term debt and deposits to Aa2 from Aa1, a one notch downgrade and downgraded the Bank Financial Strength Rating (BFSR) to the next level too, C + to C.

Regarding Societe Generale, Moody's Aa2 to Aa3 reduced from the note of the long-term debt and deposits, with a negative outlook.The agency estimates that the impact of monitoring the Bank Financial Strength Rating (BFSR) will be limited to a one notch downgrade.

Moody's believes, however, that Societe Generale has a level of capital sufficient to absorb potential losses it is likely to record its holdings on Greek government bonds.

It added that Societe Generale will remain capitalized at a level consistent with its BFSR, even if the quality of the signature of the Ireland and Portugal were to deteriorate further.

Societe Generale issued a statement following the announcement by Moody's.The bank says it has demonstrated its ability to effectively manage the current situation in the debt crisis in Greece and has taken appropriate measures to strengthen its profile of refinancing.

Societe Generale said Monday it would conduct asset sales and cost reductions designed to release four billion euros in additional capital by 2013.

FRENCH BANKS "KEEP NOTES OF VERY GOOD"

For BNP Paribas, Moody's believes that the first French bank has a level of profitability and capital sufficient to absorb potential losses it may suffer over time due to its exposure to Greece, Portugal and the Ireland.

Moody's continues its review with negative implications for long-term rating and deposits – currently Aa2 – BNP Paribas, but considered unlikely that this under surveillance results in a downgrade of more than one notch.

BNP Paribas said Wednesday it would reduce the size of its balance sheet of about 10% by the end of 2012 and expects to achieve a capital adequacy ratio of 9% under the new banking regulations of Basel III on 1 January 2013.

Following the announcements by Moody's, the French government has reaffirmed the "strong" French banks.

"French banks have withstood stress tests that were very demanding few weeks ago," said Valerie Pécresse, budget minister and spokesman of the government after the cabinet meeting.

"There is no funding problem, or issue credit or liquidity problem for French banks," she said.

French banks are "very strong and keep very good notes," she said.

Radio Europe 1, President of the Financial Markets Authority (AMF) Jean-Pierre Jouyet noted that the cuts of note occurred already anticipated by the market.

On RTL, the governor of the Banque de France Christian Noyer, for its part felt that the situation of French banks was unlikely to deteriorate further after the decision by Moody's.

At the Paris stock exchange, securities of the three banks have opened down sharply after the announcements by Moody's, but have rapidly reduced or erased their losses, with the overall market, thanks to remarks by the President of the European Commission suggesting a forthcoming proposal for the introduction of euro bonds.

French banks are the institutions most exposed to Greece, according to the Bank for International Settlements (BIS).

Earlier this afternoon, the action Societe Generale lost 2.8% and 1.6% gave the BNP.But Crédit Agricole clinching 2%.

Citigroup cut its price targets on French banks.

Doped including the sales and purchases of clothing, household consumption increased by 1.2% in June after declining during the previous two months. But the trend throughout the second quarter is negative. The World Food Planet Carrefour de Lyon

Finally a somewhat favorable economic indicator. While unemployment has increased again and the accumulated bad news on the front of the activity, household consumption expenditure increased 1.2% in June, after falling 0.3% in in May, according to INSEE. Increased yet insufficient to reverse the trend throughout the second quarter they were down 1.8% after 0.1% in the first quarter. What will weigh on growth mechanically.

This recovery is mainly due to the expenditure on durable goods, which rose 2.5% in June after falling 0.1% in May.Throughout the second quarter, but they recede by 6.3% from 2.2% in the first quarter.

Purchases of automobiles including increased 2.2%, but this increase does not offset the declines in previous months. In total, they were down 11.2% in the second quarter. Purchases of equipment housing are also up in June (3.8%, but 0.6% in the second quarter), thanks to a favorable schedule balances in furniture.

The strongest recovery has benefited from purchases of textiles and leather, which rose 4.3% after declining in May (-3.5%). This increase is partly due to the timing of sales that began early this year. In the second quarter, this item was down 0.3%, after -0.9%.

Consumer spending in other manufactured goods are up slightly in June (0.7%, after -1.2% in May).They decrease slightly in the second quarter (-0.2% after +0.6% in the first).

Energy consumption, it has continued to rise last month from 1.4% after 5% the previous month. Throughout the second quarter, however, declined by 1.1% due to particularly mild weather in April.

In the end, only the consumption of food has fallen (-0.4% after -1.4% in May). It is generally slightly lower throughout the second quarter (-0.1% after +0.2% in the first quarter).

Note that the number of consumer goods in May was revised by the INSEE, which is now estimated at -0.3% against -0.8% previously.

After a very dynamic first quarter, the French economy is expected to mark time before rebounding and reaching 2.1% over the year, exceeding the government's objective, according to INSEE. French managers come to the business district of La Défense

French growth should undergo a brake in the second quarter before rebounding and reaching 2.1% over the year, slightly more than the government's objective, according to new estimates published by INSEE on Thursday. After a very dynamic first quarter in which gross domestic product (GDP) grew by 1%, the French economy would have stalled, says the National Institute of Statistics in its first forecast for the whole of the 2011.

As in other advanced economies, France has experienced the full number of shocks, such as rising commodity prices, the consequences of the earthquake in Japan, or more restrictive economic policies. However, these shocks will be "temporary" said Sandrine Duchêne, head of the economic situation of INSEE. And factors should slow fade in the second half.

After an expected growth of only 0.2% in the second quarter, activity should then bounce back with an expected GDP growth of 0.5% during the last two quarters of the year. Over the whole of 2011, growth would reach 2.1%, slightly higher than the official government forecast (2%).

This performance is consistent with the euro area average. As usual, Germany will remain the locomotive of the region, INSEE provides a 3.7% growth for the country in 2011.Conversely, Spain (+0.7%) and Italy (+0.8%) will be left behind.

Unemployment folds

Over the period, the labor market should continue to improve in France, total employment grew more strongly than in 2010. Unemployment, which stood at 9.2% of the workforce in the first quarter, fell back slightly by the end of the year to 9%.

Household consumption, even in the first quarter supported by a "drag effect" of scrapping, related to the timely delivery of vehicles ordered in late 2010, should fall back sharply in the second quarter, "backlash". She then rebound in the second half, however, at a rate slightly lower than before the crisis, according to Insee.

Traditional engine of French growth, consumption would increase by 1.2% over the year, after rising 1.3% in 2010.Business investment will remain dynamic, while the trade would have a broadly neutral impact on growth.

Household income would be supported by rising employment and wages. The decision to pay a premium to employees in companies distributing dividends is expected to contribute to this increase, according to INSEE.

Inflation of 2.2% trim on the purchasing power

But this acceleration will be partially eroded by the pursuit of expected inflation. To INSEE, the rise in food prices, already substantially since March, is expected to continue in effect until December. On average, inflation should be 2.2% throughout this year, a level higher than the 1.8% forecast by the government.

Thus, household disposable income, which should accelerate in 2011 (+3.3% after +2.0%), would contreblancé by higher inflation.Overall, the purchasing power of households rise by only slightly faster in 2011 than in 2010 (1% after +0.8%).

A greater than expected weakness in the U.S. economy or boost pressure on sovereign debt, however, could darken the picture, warns INSEE. Conversely, if the French households decide to save less this year, would benefit just the consumer, so to growth.