in greece and nm uniquely in greece, they let their government get too big, too enjudgerous, borrowed a huge amount to support that. they and almost the rest face loss of competitiveness. they make it hard to start a business, very hard to use the talent of their country's more carefully and they have financial systems that -- we had a terrible crisis in the united states but their financial systems were much rnlg laler, much more risky than even what happened in the u.s. those three challenges of fiscal reforms over time. enhancing reforms so it's easier to start a business and financial systems that are brought down to earth. had more gravity in them. those are what's necessary. very tough, very long hard road and it's important for people to recognize as you did that these reforms which can work against growth in the near term have to be supported not just by conditional financial assistance but those countries that are in a position to do more to support growth should do that. that would make the overall rye crisis less risky for them in the world. >> let me talk about two questio

>> yanis varoufakis: greece is in its great depression.e is in a coma, and it is getting deeper into that coma as one company, one firm, one shop shuts after the next. >> kroft: yanis varoufakis is an economist at the university of athens who has advised the greek government. he says the belt-tightening is stifling economies all over europe and made the situation in greece much worse. the greek unemployment rate now stands at 21%, and the economy is shrinking at the rate of 8%. there are bread lines in athens, and in the central markets, more people looking than actually buying. how's your business? >> 70% down. right now, everything is very difficult and i don't think we've even started to see the beginning of the bad times. people don't have the money to buy anything. the situation is very bad. >> kroft: there's a feeling of hopelessness, humiliation, and anger in the country as the economy continues to spiral downward. most people would say greece got itself into this by borrowing way too much money, by being a fairly unproductive socie

and the pain and possibly of conflict in greece and elsewhere cannot be ruled out. >> greece has time and again explained that it would like to remain in the euro. they have major weaknesses. but they are trying to overcome them. bidet in the administration or the competitiveness of the business community. it is going to be a long and arduous road. we have taken the decision to be in a currency union. this is not only in monetary decision, this is a political one. it would be catastrophic if we were to say to one of those who have decided to be with us, we no longer want you. incidentally, the treaties to not allow for that anyway. people all over the world ask, who would be next? the european area would be incredibly weekend. the export nation germany in particular benefits from the euro. it would be a huge political mistake to allow greece to leave. that is why we will be clear with greece. we will say, if you want to be part of the common currency, you have to do your homework. at the same time, we will always support you. >> many british people see you as the most powerful politic

and what they're doing to europe and in particular greece at the behest of global banks toure's at thei.m.s. was tyler durden portrayed by brad pitt in the movie it would say it's only after europe has lost everything the banks toure's can profit off anything we're seeing in europe now is the tape out of a small but important part of a con of the continent's economy through forced austerity and big news in the financial rags today from the financial times to the wall street journal is the collapse seen parts of the european economy. for the first time since two thousand and nine the seventeen nation euro zone economy contract and shrinking three tenths of a percent the last quarter of two thousand and eleven one more quarter a negative growth and europe will officially be in a recession and looking at individual nations you can see why the british economy shrank by two tenths of a percent the fourth quarter of the weight of austerity measures from conservative prime minister david cameron who proudly proclaimed that europe has entered the quote age of austerity quote portugal's economy

a nation with a lot of resources it is for example greece and chinese are making huge investments in greece's main port iris qatar's investing five billion dollars in tourism an infrastructure there is selling off their country wealthy germans and scandinavians want to make greece the florida of europe was article about this new york times over the weekend greek there turning greek islands that used to be the property of the government of the people into expensive retirement homes for wealthy europeans now that the economy has collapsed it's a fire sale for that country if you take down the government space is created so that corporations and very wealthy individuals can step in this is a piece from russia's russell short post piece in the new york times he said whether or not the country pays its debts other nations and foreign companies now understand the greek government is how are of this so the future they'll take over buyable assets and run parts of the country by themselves this isn't just happening in greece and other cash strapped nations are going to be following suit and t

well you take a country like greece you stick it on the fondue fork and he get put into the debt and then you serve it up to goldman sachs or j.p. morgan. oh this is great now spain is being thrown into the debt fondu well this debt fondue has a shelf and it's called the central bankers and apparently they're however not bringing stability and magic recovery to the markets according to jonathan winds at capital economics widespread hopes that the e.c.b. would use the might of its theoretically on limited balance sheet to fire a so-called silver bullet into the heart of the broader euro zone crisis by buying up or somehow guaranteeing large portions of the italian spanish debt have all but evaporated so let's look at somewhere where they're actually able to maintain stability in their currency so mali is mighty shilling hard to kill a currency issued in the name of a central bank that no longer exist use of a paper currency is normally taken to be. pressure faith in the government the issues it wants to solve and so you have the issuer is in doubt anyone holding its nose will quickly

may collapse what they mean is greece look unless it overrules a democracy pushkin one of our power technocrats which means the bank lobbyist to come in and sell off its land so office water and sewer system sell off its ports sell off its tourist areas sell off its. parthenon it sells a lot for very little amounts to be financed on credit by the banks the buy them out creating a huge bank market and create what looks like the biggest resource prayer since the breaking invasions of europe thousand years ago those in years ago it took an army to grab land and infrastructure and take over the government and today without an army without forests in the european central bank and the european union is being able to grab the land a better country a greece spain portugal ireland and to impose tribute without any military force that are just by trying to convince the. people but as margaret thatcher said there is no alternative and to make sure there is no alternative there is no discussion of actual alternatives of course there are many on here and of course i want to get into those i get

the fonz and various large interest bearing accounts at the bank of greece were rated these included most of the state's regional hospital budgets very soon averse cities and it is alleged at least one utility company the greek government used this money in order to purchase government bonds from various bond holders without getting permission from the bank account owners well yeah it was already up and like the memorandum of the document that they signed off on which i love the troika to socially undermine sovereignty and greece and now they're finding out they owe that the fine print it gives them access to all this these retirement funds hospital funds school funds all we lost all of that as well and of course the recourse at this point is not there there's nothing they can do but the cops will dress up like anarchists and beat some citizens in syntagma square and say oh we've got an emergency in our hands was passed some more measures that steal the money from folks yes but max let's bring it back to this issue of trust because this is what we've been talking about from the begin

absolutely look the whole rationale for saving greece was not greece in and of itself greece is tiny it's less than two percent of the total eurozone g.d.p. the issue of saving greece of course was to show the world that the euro products were serious about potentially backstopping any of the sovereign debt of any of the other major countries but of course they botched the job they stretch it out over a two year period from may two thousand and ten until march of two thousand and twelve and it kept getting bigger and worse and they just did not do the firewall that they should have done initially and so of course now that in decisiveness is is coming back to haunt them because the markets in general don't really think that the europe it's the troika that is the european commission the european central bank and the i.m.f. the international monetary fund nobody really thinks that they have the the political will to really fix a country is because spain now because the problem with spain is not that it's simply overdid it you have a whole host of structural reforms that have to be imple

elections in greece this weekend may hold the answer. with the country in dire financial straits, the two main parties in the governing coalition may be booted out. we have been exploring the mood of the country. >> the peloponnesus, where the gods of greek myth and legend once played, and where we found this man, desperately hoping for better times after five years of recession and continuing government cuts. do you think greece should carry on cutting in the way brussels is asking? " thethey have to stop," he tells me. "there will be trouble. people do not have anything more to give." a large number of people are expected to vote on parties that want to turn their back on the brussels-imposed austerity. if that happens, there are those who fear this country could be charting a very different course, one that takes it out of the euro, with all the massive implications for this continent that that would bring. wind your way around this country and you find exhaustion. greece is defeated, crumbling. that is changing politics. the same old

greece is suffering. this is a deeply troubled nation.we'll have to see whether there's any light at the end of the tunnel in the months ahead. >> a rebel group in northern mali has announced the end of its military operations after capturing all the territory it claims. the national liberation movement says it has declared a unilateral cease-fire. meanwhile, the military has postponed a national convention due to be held today after all political groups refused to attend. the bbc's martin vogel joins me from mali's capital. just what's happening in the north? where does this leave the country? is it likely to end as the government tries to fight back? >> i think the government is very unlikely to try and fight back for the moment, because basically here in burma, i think they're in turmoil with its military guns, the regional body has put sanctions on mali. for the moment, the country is effectively divided, and the rebels -- there's a cease-fire. there's another group that's demanding for sharia law to be brought in northern mali, and t

greece now reports thousands of a story and scrape by to support a troubled euro states. two thousand and eleven estonia welcomes a new year and a new era as part of the euro club is a moment of triumph after years of tough financial discipline for the nation which is the pockets of everyone the euro zone demanded that as a condition of membership but just over a year old and the idea has lost its fizz joining the euro has made an already painful situation even worse teachers really suffer here our monthly pay is insufficient even to survive on. as the new kid in the block a study played no part in amassing the devastating debt dragging it down but it still being asked to contribute to the multi billion euro fire will designed to cushion the currency against the crisis like the one which gripped greece teachers or just some of those in uproar after having wage cuts force and to join the currency union there is little appetite for sending money abroad to richer countries particularly when it's the only salaries of the full world below the e.u. average even key legislators

to receive aid from the eu and the international monetary fund, greece has pledged to slash spending. without an economic recovery, more greeks will be returning to soup kitchens. >> finally, the highest building in new york city is under construction. it is being built on the site of the world trade center. >> on monday, workers erected steel columns, making the building higher than the iconic 1930's skyscraper. they will continue work on the building also known as the freedom tower. >> that is it for now. thank you for watching. we will have more news at the top of the our. >> we will see you again soon. -- we will have more news of the top of the hour.

in portugal, no news and greece, little news. we see it spreading. >> well, you mentioned three weeks before the first rounds in those presidential elections, and the economy now is really reasserting itself after all that business, when it was securities, now the economy. >> we are talking of course the second largest economy in the euros, and president sarkozy unveils his economic manifest. how will deal with the economy. he wants to stick to the target of cutting $115 billion euros from the budget over the next five years. and also talked about taking training program so they can take their benefits. tax exile, having to cough up basically. we know his main competition is from the -- they include higher taxes for the rich, a freeze on fuel prices and pay cuts fsht president and the cabinet ministers. but what sort of challenges face the winner, or what condition are they in? >> i think it's fair to say they're in a fairly precarious position. we had the latest debt figures for last year. we showed debt higher than probably mos

out and not greece and then you know. and of course the i.m.f. itself is in violation of his own sure what it means money because it's only permitted to live. for the balance of payments just not committed to live for. the deficit problems government problems so what we see coming out of this crisis is lowness next. has just been good story of the european central bank is just disappearing its charter and so by refusing to face the real issue or create lawlessness in addition to these other things that we have spoken about yet and that's something i want to talk to you about after the break in terms of what you think the i.m.f. is really trying to become maybe and also some of that lawlessness that i believe we're seeing in the u.s. we will be back stage here i will come back after the break and have more with paul craig roberts economist and former assistant secretary of the u.s. treasury under ronald reagan and also still ahead payday lending ok it seems big banks are bankrolling the practice even getting into the busin

for years, he managed one of greece's most successful vineyards. that experience is useful now. he is running the city like a business. he is not relying on plic gid party politicians but on young specialists -- he is not relying on party politicians. it is a university city, and he wants to see students with modern professions stay here after their studies. immigration is a big problem in greece. >> younger people see that things are moving forward in the city. >> it is about time. so you are staying? >> who else is going to stay? >> to make the city more attractive for residents and tourists alike, it is expanding cultural offerings, but without spending more than expected revenues. >> we are creating a precise financial plan and considering how to use the meager funds we have. we do not want the money to trickle away. we've worked together with private enterprise and seek sponsors. >> this here is the old roman market. >> the team woos tourists with the city's greco roman byzantine, jewish, and ottoman history. the city's poor relations with neighboring turkey have improved.

so making not absolutely clear the simple fact is greece must have thought. on it it probably needs to leave your room egypt lee it must be played its currency it is going to still have many problems but the truth of the matter is that when you do get to this sort of extreme only this sort of extreme measure is going to be possible to resolve your situation and ultimately it really beggars belief that we have a greek politician the most highly paid politicians in the whole of the european union turning round and doing oh well that's very sad one of our constituents killed themselves when they themselves make fifteen dollars and euros per month with any difficulty whatsoever as a back bencher b. which is enough to manage to pay for dozens of pensioners every month in new austerity greece. the employment across the euro zone as a record high since the single currency was north thirty years ago very hard for spanish and greek people out of work but these trends are also affecting countries that have gone more recently. greece reports of a stone scrape by having

one of the biggest problems facing greece today's correction.t formalities' you have to get done, there are always degrees of bribes to pay. a former greek minister was arrested for allegedly financial misconduct. now it seems the greek public is no longer prepared to and accept such behavior. people want corrupt officials to be held responsible. >> to 0.5 hours from athens, blue water as far as the eye can see. beautiful surroundings like this and the ongoing socio- economic crisis seems far and away. it is not. building this was a struggle against one of the most acute problems -- corruption. it all started seven years ago when he decided to construct a huge resort here on the beach. together with his brother, they drummed up support for the 30 million euro project. they applied for support through the greek loan program partially funded by the eu is personal odyssey then began. >> we were sent from office to office, minister to minister, deputy to deputy without being able to find a solution. >> at the greek economics ministry, he had to pres

for greece we're talking about a 30% deflation. 30% deflation. that's like the great depression in the united states. you know, would you bet a plugged nickel that that's going to happen? the greeks are very, very slow to implement any reforms. 30% reduction in wages? it's just not going to happen. for italy, it's 20% to 25%. for spain, it's 20% to 25%. nobody even talks about cost of production. but cost of production is the solution to growth. so my proposal is a very simple one which no one in europe wants to hear. and i'll tell you why they don't want to hear it in a minute. what i say is, keep the euro. divide it in two. take the southern countries and have a soft euro. float it against the hard euro. the hard euro can adopt the fiscal restraint. the soft euro will deflate, devalue against the hard euro. when it devalues to a new equilibrium, if they join the fiscal responsibility pact, they come back into the hard euro. that would do what the greeks, the italians, the spanish are used to. that is, you solve the problem by devaluing. and tha

don't know greek greece could play so that's how they're going out and greece and. the banks and of course. itself is in violation of its own sure when it lends money cause it's only permitted to learn. the balance of payments just not committed. for. the deficit. problem so what we see coming out of this crisis is longest next. disappearing is chary of european central bank is just in case this is a very good story and so by refusing to face the real issue or create an addition to these other things we have spoken about yeah and that's something i want to talk to you about after the break in terms of what you think the i.m.f. is really trying to become a bit and also some of that lawlessness that i believe we're seeing in the u.s. we will be back stay here i will come back after the break and have more with paul craig roberts economist and former as a secretary of the u.s. treasury under ronald reagan and also still ahead the payday lending ok of things big banks are bankrolling the practice even getting into the business themselves and yelp or wells their bank rol

which isn't enough to manage to pay for dozens of pensioners every month the new austerity greece. across the usa has reached a record high since a single currency was launched thirteen years ago and then the hoffa spanish and greek. but these trends are also affecting countries that have joined the euro recently as artie's they can graze now reports thousands of stones great buy for having to support troubled euro states. two thousand and eleven as though new welcomes in a new and a new era as part of the euro club is a moment of triumph after years of tough financial discipline for the nation which has hit the pockets of everyone the euro zone demanded that as a condition of membership but just over a year on and the idea has lost its face joining the euro has made an already painful situation even worse teachers really suffer here our monthly pay is insufficient even to survive. as the new kid in the block a study of played no part in amassing the devastation debt dragging it down but it still being asked to contribute to the multi billion euro fire will designed to cushion the

you need to know this the gangsters and technocrats pushing trickle down austerity in greece now have blood on their hands on wednesday a seventy seven year old retired pharmacist walked up to the greek parliament building and shot himself in the head to protest the crippling austerity measures that are ripping apart that nation and then left a suicide note we'll get into that in just a minute but his suicide prompted thousands of greeks to take to the streets in central athens in fresh new protests against trickle down austerity since trickle down austerity began in greece suicide rates have jumped up forty percent so not only is trickle down austerity bad economically it's bad morally as well yet it's just the thing that the republican budget written by multi-millionaire congressman paul ryan wants to bring to the united states of america and if republicans win big in november and are able to carry out their trickle down austerity agenda and we we can expect more suicides here in the united states as well here's the bigger picture back in two thousand and two and b.b.c. reported on

on greece. >> morning, i'm michael nad year everywhere greece. seems weise are talking about outlook, if you can tell us what is the prediction or outlook for greece and the second question is that also some people in -- analysts in europe start already talking about a third program. what is your opinion, sir? >> well, on the outlook for greece, which is what is directly relevant for this press conference which is on the world economic outlook, we're seeing growth negative in 2012 after contracting by about 7% in 2011, we expect the greek economy to contract by another 4.7% in 2012. and there are really two key factors here at play. the fishes is a very large fiscal adjustment that is taking place. and the second is a significant reduction in minimum wages which is one ingredient in rebuilding competitiveness of the greek economy, but which in the short run will be weighing on demand and therefore, subtracting from growth but in the long run should help bring growth back up again and improve the competitiveness of the greek economy. >> all right.

can restructure young says greece needs to take urgent action to get out of its dire situation. the greek government is bankrupt the greek government cannot afford to stay in the euro and pay its debts it must default ultimately that may be a terrible problem for a great many financier's and investors but at the same time i have to say any bank that bought greek there in the course of the last ten years was stupid so making that absolutely clear the simple fact is greece default on its debt nar it probably needs to leave the euro immediately it must deflate its currency it is going to still have many problems but the proof of the matter is that when you do get to this sort of extreme only this sort of extreme measure is going to be possible to resolve your situation and ultimately it really beggars belief that we have a greek politician the most highly paid politicians in the whole of the european union turning round and going oh well that's very far one of our constituents killed themselves when they themselves make fifteen guys an euro's or month without any difficulty whatsoe

are the sources of potential growth in greece.i don't think that's an issue in spain. they're export competitive. >> susie: we know the european policy makers have been demanding tough austert measures from greece and now from spain and italy and other troubled countries. i don't know if you saw paul krugman wrote an article saying what europe is doing is economic suicide by just pushing the envelope, and that this is going to have an impact that the whole world has to pay a price for it, this strategy of getting these countrys to do the austerity measures. >> is he right? >> that's a perspective, and widely shared by many people in europe, and the emphasis is on the countrys and fiscal adjustment, and i think there is a click saying that's at the expense of growth. we're seeing rumblings, and seeing that in frons, and the presidential candidate. who i think will -- the presidential elections, and clearly have concerns about one side of fiscal adjustment. germany remains ready to review that. the problems began with excessive fisc

which is are not the money to pay for dozens of pensioners every month a new austerity greece. i don't blame it across the eurozone his rates are back or high since the single currency was launched thirteen years ago nearly half a dozen greek young people now out of work but is wearing trousers also a factor in countries that have joined the euro more recently as it is jake agreed reports thousands of us stony and scrape by well having to support trouble you're all states. two thousand and eleven estonia welcomes a year and a new era as part of the euro club is a moment of triumph after years of tough financial discipline for the nation which is the pockets of everyone the euro zone demanded that as a condition of membership but just over a year old and the idea has lost its fizz joining the euro has made an already painful situation even worse that teachers really suffer here our monthly pay is insufficient even to survive. as the new kid in the block a study of played no part in amassing that devastating debt dragging it down but it's still being asked to contribute to the mu

coming up with greece in great after an elderly man becomes the people's will still retain matar that boiled over to arrive this week after the retired pharmacist killed himself in front of parliament is the side that he had no more means to live . in the twelve survivors from beach who made plane crash that killed thirty one are continuing to receive treatment in hospital as big failure to d.i.y. the plane it's named as the primary cause of the tragedy. russia has pledged to bring home big to the business model sentenced in the u.s. to twenty five years behind bars moscow says if you use the case as political and he was found guilty of conspiring to kill americans but maintains his innocence the judge stressed there was no proof booth would have committed any crime but with a sting operation that setup is arrest ati's and the future of. here is spent by the u.s. to hunt down one russian man tens of millions of dollars of taxpayer cash poor into a sting operation snatched up from a third country alleged arms dealer viktor boot was handcuffed flown to the u.s. and placed in solitary co

morgan goldman sachs wall street banks they go to greece they go to europe they go to municipalities in america and they say we're going to sell you a hedging product to hedge you against risk volatility risk or market adverse conditions risk the sales all that product whether it's a rather classic example are sold to a thousand times greater than the underlying component of risk that they say they're protecting against to the point where they create the instability they create the collapse and of course they've done so in a way where the insurance that they've sold does not work so it didn't work in greece it didn't work in europe it didn't work in municipalities all of america it didn't work at a i.g. it didn't work in portfolio insurance in one thousand nine hundred seven it didn't work in the mexican peso crisis the asian financial crisis the dot com collapse the housing mortgage for part the mariners rank of america we have no idea what we're doing countrywide growth of merrill lynch risk it never works but they keep going the same product over and over and over again because we

and a potent symbol of the struggle of greece warns the distraught elderly victim of the government who suicide outside. clashes. this is our team name is kevin zero in our top story and eight pm from moscow american prosecutors are seeking life imprisonment for a russian businessman vic to boot he was convicted of arming terrorists and conspiring to kill u.s. citizens a court will announce the simpsons later on thursday. he's innocent and that his cases fabricated result he's innocent reports. years spent by the u.s. to hunt down one russian man tens of millions of dollars of taxpayer cash forward into a sting operation snatched up from a third country alleged arms dealer viktor boot was handcuffed them to the u.s. and placed in solitary confinement for months before a trial found him guilty on all four charges one conspiring to kill united states nationals two conspiring to kill united states officers and employees three conspiring to use an acquire anti-aircraft missiles and for conspiring to provide material support to the far forty four year old russian air cargo business men fasci

presenter in greece is bombed with the word of ags live in error by a group of mass protest there is a probe into the studio. all those last and forty eight hours left for the syrian government to comply with the u.n. backed peace plan it calls in damascus to withdraw troops and tanks from residential areas seizing all military activity but syrian activists and even the head of the u.n. say the regime continues its crackdown on dissent the mask has blamed ongoing violence and terrorist funded and armed from abroad more than a hundred people were reportedly killed just on saturday as rebel fighters are refusing to cease fire until president assad steps down and they've been promised multimillion dollar support from the u.s. and its allies as a geezer first retorts. talks of ending the violence on the inside the friends of syria conference. outside the turkish riot police were getting heavy handed they dispersed a tiny proceeding government gathering. quite a crowd. first thing i'm afraid their actions going to seem to certain further anger already rowdy crowds oh yes houses it's. just

valid outs on thursday greece also extended the deadline for the last part of a bond which would see private investors shoulder massive losses let's not talk to economic analysts and international lawyer nick scratch scratch because who is in athens thanks for being with us the answer also thirty dr now has its most public marder i mean will the pensioners that triggered a nationwide riot through even overthrow the government. well at this point inside we have about a third of the population in greece living underneath the poverty line and we've got about a million people unemployed and probably half a million kids who really don't we very well at all all we need is something like this to catalyze opinion had to send us into deep reflection will it actually spark more riots well it's not going to help the situation any at all. but how is the government reacting to this suicide apart from calling it tragic and i mean is its policy of cards going to be at least a little star in here. well this particular government one must understand is more of the kids than anything else look as part