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European debt crisis: Greece vows to ‘fight back to prosperity’ – Live

• FTSE 100 jumps 108 points at the start of trading, as George Papandreou and Angela Merkel prepare to discuss Greece’s bailout
• Barack Obama: Europe is “scaring the world”
• Trader: I’ve been dreaming about this moment for three years
• Check out key upcoming events in today’s agenda

10.55am: George Papandreou is refusing to be funereal in Berlin. Greece’s prime minister promised Germany’s business leaders this morning that Athens will meet its commitments to the international community, and rebuild its economy.

Papandreou told the Federation of German Industries that:

I promise you, we Greeks will soon fight our way back to growth and prosperity after this period of pain.

But to achieve that, he added, the European Financial Stability Fund (the EFSF, Europe’s main bailout fund) must be strengthened. The Greek PM also argued that Europe must embrace closer fiscal union if it is to triumph over market speculators who believe the single currency is doomed.

Along with much tighter fiscal oversight, we must expand the EFSF and formulate permanent mechanisms for economic stability and solidarity.

The euro zone must now take bold steps toward fiscal integration to stabilize the monetary union. Let’s not let allow those who are betting against the euro to succeed.

10.33am: Are you astounded by stock trader Alessio Rastani’s admission that he’s been dreaming about the chance to make money from a new financial crisis? Or is this just the way the world works?

Let us know, in this poll: Are you shocked by this stock market trader’s comments?

9.59am: “The governments don’t rule the world, Goldman Sachs rules the world”.

With that bold statement, and the admission that he’s been dreaming about a recession for the last three years, stock market trader Alessio Rastani has turned into the latest “celebrity” of the financial crisis.

Rastani’s appearance yesterday on BBC News 24 has now “gone viral”, with more than a quarter of a million views. Rastani does appear to be speaking honestly – he advises viewers to “be prepared and act now”, rather than trust politicians to resolve the crisis.

The stunned look on the interviewer’s face is clearly genuine too!

Rastani’s admission that he “doesn’t really care” about the desperate efforts to rescue the euro is attracting a backlash this morning.

Umair Haque, a London-based economist, believes Rastani is an example of what’s wrong with the City:

@umairh: Good morning, everyone. I’ve seen the trader video. What is there left to say? It’s the truth. Now, either we create the future. Or not.

Erik Wesselius is struggling to believe Rastani is the real deal:

@erikwesselius: I still can’t believe “crash trader” @AlessioRastani is real. But if this is a prank, it’s an elaborate one

My colleague Charles Arthur, though, is slightly more sanguine:

@charlesarthur Compare this scarily straight-talking stock market trader against the idiot politicians burbling about the euro:

Incidentally, you can follow Rastani on Twitter, at @alessiorastani

9.29am: Just hearing that Evangelos Venizelos, Greece’s finance minister, is giving a press conference in about 90 minutes.

Our Athens correspondent, Helena Smith, has more details:

It’s a glorious autumnal day in Athens but there are clouds in the sky and clouds on the horizons for Greece’s embattled government.

The finance minister, who returned from the IMF’s annual meeting overnight, gives an all-important press conference at noon local time (11am BST) outlining details of Greece’s new austerity measures. These cutbacks were announced last week in a desperate bid to meet fiscal targets and secure a sixth tranche of aid from the country’s “troika” of lenders.

Investors should watch what he says closely.

Confusion has reigned over what exactly the measures will amount to in terms of lost jobs and extra taxes but of one thing Venizelos is clear: the belt-tightening will be the equivalent of “3% of the country’s gross domestic product,” as he explained in Washington.

But he also said they are being enforced in an environment of “deep recession, bad liquidity conditions, uncertainty and anxiety” which is THE problem.

After seeing their wages and benefits and working conditions gradually eroded, the country’s vast array of state employees once again feel it is the most vulnerable sector of society – namely pensioners and low-income civil servants – who are being called upon to pay the price for Greece’s great economic crisis. The rich, who have made million avoiding the taxman, seem to have got off scot-free.

9.15am: The Euro crisis is dominating the business sections of today’s newspapers, online and in print. Here’s a round-up of some of the most interesting pieces I’ve read:

The Guardian: Bankruptcy threat to Greece as euro ministers delay vital €8bn
The Daily Telegraph: Germany at war over eurozone bail-out
The Financial Times: Germany and the eurozone: Besieged in Berlin (registration required)
The Daily Mail: Families face £5,000 bill to bail out debt-stricken Euro nations
FT Alphaville: Disorderly default, almost as bad as civil war

8.49am: America ratcheted up its pressure on Europe last night, with Barack Obama issuing his sternest warning yet about the need to resolve the euro debt crisis.

As this video shows, Obama told a forum organised by LinkedIn that Europe’s failure to fix its banking sector had been compounded by Greece’s woes, creating a situation that is “scaring the world”. The US president said Euro politicians now need to speed up their efforts to fix the crisis:

“They’re trying to take responsible actions, but those actions haven’t been quite as quick as they need to be.”

8.24am: Eight of the top risers on the FTSE 100 this morning are mining giants – led by Antofagasta, the copper producer, which is up 5.3% at £10.01. Mining stocks typically rise when investors feel confident about global economic prospects, and fall whenever fears over the global economy ripple across the City.

There’s good news for taxpayers too – the second-best performing stock is Royal Bank of Scotland, which has gained nearly 5% to 24.6p. That’s still roughly only half the level at which the government bought into the bank when it was bailed out in early 2009 – so some way to go yet.

8.06am: Europe’s stock markets are open, and there’s a rush to buy shares. The FTSE 100 jumped by 108 points to 5197, a rise of just over 2%. Similar gains in other markets, with the Italian FTSE MIB the best early performer (up 2.4%).

So optimism reigns – but for how long? As Michael Hewson, market analyst at CMC Markets, predicted earlier this morning:

Uncertainty will undoubtedly remain the predominant sentiment.

7.55am: Here’s a few events to watch out for today:

• Spain and Italy to auction government debt – this morning
• Greek PM George Papandreou addresses a conference for the Federation of German Industries – 10am CET (9am BST), Berlin
• CBI Distributive Trades Survey (measuring UK retail sales in September): 11am BST
• US consumer confidence data – 10am EST (3pm BST)
• Greek property tax debate and vote – from 7pm CET (6pm BST), Athens
• Papandreou/Merkel “working dinner” – evening, Berlin

7.45am: Japan’s finance minister has also hinted today that his country could offer some support to Europe

“If there is a scheme that is based on a firm process, involves a reasonable amount of money and could provide the world and markets with a sense of security regarding a Greek bailout, I would not rule out the possibility of Japan sharing some of the burden,” Jun Azumi told Reuters.

Japan has its own financial problems (including the biggest debt-to-GDP ratio in the G20), and its fiscal reduction plan partly depends on decent economic growth – unlikely if the EU debt crisis triggers a global downturn. Its exporters are already suffering from the strength of the yen, which hit a ten-year high against the euro on Monday.

We know Azumi is serious, as last week he said Tokyo would “supportively think about” supporting Europe. How would this work in practice? It could buy up bonds from weaker eurozone nations, helping to drive down their borrowing costs. Or, as the second largest contributor to the International Monetary Fund, its support would be important if the IMF did increase its support for Europe.

7.35am: Good news – the financial markets are in upbeat mood. Asian markets have all risen today (see the latest prices here), and Japan’s Nikkei just closed 2.8% higher at 8,609.95. That’s a healthy rebound from Monday’s two-and-a-half-year low.

City traders expect a strong start in London, with the FTSE 100 being called up more than 100 points. We saw yesterday that the markets are pretty jittery, and it probably wouldn’t take much to send share prices down again.

Here’s the view of Chris Weston, institutional trader at IG Markets:

Sentiment in equity markets changed markedly just after the European close last night, with traders suddenly becoming increasingly confident that European leaders can now reach an agreement to successfully contain the debt crisis. With stock prices having been decimated in recent days, this was sufficient to see the bargain hunters flood back into the market.

We’re looking at some big upswings in Europe ahead of the open although sustaining these gains – and ensuring we can continue to grind higher – will rely on two key points.

Investors must hold their nerve and at the same time central banks and finance ministers need to remain ‘on message’ as any suggestions that the rescue plans may go awry will likely be enough to see markets take fright once again

7.30am: Good morning, and welcome to our live coverage of another important day in the European debt saga.

Greece is top of the agenda today. Prime minister George Papandreou is meeting Angela Merkel in Berlin tonight for dinner, to “discuss the economic situation in Europe”. Papandreou will also address a business conference during his visit to Berlin.

And the Greek parliament will vote on an unpopular property tax – just one small part of its latest austerity package. Transport workers are organising strike action, and protesters are expected to gather in Athens to register their anger. Riot police clashed with demonstrators on Sunday – will we see a repeat?

We’ll also be tracking the latest efforts to construct a rescue package for the eurozone. Last night, German officials were insisting that Europe is a long way from agreeing a plan – was the €2trn bailout that hit the headlines last weekend just wishful thinking? Is Europe as indecisive and divided as ever?

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