Is Macedonia’s capital being turned into a theme park?


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The Warrior on a Horse statue in the Macedonian captial Skopje depicting Alexander the GreatThe “Warrior on a Horse” statue in the Macedonian captial Skopje depicting Alexander the Great

Children perform in front of a triumphal arch, for the ceremony of Independence on September 8,2011. Children perform in front of a triumphal arch, for the ceremony of Independence on September 8,2011.

Crowds celebrate the European success of the Macedonian national basketball team in front of the new Warrior on a Horse statue in Skopje's main square.Crowds celebrate the European success of the Macedonian national basketball team in front of the new Warrior on a Horse statue in Skopje’s main square.


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(CNN) — When Macedonia celebrated the 20th anniversary of its independence from the former Yugoslavia last month, it did so in a capital city that has been radically transformed over the past two years.

Almost 20 new buildings — and a similar number of statues, fountains and monuments — are being built around the center of Skopje.

The transformations are being made as part of a project called Skopje 2014, aimed at rebuilding a city that lost many of its landmarks in a 1963 earthquake.

The centerpiece, in place in time for the anniversary celebrations on September 8, was a 22-meter statue, called Warrior on a Horse. It is widely understood to depict Alexander the Great, but has not been officially named as such because of a long-running dispute with Greece, to whom the ancient king is a national hero.

There is also a new Museum of Macedonian Struggle, which opened on Independence Day, a triumphal arch, a new foreign ministry building, a new constitutional court, a new national theater and a new archaeological museum, among other buildings.

Country profile: Macedonia

The official cost of the project is 80 million euros, although critics claim the final bill could be as high as 500 million euros, according to the online newspaper Balkan Insight.

Skopje 2014 has divided Macedonians, some of whom say a country with more than 30% unemployment, according the U.N data, should not be spending so much on a building project.

Goran Atanasovski, who runs an independent tourism website travel2macedonia.com.mk, said: “The project splits the people, like a river between the coasts, some of them are for it, while others are not.

“The controversy for the project is mostly that Macedonia belongs to a group of countries with high unemployment level.”

However, Zoran Nikolovski, the government’s head of tourism, said: “Skopje already has a totally new look from it did two years ago, and by 2014 it will have even more new buildings. Even in this global economic crisis we are building, not only buildings and attractions but also a new infrastructure and accommodation capacity, like brand new airports, roads and hotels.

“At first there was misunderstanding from people, but now they are seeing that it is really beautiful for people who live in Skopje as well as for travelers.”

What do you think of the new buildings? Send in your images

Others question the taste of classic antiquity buildings and bronze statues.

One Macedonian who asked not to be named said: “I try to avoid the city center now. It has turned into a theme park. Wherever you turn there are new bronze statues and sculptures. It’s as if they’re trying to create a national identity.

“I would have thought in the 21st century we should be building something modern, urban and contemporary. I can’t imagine any other city building a triumphal arch in the 21st century.”

Regardless of personal opinions of the project, Skopje 2014 and other infrastructure investments do appear to be helping Macedonia to attract foreign tourists.

Nikolovski said there had been a 25% increase in foreign tourists visiting Macedonia in the first seven months of this year, compared with the same period last year.

Atanasovski said: “Whether it was due to Skopje 2014 or not, this was first season that I’ve actually seen mass groups of foreign tourists with a travel guides in the downtown and the Old Bazaar.

“This is the first year when Skopje received more tourists than Ohrid, the leading tourism destination of Macedonia.”

Official government statistics show a steady increase in foreign tourists arriving in Macedonia from 99,000 in 2001 to almost 262,000 last year.

While the majority come from neighboring countries, there has been an increase in recent years from further afield, including Austria, Germany, Russia, Poland, Italy and Turkey.

Nikolovski said: “We have a lack of opportunities for mass market tourism because we don’t have a coastline, but we do have beautiful lakes and mountains and interesting culture and history.”

He said the country was also developing its gambling tourism market, with a number of casino hotels.

The government has recently introduced policies to boost tourism including a reduction in sales tax on hotels and catering from 18% to 5% and subsidies to attract tour groups from certain countries.

Atanasovski said: “The previous years, usually the tour operators have been including Macedonia as a part of wider Balkan tours and haven’t stayed in Macedonia longer than a day. Starting from last year, the number of nights spent in Macedonia has increased.”

Regardless of money spent on grand projects and infrastructure, national pride has been given a boost from a quarter that no politician could plan. Macedonia’s 20th anniversary celebrations coincided with the national basketball team unexpectedly reaching the semi-finals of the European championships.

“Honestly, I haven’t seen the people of Macedonia so happy and proud before,” said Atanasovski. “Flags were all over, on people, on cars, on windows. People have replaced their economic problems with a smile and happiness.”






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‘Fifth of holidaymakers travel uninsured’

By Peter Woodman

Tuesday, 4 October 2011



Visit the Ports of Santorini on your Greek Holidays – Eva

The island of Santorini is as idyllic as they come. From the picture perfect houses to the dazzling deep blue sea; this is what Greece holidays were made for. The whole island is an active volcano, and its shape and land is a direct result of volcanic disruptions – the most significant being the eruption of 1500BC, when the western part of the island disappeared under water.

Residents here are proud of their heritage, which can be seen in the museums up and down the island. So why not visit the different ports of the island to see all aspects of island life. The hard part will be choosing your favourite.

While the bustling Fira port which is in use today is the one you’ll see if you come and go by ferry, this is simply a place for transport. The Old Port is far more interesting, and while it’s not used as much as it used to be, there are plenty of small fishing boats which moor here, and it’s worth taking the time to sit by the water’s edge and watch the world go by. Above hang the tiny white buildings of Fira town.

A must-do activity on your Greece holidays is to take a donkey ride down to the old port. After all, it’s not easy to get down there from the steep cliff-top town. If you don’t fancy bothering a mule for the journey, you can walk the zig-zagging path which goes all the way to the sea. Of course, you don’t have to walk back up – there is a cable car which offers a quick ride back to the town, with some stunning views to enjoy on the way up.

You might think you can enjoy mule rides and ports on Crete holidays or other islands, but one highlight which is unique to Santorini is its little town of Oia. Here the sunsets are world-famous, thanks to the unobstructed views out to sea. Perch at a table at one of the cliff-side bars and take in this natural wonder.

Claire Collins is a keen travel writer, and has just come back from her Greece holidays, which she absolutely loved!


Holidaymakers look to Eurozone for travel bargains

Interest in crisis-hit Eurozone countries has soared from budget-conscious holidaymakers hoping for cut-price deals, according to online travel retailer Hotels.com

It says that from June to September, searches for hotels in Spain were up 85%, in Portugal up 80%, Greece up 78%, Italy 72% and Ireland 50% on the same period in 2010.

The capital cities of those countries also saw substantial jumps with searches for Madrid up 67%, Lisbon 61%, Rome 41%, Athens 37% and Dublin 8%.

However, bargain hunters may have been disappointed as, despite their financial woes, not all the countries listed have lowered their prices. Hotel rates have been cut in Greece and Portugal, but in Spain, Italy and Ireland prices are up year on year as hoteliers cash in on increased demand from holidaymakers switching from the North African troublespots of Egypt and Tunisia.

According to Hotels.com’s latest Hotel Price Index, which tracks prices paid for rooms rather than advertised rates, the average room rate in Athens fell by 15% to £80, but across the whole of Greece it was down just 4% to an average of £96. In Lisbon prices were down just 3% to £79 but in Dubln prices rose 7% to £73 and in Italy and Spain they were up 5% and 3% to £113 and £83 respectively.

Alison Couper of Hotels.com said: “There are undoubtedly some good deals on hotel rooms at the moment and this applies to the Eurozone as much as anywhere else.

“Hoteliers in some of the affected countries have cut their room rates to attract visitors because demand has slumped as domestic consumers tighten their belts. It could well be that savvy UK travellers are shopping around and targeting those destinations affected by the Euro crisis in the hope of bagging a bargain.”

She added: “A range of factors affect the popularity and price of hotel destinations, including political unrest, natural disasters and economic turmoil.

“There seems no doubt that the debt upheaval besetting parts of the Eurozone has played, and will continue to play, a significant part in influencing prices as hoteliers discount room rates in an attempt to attract both domestic and overseas visitors.

“This in turn appears to be generating interest from Britons looking for a good deal on the Continent.”

By Linsey McNeill


Rösler lays out plans for orderly default before visiting Greece

Just days before he is due to travel to Athens, Economy Minister Philipp Rösler laid out a framework for orderly state bankruptcies, calling for it to be included in a contract for the permanent euro crisis management mechanism.

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Rösler suggested that when a country within the eurozone can no longer service its debts it would have to surrender some of its sovereignty in a process which would be led by an independent committee to balance, organise and monitor negotiations between creditors and the debtor state. The country concerned would have to establish a sensible restructuring programme, he said.

A European Currency Fund could take on this role as a successor to the European Stability Mechanism (ESM), which is due to be introduced at the latest in 2013, Rösler said, while creditors would also have to accept some of the losses. The framework had been sent by Rösler to the Finance ministry with the demand it be included in the ESM contract, the Frankfurter Allgemeine Zeitung reported.

Rösler has been heavily criticised by other senior members of the government for openly airing the possibility of a Greek default – just as the German political body voted for an increase in the country’s contribution to the Greek bail-out.

Yet deputy head of the Christian Democratic Union’s parliamentary party, Michael Fuchs said on Tuesday he thought it made sense to plan the kind of intervention outlined in Rösler’s framework. He told SWR radio, he could not really understand why Luxembourg’s prime minister Jean-Claude Juncker, who heads the group which has political control over the euro, still believed that Greece’s bankruptcy could be avoided.

Rösler is due in Athens on Thursday, taking a group of German industry managers with him, to talk about possible investments. Yet Rösler’s finance ministry is said to be warning against expectations of any kind of quick fix, drawing parallels to the long-term changes effected in East Germany and other former socialist countries.

While Europe’s future seems to depend on what happens to Greece, the pressure is showing on its prime minister Giorgos Papandreou, who has recently been close to resigning, according to a report in the Financial Times Deutschland.

The paper reported on Tuesday that he had twice spoken about stepping down in the last three weeks. He offered his resignation both times, but then continued, the paper said, quoting sources from people close to him.

He is finding it difficult to deal with the demonstrations by tens of thousands of his fellow Greeks against the savings plans he is being forced to implement – and the pressure from European Union and the International Monetary Fund to increase the cuts. A sense of powerlessness is also making him feel terrible, an insider told the paper. “Greece is deciding nothing any more,” the insider said.

The FTD said the insider described as catastrophic, the effect of his potential resignation in the middle of the negotiations for new financial aid and the implementation of the widespread cuts.

“But when a weariness of holding office has planted itself in his head, he will take that step sooner or later,” he said.

The Greek government denied the report completely, with a spokesman saying, “The information that you have received is nonsense.”

The Local/hc


Among the ruins, the sun is still shining


In a nation on a financial precipice, tourism offers a beacon of hope, writes Niki Kitsantonis.

Despite all the gloom surrounding Greece and its battered economy, the sun has been shining on the country’s tourism industry, offering one of the few glimmers of hope for recovery.

Greeks have cut back on holidays, prompting a 20 per cent drop in domestic tourism. But the number of foreign visitors to its sun-drenched islands and ancient monuments is set to reach a record of 16.5 million this year.

That is up 12 per cent from 2010, according to the Association of Greek Tourism Enterprises. Sorely needed revenue is expected to increase by the same rate, netting 11 billion euros, ($14.7 billion).

In places like the Cretan port of Rethymno, the debt crisis seemed a distant concept at times. During a recent visit, restaurants were full all along the coastal promenade.

”Our foreign customers have always been our bread and butter,” Maria Stavroulaki, the owner of the Knossos tavern, said one late-summer night. ”They saved us this year, too.”

Greece faces a long road to recovery after two years of austerity. The finance minister, in one of the more optimistic forecasts, said last month that the economy could shrink more than 5 per cent this year before slowly returning to growth in 2012.

With most economic indicators pointing downward, the increase in visitors is seen as a godsend.

Tourism accounts for almost a fifth of the country’s gross domestic product and one in five jobs. Exports rose 40 per cent in the first half of 2011, after a 25 per cent drop in 2010, but they account for a much smaller share of gross domestic product.

Coastal shipping, which feeds tourism, performed well, too. The number of passengers on cruise ships docking in Greece is up 28 per cent in the first eight months of the year.

”Without a doubt, tourism has already helped soften the blow of the economic crisis,” said Pavlos Geroulanos, the Culture and Tourism Minister. ”New markets keep growing and old ones are coming back with an old passion for Greece.”

The rebound, despite fierce competition from regional rivals such as Spain and Turkey, appears to be part luck, part planning.

As well, the Arab Spring uprisings diverted visitors from popular tourist destinations such as Egypt, Tunisia and Morocco, industry analysts said.

Advertising appears to have helped as well, with the central and local authorities promoting religious tourism, mountaineering and agricultural tourism. An online government video campaign called ”You in Greece” showed visitors against a backdrop of tantalising beaches and picture-perfect ports.

Meanwhile, the reduction in January of the value-added tax on hotels from 13 per cent to 6.5 per cent – one of the few tax breaks introduced amid several austerity measures – allowed hoteliers to reduce prices to attract more customers.

”The first thing that the Greeks did right is drop their prices early this year,” said Toby Nicol, the communications director of the World Travel and Tourism Council, an industry group based in London.

As usual, about a third of all foreign visitors this year came from Greece’s most loyal markets: Germany – despite the grumbling over having to pay for Greece’s bailout – and Britain. But there was also a surge in visitors from Russia after the lifting of visa restrictions at the end of last year; from the former Soviet states; and from Serbia, Israel, Turkey and China.

Official figures are not broken down by country of origin, according to the head of the Association of Greek Tourism Enterprises, Andreas Andreadis, but visitor numbers from the new markets are up sharply and show rich potential for further gains.

”Greece is more accessible to Russia and Israel than Spain, for example, so we should exploit this,” he said.

For Greece to build on this year’s success, it must also dispel its image as an unpredictable destination where labour strikes can cause transport disruption and protests can turn violent, Nicol said.

Violent anti-austerity rallies are thought to have kept many visitors away from Athens, where arrivals have fallen 3 per cent this year. About 10,000 hotel cancellations were made in one particularly riotous week in June, when tough measures were being voted on

in Parliament.

There were anti-austerity protests on some of the islands, too, but hoteliers did what they could to muddle through.

Economists in Greece say the country needs to branch out from the old sun-and-sea formula and start catering more to specialised interests to attract visitors year-round.

This could help make a dent in unemployment, which has hit 16 per cent overall and exceeds 30 per cent among the under 30s, by extending seasonal jobs that usually end in September.

”Greece has mountains, it has monasteries and hot springs,” said Yannis Stournaras, who heads the Foundation for Economic and Industrial Research in Athens. ”It could be attracting visitors all year round.”

The New York Times


Experts: $3 a gallon gas by Christmas

The average gas price in Bradenton, Sarasota and Venice right now is $3.33 a gallon, down from $3.41 a week ago, said Jessica Brady, spokeswoman for AAA. The national average price of regular unleaded gasoline is $3.42 per gallon, reflecting an 8-cent decrease from last week. Florida’s average price is $3.39.

“The poor economy here and abroad has been driving down the price,” Brady said. “And it looks like it will continue to decline unless we get some positive news.”

The debt crisis in Greece and elsewhere has contributed to pushing the value of the euro down, causing the U.S. dollar to go up and the price of oil to decline, she said.

With summer vacation becoming a distant memory, travel normally drops in the fall so demand is down, another factor in lowering prices.

“Summer vacations are over and we usually don’t get a big pop in traffic until Thanksgiving,” Brady said. Because of the huge fluctuations in the market right now, she didn’t want to predict what holiday travel would be like this year.

“But if you look at the current trend, there probably will be more people traveling over the holidays,” she said.

A number of factors including floods, tropical storms and Libya all contributed to a drive-up in prices this summer during a time when demand had fallen, Flynn said.

Integrated Freight in Lakewood Ranch, which has 200 trucks on the road doing long-distance hauling, is happy to pass on the lower fuel costs to its customers, said Dave Evins, finance manager.

“About 30 to 35 percent of our sales goes into diesel fuel so this is a big savings,” Evins said.

Weekly diesel prices are entered into the company’s computer system, which then automatically calculates the fuel charge.

Prices started to drop a couple of months ago, Evins said, but that drop escalated in the last few weeks.


Wall Street Closes Sharply Lower

Shares in every major sector spiraled downward on Monday as the market dropped to its lowest point in over a year amid anxiety over the European debt crisis and the struggling United States economy.

The nation’s biggest banks were once again hard hit, with Citigroup and Bank of America plunging almost 10 percent while shares of regional and community banks also plummeted. American Airlines fell by almost a third to just below $2 on speculation that it could declare bankruptcy.

The sharp sell-off brought Wall Street to the edge of a bear market — generally a fall of 20 percent from a recent high — as the Standard Poor’s 500-stock index showed a 19.4 percent decline since its April 29 high. That, in turn, could unleash yet another wave of negative news that could scare investors and push stocks even lower.

“People are really panicked, so any more incremental news in that direction, bad headlines if you will, are certainly things that may spur momentum to the downside,” said Jeffrey Kleintop, chief market strategist for LPL Financial.

On Monday, the S. P. 500 fell 2.85 percent, or 32.19 points to 1,099.23. The Dow Jones industrial average was off 258.08 points, or 2.36 percent, to close at 10,655.30. The Nasdaq composite index dropped 3.29 percent. Major stock markets in Europe and Japan also closed lower.

Seeking safer assets, investors flocked to Treasury bonds. Yields on the benchmark 10-year note fell to 1.75 percent from 1.92 percent late Friday. Fears that the problems in Europe might spread across the Atlantic and push an extremely fragile economy back into a recession have been looming for more than a year. With the job market still weak and the confidence of businesses and consumers in tatters, investors seem to be lurching from one piece of bad news to another.

Through the summer, for every big gain in stocks there were twice as many big losses, with 13 days of drops of 2 percent or more compared with seven days of gains of at least 2 percent. The rises were often driven by hopes that the European debt crisis could be contained, but then were wiped out by fears of cascading defaults and bank runs, and no real solution to too much debt and too little growth in Europe.

Even glimmers of hope, like reports on Monday showing stronger-than-expected manufacturing and construction data, were overshadowed by the unknowns about what will happen in Europe.

“That uncertainty has the markets completely shell-shocked, in jitters,” said Nariman Behravesh of IHS Global Insight.

In Europe, stock markets closed lower as finance ministers from the euro zone countries met Monday to try to approve a new installment of aid to Greece. But tension over the country’s inability to impose tough structural changes has stalled the talks, and no decision is expected this week.

Investors are also awaiting a meeting of the European Central Bank on Thursday, and many expect the bank to cut interest rates. Analysts say such action could push the euro lower and perhaps stave off a sharper decline in growth.

But fears about European contagion again weighed heavily on the major American banks, whose shares have fallen more than 35 percent this year.

“It’s just painful. Every day seems like it is the worst,” said Frederick Cannon, the chief equity strategist at Keefe, Bruyette Woods in New York. “As long as U.S. financials are tied to the comings and goings of Europe, it is going to be a roller-coaster ride without an end to it.”

Wall Street firms were pounded as investors worried that they may have large, indirect exposures to the Continent’s fiscal troubles because of the business they do with major European companies and banks. On Monday, Morgan Stanley’s shares fell almost 8 percent after plunging more than 10 percent on Friday. Shares of Goldman Sachs fell almost 5 percent Monday.

In another sign of investor fears, credit-default swaps on bonds backed by both Morgan Stanley and Goldman Sachs surged on Monday to their highest levels since the 2008 financial crisis. According to Markit, a credit derivatives data provider, investors are now paying $558,000 to insure against the risk that $10 million of Morgan Stanley bonds might default. They are paying $348,000 for similar protection for Goldman Sachs debt.

More domestically focused banks were not spared. Amid the onslaught of bad economic news — and fears of another weak jobs report on Friday — investors were dubious about the financial industry’s ability to improve revenue. They are also concerned that Federal Reserve policy measures to keep interest rates near zero for the next two yeas will ravage their results. Even generally well-run institutions — like JPMorgan Chase, Bank of New York Mellon, PNC Financial, U.S. Bancorp and Wells Fargo — fell 3 to 5 percent.

Airline stocks were also battered on Monday amid concerns consumers and businesses will cut back on travel spending in a deeper downturn. Traders started circling AMR, the parent company of American Airlines, because of rumors that it may be headed for bankruptcy.

An analyst report noted that an unusually large number of pilots have retired in recent months, contributing to AMR’s price drop of more than 33 percent, to $1.98. Shares of Delta Air Lines and United Continental Holdings fell about 11 percent. The U.S. Airways Group stocks sank almost 16 percent.

David Jolly, Stephen Castle and Bettina Wassener contributed reporting.

This article has been revised to reflect the following correction:

Correction: October 3, 2011

Because of an editing error, an earlier version of this article misstated the price of oil. It is trading slightly above $77, not $777.


Stocks Tumble on Greek Woes (AA, AAPL, ACI, AMR, ANR, BAC, NFLX, PCLN, UAL …

NYSE:AMRNew York, October 3rd (TradersHuddle.com) – Stocks were tumbling at the start of a new quarter. The market was failing to rebound from the worst quarterly decline since 2008, amid global growth concerns and as Greece acknowledge that it was missing deficit targets, spurring default fears. Market chatter regarding signs of economic slowdown and credit tightness in China weigh on sentiment as well.

The Dow Jones Industrial Average was falling 1.85%. The SP 500 index was losing 2.13%, while the NASDAQ was tumbling 2.53%.

The market started under pressure unable to stage a rebound from the worst quarterly performance since the height of the credit crisis. Sentiment was notably bearish amid declines in overseas markets after Greece acknowledged that it would miss its deficit targets for this year and next as its economy weakens further.

In Asia, stocks extended last week losses, as Hong Kong shares plunged, while China and Korea were closed for Golden Week. The Nikkei fell despite a better than expected Takan Survey, as it was weighed down by exporters and financials. The yen strengthened on concern the EU debt crisis will dampen global growth. Meanwhile, Hong Kong shares plunged more than 4%. Over the weekend, China’s official PMI came in and was a little better than expected, but it failed to provide any lift to shares in Hong Kong, which were dealing with foreign funds liquidated positions in mainland financials and property developers.

On the economic front, the September ISM number provided a boost to shares, which attempted a rebound from early weakness. Data showed that U.S. manufacturing expanded at a faster pace than expected in September, as the ISM manufacturing index for September came in at 51.6, compared with 50.6 in August, and a reading of 50.5 that was widely expected among economists.

In Europe, markets closed sharply lower, but were able to cut losses following the better than expected U.S. economic data. Stocks were under pressure following the admission from Greece that it will fail to meet the deficit targets despite putting in place austerity measures. Concern over the deteriorating sovereign debt crisis stubbornly kept pressure on both the euro and equities.

However the attempt to move higher following the unexpected jump in manufacturing activity in September was short lived, with stock extending losses in early afternoon. Concern over Europe and chatter regarding signs over a Chinese slowdown continued to weighed on the market at the start of the quarter.

All of the SP 500 sectors were trading lower, with energy, financials, healthcare, and industrials posting the biggest declines, while consumer staples were posting the smallest decline.

Commodities were under pressure amid Dollar strength and concerns over global growth. Crude oil was falling 2.4% to $77.40 per barrel, which in turn added pressure to the energy sector, which was already seeing weakness as coal companies were being hit after Arch Coal (NYSE:ACI), the Missouri based coal producer, cut its guidance below consensus last Friday. The stock was tumbling 8.57% to $13.33 after posting a new 52-week low at $13.25.

The news also pressured Alpha Natural Resources (NYSE:ANR), the steam and metallurgical coal producer, which extended its losses from last quarter. Alpha was the weakest in the sector, tumbling 7.46% to $16.36 after posting a new yearly low at $16.10. The stock was the worst performer of the SP 500 last quarter, plunging 61%.

Financials were also under pressure, on concerns over the European debt crisis and its impact on the European banking system and as shares of Bank of America (NYSE:BAC), the largest U.S. lender, broke down below $6 per share after a report from FBR Capital Markets stating that the federal housing insurance program may be forced to deny bank claims for money lost in home loan foreclosures, costing them another $13.5 billion in mortgage-related losses, amid increasing political pressures to deny claims. According to the analyst Bank of America could face $2 billion more in losses.

Reports that its website was again malfunctioning on Monday, despite reports that it had fixed the issues over the weekend were affecting the stock as well. Credit Suisse reduced its target price to $13 and cut its estimates on the lender, but still reiterated it’s outperform rating. The stock nevertheless broke down and was plunging more than 8% to post a new multi year low at $5.60

Rival Wells Fargo (NYSE:WFC), San Francisco based financial firm, was falling 2.26% to $23.57 after the FBR Capital report said that Wells could face up to $3 billion in losses from claims that the FHA could deny.

Other stocks seeing notable moves were

Alcoa (NYSE:AA), the aluminum producer, was tumbling 5.64% to $9.03 after posting a new multi-year low at $8.95. The stock was feeling the pressure of lower metal prices on concern over the global economy and as it was downgraded to a Hold from a Buy at Deutsche Bank.

AMR Corp. (NYSE:AMR), the parent of American Airlines, was plunging 25% to $22.22 after posting a new multiyear low of $1.75. The stock was falling the most since 2001 on bankruptcy speculation, as the airline has to deal with high jet fuel prices and higher labor costs than competitors, amid an aging fleet.

Apple (NASDAQ:AAPL), the maker of iPads and iPhones, was falling 113% to $377 amid broad weakness in the market. The stock was outperforming in the session ahead of the unveiling of its new iPhone scheduled for tomorrow. Ticonderoga issued a research note in which it states that Apple stock has not performed like in past years ahead of its new iPhone launch, given the underperformance in the last 2 weeks. Last week the stock tumble close to 6% amid concerns over the iPad production estimates, as Amazon unveiled a new tablet and JPMorgan said that its production orders for the 4th quarter had been cut 25%. Jefferies acknowledged JPMorgan’s research note, saying that iPad production plans have scaled back but as a result of a shift of a portion of its supply chain to Brazil and an earlier than anticipated launch of the iPad 3 for January 2012. The firm reiterated its Buy rating and $500 price target, however this failed to lift the stock. Apple is now trading between its 50day moving average at the $385 area and its 200day moving average at the $353 area.

Netflix (NASDAQ:NFLX), the video subscription service, was adding 1.18% to $114.61 after it was named long Research Tactical Idea at Morgan Stanley. The firm said that Wall Street was not valuing the streaming business correctly and that they expect price to rebound in the next months. Netflix tumbled 57% last quarter, as the stock was hit after the lowered guidance in subscriptions following customers cancelling its DVD mail in plan at a faster pace than anticipated in reaction to a price increase.

Priceline.com (NASDAQ:PCLN), the name your price online travel company, was climbing 1.26% to $455.13 after it was upgraded to Overweight from Equal Weight at Morgan Stanley.

United Continental (NYSE:UAL), the world’s largest airline, was tumbling 10% to $17.41 after it was downgraded to a Hold from Buy at Citigroup. The stock was also receiving pressure from the price action at AMR.

Yahoo! (NASDAQ:YHOO), the Internet media company that owns the second largest search engine, was gaining 2.24% to $13.47 after trading as high as $14 on continued MA speculation. Jack MA, Chariman of Alibaba Group, said at a speaking investment in Stanford that its company is very interested in Yahoo. The company has been involved in takeover speculation since it ousted its CEO Carol Bartz.


Seven Currencies Since 1914 Is Enough for Germans Rescuing Euro

October 03, 2011, 6:25 PM EDT

By Leon Mangasarian

(Click on EXT4 for more on Europe’s debt crisis.)

Oct. 4 (Bloomberg) — Addi Brittnacher is one German willing to pay a Greek ransom to save his way of life.

The 61-year-old retired machine worker is from Saarland, the western corner of Germany wedged beside France and Luxembourg and a region built on coal and steel that became the heart of the European Union’s genesis. His wallet used to bulge with three kinds of cash and an identification card to cross the borders a few hundred meters from his home.

“There are no more borders here and people don’t have borders in their heads,” said Brittnacher, as he drove a van on a rutted gravel road along vineyards above the Mosel River. “It’s worth saving Greece to save the euro.”

Saarland is the birthplace of the European integration project that emerged from World War II and culminated in monetary union and the introduction of euro bank notes nine years ago. That makes the region a microcosm of why German Chancellor Angela Merkel may have to do whatever it takes to prevent Greece from blowing the 17-member euro apart.

The region, which was swapped between France and Germany as war booty, has had seven currencies since 1914. The people there don’t want another one because employers such as 263-year-old ceramic maker Villeroy Boch, Ford Motor Co. and automotive- parts producer Robert Bosch GmbH depend on exports.

Feeling Pain

“The euro is vital because we have above average exports in comparison with other German states,” Christoph Hartmann, 39, Saarland’s economy minister, said in an interview in his office in the state capital, Saarbruecken. “We need long-term security for euro members and we won’t get this through cosmetic changes. It will be painful.”

Greece has about 350 billion euros ($465 billion) of debt, equivalent to five times the size of Argentina’s default a decade ago. The Greek pile will amount to 62 percent more than the size of its economy this year, while its budget deficit will remain wider than targeted as Prime Minister George Papandreou struggles to implement measures to raise money. Based on 10-year government bond prices, its borrowing costs were 22.8 percent yesterday, more than 11 times Germany’s.

Brittnacher lives in the German village of Perl across the Mosel River from the Luxembourg village of Schengen, where EU members signed the agreement in 1985 that led to a passport-free travel zone encompassing most of the group’s now 27 countries.

Wine Prices

Thomas Schmitt, 46, a vineyard owner in Perl, has 7 hectares of grapes producing 90 percent white wines including Grauer Burgunder, Weisser Burgunder and Elbling.

“The euro is a huge help for us when we have to make big investments,” Schmitt said. “It allows me to compare prices from suppliers in France, Germany and Luxembourg.”

“Naturally, I would help Greece although I’m skeptical about whether they can get this thing under control,” he said, sitting at table made from a wine barrel in his vineyard’s cellar. “If the EU can’t solve this problem then who can?”

As the EU’s largest economy, Germany has committed the lion’s share to the rescue of Greece, Ireland and Portugal so far and is under pressure to commit more funds.

It’s the biggest country in the European Financial Stability Facility, or EFSF, with its guarantees rising to 211 billion euros, or 27 percent of the money. The expansion of the fund was approved by German lawmakers on Sept. 29 while polls showed the majority of the public didn’t want to.

Merkel’s Future

The broader EFSF has a remit to buy bonds of distressed euro-area governments on both the primary and secondary markets, aid troubled banks and offer credit lines. All but three of the euro members have approved it.

“The euro is our common future,” Merkel said in a Sept. 27 speech in Berlin attended by Papandreou. “We have to show solidarity to preserve the common currency.”

Germany “profits from the euro” and will provide all the help it can to stabilize Greece, she said.

The Saarland’s dependency on sales abroad reflects the nation. Germany is the world’s second-biggest exporter after China. Outgoing goods rose 14.7 percent in the first half of 2011 from the same period a year earlier, to 525.6 billion euros, according to the Federal Statistics Office in Wiesbaden.

About 17 percent of Saarland’s exports go to France, with its neighbor accounting for 19 percent of imports into the area, the state’s Economy Ministry said.

Seeking Safety

“Without the euro, Germany would be in a very difficult position,” Bruce Stout, the manager of Aberdeen Asset Management Plc’s $1.5 billion Murray International Trust, said in an interview at his office in Edinburgh. “If they weren’t in the euro could you imagine what the over-valuation of the deutsche mark would be? People would see it as a safe haven.”

The euro lost 7.7 percent against the dollar in the third quarter. It sank by 9 percent versus the Swiss franc from June 30 until Sept. 5, the day before the central bank in Zurich said it would cap the currency to prevent its role as a safe haven from damaging the country’s economy.

The Saarland changed hands four times between Germany and France in the 20th Century as a result of both World Wars. Its currency varied more, including the adoption of the transitional Saarmark for six months in 1947.

The state was a core of the European Coal and Steel Community, set up in 1951, to “make it plain that any war between France and Germany becomes not merely unthinkable, but materially impossible,” according to Robert Schuman, the French foreign minister at the time and an architect of European unity. He called the coal and steel alliance “a first step in the federation of Europe.”

Border Triangle

Schuman’s family hailed from Lorraine, the area of eastern France across the border from Saarland that was annexed by the German Empire in 1871. Brittnacher was born in Saarland after World War II when it was occupied by the French.

Driving through a French farm village surrounded by forests, Brittnacher, a well-built man with short grey hair and a neatly trimmed moustache, rolls down the window of the van and greets an elderly woman in Plattdeutsch, or “low German,” as she sorts walnuts in front of her home.

The language, which sounds like a mixture of German and Dutch, is spoken by people in the border region of the three countries, he said. “People get confused because we also speak the local dialect,” he said.

Schmitt’s vineyard in Perl is also a blend reflecting the region. Pointing to the cellar’s stone walls, oak beams and heavy wrought iron door hinges, Schmitt said the beams and hinges were made by French craftsmen while the stonework was done by a Portuguese company from Luxembourg. “That’s European unity in stone, steel and wood,” he said.

Better Fish

Markus Moelle, 36, an architect in Saarbruecken, said that German skilled trades are also in demand in France.

“I have French customers who say they only want German plumbers and electricians, even though they’re more expensive, because they know the Germans have better training,” Moelle said on the roof terrace above his office, Raumloesungen Ltd., in an industrial park on the outskirts of Saarbruecken.

Moelle, who designs logistic centers, said “the euro is a foundation for all cross-border business in the region.”

“I can compare prices, wages, you name it, for any project,” he said. “On a personal level, I love having the euro and open border because I do my shopping in France. French supermarkets have far better fish than those in Germany.”

Worldly Region

The Saarland, with a population of about 1 million, is one of the most international parts of Germany.

More than 200,000 people commute across the state’s national borders to jobs, business or for shopping every day, the Saarland Interior and Europe Ministry said in an Aug. 31 statement. Saarland and French police forces carry out regular joint deployments such as a June training operation with 500 French and German officers.

Support in the Saarland for doing whatever it takes to keep the euro region intact compares with 76 percent of Germans who opposed expanding the firepower of the rescue fund for indebted euro governments, according to an FG Wahlen poll for ZDF television published on Sept. 9.

Merkel’s Christian Democratic Union governs the Saarland with the Greens and Free Democrats.

“The labor force beyond the border is increasingly important,” said Hartmann, the economy minister, citing Germany’s aging population. “The French have always worked here but this is growing in importance.”

Hartmann, a member of the Free Democratic Party that serves as junior coalition partner to Chancellor Merkel in Berlin, said that to save the euro Greece will need a “haircut” and its debts will have to be reduced by up to 80 percent. Banks will have to take a “loss,” he said.

Germany’s Greece

Unlike some richer German states, Saarlanders have experience of what it’s like to need aid.

The Saarland was handed 6.6 billion euros in subsidies from 1994 to 2004 to cut its debt and is due to receive a further 2.34 billion euros from 2011 to 2019, according to the state’s Finance Ministry.

The Saarland is the smallest of Germany’s states after the cities of Berlin, Hamburg and Bremen, and had 11.8 billion euros of debt at the end of 2010, the Finance Ministry said.

“You could say we’re the Greece of Germany,” Oliver Groll, an economist at the state’s Chamber of Industry and Commerce, said in an interview. “The Saarland profits from the rest of Germany. Low interest on German bonds helps the indebted Saarland. It’s kind of a German euro bond we benefit from.”

Honecker’s Home

The state, which produced East German communist leader Erich Honecker, has converted a once declining economy from coal and steel into one based on manufacturing and services. Steel and coal employed 100,000 people in 1960 and today the number is 14,000, with the final 3,000 coal jobs due to be axed next year, according to the Chamber of Industry and Commerce.

Today, of the Saarland’s 100,000 industrial jobs, about 45,000 are at automotive companies including Ford, which makes its new Focus compact car in the region, and Robert Bosch manufacturing diesel injection components.

The Saarland’s gross domestic product grew 4.7 percent last year, the biggest yearly expansion since 1979, according to data from the Economy Ministry. That’s more than Germany as a whole at 3.6 percent in 2010.

Nationwide, growth is forecast to slow to 2.7 percent this year and 1.3 percent in 2012, the International Monetary Fund said last month. The Greek economy will shrink for a fourth straight year in 2012, contracting 5 percent this year and 2 percent next year, it said.

Deutsche Mark

Heino Klingen, director of the Saarland Chamber of Industry and Commerce’s economic and business-development division, warns that any return to the deutsche mark would push up the value Germany’s currency to rates of the 1980s and harm exports.

“Saarland industry exports over 50 percent of what it produces, mostly to the euro region with France as our biggest market,” Klingen said in an interview. “So the euro is very, very important for us.”

To buttress growth, the Saarland needs to attract more companies to base their business there and create research and development jobs, Hartmann said.

One global company with its headquarters in the Saarland is Mettlach-based Villeroy Boch, a ceramics maker of everything from toilets to luxury tableware for all recent popes including Benedict XVI. The company, founded in 1748, is active in 125 countries and generates 65 percent of its revenue in euros, Joerg Wahlers, its chief financial officer, said by e-mail.

“This alone shows the meaning of the currency for us,” said Wahlers. “The euro reduces Villeroy Boch’s currency risks and gives us greater planning security.”

Dishwasher Safe

Villeroy Boch expects global sales of 760 million euros in 2011 with net operating profit of about 30 million euros, said Almut Haehner-Ural, Villeroy Boch’s spokeswoman.

At the company’s museum next to the factory, tableware designed for recent popes is on display. Benedict’s are less ornate, simply with his coat of arms of crossed keys, a bear and a scallop shell after he requested they be toned down.

“He wanted less gold and a thinner gold border,” said Ester Katharina Schneider, who runs the museum. “He chose from our normal production line and the plates are dishwasher safe. We’re told he uses them on a daily basis.”

Brittnacher’s van rattles up a hillside surrounded by fields of rich, reddish soil littered with stone fragments.

“This field is in Germany but it’s farmed by two Frenchmen,” said Brittnacher, whose home is 300 meters (984 feet) from Luxembourg and 500 meters from France. “Back in the old days of border controls they had to declare the manure they drove across the border as fertilizer.”

He pulls up at a Franco-German “Peace Chapel” built of stone between 1996 and 1999 and straddling the French-German border. Inside is a metal plaque listing men from the surrounding villages who were killed in both world wars.

“These three countries here are our capital,” Brittnacher said. “We haven’t had a war for more than 60 years in a place where there was so much war. This alone makes the EU and the euro worth fighting for.”

–With assistance from Tony Czuczka in Berlin. Editors: Rodney Jefferson, John Fraher

To contact the reporter on this story: Leon Mangasarian in Perl, Germany, at [email protected]

To contact the editor responsible for this story: James Hertling at [email protected]oomberg.net