Belgian National Bank Governor Gets It: Bailing Out Spain ‘Makes No Sense’

Belgian National Bank Governor Gets It: Bailing Out Spain “Makes No Sense” (ZeroHedge, Aug 11, 2012):

A week ago we explained quite clearly why instead of encouraging self-defeating, short-termist behavior by promising to save Europe’s insolvent countries if and when needed, which does nothing to resolves Europe’s problems and make it worse in exchange for a brief respite from bond selling, the ECB should be doing precisely the opposite: encouraging local governments to understand that there is no magic bazooka from the central banks. Specifically we said that “this Catch 22 of confounding cause and event can continue seemingly indefinitely, although in reality it can’t. Because fundamentally what the bond market does is keep sovereigns “honest” – just as Schauble said a week ago, Spanish yields at 7% are not the end of the world – instead what they are is a signal to the country to get its spending in control in order to reduce its deficit, and fundamentally get its house in order – yes, that means getting government spending to a sustainable level and firing hundreds of thousands of workers, as well as probably raising taxes even more. It also means pain all around, but the pain is inevitable and will only be worse the longer reality is denied.” This logic is so clear that only a lifelong economist, PhD or Goldman apparatchik can not grasp it: sadly that accounts for most of the people “in charge.”

Which is why we were delighted to read that at least one person “gets it” – Belgian national bank governor Luc Coene, the same Belgium that is also the clogged heart of the Burtonian bureaucratic labyrinth known as the EU, who told Belgium’s two largest newspaper that “buying the bonds of these countries would only serve to weaken the ECB and do nothing to resolve underlying issues of competitiveness.  “It makes no sense for the ECB to start financing those countries,” said Mr Coene, “It would only lead to the ECB taking on the whole public debt of Spain and Italy onto its balance sheet.” Bingo. And not a moment too soon – we really were starting to pull a Mogatu here.

Read moreBelgian National Bank Governor Gets It: Bailing Out Spain ‘Makes No Sense’

Germany Folding? Europe’s Insolvent Banks To Get Direct Funding From ESM

Germany Folding? Europe’s Insolvent Banks To Get Direct Funding From ESM (ZeroHedge, April 26, 2012):

We start today’s story of the day by pointing out that Deutsche Bank – easily Europe’s most critical financial institution – reported results that were far worse than expected, following a decline in equity and debt trading revenues of 23% and 8%, but primarily due to Europe simply “not being fixed yet” despite what its various politicians tell us. And if DB is still impaired, then something else will have to give. Next, we go to none other than Deutsche Bank strategist Jim Reid, who in his daily Morning Reid piece, reminds the world that with austerity still the primary driver in a double dipping Europe (luckily… at least for now, because no matter how many economists repeat the dogmatic mantra, more debt will never fix an excess debt problem, and in reality austerity is the wrong word – the right one is deleveraging) to wit: “an unconditional ECB is probably what Europe needs now given the austerity drive.” However, as German taxpayers who will never fall for unconditional money printing by the ECB (at least someone remembers the Weimar case), the ECB will likely have to keep coming up with creative solutions. Which bring us to the story du jour brought by Suddeutsche Zeitung, according to which the ECB and countries that use the euro are working on an initiative to allow cash-strapped banks direct access to funding from the European Stability Mechanism. As a reminder, both Germany and the ECB have been against this kind of direct uncollateralized, unsterilized injections, so this move is likely a precursor to even more pervasive easing by the European central bank, with the only question being how many headlines of denials by Schauble will hit the tape before this plan is approved. And if all eyes are again back on the ECB, does it mean that the recent distraction face by the IMF can now be forgotten, and more importantly, if the ECB is once again prepping to reliquify, just how bad are things again in Europe? And what happens if this time around the plan to fix a solvency problem with more electronic 1s and 0s does not work?

Here is Deutsche Bank’s Jim Reid redirecting attention back to where it was all throughout the summer and fall of 2011, until the new Goldman-based head of the ECB relented days after his appointment:

Read moreGermany Folding? Europe’s Insolvent Banks To Get Direct Funding From ESM

Strauss-Kahn To Be Questioned About Prostitutes Orgies, Involving Police And Other Government Officials

Strauss-Kahn questioned in prostitution case (Wall Street Journal, Feb. 22, 2012):

PARIS — Former International Monetary Fund chief Dominique Strauss-Kahn was being held for questioning Tuesday by French police investigating a suspected hotel prostitution ring.

Strauss-Kahn, a one-time French presidential hopeful whose chances were derailed by a sexual assault accusation, arrived at the police station in the northern city of Lille for a pre-arranged morning appointment and was still there in the late afternoon.

Police are probing a suspected prostitution ring in France and neighboring Belgium that has implicated police and other officials. They have questioned prostitutes who said they had sex with Strauss-Kahn during 2010 and 2011 at a luxury hotel in Paris, a restaurant in the French capital and also in Washington, D.C.

French law permits police to question Strauss-Kahn for 48 hours, and then for another 48 hours with a judge’s approval.

Strauss-Kahn lived in the U.S. capital while he was head of the IMF before resigning his position in May after he was charged by New York police with making a hotel maid perform oral sex. The charges were later dropped.

Two men with ties to Strauss-Kahn have been put under preliminary investigation in France on charges including organizing a prostitution ring and misuse of corporate funds.

Strauss-Kahn’s name surfaced in the investigation last fall and his lawyer has asked that Strauss-Kahn be allowed to tell his side of the story. One of Strauss-Kahn’s lawyers has said that the former French presidential hopeful never knew that the women at orgies he attended were prostitutes.

Read moreStrauss-Kahn To Be Questioned About Prostitutes Orgies, Involving Police And Other Government Officials

The Real Dark Horse: S&P’s Mass Downgrade FAQ May Have Just Hobbled The European Sovereign Debt Market

From the article:

S&P may have just killed the European sovereign market by saying out loud what only “fringe bloggers” dared suggest in the past.


The Real Dark Horse – S&P’s Mass Downgrade FAQ May Have Just Hobbled The European Sovereign Debt Market (ZeroHedge, Jan. 13, 2012):

All your questions about the historic European downgrade should be answered after reading the following FAQ. Or so S&P believes. Ironically, it does an admirable job, because the following presentation successfully manages to negate years of endless lies and propaganda by Europe’s incompetent and corrupt klepocrarts, and lays out the true terrifying perspective currently splayed out before the eurozone better than most analyses we have seen to date. Namely that the failed experiment is coming to an end. And since the Eurozone’s idiotic foundation was laid out by the same breed of central planning academic wizards who thought that Keynesianism was a great idea (and continue to determine the fate of the world out of their small corner office in the Marriner Eccles building), the imminent downfall of Europe will only precipitate the final unraveling of the shaman “economic” religion that has taken the world to the brink of utter financial collapse and, gradually, world war.

Here are the key take home messages from the FAQ (source):

Read moreThe Real Dark Horse: S&P’s Mass Downgrade FAQ May Have Just Hobbled The European Sovereign Debt Market

Is This 2008 All Over Again? No, It’s Worse. Much Worse. Get Ready For Worldwide Currency Devaluation!

Recommended:

Worse Than 2008 (ZeroHedge, Dec. 21, 2011)

Prepare for collapse.

Got physical gold and silver?

Don’t miss:

Max Keiser And Gerald Celente On MF Global Bankruptcy Implications – The JP Morgan Connection – Goldman Sachs – CME (‘Chicago Mafia Exchange’) – Gold, Silver – Syria, Iran – Entire Financial System Collapsing, One Big Global Ponzi Scheme – False Flag, WW III – Bank Holiday, Economic Martial Law – ‘YOUR MONEY ISN’T SAFE’ (Video)


Of Imminent Defaults And Self Deception: Hedge Fund Manager Kyle Bass Prepares For The Worst

Flashback:

University of Texas Takes Delivery Of $1 Billion In Gold Bars After Cue From Hedge Fund Manager Kyle Bass, Storing It In New York Vault


Of Imminent Defaults And Self Deception. Kyle Bass Prepares For The Worst (ZeroHedge, Nov. 30, 2011):

In his latest letter to LPs, Kyle Bass of Hayman Capital Management, offers his tell-tale clarity on what may lie ahead for Europe and Japan. With his over-arching thesis of debt saturation becoming more plain to see around every corner, Bass bundles the simple (and somewhat unarguable) facts of quantitative analysis with a qualitative perspective on the cruel self-deception that we all see and read every day about Europe.

Whether it is Kahneman’s “availability heuristic” (wherein participants assess the probability of an event based on whether relevant examples are cognitively “available”), the Pavlovian pro-cyclicality of thought, or the extraordinary delusions of groupthink, investors in today’s sovereign debt markets can’t seem to envision the consequences of a default.

His Japanese scenario is no less convicted, as we have discussed a number of times, with the accelerant of this debt-bomb being the very-same European debacle and his time-frame for this is set to begin in the next few months.

Hayman_Nov2011

So Much For ‘Europe Is Fixed’: French, Spanish, And Belgian CDS Hit New Records

So Much For “Europe Is Fixed”: French, Spanish, And Belgian CDS Hit New Records (ZeroHedge, Nov. 14, 2011):

It seems that rotating a few pawns at the top is not quite the bazooka everyone expected it to be last week. Case in point: CDS in the core European trio of France, Spain and Belgium just hit new all time wides. But before anyone blames evil CDS speculators, it is notable that CDS is significantly outperforming cash bonds. And since everything that can be said about Europe’s ongoing implosion has been said already, the only question is which Goldman “advisor” will replace Sarko in a few weeks.

CDS:

and cash bonds:

France, Belgium, Italy And Spain Ban Short-Selling Of Financial Stocks

– Four European Nations to Curtail Short-Selling (New York Times, August 11, 2011):

A European market regulator announced on Thursday night that short-selling of financial stocks in several countries would be temporarily banned in an effort to stop the tailspin in the markets.

The European Securities and Markets Authority, a body that coordinates the European Union’s market policies, said in a statement that these negative bets on stocks would be curtailed effective on Friday in France, Belgium, Italy and Spain. They are already banned in Greece and Turkey.

“Today some authorities have decided to impose or extend existing short-selling bans in their respective countries,” the authority said. “They have done so either to restrict the benefits that can be achieved from spreading false rumours or to achieve a regulatory level playing field, given the close inter-linkage between some E.U. markets.”

The statement said details for each country would be posted on their individual financial regulators’ Web sites.

European financial regulators have been discussing a continentwide a ban over the last few days amid fears from governments in places like France that these negative bets on stocks were driving a panic. In short-sales, a trader sells borrowed shares in hopes that they will decline in value before he has to buy them back to close out his loan. The difference in price is his profit, or loss.

But some countries, like Britain, came out publicly against a short-sale ban.

Critics say short-selling encourages speculation and pushes stock prices down, sometimes feeding on itself in a panicked market, while advocates say it keeps the market honest and maintains liquidity.

The increasing number of European governments banning short-selling puts United States regulators in a tricky position. Investors with negative views on bank stocks who are forced to close their negative bets in Europe might shift them to American banks. On Thursday, stocks in the United States continued their see-saw ride, surging 4 percent, buoyed by hopeful data on initial jobless claims.

The short-selling announcement in Europe stirred some immediate criticism. “It is a crisis of confidence, and when you do something like this, it shows a lack of confidence, which is exactly the opposite of what you want to say to the markets,” said Robert Sloan, managing partner of S3 Partners, a firm that helps hedge funds manage their relationships with their brokers.

Back in 2008, European and United States officials coordinated temporary bans on shorting financial stocks.

The bans in Europe are drawing to the list of comparisons that commentators are making between the current market unrest and the financial crisis of 2008.

Back then, governments around the world, including Britain and the United States, banned short-selling on financial stocks temporarily. The ban was meant to prevent bank stocks from falling further, but in time, stocks fell anyway.

Hedge funds, in particular, were hurt by the ban because it interfered with trading strategies that pair negative bets with positive ones.

The ban on short-selling in 2008 has been widely criticized and blamed for driving investors out of the market altogether, further hurting stock prices.

It is impossible to know whether the panic would have been worse without the ban, which protected companies like Goldman Sachs and Morgan Stanley, but general studies of short-selling have found that bans on that activity can lead to more volatility in the market and lower trading volume, according to Andrew W. Lo, a professor at the Massachusetts Institute of Technology.

Mr. Lo said banning short-selling also removed important information about what investors think about the financial health of companies, and suggested that the bans served mainly political purposes.

“It’s a bit like suggesting we take heart patients in the emergency room off of the heart monitor because you don’t want to make doctors and nurses anxious about the patient,” he said.

Details were still emerging about each country’s policy. In France, the market watchdog banned short-selling or increasing short-selling positions, effective immediately, for 15 days on 11 financial institutions. They are: April Group, Axa, BNP Paribas, CIC, CNP Assurances, Crédit Agricole, Euler Hermès, Natixis, Paris Ré, Scor, and Société Générale.

Shares in the banks have slumped sharply, sometimes on market rumors. Société Générale’s shares plunged as much as 23 percent Wednesday before closing down 14 percent, on what the chief executive, Patrick Oudea, called “fantasy rumors.” Its shares recovered slightly on Thursday, gaining 3.7 percent.

The European authority does not have the authority to impose a policy on short-selling but it can make recommendations and coordinate cooperation among the European Union’s 27 governments. The European Parliament is considering legislation to give the authority additional powers.

Some investors are already anticipating that such a ban may occur, Mr. Sloan of S3 Partners said. He said that for the past two months many investors had been getting out of their short positions, in part out of fear that such a ban might be introduced. He also said if there were more short-sellers in the market now, the markets might be falling less than they are. That is because as markets fall, short-sellers often close their positions to cash in profits and in doing so, they have to purchase shares to cash out.

The markets could use these sorts of buyers now, said Mr. Sloan, who wrote a book after the 2008 crisis called “Don’t Blame the Shorts: Why Short Sellers Are Always Blamed for Market Crashes and How History Is Repeating Itself.”

Arturo Bris, a professor of finance at the IMD business school in Lausanne, Switzerland, studied financial stock prices in 2008 before and after a short-selling policy was put in place. On Wednesday, Mr. Bris said that he did not think such a ban in Europe would help in the long run. “If there is a ban in the European markets in the next couple weeks it would stop the blood, but it’s not going to solve the problem,” Mr. Bris said. “It would just delay the problem.”

Even with the European countries’ bans on short-sales of some stocks, investors who have negative opinions on companies may still find ways to bet against them in the derivatives market, if those sorts of trades remain allowed.

Italy Burning, Undergoing Slow Motion Crash, With Bank After Bank Getting Halted

The Vespa Has Crashed Into The Mountain: Italy Burning (ZeroHedge, Aug 1, 2011):

Italy undergoing a slow motion crash, with bank after bank getting halted, first Intesa, then Monte Paschi, and most recently, main bank Unicredit.

The FTSEMIB is now down a whopping 5.5% from intraday highs, led by the financial sector which may or may not last the week absent another EFSF expansion as we have speculated before.

Of course, should that happen, Italy becomes a liability and not a funder, meaning the proportional obligations of Germany and France will surge, just as we explained two weeks ago.

And more bad news: the spread between the 10 year Italy – Bund just hit an all time wide of 349, +16 bps on the session, as Italy CDS are now trading 328, +12, and Spain is 9 bps wider to 374.

Time for bailout #3, this time to rescue Italy, then Belgium and Spain, then France and the UK, until finally the Fourth Reich, in the darkness, shall bind them.

General Italy

And just the country’s top (and we use that term loosely) banks:

Belgium Finds Radioactive Cesium-137 Above Legal Limits On Containers From Japan

BRUSSELS – Belgium’s radiation safety regulator has discovered radiation levels surpassing European Union limits on a shipping container from Japan, the agency said on Wednesday.

The agency is decontaminating the container after it found radiation from Cesium-137 being emitted at a level of 0.5 microsieverts per hour in two rust spots.

This exceeds a limit of 0.2 microsieverts per hour suggested by European officials.

Read moreBelgium Finds Radioactive Cesium-137 Above Legal Limits On Containers From Japan

Rail Strike Shuts Down Belgium, Severely Disrupts International Travel

A 24-hour strike has shut down rail service in Belgium and severely disrupted travel in northwestern Europe. Disruptions are expected to last until Tuesday morning.


Brussels is at a standstill

A 24-hour strike by one of Belgium’s main rail unions has forced the cancellation of nearly all high-speed rail service in and out of the country and severely disrupted the national network.

The strike, which began affecting the international trains linking Belgium to France, Germany the United Kingdom and the Netherlands on Sunday evening, has shut down the country and led to massive traffic jams.

“Not one train is rolling in [the Southern province of] Wallonia or in Brussels. In [the Northern province of] Flanders, only a handful of trains are moving,” a spokesman for Belgian rail network operator Infrabel told the Belga news agency.

Eurostar, Thalys cancel service

Eurostar canceled trains between the northern French city of Lille and Brussels until 10 p.m. local time Monday, though said the Paris-London line would not be affected.

But trains coming from London to Brussels will end at Lille, with buses taking passengers the rest of the way to the Belgian and European Union capital. All Thalys service to and from neighboring countries has been stopped.

Read moreRail Strike Shuts Down Belgium, Severely Disrupts International Travel

China’s Leading Credit Rating Agency Strips Western Nations of AAA Status

China’s leading credit rating agency has stripped America, Britain, Germany and France of their AAA ratings, accusing Anglo-Saxon competitors of ideological bias in favour of the West.

beijing-office-buildings
Beijing office buildings – Chinese rating agency strips Western nations of AAA status (AFP)

Dagong Global Credit Rating Co used its first foray into sovereign debt to paint a revolutionary picture of creditworthiness around the world, giving much greater weight to “wealth creating capacity” and foreign reserves than Fitch, Standard & Poor’s, or Moody’s.

The US falls to AA, while Britain and France slither down to AA-. Belgium, Spain, Italy are ranked at A- along with Malaysia.

Meanwhile, China rises to AA+ with Germany, the Netherlands and Canada, reflecting its €2.4 trillion (£2 trillion) reserves and a blistering growth rate of 8pc to 10pc a year.

Dominique Strauss-Kahn, chief of the International Monetary Fund, agreed on Monday that the rising East is a transforming global force. “Asia’s time has come,” he said.

The IMF expects Asia to grow by 7.7pc in 2010, vastly outpacing the eurozone at 1pc and the US at 3.3pc. Emerging nations hold 75pc of the world’s $8.4 trillion (£5.6 trillion) of reserves.

Read moreChina’s Leading Credit Rating Agency Strips Western Nations of AAA Status

Belgium: Top Catholic Bishop Resigns Over Child Sexual Abuse

bishop-roger-vangheluwe
Roger Vangheluwe said he was ‘enormously sorry’ for the abuse

The longest-serving Roman Catholic bishop in Belgium has resigned after admitting sexually abusing a boy for years. Roger Vangheluwe, 73, said that he was “enormously sorry” for molesting the boy from before he was made Bishop of Bruges in 1985.

The Vatican accepted his resignation only a day after a lawsuit was filed in the US against Pope Benedict XVI over sex abuse committed by an American priest.

The Catholic Church is reeling from the departures of several senior figures over abuse scandals, including Walter Mixa, a senior German bishop close to the Pope, who resigned on Thursday after admitting beating children at an orphanage.

Mr Vangheluwe is the most senior cleric to step down over child sex abuse during the crisis. In a statement read by the head of the Catholic Church in Belgium, Archbishop André-Joséph Leonard, the bishop said: “When I was not a bishop, and some time later, I abused a boy. This has marked the victim mentally forever. The wound does not heal. Neither in me nor the victim.”

Church officials said that Mr Vangheluwe would not be prosecuted because the crime had not been reported within the country’s statute of limitations, understood to be ten years after the victim turns 18 for cases of child sex abuse.

Read moreBelgium: Top Catholic Bishop Resigns Over Child Sexual Abuse

Belgian Bishops Failed To Punish Over 300 Paedophilia Complaints

BELGIAN bishops have failed to punish any clergy over 300 complaints of paedophilia brought to their attention in the 1990s, claims a priest who helped many victims.

”We brought forward between 1992 and 1998 more than 300 complaints from victims of abuse committed by priests, but only 15 ended up with admissions” of guilt, Father Rick Deville told the Flemish dailies De Standaard and Het Nieuwsblad yesterday.

”A priest accused would most often be moved, but was never punished,” he complained.

Read moreBelgian Bishops Failed To Punish Over 300 Paedophilia Complaints

GM Europe seeks cash with 300,000 jobs at risk

The carmaker wants £3billion from European governments to keep factories open, with Belgian and German plants most at risk

The European operations of General Motors will run out of cash within weeks unless they get government support, the American carmaker said yesterday, adding that a collapse would put up to 300,000 jobs at risk.

Fritz Henderson, the chief operating officer of GM, said that the division, which includes Opel in Germany and Vauxhall in Britain, would hit liquidity problems early in the second quarter.

Read moreGM Europe seeks cash with 300,000 jobs at risk

BNP Paribas to take control of Fortis

FRENCH bank BNP Paribas has confirmed it has taken control of ailing finance group Fortis’s arms in Belgium and Luxembourg to create the “leading European bank in terms of deposits.”

The deal, thrashed out over a weekend of intense talks, leaves the Belgian and Luxembourg governments with reduced holdings in Fortis, which they partly nationaised a week earlier.

Under the deal, announced by Belgian and BNP officials in Brussels and official sources in Luxembourg, France’s biggest bank will take up to 75 per cent of Fortis’s Belgian operation leaving the other 25 per cent, a blocking minority, in the hands of the Belgian Government.

On the Luxembourg side, BNP Paribas will take 66 per cent of the shares leaving the Grand Duchy with 33 per cent, the source said.

Read moreBNP Paribas to take control of Fortis

Fortis Gets EU11.2 Billion Rescue From Governments

Sept. 29 (Bloomberg) — Fortis, the largest Belgian financial-services firm, received an 11.2 billion-euro ($16.3 billion) rescue from Belgium, the Netherlands and Luxembourg after investor confidence in the bank evaporated last week.

Belgium will buy 49 percent of Fortis’s Belgian banking unit for 4.7 billion euros, while the Netherlands will pay 4 billion euros for a similar stake in the Dutch banking business, the governments said in a statement late yesterday. Luxembourg will provide a 2.5 billion-euro loan convertible into 49 percent of Fortis’s banking division in that country.

Fortis is the largest European firm so far caught up in the global financial crisis that drove Lehman Brothers Holdings Inc. into bankruptcy two weeks ago and prompted U.S. President George W. Bush to seek a $700 billion bank rescue package. Fortis dropped 35 percent last week in Brussels trading on concern the company would struggle to replenish capital depleted by the 24.2 billion- euro takeover of ABN Amro Holding NV units and credit writedowns.

Read moreFortis Gets EU11.2 Billion Rescue From Governments

Belgian, Dutch Central Banks Seek Solution for Fortis

Sept. 28 (Bloomberg) — Discussions between European, Dutch and Belgian officials on the future of Fortis, Belgium’s largest financial-services firm, carried into the evening as they sought a “solution” for the beleaguered bank.

Dutch central bank chief Nout Wellink and Finance Minister Wouter Bos went to Brussels for talks with the Belgian government and regulators. European Central Bank President Jean-Claude Trichet met with Belgian Prime Minister Yves Leterme and Finance Minister Didier Reynders today.

Fortis fell a record 20 percent in Brussels trading two days ago on concern the firm would struggle to raise the 8.3 billion euros ($12.1 billion) it’s seeking to bolster reserves. The bank said Sept. 26 its financial position is “solid,” and replaced interim Chief Executive Officer Herman Verwilst with Filip Dierckx, who heads the banking unit. Managers and government officials are considering a possible sale of part or all of the bank, the Wall Street Journal reported, citing unidentified people familiar with the situation.

“Fortis failed to restore confidence on its own and that can only be done now with the help of the regulatory institutions or rivals,” said Corne van Zeijl, a senior portfolio manager at SNS Asset Management in Den Bosch, the Netherlands, who oversees about $1.1 billion, including Fortis shares.

Fortis has fallen 71 percent this year in Brussels, the second-worst performance among the 69 companies on the Bloomberg Europe Banks and Financial Services Index, cutting the lender’s market capitalization to 12.2 billion euros ($17.8 billion).

Read moreBelgian, Dutch Central Banks Seek Solution for Fortis

Europe fuel protests spread wider

Flemish fishermen protest in Brussels outside European Parliament
Belgian fishermen have been protesting directly to the EU

Fuel protests triggered by rising oil prices have spread to more countries across Europe, with thousands of fishermen on strike.

Union leaders said Portugal’s entire coastal fleet stayed in port on Friday, while in Spain, 7,000 fishermen held protests at the agriculture ministry.

French fishermen have been protesting for weeks, with Belgian and Italian colleagues also involved.

UK and Dutch lorry drivers held similar protests earlier this week.

The strike reflects anger at the rising cost of fuel, with oil prices above $130 (83.40 euros; £65.80) a barrel.

Trade unions say the cost of diesel has become prohibitively high, after rising 300% over the past five years.

Wholesale fish prices, meanwhile, have been static for 20 years.

Fishermen’s leaders from France, Spain and Italy have been meeting in Paris to co-ordinate strikes and protests over the next three weeks in the run-up to a European Union fisheries ministers’ meeting.

The protesters are calling for direct immediate aid for the fisheries industry, coupled with increased subsidies.

The European Commission said in a statement it was willing to show flexibility towards the industry but it has ruled out subsidies to offset rising fuel costs.

Short-term aid packages were acceptable as long as they were used to address structural deficiencies in the fleets, it said.

‘Ruin for fishermen’

Several thousand fishermen marched on the agriculture ministry in Madrid, where they handed out 20 tonnes of fresh fish to members of the public in an attempt to draw attention to their ailing industry.


Fishermen held protests in Brussels and Madrid

Many blew whistles and klaxons, and let off firecrackers producing red smoke.

The BBC’s Steve Kingstone at the protest said he could see flags from Catalonia, the Basque country and Galicia.

Read moreEurope fuel protests spread wider