Top 10 at 10: Austrian bank fears; 'A million Xmases ruined?'; Chimerica revisited; Dilbert

Here are my Top 10 links from around the Internet at 10am. I welcome your additions and comments below or please email your suggestions for Wednesday's Top 10 at 10 to bernard.hickey@interest.co.nz The machines should be very afraid of the humans... 1. Pressure not off - Yesterday's more buoyant economic outlook from Treasury does not make the tough decisions go away, Brian Fallow at NZHerald points out correctly. We will remain in deficit until 2016 and that will cost us for a long time.

It is a recipe for interest costs to eat up more and more of the future tax dollar, well before the echo of the baby boom sends health and superannuation costs through the roof. It is not sustainable. One consequence is that whatever the next Budget does on the tax side will need to be fiscally neutral - an exercise in robbing Peter to pay Paul. Doing that without violating people's sense of fairness will be a daunting task. But serious tax reform will be needed if the Government is serious about increasing the economy's growth rate.

2. Here we go - Greece announced massive budget cuts overnight to turn a budget deficit of 13% of GDP into a 3% deficit by 2013. The bond vigilantes finally are having an impact. We'll see next year how the global economy copes with rising interest rates and budget cuts/new taxes. FTAlphaville has the report. The solution includes a capital gains tax and the reintroduction of land taxes. Cue riots. HT Blair Rogers via Twitter.

Papandreou is aiming to reduce Greece's deficit from 13 per cent of GDP to 3 per cent by 2013, and here's how he plans to do it:

• A Reduction in defence spending in 2011 and 2012;
• Cutting bonuses across the public sector;
• Reducing social security and government operating expenditure by 10 % each, and salary caps for public utility directors;
• Taxes of up to 90 % on large bonuses for private bankers; the closure of a third of Greece's tourist offices abroad;
• Eliminating cost-of-living increases for public sector workers with salaries of more than €2,000;
• The introduction of capital gains tax; the resumption of inheritance and property taxes abolished by the previous government;
• A crack-down on corruption; a major reform of health care finances;
• Bringing immigrants currently working outside the social security system into it.

3. Austrian worries - One of the catalysts for the depression of the 1930s in Europe was the collapse of Austria's Creditanstalt. So news overnight that Austria's fourth largest bank, Oesterreichische Volksbanken, may be in trouble was closely watched. The bank itself has denied it, but here's the background from MarketWatch.com. This is all about problems with Eastern European loans, which is part of the issue in Greece's banking system and one reason why the euro fell overnight vs the US dollar.

Worries over the state of the Austrian banking industry continued Tuesday after a report -- swiftly denied by the bank itself -- that Oesterreichische Volksbanken had been put on a watch list by a concerned central bank. The report in Austrian newspaper Die Presse said the country's fourth-largest financial institution was viewed as systemically important and had been asked to put forward a new strategy. It came a day after Austria said it had nationalized Hypo Group Alpe Adria, its sixth-biggest lender, on the heels of rising loan losses in Eastern Europe that threatened to bring down the bank.

4. The neo-Nazi link - It seems part of the nervousness around the Austrian banks was triggered by the nationalisation of Hypo Group Alpe Adria for 3 euros. It turns out this was all connected to the ambitions of Jorg Haider, the neo-Nazi politician who died in a car crash a few years ago. The New York Times has the story, which includes details about diamond smuggling and Croatian generals on the run. Priceless.

Hypo, the sixth-largest bank in Austria, expanded rapidly into the Balkans during Mr. Haider's return to office in Carinthia, which began in 2000 and ended only with his death. According to the Austrian central bank, Hypo and other Austrian banks can expect at least 10 billion euros in write-downs in the next two years, largely from Eastern Europe, and possibly twice that. Under Mr. Haider's leadership, Carinthia sank ever deeper into debt, with its borrowings expected to hit 2.5 billion euros next year, a record for an Austrian region. It was also under Mr. Haider that Hypo Alpe, then half-owned by a government holding company, embarked on a number of dubious domestic investment projects "” a sort of stimulus package without a crisis to justify it, the Austrian version of pork barrel projects. One was Schloss Velden, a huge chateau resort backed by Hypo Alpe, which is still loses money. But even Schloss Velden is fairly innocent compared to the deals that have gone sour in the Balkans. In just one case of supposed shenanigans, Hypo Alpe Real Estate has been accused of financing about 250 million euros in transactions with the ex-Croatian general Vladimir Zagorec, who was extradited from Austria to Croatia in 2005 charged with the embezzlement of 5 million euros in diamonds.

5. Very cool - This visualisation of data by datavisualisation.ch on who owns US Treasuries is very cool. It shows how much China has grown and, generally, how much debt America has issued over the last year. HT Gertraud via email. Who Owns America's Debt - A Dynamic Perspective on Major Foreign Holders of Treasury Securities (2002-Present) from Computational Legal Studies on Vimeo. 6. Chimerica benefits who? - Niall Ferguson has been talking about the idea of the Chinese and American economies locked in a love/hate embrace since 2007. The assumption was that China was the beneficiary because it was reaping big trade surpluses and economic growth at the 'expense' of America running deficits and debt-fueled consumption led economic growth. Now Chinese economist Zhang Hongliang reckons different, according to CC at the China Hush blog. He thinks China is the loser in Chimerica. HT Troy Barsten via email.

• The formation of a new pattern of industrialization: The US enjoys the accomplishments of industrialization while China bears the burden of the negative effects of industrialization. This means that the three disasters of the modern economy are all shifted to China: environmental pollution and the depletion of resources, overproduction, and inflation.
• The formation of a new pattern of the distribution of wealth: Whatever China has, the US gets to enjoy. This double-loop leads to the outflow of China's wealth and locks in China's poverty.
• The formation of a new pattern of economic development: China has become the international milking cow and the world's garage. In terms of the economy: foreign trade accounts for two-thirds of China's GDP and foreign investment accounts for two-thirds of foreign trade. In terms of production: the West uses rules to control finance, capital to control resources, technology to control industry, and brands to control the market. In terms of resources: the West uses centralized planning to handle China's market decentralization.
• The integration and assimilation of the interests of the wealthy people in the US and China intensifies the burden on the ordinary Chinese people.
• Political influences can be seen in the integration of US and Chinese policies. China's policies have to account for and be built upon the foundations of American policy, and China's decisions are all in consideration of the requests of the US.
• Cultural influences are noticeable in the increasing Americanization of Chinese ideology and culture. Not only is Chinese culture more and more resembling American culture, the way in which Chinese culture is changing is fulfilling the hopes of the US. Also, in terms of spiritual culture, China and the US are walking toward opposite ends of the spectrum.

7. A million Christmases ruined? - This has flown under the radar a bit, but is useful for New Zealanders booked to travel home or abroad on British Airways in the 12 days from December 22. There might be a strike, the FT.com reports.

Willie Walsh, British Airways chief executive, said: "We are absolutely determined to do whatever we can to protect our customers from this appalling, unjustified decision from Unite. We do not want to see a million Christmases ruined. "Unite was told about the problems with its ballot on Friday. Yet it cynically went ahead with an extreme, highly publicised threat to our customers and our business in the knowledge that it might not be able to carry it out." The airline is seeking an injunction to prevent the strike going ahead.

8. Renewing Glass Steagall? - Remember how the repeal of the Depression era Glass Steagall act separating investment banks from real banks was a factor behind the debacle of 2007 and 2008? Well now the US congress is thinking of bringing back Glass Steagall, Bloomberg reported.

The U.S. House is considering reinstituting the Depression-era Glass-Steagall Act, which barred bank holding companies from owning other financial companies, Majority Leader Steny Hoyer said. A renewal of the 1933 law "is certainly under discussion" by House members, Hoyer told reporters in Washington today. The Glass-Steagall law was repealed in 1999 to help pave the way for the formation of Citigroup Inc. by the $46 billion merger of Citicorp and Travelers Group Inc. "As someone who voted to repeal Glass-Steagall, maybe that was a mistake," said Hoyer, a Maryland Democrat. Hoyer made the comments when asked whether Congress and President Barack Obama's administration could do more to persuade banks to make more business loans and get credit flowing into the economy. Obama met yesterday with the chief executive officers of U.S. banks, urging them to lend more money.

9. Just devalue - Ambrose Evans Pritchard has given his take on the Greek budget mess. He's not impressed with the budget reforms outlined above. He reckons Greece has revolted and now the euro is in danger. He thinks Greece should pull out of the euro, devalue and default in the same way Argentina did. Yikes. He is a eurosceptic to say the least.

Euroland's revolt has begun. Greece has become the first country on the distressed fringes of Europe's monetary union to defy Brussels and reject the Dark Age leech-cure of wage deflation. While premier George Papandreou offered pro forma assurances at Friday's EU summit that Greece would not default on its €298bn (£268bn) debt, his words to reporters afterwards had a different flavour. "Salaried workers will not pay for this situation: we will not proceed with wage freezes or cuts. We did not come to power to tear down the social state," he said. The danger point for Greece will come when the Pfennig drops in Berlin that EMU divergence between North and South has widened to such a point that the system will break up unless: either Germany tolerates inflation of 4pc or 5pc to prevent Club Med tipping into debt deflation; or it pays welfare transfers to the South (not loans) equal to East German subsidies after reunification. Before we blame Greece for making a hash of the euro, let us not forget how we got here. EMU lured Club Med into a trap. Interest rates were too low for Greece, Portugal, Spain, and Ireland, causing them all to be engulfed in a destructive property and wage boom. The ECB was complicit. It breached its inflation and M3 money target repeatedly in order to nurse Germany through slump. ECB rates were 2pc until December 2005. This was poison for overheating Southern states. The deeper truth that few in Euroland are willing to discuss is that EMU is inherently dysfunctional "“ for Greece, for Germany, for everybody.

10. Totally irrelevant video - Baby dances to Beyonce. The real story is that this YouTube video has become a huge hit with 5.9 million views and the clever dad behind it has set up a website. It turns out the kid lives in New Zealand and his dad Chester is very clever. 'Cory' now has his own website http://singlebabies.com/ and his own facebook pagehttp://www.facebook.com/pages/Cory-Elliott/141898469073 This video has gone into Mashable's Top 10 viral videos for 2009. That's number eight wire thinking in a digital age.

Cory was born on November 11th 2007 in Auckland, New Zealand. This video was shot at his grandmother's home when he was just 13 months old... at that stage he wasn't even walking, just pulling himself up on furniture. The TV was tuned to NZ music channel C4 at the time, and when Cory noticed Beyonce's music video "Single Ladies" he crawled over and began to dance! It was such a crack up, and luckily dad Chester had a video camera handy and got the whole thing on tape. You can hear Chester holding back the laughter in the background!