Monday's Top 10 with NZ Mint: Roubini picks perfect storm for global economy in 2013; Germans play with Euro fire over Greece; Vero's hard line in Christchurch; Dilbert

Here's my Top 10 links from around the Internet at 10 past 4 pm  in association with NZ Mint.

I'll pop the extras into the comment stream. See all previous Top 10s here.

I welcome your additions in the comments below or via email to bernard.hickey@interest.co.nz.

Apologies lateness today. Christchurch again.

1, Roubini's perfect storm - Bloomberg reports Nouriel Roubini warning that 2013 could be an ugly year for the global economy.

I'll wager John Key will end up having to deliver a black budget in 2013 as our economy (and the global economy) fails to fire because of the sheer weight of debt and deleveraging.

A Chinese slowdown is the key for us because it will have a disproportionate impact.

Roubini predicted the 2008 crisis.

He has been pretty right ever since.

Here's Roubini in full gloom mode.

A “perfect storm” of fiscal woe in the U.S., a slowdown in China, European debt restructuring and stagnation in Japan may converge on the global economy, New York University professor Nouriel Roubini said.

There’s a one-in-three chance the factors will combine to stint growth from 2013, Roubini, who predicted the global financial crisis, said in a June 11 interview in Singapore. Other possible outcomes are “anemic but okay” global growth or an “optimistic” scenario in which the expansion improves.

“There are already elements of fragility,” he said. “Everybody’s kicking the can down the road of too much public and private debt. The can is becoming heavier and heavier, and bigger on debt, and all these problems may come to a head by 2013 at the latest.”

2. Playing with fire - Reuters  reports Germany is seriously considering forcing Greek bond holders to take haircuts.

Ratings agencies say this would be seen as a default and the European Central Bank has said this would unleash hell on Greece's banking sector and beyond.

Yet the Germans are persisting...

This is unlikely to end well.

Berlin is pushing hard for commercial banks to contribute to the cost of the estimated 120 billion euro ($172 billion) deal, but has not yet convinced the European Central Bank and ratings agencies that this can be done without triggering a credit default.

Officials say the ECB argues that a swap, favored by German Finance Minister Wolfgang Schaeuble, could be judged a default and make Greek bonds unacceptable as collateral, potentially leading to a collapse of the Greek banking sector.

Part of the poker game is convincing the banks involved that it is in their interest to take on future Greek debt in aid of avoiding a full-scale default on existing loans.

Much of the money could come from Greek banks, who have been shut out of funding markets and are dependent on the ECB or other official sources of liquidity for their survival.

3. 'How the Fed is bailing out European banks' - The boys and girls at zerohedge are in full on consipiratorial mode about the US Federal Reserve's lending to European banks and how it guarantees QE III.

Large grains of salt required for consumption, but something is brewing.

Not only has the Fed's bailout of foreign banks not terminated with the drop in discount window borrowings or the unwind of the Primary Dealer Credit Facility, but that the only beneficiary of the reserves generated were US-based branches of foreign banks (which in turn turned around and funnelled the cash back to their domestic branches), a shocking finding which explains not only why US banks have been unwilling and, far more importantly, unable to lend out these reserves, but that anyone retaining hopes that with the end of QE2 the reserves that hypothetically had been accumulated at US banks would be flipped to purchase Treasurys, has been dead wrong, therefore making the case for QE3 a done deal.

In summary, instead of doing everything in its power to stimulate reserve, and thus cash, accumulation at domestic (US) banks which would in turn encourage lending to US borrowers, the Fed has been conducting yet another stealthy foreign bank rescue operation, which rerouted $600 billion in capital from potential borrowers to insolvent foreign financial institutions in the past 7 months. QE2 was nothing more (or less) than another European bank rescue operation!

4. Not everyone loves the World Cup - Anyone trying to sell tours to non-rugby tourists during the Rugby World Cup is struggling, NZHerald reports.

Non-rugby inbound tour operators say the Rugby World Cup is creating havoc for their businesses.

Hotel surcharges, over-optimistic ticketing projections and a lack of interest in the sport are being blamed for a drop in regular bookings.

5. What is Vero up to? - Marta Steeman at The Press reports that Vero is playing very hard ball with businesses in Christchurch. It is apparently just paying out 'prevention of access' payments to companies inside the cordoned off CBD area.

Vero's reason for not paying out on business interruption insurance in the CBD is that there is no business being done in the CBD to be interrupted....

Some insurers are paying out prevention of access provisions, but are not paying full business interruption claim for properties and businesses behind the cordon.

The prevention of access payments are a lot less. They are generally between 5 per cent to 10 per cent of the total sum insured for business interruption, called "sub- limit" payments.

Vero is applying sub-limits to businesses inside the cordon. Vero marketing and communications manager Ian Walker says prevention of access is the only cover available to business owners within the cordon. Insurers do not have access to repair buildings so nothing will happen until the cordon has gone, he says. There is no business to be interrupted because no business is taking place inside the cordon, he says.

Because of the cordon Vero has not been able to undertake thorough and robust assessments of the damage and the company does not know what will happen to the CBD. Walker says Vero is not settling damage claims in the cordon at present.

6. Expect battles like this for a long time - The BBC reports the Bank of Ireland is trying to impose a haircut on some bond holders. This is getting ugly.

Ireland's recent economic problems have resulted in the government insisting that banks shore up their capital positions. BOI has been told it must raise 4.2bn euros in capital by a 31 July deadline, imposed by the state.

In order to raise the money, BOI announced an exchange offer, which would see most of the PIBS investors receiving 20p in the pound for their holding. However, people with more than £100,000 invested in the PIBS, are being offered 40% of the value of their bonds, if they accept new shares instead.

7. There is hope - The Irish Times reports Iceland has just returned to the bond markets. Unlike Ireland which transferred bank debt to public balance sheets, the Icelanders refused to bail out their banks. And now the Icelandic economy is starting to grow.

ICELAND RETURNED to international debt markets for the first time since its banking meltdown more than two years ago as investors offered to buy twice the amount the government offered in dollar-denominated bonds.

“This transaction is an important milestone for Iceland,” finance minister Steingrimur J Sigfusson said in a statement on the government’s website yesterday. “Iceland has set a benchmark in the market which should over time facilitate capital market access for other Icelandic issuers.”

Iceland, which averted a sovereign default by refusing to bail out bondholders when its banks failed in October 2008, will enjoy economic growth of 2.2 per cent this year and 2.9 per cent in 2012 as its budget deficit narrows to 1.4 per cent of gross domestic product, according to the Organisation for Economic Co-operation and Development.

8. Slaves to banks - Dirk Kurbjuweit writes at Der Spiegel about the stresses inside Europe's political and financial systems. It has struck a chord oop north.

In today's Europe, the people are no longer in control. Instead, politicians have become slaves to financial institutions and the markets. We are partly to blame -- and changes are urgently needed to nurse European democracy back to health.

9. Plutocracy report - The New York Timers reported Barack Obama is reaching out to financial industry donors ahead of the next election.

A few weeks before announcing his re-election campaign, President Obama convened two dozen Wall Street executives, many of them longtime donors, in the White House’s Blue Room. The guests were asked for their thoughts on how to speed the economic recovery, then the president opened the floor for over an hour on hot issues like hedge fund regulation and the deficit.

Mr. Obama, who enraged many financial industry executives a year and a half ago by labeling them “fat cats” and criticizing their bonuses, followed up the meeting with phone calls to those who could not attend.

The event, organized by the Democratic National Committee, kicked off an aggressive push by Mr. Obama to win back the allegiance of one of his most vital sources of campaign cash — in part by trying to convince Wall Street that his policies, far from undercutting the investor class, have helped bring banks and financial markets back to health.

10. Totally Jon Stewart video - The Canadians are the biggest supplier of oil to America. "Bit by bit they are killing us."