An unconfirmed Spanish media report suggesting that a legion of depositors had withdrawn around €1bn from Bankia following the Spanish government’s rescue of the ailing lender last week, spread panic.

Shares of Spain’s fourth largest bank crashed 29 per cent before a reported denial reduced the fall to 11 per cent.

Already in the dog-house, domestic banks took a pasting on renewed concerns about their exposure to Spain. Late rumours that troublesome credit rating agency Moody’s was to downgrade 20 Spanish banks rubbed salt in to dealers’ gaping wounds.

Barclays, which is by far the most exposed to Spain, to the tune of £26.5bn or 61 per cent of core tier 1 capital, was sold down to 179p before closing 7.15p lower at 181.9p.

Royal Bank of Scotland, which is 81 per cent owned by the UK taxpayer, has a £14.6bn exposure of 32 per cent of core tier 1 capital. It dipped to 21.06p and closed 0.81p off at 21.075p. Lloyds Banking Group, 41 per cent owned by the public, has a £6.8bn exposure or 18 per cent of core tier 1 capital. The close was 1.02p cheaper at 27.65p. Ironically, earlier in the day dealers sighed in relief when they heard demand for a Spanish bond auction had been strong.

It raised just below the top of its target amount of €2.5bn, but the yield on the 2015 debt it sold jumped to 4.375 per cent, against the 2.89 per cent at an auction in April. The 2016 debt sold with a yield of 4.876 per cent against 4.037 per cent at an auction earlier this month.

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The warnings came as the Greek government last night won a vote of confidence in the Athens Parliament, clearing the way for a second bailout to go ahead. The crunch will come next week when the Greeks vote on a £25billion austerity package demanded by the EU before they hand over any more cash.

The potential devastation of banks and other City institutions would be equal to 24 per cent of our annual national output, or £14,640 for every family in the UK.

Ministers had claimed that British banks have ‘only’ £2.5billion of exposure to Greek government debt, while the Bank of England says the potential losses would be just £8billion.

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Brian Eno — one of the world’s most influential musicians and artists, and producer of U2 and Coldplay, among many others — is also a committed activist in the anti-war movement. This is a transcript of the speech he made at Stop the War Coalition’s Antiwar Assembly on 8 October 2011.

Many of the speakers today will be addressing the moral issues of the war. I want to talk about the economic facts. So far the war in Afghanistan has cost us 20 or 30 billion pounds.

Billions are hard to grasp, so another way of looking at it is to say that the war is currently costing £12m a day. I’ll repeat that: £12million a day.

What else could we be doing with that amount of money?

Well, how about building some decent schools? For £20 million pounds – that’s less than two days of the war – you could build a very modern and large school.

That means about 15 big schools a month. For 20 days of the war you could build a big regional hospital.

And what about the people who work in them, the people who build our future and look after us? How about a pay rise for all our teachers and nurses? An extra £1000 a year for all 800,000 of them would cost us just 2 months in Afghanistan.

How about child-care? Britain, with the third largest defence budget in the world after America and China, has the highest childcare costs in Europe. British families with young children spend nearly a quarter of their income looking after their children – primarily because we pay so much for childcare. In Germany, by contrast, the figure is 3%. We could become equal with Germany for less than the cost of three months in Afghanistan.

You might have been impressed that in August the government promised £6.5 pounds to train people in renewable energy technologies – that is until you realise that’s about thirteen hours in Afghanistan. Our whole clean-energy research budget was cut dramatically over the last year, and almost crippled as a result. The saving? A few days at war…

And how about culture, one of our country’s biggest exports? Well, earlier this year The Arts Council had its budget cut by £100m: that means small theatres, arts labs, etc – the places where future talent is discovered and nurtured – are closing down. The saving? Eight days in Afghanistan.

The BBC World Service had its budget cut by £46m, which meant that it lost about a sixth of its foreign listeners. What did we save by that brilliant piece of international diplomacy? Three days at war. Which do you think is the best investment? A news service whose impartiality is respected all over the world, or a totally ineffective war machine which incurs contempt and hatred for this country?

Even BBC Online, whose total annual budget amounts to 24 minutes in Afghanistan, had its budget cut to pay for an extra 12 seconds of war.

But it’s not only the Arts that are being cut back. It’s the sciences too. Government funding of science research was reduced by about a billion pounds over the last year. That’s a huge loss for British science – and ultimately for our economy – but we shouldn’t be too fed up because it’ll pay for a whole 11 weeks in Afghanistan.

What about youth centres? In the wake of the recent riots you might think that it would be a good idea to invest in anything that would help young people find their feet. For the cost of the war, you could build at least two a day – and those would be top-of-the-line places. Build a bit more modestly, and you could probably manage five or 10 a day.

Council housing anyone? Very unfashionable at the moment but, as someone who grew up in one, I think I know their value. We have nearly two million people on waiting lists, and we aren’t anywhere near keeping up with demand. What would it cost? And how much more would it stimulate our economy to build houses than to fight pointless wars?

We’re constantly being told that these are hard times and we have to tighten our belts, but as far as I can see the belts round the biggest bellies aren’t tightening at all. As usual, it’s the people at the bottom who suffer – both here and in Afghanistan.

Brian Eno has spoken at numerous Stop the War Coalition events and in 2005 was the curator of a fund-raising concert featuring Rachid Taha, Nitin Sawhney, Mick Jones from the Clash and Imogen Heap, the video for which is available on Amazon. The version played that night of the Clash’s Rock the Casbah is now quite rightly regarded as a classic and can be seen in a video clip here. Brian Eno’s latest album is Drums Between the Bells, a collaboration with poet Rick Holland.

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The 5th episode of The World Tomorrow takes us to the very heart of America’s War on Terror: Guantanamo Bay. In the episode Julian Assange speaks with Moazzam Begg – former Gitmo prisoner and a rights campaigner fighting for those still trapped behind the wire, and Asim Qureshi – former corporate lawyer, whose human rights organization Cageprisoners Ltd exists solely to raise awareness of the plight of prisoners who remain in Guantanamo Bay.

When I first read Naomi Klein’s The Shock Doctrine a few years ago, I had no idea how prescient the book was. It was a polemic about “disaster capitalism”, arguing that sudden crises are intentionally manipulated to push through extreme free market policies that were otherwise not politically possible. But early 2008 was a completely different era: although Northern Rock had just suffered the first bank run for 150 years, it seemed like a bizarre blip. The US sub-prime crisis was rumbling away, but it was like sheet lightning from a distant storm. “The deficit” was not an everyday term of political debate. It was not at all clear that the world was about to be utterly transformed.

And yet the past four years have proved a total vindication of Klein’s argument. A crisis of the market was cleverly transformed by free market ideologues into a crisis of public spending. Across Europe, the biggest slump since the 1930s has been used to push through policies straight out of some right-wing wet dream: the slashing of taxes on the rich and major corporations; the selling off of public services; and a bonfire of workers’ rights. It is disaster capitalism on speed.

But, this week, the great revolt against the Shock Doctrine began. That is exactly how we must understand the sudden sea change in European politics: not least, the election of Socialist François Hollande in France, and the stunning breakthrough of anti-austerity leftists in the Greek elections.

Before I am accused of a swivel-eyed left-wing conspiracy theory, it is worth pointing out that even some proponents of austerity are candid about their strategy. Last November, I was in Portugal, which – after being bailed out by the EU and IMF – is pushing through a far-reaching free market agenda. The first wave of the most radical privatisation programme in the country’s history is under way, including the selling off of energy, water, public transport and the national airline. VAT on electricity and gas has been hiked from 6 per cent to 23 per cent, driving up energy bills; many public sector workers are facing a drop in income of a quarter; and unemployment benefits have been slashed by nearly a fifth. Austerity has plunged the country into a deep recession, and debt-to-GDP ratio is soaring: but that is not the point. Portugal is being remade in the image of neo-liberal dogma.

Free market economists in Portugal had long supported such policies, but knew they could not get away with them in normal circumstances. “The thing with deep reforms is that democracies have a strong bias in favour of the status quo,” I was told by Professor Ferreira Machado, the Dean of one of Portugal’s leading business schools, who boasted that he was just a phone call away from the country’s Prime Minister. When asked if there was a collision course between democracy and the radical reforms he thought necessary, he was candid. “I think there is a difficulty reconciling it,” he said, and mentioned an opposition leader who had caused a political storm by suggesting the suspension of democracy for six months. “Of course, she was not advocating that – she was actually expressing that collision course between the two things, and what she was saying was that it would be much easier to do the necessary reforms if we could put democracy in brackets.”

Full Story – The Independent

In the fourth episode of The World Tomorrow Julian Assange speaks with two leading Arab revolutionaries in the middle of conflict, Alaa Abd El-Fattah from Egypt and Nabeel Rajab from Bahrain. Alaa Abd El-Fattah is a long time Egyptian blogger, programmer and political activist. His parents were human rights campaigners under Anwar Sadat; his sister Mona Seif became a Twitter star during the 2011 Egyptian revolution, and is a founder of the No Military Trials for Civilians group formed under the post-Mubarak military junta. El-Fattah was imprisoned for 45 days in 2006 for protesting under the Mubarak regime, and released after “Free Alaa” solidarity protests in Egypt and around the world. In 2011, from abroad, El-Fattah helped route around Mubarak’s

In the third episode of The World Tomorrow Julian Assange speaks with Tunisia’s first post-revolution leader Moncef Marzouki about the West’s double standards in protecting human rights. He is a former human rights activist. During the reign of the previous President he was imprisoned and kept in solitary confinement, which he considers to be torture. Once elected Head of State, he has vowed to put an end to human rights violations in Tunisia.

Marzouki recalls how he was invited to the US to talk about the human rights situation in Tunisia with a man he believed was involved in the Guantanamo controversy. Torture and the West’s double standards on the issue is indeed one of the hottest topics in this episode of the show.

On April 17, 2012, as millions of Americans were filing their income tax returns, the highly-respected Stockholm International Peace Research Institute (SIPRI) released its latest study of world military spending.

In case Americans were wondering where most of their tax money — and the tax money of other nations — went in the previous year, the answer from SIPRI was clear: to war and preparations for war.

World military spending reached a record $1,738 billion in 2011 — an increase of $138 billion over the previous year. The United States accounted for 41 percent of that, or $711 billion.

Some news reports have emphasized that, from the standpoint of reducing reliance on armed might, this actually represents progress. After all, the increase in “real” global military spending — that is, expenditures after corrections for inflation and exchange rates — was only 0.3 percent.

And this contrasts with substantially larger increases in the preceding thirteen years.

But why are military expenditures continuing to increase — indeed, why aren’t they substantially decreasing — given the governmental austerity measures of recent years? Amid the economic crisis that began in late 2008 (and which continues to the present day), most governments have been cutting back their spending dramatically on education, health care, housing, parks, and other vital social services. However, there have not been corresponding cuts in their military budgets.

Americans, particularly, might seek to understand why in this context U.S. military spending has not been significantly decreased, instead of being raised by $13 billion — admittedly a “real dollar” decrease of 1.2 percent, but hardly one commensurate with Washington’s wholesale slashing of social spending. Yes, military expenditures by China and Russia increased in 2011. And in “real” terms, too. But, even so, their military strength hardly rivals that of the United States.

Indeed, the United States spent about five times as much as China (the world’s #2 military power) and ten times as much as Russia (the world’s #3 military power) on its military forces during 2011. Furthermore, when U.S. allies like Britain, France, Germany, and Japan are factored in, it is clear that the vast bulk of world military expenditures are made by the United States and its military allies.

This might account for the fact that the government of China, which accounts for only 8.2 percent of world military spending, believes that increasing its outlay on armaments is reasonable and desirable. Apparently, officials of many nations share that competitive feeling.

Unfortunately, the military rivalry among nations — one that has endured for centuries — results in a great squandering of national resources. Many nations, in fact, devote most of their available income to funding their armed forces and their weaponry. In the United States, an estimated 58 percent of the U.S. government’s discretionary tax dollars go to war and preparations for war.

“Almost every country with a military is on an insane path, spending more and more on missiles, aircraft, and guns,” remarked John Feffer, co-director of Foreign Policy in Focus. “These countries should be confronting the real threats of climate change, hunger, disease, and oppression, not wasting taxpayers’ money on their military.”

Of course, defenders of military expenditures reply that military force actually protects people from war. But does it? If so, how does one explain the fact that the major military powers of the past century — the United States, Russia, Britain, Germany, France, Italy, Japan, and China — have been almost constantly at war during that time?

What is the explanation for the fact that the United States — today’s military giant — is currently engaged in at least two wars (in Iraq and Afghanistan) and appears to be on the verge of a third (with Iran)? Perhaps the maintenance of a vast military machine does not prevent war but, instead, encourages it.

In short, huge military establishments can be quite counterproductive. Little wonder that they have been condemned repeatedly by great religious and ethical leaders. Even many government officials have decried war and preparations for war — although usually by nations other than their own.

Thus, the release of the new study by SIPRI should not be a cause for celebration. Rather, it provides an appropriate occasion to contemplate the fact that, this past year, nations spent more money on the military than at any time in human history. Although this situation might still inspire joy in the hearts of government officials, top military officers, and defense contractors, people farther from the levers of military power might well conclude that it’s a hell of a way to run a world.

Web link to original article.

In the meantime, Greece is seeking a deal with private lenders and the EU “by the end of the week” its prime minister said today, as Athens races to avoid a financial meltdown ahead of debt repayments due in March.  Although arms dealers expect it still to be business as usual.

Greece’s top military brass plan to buy up to 60 Eurofighter aircraft, costing €4bn and a number of French frigates and German subs.

Continuing tensions with Turkey and the fight against foreign migrants are cited by the generals as reasons for necessary military spending .

I wonder why migrants would want to cross into Greece with its hospitals only handling emergencies, their schools lacking textbooks, riots on the streets and welfare spending being slashed?

Apparently, the Merkozy twins have insisted that Greece honour its existing arms contracts and even sign new ones.  When Greece announced in September that it would not take delivery of four submarines built by German company, ThyssenKrupp, alleging technical faults, this led to accusations that Athens is effectively defaulting on a €520m contract.  They also cancelled tenders for a flight of maritime aircraft worth up to €250m. No wonder Merkozy are calling for an unelected EU official to be in charge of Greece’s budgets.

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Slavoj Zizek and David Horowitz are the guests for the second episode of Julian Assange’s interview show, “The World Tomorrow”. “Intellectual superstar” Slavoj Zizek is a philosopher, psychoanalyst and cultural commentator. David Horowitz is a renowned stalwart of hardline conservative American political thought and an unrepentant Zionist.

The tone of the conversation between Zizek, Horowitz and Assange alternated between combative, personal and good-humoured. The topics covered jumped backwards and forwards at a wildfire pace, to include Palestinians and Nazis, Joseph Stalin and Barack Obama, the decline of Europe and the tension between liberty and equality, amongst many others.