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March 6, 2014

In 2011 and 2012, many thought the Euro might break up due to the sovereign debt crisis. Unlike countries that have their own currency, countries in the Eurozone are dependent on the monetary policy of the European Central Bank (ECB). This disconnect makes Euro countries much more vulnerable than other countries to solvency crises. Since, then, however the new chief of the ECB, Mario Draghi, has engaged in a bond-buying program of Outright Monetary Transactions (OMTs) which has helped struggling periphery countries (Spain, Greece, Portugal, Italy, etc) stay solvent.

But while this has lowered interest rates in the struggling countries — and done enough to keep the Euro together — it has not been enough to get Europe out of the woods. Unemployment still remains cataclysmically high in Greece, Spain, Portugal, Italy, and high throughout the Eurozone. And now with inflation rapidly falling, many are worried that Europe is falling into debt deflation. Of course, Europe as a whole is not in deflation yet.

But as Paul Krugman argues, the process is already under way:

I'd say that to have debt deflation — in which falling prices due to a weak economy increase the real burden of debt, which depresses the economy further, and so on — you don't need to have literal deflation. The process begins as soon as you have lower inflation than expected when interest rates were set. It's also noteworthy that inflation rates in the highly indebted countries are all well below the eurozone average, with actual deflation in Greece and near-deflation in the rest. So the debt deflation spiral is in fact well underway. [The New York Times]

Europe's approach throughout the crisis has been to do the very minimum necessary to keep the Euro system afloat. It remains to be seen if that is an approach compatible with an economic recovery anytime soon. John Aziz

5:22 a.m. ET

Amid all the intrigue and speculation over possible collusion between President Trump's campaign and Russian intelligence, big questions remain about Trump's business dealings with Russia — a mystery that might be solved if Trump released his tax returns. Trump has sent mixed signals about his business ties with wealthy Russians, saying in February he has "no dealings with Russia" or "loans with Russia," and in 2013 telling Real Estate Weekly after a meeting with potential investors in Moscow that he has "great relationship with many Russians," especially "the oligarchs." Donald Trump Jr. also told Russian media in 2008 that "Russians make up a pretty disproportionate cross section of a lot of our assets."

On Tuesday, USA Today looked at the "wealthy Russians and oligarchs from former Soviet Republics — several allegedly connected to organized crime," who have invested in Trump-branded real estate, basing the article on a "review of court cases, government and legal documents, and an interview with a former federal prosecutor." The review focused on "10 wealthy former Soviet businessmen with alleged ties to criminal organizations or money laundering," but the pertinent question now is whether Trump is beholden to Kremlin-linked Russian oligarchs.

Ken McCallion, a private lawyer and former assistant U.S. attorney in New York during the Carter and Reagan administrations, says that's a real possibility. McCallion told USA Today that he spent years looking into the Trump Organization and its business relationships, especially with Russians. "The FBI is always concerned if public officials can be blackmailed," he said. "It's Russian-laundered money from people who operate under the good graces of President Putin. If these people pull the plug on the Trump Organization, it would go down pretty quickly." You can read a lot more about the oligarchs and their alleged ties to Trump at USA Today, and get an overview in the video report below.

The White House referred USA Today to the Trump Organization, which said that it "never entered into a single transaction with any of these individuals and the condominium units were all owned and sold by third parties — not Trump." Peter Weber

4:46 a.m. ET
Christopher Furlong - WPA Pool/Getty Images

Late Tuesday, British Prime Minister Theresa May signed a letter formally notifying the European Union that the U.K. is invoking Article 50 of the EU's Lisbon Treaty, beginning the countdown for Britain's exit from the union. Britain's ambassador to the EU will deliver the letter to European Council president Donald Tusk on Wednesday at 12:30 p.m. local time. May's government will then lead divorce negotiations with the EU, and in March 2019, Britain will leave the EU, deal or no deal.

The EU in coming days will come up with draft negotiation guidelines, and EU leaders will meet without May on April 29 to adopt a common negotiating stance. The talks will work to unravel the regulations, laws, and other agreements that have bound Britain and the EU since the U.K. joined the bloc in 1973. Peter Weber

4:18 a.m. ET

Nobody seems sure what is going on with President Trump and Russia, and that's "partly because it's really complicated," Stephen Colbert said on Tuesday's Late Show. It's also because Trump has "really boring spies," he said. "So I'm going to liven it up right now by explaining the situation with more exciting spies, the Tom Clancy novels." This works out better than you might think.

Colbert spent a few minutes on the new Trump-Russia revelations, including Jared Kushner's previously undisclosed meeting with a sanctioned Russian bank in December. "And it looks like the pressure of these Russian rumors are getting to the administration," he said, a point he illustrated with Sean Spicer's quip about Trump and Russian dressing. "Wait a second, the president put Russian dressing on a salad tonight?" Colbert said. "That's huge news! Trump ate a salad?" Still, based on his twitter feed, "Russia rumors must be getting to Trump, too."

Rumors aside, "what's the truth?" Colbert asked. "Was there nefarious collusion between the Trump campaign and Russia, or is this all just being blown out of proportion by the liberal media over at The New York Times and the FBI? Who knows?" Not, he suggested, House Intelligence Committee Chairman Devin Nunes, who "doesn't seem all that focused on Russia, because he's spent a lot of time trying to validate Trump accusing Obama of wiretapping him a couple of weeks ago."

Nunes held a surprise press conference last week saying he'd seen evidence that U.S. intelligence agencies inadvertently picked up Trump team communications with foreign powers, but hasn't shared it with his committee members and says he'll never reveal his source. In fact, Colbert said, "the only person he has briefed on the subject is Donald Trump. Oh, that is brilliant detective work. You gather all the evidence you can on the prime suspect, and then you share it with him." The big questions are "what Nunes found out, and who leaked it to him," Colbert said. "And to get to the bottom of that, we're going to need The Late Show's Figure-It-Out-a-Tron." Think Glenn Beck's chalkboard, but naughtier. "He's really in Trump's inner circle," Colbert said, drawing complete. "And no matter where this investigation leads, no matter what we find out, one thing is true: Nunes is not coming out of this smelling like a rose." Watch below. Peter Weber

2:57 a.m. ET

If you heard talk about Russian dressing on Tuesday, this testy exchange between White House Press Secretary Sean Spicer and April Ryan, the White House correspondent for American Urban Radio Networks, is probably why.

Ryan was reminding Spicer of all the Russia-related news the White House is dealing with — the scuttled Sally Yates testimony, President Trump's widely dismissed claims he was wiretapped at Trump Tower, the broader Russia investigation — and Spicer cut it, rejecting the premise. "No, we don't 'have' that," he said. "I've said it from the day that I got here until whenever that there's not a connection. You've got Russia. If the president puts Russian salad dressing on his salad tonight, somehow that's a Russian connection."

Nevertheless, Ryan persisted. Spicer selectively insisted that everyone has dismissed reports of Trump-Russia collusion, despite the ongoing FBI investigation, and told Ryan, "I'm sorry that that disgusts you. You're shaking your head." He accused her of pursuing an "agenda" and ignoring "facts," and when she changed subjects to ask about a White House visit by Condoleezza Rice, Spicer accused Ryan of being "hellbent on trying to make sure that whatever image you want to tell about this White House stays," adding again: "Please, stop shaking your head again."

Even though he said "please," Spicer instructing a reporter — especially a black female reporter — on how she should gesture or behave rubbed a lot of people the wrong way, including Ryan.

Hillary Clinton, in a rare public speech Tuesday, said Ryan "was patronized and cut off as she tried to ask a question," threw in Bill O'Reilly's jab at Rep. Maxine Waters (D-Calif.), and said: "Too many women, especially women of color, have had a lifetime of practice taking precisely these kinds of indignities in stride." At The Washington Post, Aaron Blake noted that Spicer has clashed with male reporters plenty of times, but this "seemed to venture into different territory." And oddly, he added, "the mere premise that Russia is an issue for the White House seemed to set Spicer off." Peter Weber

2:00 a.m. ET

Rep. Maxine Waters multitasked on Tuesday night, dressing down Fox News host Bill O'Reilly while at the same time sharing an empowering message for women.

On Tuesday morning, Fox & Friends had shown a clip of Waters speaking out against President Trump. "I didn't hear a word she said," O'Reilly told the Fox News morning hosts. "I was looking at the James Brown wig." Waters hit back later that day. "I'm a strong black woman and I cannot be intimidated," she said on All In with Chris Hayes. "I cannot be undermined."

Speaking directly to the women watching, Waters implored them not to "allow these right-wing talking heads, these dishonorable people, to intimidate you or scare you. Be who you are, do what you do, and let us get on with discussing the real issues of this country." When a woman "stands up and speaks truth to power," people will attempt to "put her down," Waters added. "I am not going to be put down, I am not going anywhere. I am going to stay on the issues." For his part, O'Reilly told Time his comment about her hair was "dumb. I apologize." Catherine Garcia

1:26 a.m. ET

In a dizzying display of athleticism, 18-year-old Andri Ragettli landed the world's first Quad Cork 1800 on Monday, soaring 38 yards while making five full rotations and four head-under-body flips.

Ragetlli made history while at the Suzuki Nine Royals 2017 competition in Italy, and said it was "crazy," adding, "I'm stoked to land it." Catherine Garcia

1:15 a.m. ET

"Let's talk about the facts tonight, the facts about this White House and those close to it and ties to Russia," CNN's Anderson Cooper said Tuesday night. "We want to show you a flow chart just so everybody can follow along, because it's confusing." Even after he runs down the verified connections between Russian interests and Michael Flynn, Jared Kushner, Paul Manafort, Carter Page, Jeff Sessions, Michael Cohen, and Roger Stone, you may still be scratching your head and noticing that there's a lot of smoke but no raging fire.

Cooper agrees. "So those are some facts. There are a lot more," he said. "The ones we listed, they might be legal, they might be totally legal connections, or nefarious — we don't know in some cases. But we do know they exist." Stay tuned, presumably. Peter Weber

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