Have a Good NEWS

. Treasury secretary Tim Geithner: 'Zero chance' of another Lehman Brothers


. Bank of France governor rules out nationalisation

...the blue crew rang the opening bell at the NYSE on 29 July to celebrate the opening of their new 3D movie. The US stock markets went into free fall. The Smurfs 3D opened in Greece on September 8, just in time for the latest wave of Europe's financial woes.

"The time for muddling through is over.

The latest twists in the Eurozone crisis have sent the

has just thrown a spanner into the Eurozone crisis machine. Reports are hitting the wires that an Austrian parliamentary committee has failed to ratify the planned expansion of the European Financial Stability Fund. That means the package now cannot be approved by the whole parliament on September 21, as planned.

Geithner hit the early morning US airwaves, telling CNBC that there "was no chance" of the Eurozone hosting a repeat of the Lehman Brothers collapse. He also warned that Europe has a "terrible growth problem", which is hampering America's own efforts to rebuild.

1.15pm:

12.49pm:

Got a suggestion for how the UK can help? Last week, Christine Lagarde said the UK needed to be "nimble" - an indication that while the IMF backs George Osborne's Plan A today, the fiscal consolidation may need tweeking if the global economic climate worsens.

capital investment, building programmes and stimulation packages for small firms were all much more successful that UK govt policies.

Tories in the European Parliament want Greece kicked out of the euro, although it's not certain that the rest of the eurozone will be listening to the advice even if the odds are shortening on a Greek departure.

Callanan also criticised José Manuel Barroso, after his pledge to bring forward options for the implementation of eurobonds.

After the early selloff, financial markets have staged a healthy rally. As madeupname2 points out below, French banking shares are recovering - Credit Agricole is now up around 3.1%, with BNP Paribas down around 1.5%, and SocGen off 3.1%.

After an unsteady start, markets have rallied in the first couple of hours trading as the Moody's rating downgrades on the French banks seems to have removed at least one element of uncertainty that had been haunting many in recent days. It does, however, seem difficult to imagine that this news will produce any extended rally.

at the commission is to unveil a green paper on the pros and cons of eurobonds next month. That has been known for a while, and Brussels officials talk about it here every day. The real issue is whether eurobonds would entail renegotiating the Lisbon treaty.

10.45am:

There was also some alarming words from Barroso:

Today's figures underline the scale of the challenge that we face particularly given slower growth across Europe and North America. Unemployment remains lower than it was six months ago but clearly we must continue to focus our efforts on supporting business growth and ensure that people who do lose their jobs have the best possible support to get back into employment.

The storm clouds are gathering with falling employment and rising unemployment at a time when it is difficult to see how this might reverse. The ongoing uncertainty surrounding the eurozone crisis means that companies are likely to remain cautious about hiring and more certain about firing.

The Office for National Statistics has just reported that unemployment jumped by 80,000 in the three months to July, on the ILO measure. That takes the total number of people officially out of work to 2.51 million, and is the biggest quarterly rise since August 2009.

CAC

9.15am:

Here's some early analysis of the French banking downgrade from Jill Treanor, our banking correspondent:

The biggest faller, perhaps surprisingly, is BNP Paribas, whose shares have tumbled by 5.1%. It dodged a downgrade - and announced a ?70bn asset sale plan. City analysts, though, reckon BNP is on borrowed time.

Surely it can only be a matter of time before BNP Paribas follows in their wake, as the bank announces a restructuring plan to increase capital, probably in order to head off a downgrade at the pass.

Christian Noyer

Speaking to a French radio station, Noyer described the downgrades of two of France's largest banks as "relatively good news". Moody's decision just means French banks now had equivalent ratings to European peers, he argued:

In SocGen's case, Moody's said that the bank could cover losses on Greek, Portuguese and Irish debt, but added: "Nevertheless, SocGen's wholesale funding, the majority of which is short-term, is still high in absolute terms and may pose a vulnerability given considerable market tension."

Good morning. It's another crunch day for Europe, as the debt crisis that has convulsed the region for months intensifies.

Back in the UK, the latest unemployment data is released at 9.30am - an opportunity to see how Britain's own economy is faring.