World Politics - Euro Area [Archive] - Page 2

gaelic cowboy

06-07-2011, 23:51

Yes, and how does that make the Bundesbank worse than other central banks?

If anything the ECB isn't independent enough. They should never have let themselves get pressured into buying government bonds from Greece and whatnot.

I didn't say they were worse I said they made the same mistakes so they dont get a free pass on this mess, German banks hold massive amounts of Greek paper which suits the ECB fine and must be a black mark on the Bundesbank.

They were not pressured they had to buy lets remember they are the central bank of Greece, plus they must show faith in there own plan to fix Greece how could they expect others to buy Greek bonds to fix the deficit.

Thats like the old central bank of Holland telling the people in say Eindhoven there local bank will be abandoned totally with there savings evaporated, this never happens anywhere and it certainly wont happen under the ECB they have no other plan.

InsaneApache

06-13-2011, 20:51

Did I say I'd give it six months a while back? I might have been a tad bit optimistic.

http://uk.reuters.com/article/2011/06/13/uk-greece-ratings-sandp-idUKTRE75C3P620110613

"In our view, any such transactions would likely be on terms less favourable than the debt being refinanced, which we, in turn, would view as a de facto default according to Standard & Poor's published criteria," the agency said.

Adrian II

07-05-2011, 09:59

[...] most people blame the Euro instead of the greedy people [...]

In a Husarly way, I think that sums it up. Like all social forces, markets create their own problems if left unchecked.

In this case we are dealing with the result of a policy of worldwide financial liberalisation that started in the late seventies and gained full force in the eighties. The reallocation of production to low income countries coupled with rising oil prices caused a steep drop in purchasing power in the West around 1980. Our answer to that has been a horrific expansion of credit, usually based on overvalued real estate. In Japan this credit bubble burst in 1991 when their real estate market collapsed. The same happened in the US in 2007 when their housing market collapsed. As a result, all over the West we had to bail out major banks with taxpayer money. Now states like Greece and the US are going bankrupt and they have to be bailed out, too, with paxpayer money from richer, more stable nations like Germany and China. No nation is exempt from this trend, because of the high degree of interdependence in the global financial system. Britain may well think it is safe, but a recent Channel 4 news documentary has shown that in the present eurocrisis it is exposed to an amount of 399 billion dollars, due to its holdings in CDS (Credit Default Swaps). For comparison: that's one-third of British GNP...

In the end we wil have to curb credit and speculation worldwide. This is going to take a while, maybe a few more shocks to the system will help our leaders to smarten up quicker. Fair markets, as opposed to free markets, are the wave of the future. I will probably not live to see that new Keynesian wave, but hopefully my children will.

AII

gaelic cowboy

07-05-2011, 14:01

Oh I forgot to post this a while back, remember how defaulting on the likes of AIB's bank debt would bring down the Euro (http://www.independent.ie/business/irish/aib-deemed-in-default-as-euro26bn-buyback-offer-launched-2673582.html)

hmm didnt happen even with a 90% reduction in the bonds, must be some flaw in the great ECB crystal ball there.

Furunculus

07-08-2011, 14:32

one notes with some amusement that the EU has declared war on ratings agencies:

http://www.telegraph.co.uk/finance/economics/8621520/Europe-declares-war-on-rating-agencies.html

tragedy into farce!

Ronin

07-08-2011, 15:10

https://www.youtube.com/watch?v=OzLJzYlpGqs

Vladimir

07-08-2011, 17:57

See, that's why you guys are in trouble. You need to pay in cash, not trash.

Vladimir

07-08-2011, 18:27

Gah!

Adrian II

07-08-2011, 18:51

one notes with some amusement that the EU has declared war on ratings agencies:

http://www.telegraph.co.uk/finance/economics/8621520/Europe-declares-war-on-rating-agencies.html

tragedy into farce!

The big three ra's are big failures. They gave A-ratings to Enron till the day it imploded. They invented many of the financial instruments that gave rise to the 2007 US subprime crisis. They gave an A+ to Lehman till the last moment. They awarded Greece an A-rating until the very day in December 2009 when that country admitted it had doctored the books, something the EU finance ministers have known since 2000.

So these agencies are totally useless. Fitch for instance is just guy in a suit named Lacharrière who lives in Paris.

I don't think that replacing them with a useless EU rating agency would improve matters though. It would be better if EU governments decided not to mind the agencies anymore and make decisions based on their own analyses and commitments.

AII

gaelic cowboy

07-08-2011, 19:04

The big three ra's are big failures. They gave A-ratings to Enron till the day it imploded. They invented many of the financial instruments that gave rise to the 2007 US subprime crisis. They gave an A+ to Lehman till the last moment. They awarded Greece an A-rating until the very day in December 2009 when that country admitted it had doctored the books, something the EU finance ministers have known since 2000.

So these agencies are totally useless. Fitch for instance is just guy in a suit named Lacharrière who lives in Paris.

I don't think that replacing them with a useless EU rating agency would improve matters though. It would be better if EU governments decided not to mind the agencies anymore and make decisions based on their own analyses and commitments.

AII

I think the accountancy firms were more at fault for Enron but the RA's had the same problems cos they both ended up touting for business and so had a conflict of interest they would get no new business if the assessment was bad.

Brenus

07-08-2011, 19:09

The funniest thing is that these agencies are the one that help the Righty Greek Government to manipulate their accountancies and to cheat the system.
They let the only choice to the social traitor Papandreou from a Socialist Party that has socialist only the name to capitulate and bow to them.

Furunculus

07-11-2011, 11:01

I don't think that replacing them with a useless EU rating agency would improve matters though.

It would be better if EU governments decided not to mind the agencies anymore and make decisions based on their own analyses and commitments.

agreed.

sadly, if the EU wants to sell debt for its borrowing requirements then it is dependent on the ratings agencies, because private investors make their decisions based off how credible government promises to repay that debt are.

for example, Italy needs to refinance, or rollover, nearly £60b before the end of 2012, and its interest rate on a ten-year bond is now 5.3% which is past the point of sustainable borrowing.

there is no such thing as eu governments ignoring the ratings agencies if they want/need to borrow.

Brenus

07-11-2011, 11:59

Fragony

07-11-2011, 12:00

Usefull or not, the reaction to it NEINNEINNEIN IT JUST ISN'T TRUE is very telling. The Eurocrats are in panic. More and more is the EUSSR becomming a parody of itself

Furunculus

07-11-2011, 12:40

"there is no such thing as eu governments ignoring the ratings agencies if they want/need to borrow"

They can change the status of the European Bank and make it equivalent to the Fed US Bank. It is a political decision.

if the ECB starts issuing eurobonds in order to buy up sovereign debt then it has just created a debt union which would in large part have to be paid for by german taxpayers.

given that the legality of the bailouts is going before the german constitutional courts right now, who are likely to rule that any further such action must be approved by the bundestag, how likely is it that german politicians will vote themselves out of office en-masse by backing a Merkel inspired debt-union?

http://www.spiegel.de/international/germany/0,1518,772969,00.html

Philippus Flavius Homovallumus

07-11-2011, 12:48

if the ECB starts issuing eurobonds in order to buy up sovereign debt then it has just created a debt union which would in large part have to be paid for by german taxpayers.

given that the legality of the bailouts is going before the german constitutional courts right now, who are likely to rule that any further such action must be approved by the bundestag, how likely is it that german politicians will vote themselves out of office en-masse by backing a Merkel inspired debt-union?

http://www.spiegel.de/international/germany/0,1518,772969,00.html

Dept union would essentially be economic union, the performance of the Greek economy would directly impact Germany and France. In such a situation political union would have to follow because you can't have Germany bankrolling Greece while Greece just sulks and/or riots.

Where this is going is scary, where it will end is impossible to tell.

We are litterally reaching make or break for the EU as we know it, and break might be preferable.

Hell, what is the EU Government's deficit? no one has signed off on the accounts for two decades now!

Adrian II

07-11-2011, 21:08

there is no such thing as eu governments ignoring the ratings agencies if they want/need to borrow.

There are many ways in which they can ignore the ra's. For instance most European institutional investors are now legally obliged to sell holdings if their rating drops beneath a certain level, but laws can be repealed and incentives granted or taken away.

Most importantly we should realise that a Greek default is not nearly as dramatic as that of Lehman's. It's only our bankers and big investors who keep telling us that is it.

AII

Tellos Athenaios

07-12-2011, 04:40

@Furunculus: that would be true if the EU debt weren't so interlinked and locked up inside the EU itself. For instance if Germany suddenly decides it really doesn't care about what some RA thinks about Greece, then it means Greece doesn't need to either. That's obviously a stupid example, but the point is that the creditors have gorged themselves so much on the worthless bonds that they are in turn reliant on the EU not to let them drown in it. At which point it is no longer clear who is indebted to whom.

Furunculus

07-12-2011, 08:51

There are many ways in which they can ignore the ra's. For instance most European institutional investors are now legally obliged to sell holdings if their rating drops beneath a certain level, but laws can be repealed and incentives granted or taken away.

Most importantly we should realise that a Greek default is not nearly as dramatic as that of Lehman's. It's only our bankers and big investors who keep telling us that is it.

AII

those nations still have to borrow, so i ask you who will lend to them?

Italy has to roll-over £60b alone in the next eighteen months! note that i said "roll-over" and not "pay off".

You can ignore the ratings agencies, or kill them as the messenger of ill news, but that will only chase away capital to asia, not solve europes problems.

I really will let rip with a throaty guffaw if the continent starts mucking around with the ratings agencies, for while it is possible to pity tragedy, i have only contempt for farce!

gaelic cowboy

07-12-2011, 21:26

Uh oh thats three dominoes (http://www.rte.ie/news/2011/0712/bailout-business.html) down how long for the next one (http://www.rte.ie/news/2011/0711/italy-business.html)

Adrian II

07-13-2011, 08:21

those nations still have to borrow, so i ask you who will lend to them?

Those same creditors wil. It's in their interest.

Look, the US is in profound doodoo with it's national debt, right? Yet it isn't. The Chinese are committed to propping up the US till kingdom come because they have a huge stake in the US economy and in international financial stability. The same goes for banks, institutional investors and major hedge funds that have significant holdings of European debt. If the GIPS nations go, they go.

By the way, the irony which you don't seem to appreciate is that the big three ra's helped to get us here in the first place.

AII

Centurion1

07-13-2011, 09:10

Those same creditors wil. It's in their interest.

Look, the US is in profound doodoo with it's national debt, right? Yet it isn't. The Chinese are committed to propping up the US till kingdom come because they have a huge stake in the US economy and in international financial stability. The same goes for banks, institutional investors and major hedge funds that have significant holdings of European debt. If the GIPS nations go, they go.

By the way, the irony which you don't seem to appreciate is that the big three ra's helped to get us here in the first place.

AII

The US is more vital on the international scale than the nations most direly affected by the current economic climate. if a couple of those default or even all of them the impact will be far less that the fallout from a US default or rating slip.

Adrian II

07-13-2011, 09:19

The US is more vital on the international scale than the nations most direly affected by the current economic climate.

Exactly. Yet even there we see no genuine panic. The powers that be will find a way to deal with most of these debt issues and you and I as tax payers will find a way to foot the bill. In the end we're all to blame for the credit bubble, despite all the childish protests about 'them' robbing 'us' blind. My greater worry is that necessary changes to the system take so long in this interdependent world. And real shocks to the system cannot be excluded. Even China's economy isn't exactly rock solid; what if they suffer a major depression and the Chinese financial bubble bursts like the Japanese bubble did in 1992?

AII

Furunculus

07-13-2011, 09:51

Those same creditors wil. It's in their interest.

By the way, the irony which you don't seem to appreciate is that the big three ra's helped to get us here in the first place.

no they won't, china was notable in its support of non-threatened eurozone debt in buying from hungary last week, it didn't throw money in the direction of athens or madrid!

sure, the ratings agency got things wrong, lifes a bitch, but the reason why it has resulted in an existential threat is due directly to the absurdities of the eurozone and its governance. to quote someone famous; don't throw the thermometer away when the temperature rises.

To repeat; I really will let rip with a throaty guffaw if the continent starts mucking around with the ratings agencies, for while it is possible to pity tragedy, i have only contempt for farce!

Centurion1

07-13-2011, 09:52

Exactly. Yet even there we see no genuine panic. The powers that be will find a way to deal with most of these debt issues and you and I as tax payers will find a way to foot the bill. In the end we're all to blame for the credit bubble, despite all the childish protests about 'them' robbing 'us' blind. My greater worry is that necessary changes to the system take so long in this interdependent world. And real shocks to the system cannot be excluded. Even China's economy isn't exactly rock solid; what if they suffer a major depression and the Chinese financial bubble bursts like the Japanese bubble did in 1992?

AII

The problem being as always that you can only patch a blown life tube with duck tape so many times. At what point will this current concept of an economic hotfix simply backfire and we are actually all screwed. Besides that obvious problem which politicians like to ignore is the more personal issue of how absolutely wrong (but I'm not naive so wth should I bother bringing morality and ethics into politics) and irritating it is to have to pay for irresponsible people who on 40 grand a year decided they deserved a 500k home. Why shouldn't I be irresponsible and buy my girlfriend expensive jewelry, upgrade from my seiko watch to a rolex, and buy a BMW. Hell I'm only 18 but i literally have the money to do all three of those things. But I do not because I am a damn responsible person with my finances and do not blow them all on frivolous things. In the end every bubble must pop and eventually the entire global economy which has been growing dramatically since WW2 will pop all the same as a child's soap bubble.

Ronin

07-13-2011, 10:07

no they won't, china was notable in its support of non-threatened eurozone debt in buying from hungary last week, it didn't throw money in the direction of athens or madrid!

but it has just a month or so ago....

Furunculus

07-13-2011, 10:51

but it has just a month or so ago....

i would be surprised if such purchases continue given the shift to countries like hungary.

Adrian II

07-13-2011, 10:53

To repeat; I really will let rip with a throaty guffaw if the continent starts mucking around with the ratings agencies, for while it is possible to pity tragedy, i have only contempt for farce!

Oh please, not even the Chinese give a hoot about what Fitch & Co think. (http://www.bbc.co.uk/news/business-13518747)

AII

Fragony

07-13-2011, 10:55

Yay junk status for Ireland, thankfully eurocrats know for a fact that it simply isn't true. NEINNEINNEIN

Tellos Athenaios

07-13-2011, 11:02

Oh please, not even the Chinese give a hoot about what Fitch & Co think. (http://www.bbc.co.uk/news/business-13518747)

AII

... Which I would say is 10/10 for the Chinese in considering the actual financial circumstances of whatever it is they're rating. Assuming that the job of a rating's agency is to give a fair gauge of the financial situation of their ratings' subjects anyway.

Adrian II

07-13-2011, 11:21

Yay junk status for Ireland, thankfully eurocrats know for a fact that it simply isn't true. NEINNEINNEIN

Eurocrats are raising a 1500 billion emergency fund for the GIPS precisely because they do know. Jawohl!

I appreciate your criticism of the EU for what it's worth, but a few facts now and then would make it more relevant.

You want an interesting factoid? Herman van Rompuy who was Belgian finance minister during the run-up to Greek accession to the eurozone (and is now President of the European Council) recently said in an interview that already in those days the EU finance ministers knew that Greece was a major financial risk. They're nobody's fool, you know, but they operate in an almost surreal environment called the City of Debt which is like a Gotham City build from paper. And with no Batman around.

AII

gaelic cowboy

07-13-2011, 13:27

Yay junk status for Ireland, thankfully eurocrats know for a fact that it simply isn't true. NEINNEINNEIN

Such a laugh watching them on the telly talking about how there baffled by the RA junking Irelands bonds, "But but Ireland is sticking to the plan"

The plan is the reason Irelands bonds are junk.

Furunculus

07-13-2011, 13:42

Oh please, not even the Chinese give a hoot about what Fitch & Co think. (http://www.bbc.co.uk/news/business-13518747)

AII

you can't have it both ways adrian, either the RA's make a difference, and caused financial armageddon, or they are an irrelevance totally ancillary to China's own judgement on the likelihood of its foreign investments going down the pan. which is it to be?

Adrian II

07-13-2011, 13:55

either the RA's make a difference, and caused financial armageddon, or they are an irrelevance

Both, sadly. We have legally and politically committed ourselves to their ratings, but behind the screens we all know better. If we stop granting them credibility, as they amply deserve, we'll all be better off.

I already mentioned the example of the EU finance ministers who were perfectly aware of Greece's troubles by 2002 when Fitch & Co were still giving Athens an AAA rating. Think Enron, subprime crisis, Lehman Brothers. Their credit ratings are as toxic as any Greek bond is nowadays. It is quite possible that they are speculating against the euro in the interest of some large clients, who knows. The SEC is still investigating them over their shady role in the subprime crisis and Lehman's demise. Yet you want to trust them? Dream on, bro, dream on.

AII

Furunculus

07-13-2011, 14:03

i feel like my false consciousness is be being called into question.

Adrian II

07-13-2011, 15:25

i feel like my false consciousness is be being called into question.

I have that every day. Luckily my Bourjwah-Fu is strong enough.

AII

Furunculus

07-16-2011, 17:51

Fragony

07-16-2011, 19:42

I don't know nearly enough about economy to join in, but I didn't they call for more stern control after the Enron stuff when it suited them. If rating buro's are madness than the world must be mad

InsaneApache

07-16-2011, 20:28

Not mad. Insane.

Ronin

07-16-2011, 21:27

european banks to take a hammering when markets open on monday morning:

http://www.telegraph.co.uk/finance/financialcrisis/8642297/Europes-bank-stress-tests-as-bad-as-1979-Irish-driving-test.html

no doubt the fault of the vile speculators and their neo-liberal running-dogs the ratings agencies!

so the test were too easy...like the earlier tests that were too easy also.

let me take a gander at what the yard stick would be for a "good test"...if all the banks failed it would be a good test I guess.

gaelic cowboy

07-17-2011, 00:03

Ireland's banks passed this time if you can believe that, How did they pass you ask, well tis simple really we set stricter targets for a pass.

Furunculus

07-17-2011, 12:35

so the test were too easy...like the earlier tests that were too easy also.

let me take a gander at what the yard stick would be for a "good test"...if all the banks failed it would be a good test I guess.

nonsense on stilts!

there are recognised flaws, and fundamental ones at that, with the euro bank tests. like not accounting for the potential of a sovereign default, something of an oversight you might agree given that greece is about to restructure its debt any day now............ which is a default in anyones language.

the tests serve two purposes:
1. so europe and its nations can assess the scale of the problem
2. to provide certainty to lenders in order that they should continue to lend with confidence

the tests have failed the second criteria, and the markets will feel that lack of confidence when they open on monday.

it is that simple.

http://www.telegraph.co.uk/finance/financialcrisis/8642492/European-Banking-Authority-was-hobbled-over-stress-tests.html

Philippus Flavius Homovallumus

07-19-2011, 17:05

Incoming Portugese PM identifies budget hole left by outgoing government (sound familiar) and now he's getting angry at the EU.

http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100010873/portugal-loses-patience-with-europe/ (http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100010873/portugal-loses-patience-with-europe/)

Adrian II

07-19-2011, 17:21

european banks to take a hammering when markets open on monday morning:

So when's the hammering?

AII

Louis VI the Fat

07-19-2011, 19:55

So when's the hammering?

AIITaking place right now, banks are being hammered as we speak in Wall Street. From Bank of America to Goldman Sachs. Serves the Yanks right for joining the Euro, I've warned them all along that nothing good would come out of that currency. :no:

Vladimir

07-19-2011, 20:15

It's the old colonial masters and their one world gobermnt trying to impose the NWO on us. :angry:

InsaneApache

07-20-2011, 16:41

I thought this anecdotal. I was talking to my dads wife last week and she was telling me how bad things had got in Greece this last year or so. She mentioned that when they first moved there crime was virtually unknown. She said that when she went into shops she would leave the car unlocked and nowt would be pinched.

All that has changed. In the last few months, a lot of her friends had been burgled. A thing unknown on the island. She now makes sure that everything is locked all the time. She sounded quite fazed about it.

I listened and we chatted for a while. I thought no more of it. Then I read this...

Greece is tightening its belt -- and the number of people living in poverty is surging as a result. Thousands line up in front of food banks and resort to rifling through rubbish bins. The country's financial crisis is rapidly turning into a social one -- while wealthy tax evaders manage to get off scot-free.

http://www.spiegel.de/international/europe/0,1518,775301,00.html#ref=nlint

Are we really looking at people starving in Europe? Not since the second world war has any population in Europe been faced with starvation.

Then Barrosso says this....

(Reuters) - European Commission President Jose Manuel Barroso warned on Wednesday that the euro zone was facing a very serious situation that could have repercussions for the global economy but said a solution was still possible.

In a statement ahead of a summit of the 17 euro zone leaders on Thursday, Barroso said it was essential the meeting comes up with an agreement that improves the sustainability of Greek public debt, provides liquidity to the European banking system and secures the involvement of the private sector in a deal.

"Nobody should be under any illusion: the situation is very serious. It requires a response, otherwise the negative consequences will be felt in all corners of Europe and beyond," Barroso said.

"The elements for a solution are known," he said, adding that the ingredients had to include: measures to ensure the sustainability of Greek public finances, the feasibility of private sector involvement, scope for more flexible use of the euro zone's bailout fund, the EFSF, and the repair of the region's banking system with more liquidity.

http://www.reuters.com/article/2011/07/20/eurozone-greece-barroso-idUSB5E7IB02120110720

Grim. Very grim.

Adrian II

07-20-2011, 17:12

I was in Greece last year and already noticed the same about crime.

Twenty percent of Greeks live below the official poverty line. Don't know exactly what that line is in purchasing power terms, but it sounds ominous enough.

AII

Louis VI the Fat

07-20-2011, 22:09

Poverty itself does not create crime. Social injustice does. In this sense, the problem is not that twenty percent of Greeks lvie below the poverty line, but that twenty percent of Greeks are wealthy enough to not have to pay taxes, people who can afford to bribe their way to maintaining their social privileges.

As with Ireland, my main gripe is that Europe protects the wealthy at the expense of the poor. Why do French banks need to be protected at the expense of Europeans below the poverty line? I want a bailout program for the poor in Europe, not for the rich.

Philippus Flavius Homovallumus

07-20-2011, 22:12

gaelic cowboy

07-20-2011, 22:18

I'm sure this is the result of the democratic deficit in Europe which the EU has done nothing to fix and, arguably, much to reinforce.

To be honest I doubt that PVC I get the feeling they would all still individually have tried to protect the banksters and whatnot

Philippus Flavius Homovallumus

07-20-2011, 22:22

To be honest I doubt that PVC I get the feeling they would all still individually have tried to protect the banksters and whatnot

Probably true, but in this case they are all doing it because the Eurozone must pull together, otherwise one or two countries might have decided "non".

Anyway, it is a fact that the larger an organistion/nation the more divorced the people at the top are from those at the bottom.

Kagemusha

07-20-2011, 23:58

Louis VI the Fat

07-21-2011, 00:25

I think the dead weight have to be cut off from euro. Those who continuosly fail to live up to the standards of EMU, should be kicked off from Euro, meaning most of the Southern Europe and any tax heavens.Other wise, all this will be just a huge trans action of tax payers money to the private investors and that is not the idea of common currency this was supposed to be.My solution would be to move boldly forward, and opt for political union. I do not think that is feasible though.

I really do think we are witnessing a tectonic shift on a global scale. Europe and North America, by and large Japan too, are set for another round of hurt. Meanwhile the rest of the world is going from strength to strength.

As for tax havens, these need to be bombed into regime change, period. Starting with the biggest of them all, the British Isles. I want our marines in London and Dublin by tomorrow.

Kagemusha

07-21-2011, 00:45

I think we in the West are about to hit the point, where global free capitalism and Keynesian mixed economical thinking cant seem to co exist for too long anymore. One of the two must go. World economy on the other hand cant be built up on debt which can not be paid, while the most profitable way of making money is speculating with huge capital funds. Thus leading to investments that have no real value, but only negative effect of pulling money out from the market. Our public macro economies have to be turned efficient enough, for them to actually be sustainable, while leeching the economy by using capital has to be stopped by regulating the financial market.

Otherwise i am afraid the financial system called capitalism is going to self destruct, first in the West and bit later in other parts in the world.

Philippus Flavius Homovallumus

07-21-2011, 01:07

My solution would be to move boldly forward, and opt for political union. I do not think that is feasible though.

I really do think we are witnessing a tectonic shift on a global scale. Europe and North America, by and large Japan too, are set for another round of hurt. Meanwhile the rest of the world is going from strength to strength.

As for tax havens, these need to be bombed into regime change, period. Starting with the biggest of them all, the British Isles. I want our marines in London and Dublin by tomorrow.

Having sane taxes is not immoral, French corporate taxes are lower than Irish ones with all your opt-outs and loopholes.

Anyway, China and India have piddly domestic sectors and political problems, if America and Europe go down then so do they!

Furunculus

07-21-2011, 06:49

looks like it is being delayed by the ECB acting as europes cash machine:

http://www.telegraph.co.uk/finance/comment/damianreece/8650903/Eurozone-has-liquidity-and-that-should-buy-us-some-time.html

phonicsmonkey

07-21-2011, 07:30

Anyway, China and India have piddly domestic sectors and political problems, if America and Europe go down then so do they!

Not true of China anymore where less than 50% of GDP is now comprised by exports and a far larger proportion of exports than ever before are now to other Asian countries and not to the US and Europe.

You could argue that if China (and indeed India) was going down it would have when the US and Eurozone economies contracted severely in 08/09. In fact it went from strength to strength on the back of strong domestic demand which shows no sign of abating.

And Louis..

As with Ireland, my main gripe is that Europe protects the wealthy at the expense of the poor. Why do French banks need to be protected at the expense of Europeans below the poverty line? I want a bailout program for the poor in Europe, not for the rich.

..while I agree with you this is not an issue isolated to Europe. Exactly the same dynamic is at play in the US and its latest manifestation is the fundamentalist Republican demand that fiscal balance be achieved solely by spending cuts and without new taxes. They won't even allow loop holes to be closed!

Brenus

07-21-2011, 08:08

“I want a bailout program for the poor in Europe, not for the rich.” Well, so we shouldn’t have voted for Lisbon Treaty… Oh, well, we didn’t but… well…

Adrian II

07-21-2011, 09:28

Louis VI the Fat

07-21-2011, 09:38

Injustice and privilege are rampant in Japan, yet crime is low.

Thesis refuted.

AIIBollox.

Temperature increases closer to the equator. This is not refuted by pointing out it is colder in Montréal than in Venice.

edit: *ignores Brenus*

rory_20_uk

07-21-2011, 09:40

I thought that Crime in Japan is very high, it is just institutionalised into the very fabric of society - and hence is rebranded privilege and nepotism.

After all, the easiest way of reducing crime is to make things not a crime anymore (in the UK we make the misdemeanours)

~:smoking:

Louis VI the Fat

07-21-2011, 09:43

Not true of China anymore where less than 50% of GDP is now comprised by exports and a far larger proportion of exports than ever before are now to other Asian countries and not to the US and Europe.

You could argue that if China (and indeed India) was going down it would have when the US and Eurozone economies contracted severely in 08/09. In fact it went from strength to strength on the back of strong domestic demand which shows no sign of abating.I too think it too optimistic that the world will forever revolve around ten percent of the global population which had a brief period of technological advantage.

China adds the entire GDP of Australia this year. Things are build in Asia that are far more advanced than anything Europe can even dream of, on a truly humongous scale at that. Internal trade between non-Western countries is exploding. Global economoy is about Brazilian resources processed by China to be used for construction in Turkey.

edit: *still blissfully ignores Brenus*

Sarmatian

07-21-2011, 10:46

I returned from a two week business trip to China yesterday and boy, was I amazed. Guangzhou makes western metropolis' look outdated - huge buildings, 10 lanes highways, modern technology... You can get anything there, from nails to spaceships, one or one million pieces. Shenzhen was a small village 30 years ago, today it has 9 million people living and working it it.

Petrol is 70-80 cents a liter, they've got all the resources they need from Russia and Brazil and, steadily more so, from Africa. Their internal market is huge. Crisis in the west won't make them implode, it may just be a temporary speed bump.

Tellos Athenaios

07-21-2011, 11:12

Brenus

07-21-2011, 11:49

Can’t ignore me, I would be the voice of the conscience if you had one.

The facts are stubborn. Last year, the Good Doctor Strauss Khan (IMF) and his accomplices (ECB, EC) sold Greece to banskters. They made a private debt (Greece towards private banks) a public debt, and then they made the bankters rulers of Greece.
Thanks to the Europe that Protects and it Armed Arm the Lisbon Treaty (treaty only enforced on “free market”) states can’t borrow money to the ECB but on the market (meaning the banksters). These banksters borrow money to the ECB at around 0.5 % then lend to countries at around 15 or more % according to the notation (given by the banskters) to the countries in need.

Thanks to DSK and his henchmen, the Greek Debt increased. So soon enough, it will be bankruptcy. But the leeches have made their money, so who care…

Sarmatian

07-21-2011, 12:06

So Sarmatian, Louis, what you are marveling at is what Europe and Japan exported, then? Massive monetary investment and industrial expertise?

More advanced than what we can dream of in China often turns out to be designed by Western companies and engineers -- that is why China plays games with “rare earths” as they want the added value and technology using those rare earths to move from Japan, the USA and Europe to China.

Bah, 30 years ago Shenzhen looked like this
https://img811.imageshack.us/img811/473/shenzhenchina30yearsago.jpg (https://imageshack.us/photo/my-images/811/shenzhenchina30yearsago.jpg/)

Now it looks like this
https://img7.imageshack.us/img7/3112/shenzhen2.jpg (https://imageshack.us/photo/my-images/7/shenzhen2.jpg/)

40 years ago bicycle was the main transportation means in China. Now they plan to have 20 million electric cars by 2025. Gone are the days when they needed western engineers, those 200-story buildings are designed by the Chinese and built by the Chinese.

rory_20_uk

07-21-2011, 12:10

Like a child in a chocolate factory, Greece apparently had no option but to borrow vast sums of money. Tax avoidance and monopolies abound, causing the economy to be sclerotic. To join the EU they asked bankers to help them hide debt so they could squeeze in.

When this problem first was noticed, first denial was used, followed by violence and strikes. People were firebombed for working in a bank.

The banks borrow money of the EU bank. The EU bank apparently wants them to do so. They are either aware of the arbitage that this causes or else would fail GCSE economics.

Greece will hopefully go bankrupt as they should have done years ago - before joining the EU when they would have devalued and caused a local problem that was caused by... the locals. After months of the EU giving heroin to a heroin addict / petrol to a fire the problem is vastly worse and threatening the whole Euro as teh debt is too large for Germany to absorb. I'm sure this too is the fault of bankers, as clearly politicians and the states involved are utterly blameless.

~:smoking:

Louis VI the Fat

07-21-2011, 12:12

https://img7.imageshack.us/img7/3112/shenzhen2.jpg (https://imageshack.us/photo/my-images/7/shenzhen2.jpg/)

40 years ago bicycle was the main transportation means in China. Now they plan to have 20 million electric cars by 2025. Gone are the days when they needed western engineers, those 200-story buildings are designed by the Chinese and built by the Chinese.I think you and I are seeing the same China.

Europeans have always marvelled at China. There are travel accounts from many centuries, all concluding more or less the same. That not Europe, but China is the centre of the world. More populous, more industrious, infinitely refined.

Centurion1

07-21-2011, 12:17

Sarmatian

07-21-2011, 13:10

I think you and I are seeing the same China.

Europeans have always marvelled at China. There are travel accounts from many centuries, all concluding more or less the same. That not Europe, but China is the centre of the world. More populous, more industrious, infinitely refined.

I believe we are. I've visited New York, Paris, London... but two weeks in Guangzhou have left a bigger impression than all those cities together. If I'm allowed to use some poetic license, I felt like I saw the future. They're gonna be number 1 pretty soon and the most amazing, or possibly the scariest fact is that you get the feeling they're not even trying, that they're still in gear one. And all that is created by 1.5 billion people bound together by 5000 years old culture. I'm going back in January for another business trip and in between I'm gonna start learning the language.

I've been to China I have some distant family in China. All that you see is by and large produced by western builders and contractors. The Chinese are up and coming sure but their position on ladder which is the wealth of nations is tenuous at best. Not to mention the people will eventually rise against the authoritarian state which they hide from visiting westerners. Their west is derived from the west and still dependent upon it.

Bollox. That is the story we tell ourselves to comfort us. China still has a long way to go, China is dependent on us, China is unstable, China is authoritarian police state... China indeed has a long way to go, but not to reach us, that's just around the corner, but to reach its full potential. That is possibly the most amazing or the scariest thing, like I've said. They're getting ahead of us and they're using maybe 10% of their potential. We're more dependent on China that China on us, it is a stable country with more than 90% of 1.5 billion people declaring themselves as Han people. For two weeks in a city with more than 12 million people, I haven't seen a single police officer except those directing the traffic, armed to the teeth with whistles and red and green flags.

rory_20_uk

07-21-2011, 13:22

In the UK we illegally arrest / kettle protestors, but that's OK as we have a reivew after a few years and declare it illegal.
The police force hires criminals, but that's OK as when they did the investigation they found no wrongdoing. If that's a problem take solace in that two people at the top resigned.
We are rapidly eroding our national identity, but that's OK as we are "multicultural" and are told we shouldn't want one.
Our care homes abuse staff and the watchdog does nothing. But that's OK as we have TV programmes to investigate too.
We have a Democracy, which means we have the ability to vote in the other lot who did PPE at Oxford for a few years.

Europe / America got to be great powers by being ruthless and outcompeting and often outgunning all competition. Now we appear to think that everyone should just be nice and accept that our way is the way to Enlightenment - even though historically we've only been thus after our peak.

Pretending that China will implode as they have a different model to us is apparently a lot easier than trying to sort anything out over here.

~:smoking:

Tellos Athenaios

07-21-2011, 13:57

I felt like I saw the future

Yeah, except that you saw it in technology they bought from the West. The real future is that they are scrambling to set up their own state of the art R&D, witness Huawei - ZTE patent spats. That is the future: your iPhone not just made in China but also designed in China.

gaelic cowboy

07-21-2011, 14:45

Those who continuosly fail to live up to the standards of EMU, should be kicked off from Euro

There is your problem straight away, Ireland is bailed out but it had top marks every year cos the government never borrowed any money, instead our banks busted our exchequer causing knockout.

InsaneApache

07-21-2011, 15:28

That is the future: your iPhone not just made in China but also designed in China.

By an Englishman in California actually.

gaelic cowboy

07-21-2011, 15:33

By an Englishman in California actually.

That only works for a while though, the classic example is the television, America lost it's control of the market by outsourcing huge amounts of production to the far east mainly Japan.

When the outsourcing companies started to make there own cheaper televisions the Americans couldnt compete.

The American television industry had practically forgot how to actually make one.

Beskar

07-21-2011, 17:50

That only works for a while though, the classic example is the television, America lost it's control of the market by outsourcing huge amounts of production to the far east mainly Japan.

When the outsourcing companies started to make there own cheaper televisions the Americans couldnt compete.

The American television industry had practically forgot how to actually make one.

I remember this argument with Furunculus. He said I was wrong because we own the patents.

rory_20_uk

07-21-2011, 18:02

Patents only last a couple of decades. And increasingly, who will be getting the next lot of them?

China also has a... special take on patent enforcement. Companies based in China for Chinese consumption can ignore the wails of the West.

~:smoking:

Tellos Athenaios

07-21-2011, 18:14

... He did? Since when has an emerging economy that relied on manufacturing according to foreign tech/demand *ever* paid more than lip service until its own industry was firmly established and had IP worth infringing of its own? Heck, the USA and European industries were all founded on precisely such practices including some genuine industrial espionage ... ?

Patents are overrated, apart from the fact that for much of the modern technology patents are also a hindrance to genuine innovation. They're from an age where you could actually count them inside your head, and the R&D investment and turnover times actually had any correspondence with the patent grant. Today, patents are dysfunctional at best and insidious at worst. Patents haven't worked properly since Germany figured out how to game the system in the 19th century.

Patents only work if everyone plays by the same rules *and* the various patent offices are actually competent. Right now, we have neither and there is no reason to assume we ever will have both.

Furunculus

07-21-2011, 20:35

So when's the hammering?

AII

http://www.guardian.co.uk/business/2011/jul/18/banks-eurozone-losses-rbs-lloyds-barclays

Louis VI the Fat

07-21-2011, 20:46

http://www.guardian.co.uk/business/2011/jul/18/banks-eurozone-losses-rbs-lloyds-barclaysAncient history. Today:

Leaders of the Eurozone countries have reached a new agreement on tackling the Greek debt crisis, at a summit in Brussels.
They include debt restructuring and an expansion of the European bailout fund.

The new bailout will - for the first time - also involve private lenders, according to the French President, Nicolas Sarkozy.
He said they will provide 135bn euros ($194bn, £120.5bn) over 30 years to Greece.

One key element of the package is an expansion of the role of the European bailout mechanism, the European Financial Stability Facility (EFSF) so it can act more freely.
The President of the European Council, Herman Van Rompuy said: "Reform of the EFSF will make it more flexible and effective. We do not now have to wait for substantial damage to occur before we can intervene."

Earlier, a statement said: "Greece is in a uniquely grave situation in the euro area."
Financial markets gained on hopes of a new deal. US shares gained 1.3%, while shares in Milan rose by 4%, and Spanish shares jumped 3%.

European banking shares led the way. In Germany, Commerzbank climbed almost 9% and Deutsche Bank rose 3.6%, while in France Societe Generale and Credit Agricole gained about 6%. German and French banks are the biggest holders of Greek debt. UK banking shares also rose strong, with Barclays gaining 7.7%, Lloyds 5.9% and RBS 5.7%.

http://www.bbc.co.uk/news/business-14239794

'It is an unusual moment when British politicians, more than the Germans, are urging closer European integration'

I do ever so dearly wish Europe would seize the moment for closer union. Now would be the time. :yes:

Vladimir

07-21-2011, 20:52

gaelic cowboy

07-21-2011, 21:10

I remember this argument with Furunculus. He said I was wrong because we own the patents.

The problem here is the skills you draw from will wither and die, if graduates are not properly schooled in the actual manufacturing process.

What company is going to take on a designer so they can design say car parts who has never even worked in say injection moulding plant or in steel fabrication.

As long as there is the posibility of learning skills in the wider economy then you will be able to source designers ,but if you let it go then the quality will drop year on year.

gaelic cowboy

07-21-2011, 21:18

Now seeing as this thread was initially started by myself on how the interest rate needed cutting or loan maturity needed extending.

Ireland gets more time to pay EU loans and rate cut (http://www.independent.ie/national-news/ireland-gets-more-time-to-pay-eu-loans-and-rate-cut-2828273.html)

By Independent.ie reporters
Thursday July 21 2011
Ireland will get a cut in EU loan interest rates and twice as much time to pay its debts as part of a plan to save the euro and Greece.

At an emergency eurozone summit in Brussels, leaders also agreed on a second bailout for Greece that will include cost-sharing with banks, backed by collateral and guarantees.

According to a draft communique drawn up by eurozone leaders in Brussels today, bailout interest rates will drop to around 3.5pc and loan maturities will double, giving Ireland 15 years to pay back its debts.

Ireland currently pays an average of 5.8pc on €45 billion of EU loans, which are offered on average over 7.5 years.

The concessions are being given on condition that the Government “participates constructively” in talks on a common corporate tax base - an EU-wide formula for redistributing taxes on business profits - and on other EU tax policies.

The discounts offered to Ireland mirror those agreed for Greece, which is struggling under a massive €350bn debt mountain.

The changes will also apply to Portugal.

Interest charged on eurozone rescue loans will now be equal to that charged to non-eurozone countries who borrow money from the European Commission.

Latvia, Romania and Hungary have so far tapped that fund, which has a ceiling of EUR50 billion.

Interest rates will not fall below the eurozone fund’s borrowing costs. That fund, the European Financial Stability Facility (EFSF), was able to tap the markets at the end of June at a rate of around 2.8pc.

That was before the European Central Bank raised its rate by 25 basis points in July.

Greece is being offered a second bailout - the final amount still to be decided - at lower interest rates and extended loan maturities.

The EU portion is to be matched by IMF funding, and coupled with a European “Marshall Plan” to help boost growth and investment in the country.

The EU has already promised to speed up the payment of €1bn in infrastructural aid, and announced this week that it was sending a technical team to Athens to help the government absorb the cash.

The new loans will be backed by “collateral arrangements where appropriate”, the communique says, after Finland insisted that it receive assurances for any extra money it is expected to stump up as part of the EFSF.

Private investors will be offered a “menu of options” to encourage them to participate in the bailout, including bond exchanges, rollovers and buybacks.

Their participation will be “voluntary”, the communique says, although ratings agencies have already indicated that they will declare Greece in partial default of its debts if the plans go ahead.

Eurozone governments will have to back bondholder involvement, possibly through a special fund guaranteed by the AAA-rated financial stability facility.

“Greece is in a uniquely grave situation in the euro area,” the draft says. “This is the reason why it requires an exceptional solution.”

The meeting in Brussels was attended by all 17 eurozone leaders, IMF head Christine Lagarde, ECB chief Jean-Claude Trichet, and a representative from the Institute of International Finance, which represents the global banking groups exposed to Greek debt.

Earlier Taoiseach Enda Kenny had called on leaders to be flexible with its plans.

European markets warmed to the news and many shares erased earlier losses on the news of a new deal.

The euro gained 0.5pc against the dollar.

- Independent.ie reporters

Sarkozy confirms lower Irish loan rate (http://www.rte.ie/news/2011/0721/euro-business.html)

Enda Kenny confirms bailout rate cut (http://www.rte.ie/news/2011/0721/eu.html)

Furunculus

07-21-2011, 22:47

'It is an unusual moment when British politicians, more than the Germans, are urging closer European integration'

I do ever so dearly wish Europe would seize the moment for closer union. Now would be the time. :yes:

of course we are, we never objected to you guys doing your own thing, we just don't want to be part of it.

if the foolishness of political union is to be sought, then do it properly!

.............. and pay for it, but good luck with the german electorate.

The problem here is the skills you draw from will wither and die, if graduates are not properly schooled in the actual manufacturing process.

What company is going to take on a designer so they can design say car parts who has never even worked in say injection moulding plant or in steel fabrication.

As long as there is the posibility of learning skills in the wider economy then you will be able to source designers ,but if you let it go then the quality will drop year on year.

i accept the point that it is difficult, but we either continue to innovate, with british RESEARCH being referenced in 15% of world research or we get poorer.

i accept the challenge.

gaelic cowboy

07-21-2011, 22:57

of course we are, we never objected to you guys doing your own thing, we just don't want to be part of it.

if the foolishness of political union is to be sought, then do it properly!

.............. and pay for it, but good luck with the german electorate.

they will be lucky if the agreement made tonight does not get upended, I expect before the end of the summer some other problem will be upon us.

Adrian II

07-21-2011, 23:43

http://www.guardian.co.uk/business/2011/jul/18/banks-eurozone-losses-rbs-lloyds-barclays

Oh please - a mere three banks got clobbered, all of them British. And that's probably because they are overexposed in CDS which makes investors particularly jittery.

I am somewhat satisfied that the new eurozone plan hammered out today talks of restructuring of debt. Organised restructuring, hurtful though it is in the short term, is the way to go.

AII

Furunculus

07-22-2011, 10:44

Oh please - a mere three banks got clobbered, all of them British. And that's probably because they are overexposed in CDS which makes investors particularly jittery.

I am somewhat satisfied that the new eurozone plan hammered out today talks of restructuring of debt. Organised restructuring, hurtful though it is in the short term, is the way to go.

AII

well that article was about how the euro fall had affected big british banks

but the stressless stress tests did affect european banks:

http://www.guardian.co.uk/business/2011/jul/18/european-shares-fall-stress-tests-default

however, as noted the fall was muted by the ECB acting as an enormous overdraft:

http://www.telegraph.co.uk/finance/comment/damianreece/8650903/Eurozone-has-liquidity-and-that-should-buy-us-some-time.html

re the point about restructuring - there really won't be much.

all that is really happening is a rolling over with longer maturities, which means greek debt as a proportion of GDP continues to grow, bankrolled as it is by the EFSF, which leaves the german taxpayer responsible for at least 32% of burden, £750 billion in other words.

http://www.zerohedge.com/article/fatal-flaw-europes-second-bazooka-bailout-82-million-soon-be-very-angry-germans

lurving it!

----------------------------------------------------

edit - sunday 24th:

Germans is getting a trifle fractious:

http://www.telegraph.co.uk/news/worldnews/europe/eu/8656892/Germany-divided-again-as-Europe-grapples-with-euro-bailout-plan.html

Furunculus

08-03-2011, 15:50

the wobbly'ness of italy and spain is starting to affect france now:

http://ftalphaville.ft.com/blog/2011/08/03/642076/eventually-french-spreads-fail-e-f-s-f/

*hums; Ride of the Valkyries*

Beskar

08-03-2011, 16:23

You know what is really moronic? It is the stockmarket causing all of these issues.

gaelic cowboy

08-03-2011, 16:41

You know what is really moronic? It is the stockmarket causing all of these issues.

No actually what there worried about is that Spain Italy may have to pull out of there commitments to the various rescue packages that have been setup in order to stablise there own situation.

That would increase the load on the others for bailing out Greece, Ireland, Portugal leading to more talks about talks and potentially someone refusing to pay anymore into it unless there is some burden sharing.

In other words the chance of default has gone up yet again, because the big plan was not big enough to start with.

rory_20_uk

08-03-2011, 16:47

You know what is really moronic? It is the stockmarket causing all of these issues.

It just isn't fair! Why won't people throw their money at lost causes to chase a political half-baked plan?

If only loads of other people were effectively willing to work longer so that Greece can continue doing a pretty poor job of everything.

~:smoking:

Furunculus

08-03-2011, 16:52

You know what is really moronic? It is the stockmarket causing all of these issues.

no, what is truly moronic is that europe created an economic structure which did not share a political commitment from the rich nations to buttress the poor nations in times of ill.

now that the ill times have arrived everyone is asking if germany is willing to show that commitment to guarantee loans that permit italy and spain to rollover its debts.

without that commitment why on earth would the markets lend more to those countries, when the threat of default is so close arising from marginal growth, continuing deficits, and enormous debts?

now that IS moronic!

Adrian II

08-03-2011, 17:07

no, what is truly moronic is that europe created an economic structure which did not share a political commitment from the rich nations to buttress the poor nations in times of ill.

No, what is truly moronic is that the West has built a paper cathedral of debt that is now collapsing. Your country for instance went through the £1trillion debt ceiling in January, equalling £40,000 per British household. Most western nations show similarly frightening figures. This has nothing to do with Eu structure. The US is fiscal union and they're in trouble for the exast same reason.

The real problem is lack of leadership on both sides of the Atlantic, as The Economist doesn't stop emphasising.

AII

Furunculus

08-03-2011, 17:22

No, what is truly moronic is that the West has built a paper cathedral of debt that is now collapsing. Your country for instance went through the £1trillion debt ceiling in January, equalling £40,000 per British household. Most western nations show similarly frightening figures. This has nothing to do with Eu structure. The US is fiscal union and they're in trouble for the exast same reason.

The real problem is lack of leadership on both sides of the Atlantic, as The Economist doesn't stop emphasising.

AII

wrong adrian.

that we have accumulated so much debt is indeed moronic, that is not in question, but neither is our ability and commitment to pay it back in question.

that. is . why. the. yield. on. british. ten. year. bonds. is. only. 2.75%!

we need more debt to rollover our old debt, fine, you can have it as you have shown that your finances are on a sustainable trend.

spain and italy however have a problem, poor growth on a brutal recession after a period of heroic borrowing and bank risk means that their finances are not on a sustainable trend, and seeing as their is no commitment from germany to a transfer union, why would you lend to these nations given the risk of default?

they need more debt to rollover our old debt, fine, you can have it, as long as we insure against your risk by charging 6.5% yield on a ten year bond.

it is that simple.

InsaneApache

08-03-2011, 17:22

Talking of morons, did anybody read 'El Presidente' Von Pumpy in the Gruniade last week?

Perhaps it's my false consciousness showing again but the man is bonkers.

Furunculus

08-03-2011, 17:29

Talking of morons, did anybody read 'El Presidente' Von Pumpy in the Gruniade last week?

Perhaps it's my false consciousness showing again but the man is bonkers.

i do worry about your false consciousness, it could lead to the ruin of us all! but in this case you are right:

Astonishingly, since our summit the cost of borrowing has increased again for a number of euro area countries.

the man is a prize cretin!

nothing is sorted or solved:

http://ftalphaville.ft.com/blog/2011/07/25/632906/whats-wrong-with-greece-bailout-ii/

1. Greece Bail Out II now detailed, rolling crisis still likely: The Euro Summit was first and foremost a summit aiming at concluding the negotiations surrounding Greece Bail Out II. This is now done. The political will of some countries to get PSI at any cost won the day which will have a number of negative side effects (rating downgrade for Greece and potentially other countries, ECB requirement for additional guarantees for Greek collateral, market perception that PSI might be a template for other countries) while not bringing substantial economic benefits. Indeed, after almost 3 months of negotiations and effort, the Greek debt load will be at best reduced by 10 to 20 percentage points of GDP to what will still be seen as an unsustainably high level. Overall, this will have been an expensive political decision. In the end, Greece will likely continue facing a rolling crisis around IMF quarterly reviews. Doubts about the trajectory of the economy and the ability to raise privatisation receipts anywhere near the targets will persist.

2. Toolkit to respond to euro area contagion rushed out: The statement clearly gives the impression that euro area policy makers are increasingly ‘getting the message’, with 3 new tools being created: a precautionary programme, a lending facility for non programme countries to recapitalise banks and a bond buying programme in the secondary market. However, the level of detail provided is low, making it hard at this stage to really tell how the new tools will work in practice and how efficient they will end up being. In particular, there is insufficient information available to tell how preventive those tools will end up being deployed and this is related to the lack of clarity surrounding the so called “appropriate conditionality” that will be imposed on member countries accessing these new help mechanisms.

3. Nice tools but no firing power: In our view a key limitation of the announcement is that it did not address the size of the EFSF. We have recently argued that a prerequisite to increase the flexibility of the EFSF was to increase very significantly its size with a view of ultimately having a lending capacity of around Eur2trn. Indeed, under the amended EFSF which will aim at having a lending capacity of Eur440bn, and given current and likely commitments, the EFSF will be left with a little more than Eur300bn of lending and or buying capacity – a too small amount to restore investor’s confidence that the euro area has once and for all dealt with its sovereign crisis. The crisis will in our view linger with markets likely to test the EFSF firepower.

Beskar

08-03-2011, 17:33

It just isn't fair! Why won't people throw their money at lost causes to chase a political half-baked plan?

Or don't tie in the government system to the stockmarket, so governments cannot be toppled due to outside economic interests.

no, what is truly moronic is that europe created an economic structure which did not share a political commitment from the rich nations to buttress the poor nations in times of ill.

Similar to the fiscal union of the USA ?

Furunculus

08-03-2011, 17:44

Similar to the fiscal union of the USA ?

if only it was.

america has a true transfer union on a scale that would make german taxpayers boil with rage, but it causes no fuss because their is the political commitment to stand behind that liability:

http://www.economist.com/node/21524887

Adrian II

08-03-2011, 18:26

that. is . why. the. yield. on. british. ten. year. bonds. is. only. 2.75%!

It's 2.21 according to Bloomberg, and it's down from 3.99% last month...

Your thinking is altogether too wishful for my taste.

AII

Vladimir

08-03-2011, 18:43

Or don't tie in the government system to the stockmarket, so governments cannot be toppled due to outside economic interests.

Sorry to pile on but your statements just seem like more anti-capitalistic rants. Stocks have proven to be a reliable way to generate wealth. It is the public sector's responsibility to provide for sound fiscal/monetary policy. Unfortunately, on both sides of the pond they're more concerned with maintaining power by trying to appease the electorate. And even that isn't the whole of it.

Kagemusha

08-03-2011, 19:46

Furunculus

08-03-2011, 20:03

Or don't tie in the government system to the stockmarket, so governments cannot be toppled due to outside economic interests.

lol, when governments decide not to buy their debt from the markets, we can have a nice bureaucratic system where the markets don't get to make an assessment of the ability to repay that debt.

let me know when that happens, and which unicorn is farting out rainbow dollars to buy it with!

Furunculus

08-03-2011, 20:04

To me it is quite clear that we need to implement a version of currency transaction tax. It is the only way of taking back the market. Or atleast make it somehow benefitial to the tax payers who are right now pouring money to the pockets of speculators.We can pump our last penny to the countries in trouble, but the effect is quite different then the expected outcome.

we have for some time, it's called capital gains tax. we even got creative recently and invented an extra bank tax to pile on top of it.

on the other hand, i do have a great deal of sympathy with those objecting to the use of taxpayers money being used to subsidise the losses of public and private institutions.

we should perhaps just let them fail, it is a novel idea know as insolvency/default. :D

rory_20_uk

08-03-2011, 20:11

Or don't tie in the government system to the stockmarket, so governments cannot be toppled due to outside economic interests.

That would be fine... Except that the party with the most to loose there would be Labour as the concept of "fiscal surplus" is heretical, and they have done sterling work in creating the massive deficit we have.

A system of bonds on infrastructure might have been an idea: money is raised from the Market to purchase something, let's say a power plant for convenience. The ROI is calculated to be 20 years. After that the state has the powerplant to use for the rest of its life. The investors get a profit with a rock-solid backing. The state ends up with more infrastructure which then generates revenue. Same could be done with ports, airports and probably loads of other things.

As Vladimir says, the main reason for massive deficits is political cowardice. In the USA, roads are supposed to be repaired based on a petrol tax. The tax has not increased since 1993 and hence the system is almost bust. If politicians lived up to the name (men of the city i.e. there to help, not help themselves) this would be a non-issue - more money is required therefore the tax on petrol needs to increase if this is to remain the method of funding the system; infrastructure would be planned, not built based upon which Senator manages to get money thrown in their direction for voting the "right" way on one project or other.

Debt allows all major decisions to be put off until a comfortable point in the future. It reminds me of Homer Simpson purchasing a car and the dealer going over the terms of finance - low monthly cost with a MFP massive final payment at the end. "But that's a long way off, right?" was Homer's only question.

The Markets have a perversely positive effect (albeit too rarely) in forcing austerity through Parliaments who would rather Panem et Circundas for a few more years. After all, who else is going to manage to enforce fiscal responsibility? Certainly not the voters!

~:smoking:

Kagemusha

08-03-2011, 20:29

we have for some time, it's called capital gains tax. we even got creative recently and invented an extra bank tax to pile on top of it.

on the other hand, i do have a great deal of sympathy with public money being used to subsidise the loses of public and private institutions.

we should perhaps just let them fail, it is a novel idea know as insolvency/default. :D

In a Global economy, it doesnt matter one bit of certain country has a capital gain tax. It has to be global to have any real meaning as money can be circulated freely. If the economy is Global, so must the rules be.I am quite sure that if and when the day comes that Euro might dissolve, your smirk will be viped off from your face quite fast. If you think that individual economies are not dependant of others these days, you have quite the surprise heading your way.

Furunculus

08-03-2011, 22:44

In a Global economy, it doesnt matter one bit of certain country has a capital gain tax. It has to be global to have any real meaning as money can be circulated freely. If the economy is Global, so must the rules be.I am quite sure that if and when the day comes that Euro might dissolve, your smirk will be viped off from your face quite fast. If you think that individual economies are not dependant of others these days, you have quite the surprise heading your way.

there are plenty of nations that cope just fine without being in a currency union, the vast majority of them in fact.

regardless, i won't smirk if the euro collapses because it will lead to misery, not least in britain, but i will be more than happy to shout "told you so" to all the fools who put political union before economic reality.

Kagemusha

08-04-2011, 19:08

lol, when governments decide not to buy their debt from the markets, we can have a nice bureaucratic system where the markets don't get to make an assessment of the ability to repay that debt.

let me know when that happens, and which unicorn is farting out rainbow dollars to buy it with!

What a laugh.Today the European central bank started buying the debt of various Eurozone countries. I dont think you really understand how serious the situation is.

gaelic cowboy

08-04-2011, 19:19

What a laugh.Today the European central bank started buying the debt of various Eurozone countries. I dont think you really understand how serious the situation is.

Problem is though tis only the bonds from Ireland, Portugal and Greece, the bonds on sale lately are Spanish and Italian whereas the bonds the ECB is buying are apparently from the secondary market and not from government debt auctions.

In other words buying PIG on the secondary debt market does not help Italy and Spain one bit.

Kagemusha

08-04-2011, 19:25

Problem is though tis only the bonds from Ireland, Portugal and Greece, the bonds on sale lately are Spanish and Italian whereas the bonds the ECB is buying are apparently from the secondary market and not from government debt auctions.

In other words buying PIG on the secondary debt market does not help Italy and Spain one bit.

Maybe there are reasons why Barroso is pushing the eurozone governments to implement the chances into EFSF, agreed last month. Spain has comparable size GDP then for example Russia. Italy is bigger.The central bank just cant buy enough of their debt. It is impossible. What they are trying to do is to stop the domino effect before it reaches Spain and Italy.

gaelic cowboy

08-04-2011, 20:03

I hate to say it but I said at the start of the thread that this craic was not workin, the bailouts were either not big enough in Greece's case or they put too much austerty on the takers of such koolade.

In other words they sleepwalked into this when it should have been closed off ages ago.

Furunculus

08-04-2011, 20:21

What a laugh.Today the European central bank started buying the debt of various Eurozone countries. I dont think you really understand how serious the situation is.
don't you appreciate my gallows humour?

of course i realise how serious it is, but it was caused by the stupidity of a political project lacking any sensible economic reality, so when it crashes i merely want the guilty publicly vilified so that future stupidity is curbed.

remember the purpose of the eu was to bring us together as a happy family; has the euro served this end?

if the purpose of the european project was to create a happier europe, more at ease with its neighbours and less prone to industrial warfare, at what point did the means become confused with the ends?

To the point where ever-deeper-union is deemed to be a good thing regardless of the fact that it is now leading to a less happy europe, because the model of governance is percieved to be less representative and less accountable!

drone

08-04-2011, 21:42

I think it's all lined up now. The US will become isolationist as it goes through the pain of the current economic crisis. Tensions in Europe will get higher and higher as the bailouts wreak havoc across the continent and more extreme governments rise to power by exploiting the crisis. A war will eventually break out, engulf the former EU, allowing the US to pull itself out of the Depression Mark II via a massive military buildup and intervention.

I was wondering how we were going to get out of this mess. ~D

Furunculus

08-04-2011, 23:04

ECB THROWS ITALY AND SPAIN TO THE WOLVES:

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8682852/The-ECB-throws-Italy-and-Spain-to-the-wolves.html

who is the lender of last resort in the eurozone?

closely related to the kissinger'ism; when i want to call europe; who picks up the phone?

gaelic cowboy

08-04-2011, 23:22

Throwing Italy and Spain to the wolves wont feed them enough though will it, France would be next with maybe a bit of Belgian seasoning and suddenly the whole things is called P.I.I.G.U.B.S.

Now that is a economic mouthful indeed.

Lets be honest these bailouts were all about preventing Spain and Italy suffering any problems, we can now say for sure that it has not worked at all.

Adrian II

08-04-2011, 23:26

ECB THROWS ITALY AND SPAIN TO THE WOLVES:

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8682852/The-ECB-throws-Italy-and-Spain-to-the-wolves.html

who is the lender of last resort in the eurozone?

Maybe Willem Buiter is right, he is a pretty sharp tool.

Portugese and Irish 10-year bond yields are an improbable 11%... maybe Trichet & Co thought they needed the money more.

However the real drama today was Wall Street where yields approached zero because everybody moved out of shares. This on the eve of a recession.

AII

gaelic cowboy

08-04-2011, 23:27

gaelic cowboy

08-04-2011, 23:31

Portugese and Irish 10-year bond yields are an improbable 11%... maybe Trichet & Co thought they needed the money more.
AII

Think about what that says in reality, the ECB does not even believe it would get it's ten yr bond money back if they bought them.

Furunculus

08-04-2011, 23:40

Maybe Willem Buiter is right, he is a pretty sharp tool.

Portugese and Irish 10-year bond yields are an improbable 11%... maybe Trichet & Co thought they needed the money more.

However the real drama today was Wall Street where yields approached zero because everybody moved out of shares. This on the eve of a recession.

AII

agreed, i read his 2050 report for citi-group a while back and it made pretty compelling reading:

http://www.nber.org/~wbuiter/3G.pdf

Adrian II

08-04-2011, 23:45

Oh, this is beautiful (http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8682558/Standard-and-Poors-and-Moodys-face-Italian-raids.html). The heat is on now.

Tehehhh.. :rolleyes:

AII

Furunculus

08-04-2011, 23:59

it will b useful provided the markets believe the accusations that the ratings agencies have seriously misbehaved.

if they don't, if they see it as further evidence of the EU trying to bend reality then the punishment will be swift!

Adrian II

08-05-2011, 00:06

it will b useful provided the markets believe the accusations that the ratings agencies have seriously misbehaved.

In Berli's Italy? Seeing how that clown turned Italian justice into his own private circus I can't see anyone believing any of their charges.

AII

Philippus Flavius Homovallumus

08-05-2011, 01:36

Oh, this is beautiful (http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8682558/Standard-and-Poors-and-Moodys-face-Italian-raids.html). The heat is on now.

Tehehhh.. :rolleyes:

AII

Where's Loius to shout "FACIST" when you need him?

The solution is now clear for the Northern EU, cut and run. If Greece is eating it's own economy then it's slide into decrepitude will hurt less if it is divorced from the EU, it's demise will harm the Euro less and its hungry citizens will be shut out of the labour market of the rest of Europe.

Honestly, what were they thinking? A currency Union between soveriegn states, in this day and age? madness.

In the long term, I suspect war with Russia or China is more likely than within Western and Central Europe, the Cold War won't have properly ended until it heats up and burns off, just like World War I someone needs to really feel thw pain of losing. Wether that will happen in ten, twenty, or thirty years though is another matter.

China is toast, its middle class is a tiny proportion of its overall population compared to Western Countries but it is mobalising against a corrupt and overstretched state which has tried to monopalise power and industrialise too quickly. India is in similar, but less severe, straits. Rusiia will be fine so long as Vladamir I remains in control (honestly, why doesn't he just take the crown already - be Augustus not Caesar), but after he dies or is deposed all bets are off.

The West needs to accept that "Lower Middle Class" means "Lower Class", pay people less and tell them to accept that tommy can't have an XBox for Christmas because they are poor - then maybe we can finally address the underlying trade deficit with the East. We also need to start punishing companies that feel they have an entitlement to work by letting them go bust. If Bombadier wanted the Thames Link contract they should have cut costs or raised quality, not bitched about it going to the Germans.

Rant over.

In conclusion, some of us will likely become poorer in the coming years, some will not. We are still wealthier than large parts of the Near, Middle and Far East, and Africa. There is no particular reason why Western Ecomonic, military, and cultural dominace should not endure for another century, but the pecking oder will probably change somewhat. Time to teach your children New World Spanish and Portugese - not Mandarin.

Adrian II

08-05-2011, 07:45

The solution is now clear for the Northern EU, cut and run. If Greece is eating it's own economy then it's slide into decrepitude will hurt less if it is divorced from the EU, it's demise will harm the Euro less and its hungry citizens will be shut out of the labour market of the rest of Europe.

Cut Greece out of the EU, let them slip into oblivion? What irresponsible nonsense. We should encourage them to leave the eurozone, if only temporarily, which is something totally different. They could take the Argentinian road - restructure, devaluate and recover - and their exports would be as welcome as their workers just as they were before this crisis. EU structural funds could help them meet the conditions for a new take-off. That would benefit all of us instead of a Greek shut-out.

AII

Furunculus

08-05-2011, 08:00

two sides of the same coin?

but yes, we should let them know we'll break the rules (what again!) and let them out if that is there wish.

Brenus

08-05-2011, 08:06

“What a laugh. Today the European central bank started buying the debt of various Eurozone countries. I don’t think you really understand how serious the situation is.”
We have to laugh.
Finally the ECB is doing what the US Fed. Bank was doing and what it should have done when the Greek Debt started. I am not sure that the ideological Conservative Economical Policy understands its failure, but the system based on greed where Banks rule is going to end.
How? I hope that the usual way to resolve such crisis (war) won’t happen.
It could have been resolved one year ago, but the Treaty of Lisbon, Armed Arm of the IMF, the European Autocracy and the ECB, who sold themselves to the Banksters, forbids it.
The Asian market is going down.

Time to apply the Article 35 of the 1793 Universal Declaration of Human Rights: "Quand le gouvernement viole les droits du peuple, l'insurrection est pour le peuple et chaque portion du peuple le plus sacré des droits, et le plus indispensable des devoirs"
When the Government assaults (French word is “rape”) the rights of the People, insurrection is for the People and every part of the People the most sacred of the Rights and the most indispensible of the duties.

Hopefully it will be done by vote.
“Que se vayan todos”

Adrian II

08-05-2011, 08:07

two sides of the same coin?

but yes, we should let them know we'll break the rules (what again!) and let them out if that is there wish.

Some of us try to think in terms of solutions. And there is nothing illegal in opting out of the eurozone.

By the way, have you read the remarks of Chinese foreign minister Yang? He says the risks of US government bonds are 'escalating' and an internationally coordinated effort is necessary to stop the free fall of markets. Why does it take a Chinese to tell the West to gets its act together when it's been obvious for so long that decisive leadership is called for?

AII

Furunculus

08-05-2011, 09:25

Time to apply the Article 35 of the 1793 Universal Declaration of Human Rights: "Quand le gouvernement viole les droits du peuple, l'insurrection est pour le peuple et chaque portion du peuple le plus sacré des droits, et le plus indispensable des devoirs"
When the Government assaults (French word is “rape”) the rights of the People, insurrection is for the People and every part of the People the most sacred of the Rights and the most indispensible of the duties.

sounds similar to the british concept of lawful rebellion derived from the magna-carta.

Furunculus

08-05-2011, 09:29

Adrian II

08-05-2011, 09:43

there is no legal mechanism with which to use for withdrawal purposes, acquis communitairre - once power is given it does not come back:

Oh, I suppose Greece could withdraw tomorrow if they wanted. The opt-out would be introduced in a new treaty with Greece which could be ratified by morning. The Germans have been pushing them to do just that for over a year. It would certainly be best for all parties concerned. And I'll be happily spending my Drachmes on their islands.

AII

Louis VI the Fat

08-05-2011, 09:51

Where's Loius to shout "FACIST" when you need him?Ermm...'Berlusconi is a fascist!'

There.

Or did you expect me to call Adrian a fascist for questioning why Italy started a criminal invetigation into ratings agencies?
(Well mind that I'm not sure the agencies aren't self serving criminals. Brenus is right. I'm going to get some Greeks together and charge a bank. We need some heads on some pikes, just to gt even.)

Papewaio

08-05-2011, 09:52

there is no legal mechanism with which to use for withdrawal purposes, acquis communitairre - once power is given it does not come back:

Law only has reach as far as it has the power and more importantly the will to enforce it.

Is the rest of the EU going to war with Greece to make Greece stay? No
Is the rest of the EU going to cut off all economic ties with Greece if it leaves? No
Does Greece lose some trading and prosperity by leaving the EU? Yes (As does the EU in the long term).

The problem that I can see with these debts, is that some countries are expected to maintain the workforce, others are expected to maintain blackmarkets, low taxes and welfare states... seems a bit rich to me.

Papewaio

08-05-2011, 09:54

I'm going to get some Greeks together and charge a bank.

So you now have my interest that you are going to charge a bank. All credit to you and may your victory be stirling gold.

Adrian II

08-05-2011, 09:55

Is the rest of the EU going to war with Greece to make Greece stay? No
Is the rest of the EU going to cut off all economic ties with Greece if it leaves? No

Indeed. But both EU nations and private investors could sue the behind off Athens if they opt out in a chaotic and one-sided manner.

AII

Louis VI the Fat

08-05-2011, 09:55

rory_20_uk

08-05-2011, 09:56

Some of us try to think in terms of solutions. And there is nothing illegal in opting out of the eurozone.
By the way, have you read the remarks of Chinese foreign minister Yang? He says the risks of US government bonds are 'escalating' and an internationally coordinated effort is necessary to stop the free fall of markets. Why does it take a Chinese to tell the West to gets its act together when it's been obvious for so long that decisive leadership is called for?

The West isn't used to the concept of decisive leadership. I am sure that the Chinese bicker behind the scenes but unlike the Chinese there are few hard decisions that are made in the end.

Hopefully it will be done by vote.

Vote in the EU? Heresy! Chances are there would not have been a EU if things were voted on.

Cut Greece out of the EU, let them slip into oblivion? What irresponsible nonsense. We should encourage them to leave the eurozone, if only temporarily, which is something totally different. They could take the Argentinian road - restructure, devaluate and recover - and their exports would be as welcome as their workers just as they were before this crisis. EU structural funds could help them meet the conditions for a new take-off. That would benefit all of us instead of a Greek shut-out.

So, just to recap: Greece broke almost every rule to get into the EU. They spent money like water whilst in the EU. Why would the EU welcome Greece back again?
And how exactly is Greece leaving the EU "willingly" going to be better than to be thrown out? Would Greece magically balance their budget? Either way, their standard of living would crash as everything from fuel to food is imported. What is Greece placed to do or grow? Poor infrastructure, little decent farmland, few mineral recources, a creaking bureaucracy and apart from tourism what do Greeks do?

~:smoking:

Adrian II

08-05-2011, 09:57

My usal mantra is 'the world is changing'.

This no longer applies. 'The world has changed' is more lik it. Eurpe and America are ran by coardly politicians. The world is looking to Being for leadership. If anything, Being is too timid, to unbelieving of what it sees. Still, at the moment China is a bstion of stability nd sanity, an anchor to the world.

Yeah, and ur blind drunk mate :mellow:

AII

Papewaio

08-05-2011, 09:59

Indeed. But both EU nations and private investors could sue the behind off Athens if they opt out in a chaotic and one-sided manner.

AII

You can only sue what someone has. What happens if they have a revolution? Does the debts transfer from the enemy prior state to the new revolutionary one?

Could just be a bloodless Coup... they can go to Fiji for lessons...

Adrian II

08-05-2011, 10:04

Why would the EU welcome Greece back again?

Because it is in everyone's s interest to have them back once they have cleaned up their act and once we have cleaned up the eurozone act. Both acts will be pretty tough in a world where all the richest nations now have national debts amounting to between 60% and 150% of GDP.

And like I said, Greece should follow the Argentinian example: restructure, devaluate (Drachme) and restore growth. If you have a better plan, I'm all ears. If you just want to bash Greece for the umpteenth time in this thread, I should tell you it's not impressive as an economic insight.

AII

Furunculus

08-05-2011, 10:19

Oh, I suppose Greece could withdraw tomorrow if they wanted. The opt-out would be introduced in a new treaty with Greece which could be ratified by morning. The Germans have been pushing them to do just that for over a year. It would certainly be best for all parties concerned. And I'll be happily spending my Drachmes on their islands.

Law only has reach as far as it has the power and more importantly the will to enforce it.
Is the rest of the EU going to war with Greece to make Greece stay? No
Is the rest of the EU going to cut off all economic ties with Greece if it leaves? No
Does Greece lose some trading and prosperity by leaving the EU? Yes (As does the EU in the long term).

this is a core problem for europe, there is no market certainty because the economic rules changes whenever they don't fit the political mould.

do i invest in country X?

how many times have they defaulted on their debts in the last 100 years?
how many times have they nationalised their economies in the last 100 years?
how many times have they created temporary punitive taxes in the last 100 years?

hell no, I'll put my money elsewhere and they can whistle for foreign direct investment!

so yes, they can and probably will tear up the rule-book (AGAIN, AND AGAIN, AND AGAIN), but they will pay a price.

and remember, this regulatory and legislative uncertainty, with the economic price that comes attached, is only inevitable because the EU is a retarded construct predicated on the belief that political will can trump economic and social reality.

why would germans pay for greeks?
why would germans pay for greeks, knowing what it costs as they are still paying for (east) germans?
why would germans pay for greeks, knowing that it will only lead to them paying for spaniards and italians?

why would markets believe that germans will pay to prevent greek default when greek debt is reduced by only 15% rather than the 70% necessary?
why would markets believe that germans will pay to prevent greek default when there isn't even agreement on how and when the rescue tools can be used?
why would markets believe that germans will pay to prevent greek default when the economic firepower of the EFSF is one quarter of what it needs to be?

remember, if YOU supported warm cuddly concepts like ever-deeper-union and thus provided cover for politicians to act in ways inimical to the interests of broader society then YOU share part of the blame for the ensuing disaster! this is an indirect representative democracy, and it means you accept, in part, responsibility for the actions taken in your name!

remember this question:

if the purpose of the european project was to create a happier europe, more at ease with its neighbours and less prone to industrial warfare, at what point did the means become confused with the ends?

to the point where ever-deeper-union is deemed to be a good thing regardless of the fact that it is now leading to a less happy europe, because the model of governance is percieved to be less representative and less accountable!

a lot of people are going to be asking this question in twelve months time, and if it turns into a nasty bout of McCarthyism I will be laughing at those who find the scrutiny uncomfortable!

Furunculus

08-05-2011, 10:40

on the subject of witchhunts, let's remind ourselves of the luminaries the advocated britain joining this rank idiocy:

"The reality of the euro has exposed the absurdity of many anti-European scares while increasing the public thirst for information. Public opinion is already changing as people can see the success of the new currency on the mainland." (Ken Clarke, 2002)

"The euro, despite gloomy predictions from anti-Europeans, has proved to be a success. We cannot afford to be isolated from our biggest and closest trading partner any longer." (Charles Kennedy, 2002)

"If we get rid of sterling and adopt the euro, we will also get rid of sterling crises and sterling overvaluations. This will give us a real control over our economic environment." (Chris Huhne, 2004)

"The euro has done more to enforce budgetary discipline in the rest of Europe than any number of exhortations from the IMF or the OECD." (Nick Clegg, 2002)

"If we stay out, the price we will pay in lost investment and jobs would be incalculable." (Peter Mandelson, 2002)

InsaneApache

08-05-2011, 10:43

If Greece leaves or is kicked out, do we get our money back?

Thought not.

Easy throwing money about when it isn't yours.

I despair.

Someones been reading the Telegraph. :wink:

Furunculus

08-05-2011, 10:47

If Greece leaves or is kicked out, do we get our money back?

Thought not.

Easy throwing money about when it isn't yours.

I despair.

Someones been reading the Telegraph. :wink:

God love Mr Hannan, a voice of sanity amid the shrieking of fools!

------------------------------------------

Dr Holger Schmieding of Berenberg bank on the ECB's half hearted attempt to calm markets by buying Portuguese and Irish debt:

If it really turns out that the main ECB response to a major Italian emergency is to buy a limited amount of Portuguese and Irish bonds, then yesterday’s ECB decision may go down in history as its worst blunder yet. What would we make of a fire brigade that responds to a major emergency but then drives to the wrong place and refuses to turn around and douse the real fire?

------------------------------------------

a few from the economist:

http://www.economist.com/node/21525396
http://www.economist.com/node/21525403

rory_20_uk

08-05-2011, 11:03

Because it is in everyone's s interest to have them back once they have cleaned up their act and once we have cleaned up the eurozone act. Both acts will be pretty tough in a world where all the richest nations now have national debts amounting to between 60% and 150% of GDP.

And like I said, Greece should follow the Argentinian example: restructure, devaluate (Drachme) and restore growth. If you have a better plan, I'm all ears. If you just want to bash Greece for the umpteenth time in this thread, I should tell you it's not impressive as an economic insight.

Possibly the "bashing" might be linked to Greece not having an A1 political or economic system...?

Yet you blithely talk about leaving, defaulting on a host of debts, following a country with a vastly different situation then expecting the world to have group amnesia and to welcome Greece back as it is in "everyone's interest". It wasn't in everyone's interest the first time round, why suddenly improve the second?

Greece either "decides" or is forced to leave after wasting billions of other people's money. They (as you suggest) default on their debts, freezing themselves from the bond market for at least a decade.

Their new currency will be worth a hell of a lot less: the country has just defaulted, most of their banks are insolvent. Possibly peg it to the Euro at a much lower value.

Given the reputation of Greeks to riot and even firebomb banks when something far less catastrophic happens, we can expect a LOT of troubles. They blockaded the ports when the government threatened to allow foreign travel operators to dock. This is a lot worse.

Sadly, most food is imported which will be a hell of a lot more expensive, given the Unions realise that political point scoring or not, people need to eat.

Things eventually settle down. Standards of living are a lot lower, prices are a lot higher. If Greece is lucky, some structural changes have been brought in to make things cheaper. Hell, if Liberia can try to sort things out, surely Greece will eventually.

Then they want to rejoin the EU...

They gain:

A stronger currency
Access to other people's money in development funds

The EU gains:

What, exactly?

~:smoking:

InsaneApache

08-05-2011, 13:17

Chipero, ouzo, raki and a lamb kebab.

Furunculus

08-05-2011, 14:18

More Buiter:

http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100011278/please-europe-either-put-up-or-break-up/

As Citi’s William Buiter told me yesterday, the issue is not how long Italy and Spain can ride out the storm in bond markets. There would be a banking and insurance crisis long before sovereign defaults came into play simply because the fall in bond prices on the secondary market is causing carnage to bank books (among other transmission mechanisms).

Kagemusha

08-05-2011, 14:39

How long again it was when i said that the entire Southern Europe should be kicked out from EMU? What ever Greece does, is too late now. If Spain or Italy will fall. Euro falls. Eurozone is the largest market in the world. US with their monopol money should understand that. US consumption cant carry the world production alone. If Euro falls, Asia falls, if Asia falls, the base of our consumption society falls. Everything falls.

Furunculus i appreciate your black humour and sarcasm, but to be honest. This is beyond who is right and not a laughing matter, when the possible effects can be beyond terryfying. My bet is that we are crash coursing into something 30´s recession pales in comparison. What you are wrong is that in your world view the market controls the world and not the people living in the world. That is exactly the line of thinking that has got us into this mess. We do not exist in order to please the "market".

If the decision makers of EU have any sense in them, they should start thinking seriously of cancelling certain national debts. After that the big Europeans who would like European integration to happen, should kick each and everyone breaking the EMU out from it. Then it can be tried to be built again with some sense this time.

The dream of deep integration of Europe cant cost us everything. The decision makers need to stop being hungry for larger then life goals and start to concentrating at things that can be actually achieved.

Meaning in very short period countries using Euro should only be Germany, Nordic countries, Benelux countries, Austria and France. These are the countries that can actually control their economical policies enough.

Furunculus

08-05-2011, 14:56

Furunculus i appreciate your black humour and sarcasm, but to be honest. This is beyond who is right and not a laughing matter, when the possible effects can be beyond terryfying. My bet is that we are crash coursing into something 30´s recession pales in comparison. What you are wrong is that in your world view the market controls the world and not the people living in the world. That is exactly the line of thinking that has got us into this mess. We do not exist in order to please the "market".

Indeed we do not exist to please the market, but one cannot ignore economic and social reality when building political institutions. If the EU wanted a federal europe it should have said so, and built slowly from a small northern core. But no, the ambition was unwanted by the peoples of europe, so it had to apply to everybody in order that there be no 'bad' examples, and it had to be done a-la death by a thousand cuts in order that there was no one great act that people could point to. They made that mistake with lisbon, not again. And thus do you arrive at the idiocy today, all from trying to bend reality!

If the decision makers of EU have any sense in them, they should start thinking seriously of cancelling certain national debts. After that the big Europeans who would like European integration to happen, should kick each and everyone breaking the EMU out from it. Then it can be tried to be built again with some sense this time.
Sovereign default?

The dream of deep integration of Europe cant cost us everything. The decision makers need to stop being hungry for larger then life goals and start to concentrating at things that can be actually achieved.
Very much agreed.

Meaning in very short period countries using Euro should only be Germany, Nordic countries, Benelux countries, Austria and France. These are the countries that can actually control their economical policies enough.
or the other way around, the economically germanic countries leave the euro and let france control the rump Mediterranean currency union?

Kagemusha

08-05-2011, 14:59

Indeed we do not exist to please the market, but one cannot ignore economic and solial reality when building political institutions. If the EU wanted a federal europe it should have said so, and built slowly from a small northern core. But no, the ambition was unwanted by the peoples of europe, so it had to apply to everybody in order that there be no 'bad' examples, and it had to be done a-la death by a thousand cuts in order that there was no one great act that people could point to. They made that mistake with lisbon, not again. And thus do you arrive at the idiocy today, all from trying to bend reality!

Sovereign default?

Very much agreed.

or the other way around, the economically germanic countries leave the euro and let france control the rump Mediterranean currency union?

See in the end we almost agree,it is just matter of view point, but leaving France to pay the bankrupcy that is Southern Europe would be beyond unfair. Though somehow am i still hearing an echo of 100 years war in that statement?

Or maybe all the European countries should understand better and let Finland decide everything. Indoeuropeans have had their shot with Europe, time for the Finno Ugrians to step in and save the day.:clown:

Furunculus

08-05-2011, 15:01

let it be noted that france is terrified of germany right now, the EU was constructed to contain the might of a reunited germany, it was the price that was demanded for unification in fact.

but, by the karlsruhr demanding bundestag involvement in european cash transfers, during a period where cash transfers are essential and germany the only country that can bankroll it, germany has become the defacto hegemon of europe.

what it demands others must comply, or angry german MP's will turn off the taps. germany is holding a hun to everyone's head 24/7, and no-one can do anything about it.

this was not how it was supposed to end, zut alors!

http://www.stratfor.com/weekly/20110725-germanys-choice-part-2

Furunculus

08-05-2011, 15:11

See in the end we almost agree,it is just matter of view point, but leaving France to pay the bankrupcy that is Southern Europe would be beyond unfair. Though somehow am i still hearing an echo of 100 years war in that statement?

not at all, without the germanic economies (not peoples, so including finland), the euro could devalue its way back to competitiveness.

Kagemusha

08-05-2011, 15:11

Furunculus

08-05-2011, 15:25

We should understand that Euro is roughly equal of Deutche mark, Germany is the economically strongest country in Europe and this is of course only my matter of view, but from the big uns, the most sensible, because of things of past, Germans cant be proud of anything, but in the end.They are paying the bills of Europe.

That is the problem, Germany strength drags the euro up making other nations less competitive than their natural position would provide for.
That they pay the bills has been taken for granted, but german people are no longer willing to be taken for granted, especially not when they are already well aware how these emergency and temporary measures have a way of becoming routine and permanent. they have already paid 187 billion euros into the former GDR with no sign of an end, they won't do it for anyone else on top.

Germany is maybe the most efficient big country in the world, 4th largest GDP in the world with only 80 million people. France could be just like Germany, but they love life too much for that, which in the end might be better way of life, while as protestant Northern European i should not admit that, i bet secretly our German members think the same.

the answer that they should just be a little more relaxed (lazy?) just isn't a possibility for a country facing the demographic decline germany is, britain will be a bigger economy by 2050!

Now UK, i just dont understand what they want. They dont want to be European, while they want to be European.Oxymoron for me. If all three could commit equally to EU, there might be one last golden age in the future for Europe.In any case time is passing us anyway.

we were never european, it was merely judged necessary to be on the inside to stop you continentals making a hash of it, and tolerance is wearing thin for even that objective. :)

Kagemusha

08-05-2011, 16:20

That is the problem, Germany strength drags the euro up making other nations less competitive than their natural position would provide for.
That they pay the bills has been taken for granted, but german people are no longer willing to be taken for granted, especially not when they are already well aware how these emergency and temporary measures have a way of becoming routine and permanent. they have already paid 187 billion euros into the former GDR with no sign of an end, they won't do it for anyone else on top.

the answer that they should just be a little more relaxed (lazy?) just isn't a possibility for a country facing the demographic decline germany is, britain will be a bigger economy by 2050!

we were never european, it was merely judged necessary to be on the inside to stop you continentals making a hash of it, and tolerance is wearing thin for even that objective. :)

Do you want to make a bet if UK will be stronger then Germany economically 2050? Im betting Germany. Well at this point i could tell you that scandinavia is basically an Island and Finland not even part of it. For the last decade we have been most of the time the most competetive economy of the world, while we dont have any natural resources to speak off, but then on the other hand we are spending like grazy to education and social mobility. So what we have is human resource.
I could pull of the card of Nordic Union, but we lost that chance back at ninetees when i was advocating that. Think of Union of Sweden, Finland,Denmark, Norway, Iceland and possibly Estonia. We would have our own valhalla, but no. We are now spending like grazy so the rest of Europe would prosper. In the end i think that is the right thing to do. Nationalism will not get us anywhere, unless some idiot decides to invade us. The future of Europe should be Europe, but only if there is real thrive for it, you cant force integration.

Vladimir

08-05-2011, 16:35

Or maybe all the European countries should understand better and let Finland decide everything. Indoeuropeans have had their shot with Europe, time for the Finno Ugrians to step in and save the day.:clown:

I still say let Norway run the show but take away their longboats just to be sure. :viking:

Kagemusha

08-05-2011, 18:10

I still say let Norway run the show but take away their longboats just to be sure. :viking:

Norway has Oil, Sweden has Iron, we have mosquitos and lakes, better trust us!:laugh4: EDIT: Oh sorry i forgot Denmark has pigs, and Iceland cod, Estonia has lot of Russians. Still the point is valid. ;)

Philippus Flavius Homovallumus

08-05-2011, 20:03

Ermm...'Berlusconi is a fascist!'

There.

Thanks I feel better. I'm sure the Ratings agencies are deeply immoral, by principle, but I doubt they are legal criminals. They don't need to be.

Law only has reach as far as it has the power and more importantly the will to enforce it.

Is the rest of the EU going to war with Greece to make Greece stay? No
Is the rest of the EU going to cut off all economic ties with Greece if it leaves? No
Does Greece lose some trading and prosperity by leaving the EU? Yes (As does the EU in the long term).

The problem that I can see with these debts, is that some countries are expected to maintain the workforce, others are expected to maintain blackmarkets, low taxes and welfare states... seems a bit rich to me.

If Greek actions were seen to threaten the beloved EU project then Greece would be punished diplomatically and financially. This has already happened, with the terms of the first bailout Greece was whipped sagagely for what appears to have been percieved moral weekness.

Cut Greece out of the EU, let them slip into oblivion? What irresponsible nonsense. We should encourage them to leave the eurozone, if only temporarily, which is something totally different. They could take the Argentinian road - restructure, devaluate and recover - and their exports would be as welcome as their workers just as they were before this crisis. EU structural funds could help them meet the conditions for a new take-off. That would benefit all of us instead of a Greek shut-out.

AII

EU structural funds? I'm not a fan of throwing good money after bad. The Greek people have thus far shown little inclination to swallow the pill, they have attacked the government instead. Part of Greece's problem is the percieved lack of political will, which is presumably also why Italy is now being punished more than Spain and Britain, which has managed to weld together a Wartime-style unity govenment committed to reducing the deficit, has thus far fared relatively well.

Until Greece shows a political will to recover the best that can, and should, be done for them is to remove them from the Euro so they can have a currency that reflects the state of their country. In the meantime we also need to avaid a mass exodus from Greece to the rest of the EU which will depress wages here to and thus harm our own populations.

Adrian II

08-06-2011, 21:40

More Buiter:

http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100011278/please-europe-either-put-up-or-break-up/

Buiter being on the mark again. I suppose he was already aware of the problems of RBS and other British banks which are directly relevant to the City. However the exact same thing applies to most European banks and institutional investors. The major Dutch pension fund ABP for instance is awash with Italian and Spanish bonds.

If and when this crisis hits the Neds, it'll be through our banks and institutionals again.

AII

Adrian II

08-06-2011, 21:52

The Greek people have thus far shown little inclination to swallow the pill, they have attacked the government instead.The Greeks are very aware of their institutional problems such as corruption and they are deeply dissatisfied with their political class. It is the same sentiment as moves quite a few members of this board like Rory or Furunculus. They demand nothing less than the complete clean-up that you are demanding.

Consider the fact that Greeks have been swallowing bitter pills sinds 2009. The itremendous budget cuts forced on them are bleeding the Greek economy dry and preventing the sort of recovery that would enable Greece to pay off debts. That is the real issue most Greeks have with the budget cuts.

Spare us the usual claptrap about corrupt Greeks having partied on the beaches on our costs for years. Greeks work more hours than northern Europeans, have fewer holidays, lower pensions, plus a very low minimum wage. All these figures can be gauged from Eurostat and OECD statistics.

AII

gaelic cowboy

08-06-2011, 22:31

If and when this crisis hits the Neds, it'll be through our banks and institutionals again.

AII

this is the key for me interbank lending NOT sovereign borrowing has caused this, the danger was let inflate and when it reared it's head in many cases it is too big to fail or survive.

Would anyone have cared about Greece defaulting if banks somewhere else didn't own the paper.

Boohugh

08-06-2011, 23:49

this is the key for me interbank lending NOT sovereign borrowing has caused this, the danger was let inflate and when it reared it's head in many cases it is too big to fail or survive.

Would anyone have cared about Greece defaulting if banks somewhere else didn't own the paper.

You can equally argue that the banks were just doing their job by lending money when asked for it by states. If governments didn't keep increasing the amount they borrowed, there wouldn't be such large amounts of debt for the banks to trade and lose so this whole issue wouldn't have appeared in the first place. The simple fact is the majority of western states were borrowing more money than they should have and rather unsurprisingly are now stuggling to pay it back after a recession hit.

Blaming the banks is like blaming the bullet for the blood pouring out of a wound. Yes, the bullet did the damage, but perhaps you need to look at who pulled the trigger.

gaelic cowboy

08-07-2011, 00:12

Ah I think were talking about different things here, when I say interbank lending it means where bank A lends money to bank B often in another country, the reason is the higher return involved.

Louis VI the Fat

08-07-2011, 01:21

We should understand that Euro is roughly equal of Deutche mark, Germany is the economically strongest country in Europe and this is of course only my matter of view, but from the big uns, the most sensible, because of things of past, Germans cant be proud of anything, but in the end.They are paying the bills of Europe.

Germany is maybe the most efficient big country in the world, 4th largest GDP in the world with only 80 million people. France could be just like Germany, but they love life too much for that, which in the end might be better way of life, while as protestant Northern European i should not admit that, i bet secretly our German members think the same.
Now UK, i just dont understand what they want. They dont want to be European, while they want to be European.Oxymoron for me. If all three could commit equally to EU, there might be one last golden age in the future for Europe.In any case time is passing us anyway.Hey! Let's not get too carried away with stereotypes. Germany, Finland, France and the United Kingdom all have a GDP per capita between $34k-$36. Exact rankings vary over time, but move mostly within a five percent bandwith. All still have a triple A (http://247wallst.com/2011/08/04/the-worlds-remaining-aaa-countries-and-those-that-are-at-risk-of-being-downgraded/) rating, the final twelve. As for debt and protestant prudence, German debt to GDP stands at 79%, French at 84% :shrug:
See, that's why France is the world's greatest country. Northern economic indicators combined with southern culture, quality of life, and lunchbreaks from 12 to 2. Which proves there is no God, for a benevolent god would not have created France so as not to reduce you all to the misery of envious despair.

With the UK not a member, and Italy and Spain in shambles, the Euro is carried at the momet by a French-German tandem, not by a German solo act. Or rather by the triple pillars of Germany, France and the small and medium powerhouses of Austria, Belgium, Netherlands, Finland etc.

Adrian II

08-07-2011, 07:43

Just when you think you've seen it all, Angela Merkel on Friday issued the following statement: 'Markets caused the drama. Now they have to make sure to get things straight again.'

This woman doesn't know her behind from a hole in the ground.

AII

Centurion1

08-07-2011, 07:56

classical_hero

08-07-2011, 08:53

Fragony

08-07-2011, 12:59

I am glad that i am not living in Europe or US right now, considering that we have only a debt as % of GDP of only 22.4%, well the US is not really in that bad of shape, if the Repubs get their act together.

Australia isn't an island, k it is but still, economies are way to intertwined for you not to be affected, what hits us hits you

Anyway, this is funny, skip the Dutch part http://www.geennieuws.com/2011/08/waarom-de-eu-nooit-iets-wordt/

Furunculus

08-07-2011, 16:29

Do you want to make a bet if UK will be stronger then Germany economically 2050? Im betting Germany.
Yes:
http://www.carnegieendowment.org/files/World_Order_in_2050.pdf
No:
http://www.google.co.uk/url?sa=t&source=web&cd=1&ved=0CBkQFjAA&url=http%3A%2F%2Fwww.research.hsbc.com%2Fmidas%2FRes%2FRDV%3Fao%3D20%26key%3Dej73gSSJVj%26n%3D282364 .PDF&rct=j&q=HSBC%20the%20world%20in%202050%20pdf%5D&ei=4813TYTFFYy4hAfppaH-Bg&usg=AFQjCNFz0oZr7CF02AJkNDddtW2HyznvrQ&cad=rja&cad=rja
Yes:
http://www.nber.org/~wbuiter/3G.pdf

two out of three eh, why yes, i think i'll take that bet.

The future of Europe should be Europe, but only if there is real thrive for it, you cant force integration.

quite, that is the problem precisely!

---------------------------------------------------------------------

eight things the eurozone needs to do, today, and won't:

http://www.johnredwoodsdiary.com/2011/08/07/the-euro-meeting-that-should-be/

Furunculus

08-08-2011, 10:31

re my previous question; at what point did europe forget that deeper-union was a a means to an end, not the ends in itself -

http://www.economist.com/node/21524818

How much more fiscal and political integration does the euro need? Nobody knows. Are citizens ready to give up more sovereignty to save the euro? Nobody has asked them. The more leaders try to fix the euro’s flaws the more they risk exposing a flaw in the European Union itself: a project of European integration that lacks a strong democratic mandate.

Furunculus

08-08-2011, 11:28

It's 2.21 according to Bloomberg, and it's down from 3.99% last month...

Your thinking is altogether too wishful for my taste.

AII

i'm pretty sure it remains in the 2.7% benchmark:

http://ftalphaville.ft.com/blog/2011/08/08/646266/france-will-feel-the-impact-of-usaa/

Philippus Flavius Homovallumus

08-08-2011, 11:49

Nigel Farage:

https://www.youtube.com/embed/UPn07X3lJBk

You can see nobody listening.

*Sigh*

Vladimir

08-08-2011, 14:16

Nigel Farage:

https://www.youtube.com/embed/UPn07X3lJBk

You can see nobody listening.

*Sigh*

All this guy does is complain but I love to hear him speak.

I want to see this guy live in concert.

Philippus Flavius Homovallumus

08-08-2011, 14:35

All this guy does is complain but I love to hear him speak.

I want to see this guy live in concert.

He called it though, didn't he? Greece, Ireland, Portugal, Spain, unable to adapt and devalue their currancies.

He's also right about rising anti-EU nationalism.

Two years ago I would have called him a crock, but increasingly I think he has been right all along about one thing, the fatal lack of consent.

Vladimir

08-08-2011, 17:31

He called it though, didn't he? Greece, Ireland, Portugal, Spain, unable to adapt and devalue their currancies.

He's also right about rising anti-EU nationalism.

Two years ago I would have called him a crock, but increasingly I think he has been right all along about one thing, the fatal lack of consent.

That's another reason why I like him. The problem is, as I see it, that he doesn't have any solutions. If he does, he's not able to implement them. His party affiliation makes me think he just wants out of the party that the UK isn't even attending.

He's right, dead right, but complaining about a problem comes after identifying it and should be used to motivate yourself to find a way to fix it.

Adrian II

08-08-2011, 18:07

That's another reason why I like him. The problem is, as I see it, that he doesn't have any solutions. If he does, he's not able to implement them. His party affiliation makes me think he just wants out of the party that the UK isn't even attending.

He's right, dead right, but complaining about a problem comes after identifying it and should be used to motivate yourself to find a way to fix it.

The Soviet analogy is just silly, but Farage is right in many other ways. As an editor I was among the opponents of the euro in 1991 for some of the same reasons he mentions, like the lack of democratic control and the fatal flaw of tying net importing and net exporting nations to one currency. I was first and foremost against it because the Maastricht treaty enshrined all the trappings of neoliberalism such as a totally independent European central bank. For similar reasons I was against the 2004 Constitution Treaty which was voted down by the Dutch in 2005.

Even so, I always thought that the EU would compensate for the euro's flaws. What we see now is that the kind of leadership we need is missing, not so much in Brussels, but in Berlin, Paris, London, also in Washington, and in The Hague as well. The Merkels and Sarkozy's and Camerons have practically abdicated and left the field to people like Barroso and Van Rompuy who have no mandate and who get no respect.

AII

Philippus Flavius Homovallumus

08-08-2011, 19:58

The Soviet analogy is just silly, but Farage is right in many other ways.

The democratic deficit, and the insistance on pushing through an authoritarian objective "for the good of the people" without their consent is reminisent of Soviet thinking, which I think is his general thrust. As an old fashioned Tory he is understandably enraged by this sort of thinking.

Even so, I always thought that the EU would compensate for the euro's flaws. What we see now is that the kind of leadership we need is missing, not so much in Brussels, but in Berlin, Paris, London, also in Washington, and in The Hague as well. The Merkels and Sarkozy's and Camerons have practically abdicated and left the field to people like Barroso and Van Rompuy who have no mandate and who get no respect.

AII

I would say this is the flaw in the EU's structure, central government hostage to local interests. Merkel did not go back to Germany and put the new bailout to a vote, she went on holiday. Under those circumstances Cameron can either sit in London and look miserable or take his wife and children on holiday, benefitting the rural Italian economy in the process. There's one Tuscan cafe with a cute waitress that's going to be getting a lot more British custom already.

Adrian II

08-08-2011, 20:03

I would say this is the flaw in the EU's structure, central government hostage to local interests.

No, it's the failure of politicians to rise above local or special interests. We've seen the same thing happen in the US which has a centralized government and a President with a clear mandate. The Merkels of this world know full well - or should know - that local interests are best served at the present by far-reaching measures.

Merkel did not go back to Germany and put the new bailout to a vote, she went on holiday. Under those circumstances Cameron can either sit in London and look miserable or take his wife and children on holiday, benefitting the rural Italian economy in the process. There's one Tuscan cafe with a cute waitress that's going to be getting a lot more British custom already.

I'm taking my euro's to Greece in a couple of weeks. But I'm a private person. This is not the sort of leadership I was hoping to see from EU leaders.

AII

InsaneApache

08-08-2011, 21:27

I'm taking my euro's to Greece in a couple of weeks. But I'm a private person. This is not the sort of leadership I was hoping to see from EU leaders.

I'd take more than you took on your last visit. A lot more.

Vladimir

08-08-2011, 21:36

Even so, I always thought that the EU would compensate for the euro's flaws. What we see now is that the kind of leadership we need is missing, not so much in Brussels, but in Berlin, Paris, London, also in Washington, and in The Hague as well. The Merkels and Sarkozy's and Camerons have practically abdicated and left the field to people like Barroso and Van Rompuy who have no mandate and who get no respect.

AII

I heard the Stig would have been EU president but his face was too recognizable.

Tellos Athenaios

08-08-2011, 21:37

Nah, I think the Stig would do better as president of the USA. Unswerving and uncompromising and never uttered a single lie, that one.

Furunculus

08-08-2011, 23:47

I heard the Stig would have been EU president but his face was too recognizable.

lol, precisely the problem; who is that and why do i care?

Vladimir

08-09-2011, 00:13

Nah, I think the Stig would do better as president of the USA. Unswerving and uncompromising and never uttered a single lie, that one.

Yes but he's clueless about ducks (and waterfowl in general). That would ruin relations with Canada (http://www.google.com/search?q=canadian+geese&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&channel=np&um=1&ie=UTF-8&tbm=isch&source=og&sa=N&hl=en&tab=wi&biw=1360&bih=647)!

Tellos Athenaios

08-09-2011, 03:01

Yes but he's clueless about ducks (and waterfowl in general). That would ruin relations with Canada (http://www.google.com/search?q=canadian+geese&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&channel=np&um=1&ie=UTF-8&tbm=isch&source=og&sa=N&hl=en&tab=wi&biw=1360&bih=647)!

But he won't reveal his ignorance by saying something foolish about fowl either, which is more than can be said for most US president candidates. Besides, I thought that to be an US president you had to have at least one major flaw in your education. When English is among the accepted handicaps, why not Ornithology? Also, you are running Mozilla Firefox in US English, your browser window is 1360×647 (w×h) in size, and that Google duck is watching you.

Papewaio

08-09-2011, 03:06

As long as you are not so clueless as when duck hunting you shoot a friend...

Furunculus

08-09-2011, 09:34

£250 billion wiped off the UK stock market in the last week, how you guys on either side of the water doing?

Adrian II

08-09-2011, 10:28

£250 billion wiped off the UK stock market in the last week, how you guys on either side of the water doing?

Free fall continuing, investors moving into gold and bonds. However there is a feeling this is not the Big One yet.

AII

Furunculus

08-09-2011, 10:54

interesting rumours that socgen and unicredit are on the brink:

http://tinyurl.com/3z2o8ty

fun times!

Papewaio

08-09-2011, 11:48

Free fall continuing, investors moving into gold and bonds. However there is a feeling this is not the Big One yet.

AII

I wonder how the likes of Warren Buffet and similar investors are doing? They are after all the ones who look at the fundamentals... if Warren is panicking then it's maybe time for brown alert.

Adrian II

08-09-2011, 13:32

I wonder how the likes of Warren Buffet and similar investors are doing? They are after all the ones who look at the fundamentals... if Warren is panicking then it's maybe time for brown alert.

Markets are showing a weak recovery all over Europe as we speak. It's not the big meltdown yet.

AII

Furunculus

08-09-2011, 14:16

ze germans are beginning to cotton on to the fact they will be underwriting 30% of the value of the ECB's planned 'industrial bond purchasing in italy and spain, and causing higher inflation in the eurozone as a result of the increased money supply:

http://www.spiegel.de/international/europe/0,1518,779183,00.html

Kagemusha

08-09-2011, 14:37

All the exchances are on negative still, the fall is less today, but if this the effect of the stimulus of the centralbank, it does not promise anything good. This is the longest fall since 2003 in Europes exchances and what is interesting the market analycist seem to be feeding the hysteria like no tomorrow. In Finland one of the key economist said in interview today that the only cure might be a significant drop of living standards in Western World. Sometimes i just have to wonder does some of people have any shame in their greed.

Adrian II

08-11-2011, 09:28

interesting rumours that socgen and unicredit are on the brink:

http://tinyurl.com/3z2o8ty

fun times!

Ehm.. (http://www.societegenerale.com/en/node/12248)

AII

Furunculus

08-11-2011, 09:44

Ehm.. (http://www.societegenerale.com/en/node/12248)

AII

yeah, i read that.

unicredit?

Adrian II

08-11-2011, 09:46

yeah, i read that.

unicredit?

I guess Uni don't hav-va da same big-ga balls as SocGen.

AII

Furunculus

08-12-2011, 08:25

I guess Uni don't hav-va da same big-ga balls as SocGen.

AII

facing ze guillotine:

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8696608/Frances-banks-are-facing-the-guillotine.html

Adrian II

08-12-2011, 09:16

facing ze guillotine:

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8696608/Frances-banks-are-facing-the-guillotine.html

Non, just ze usual jitters, eye theenk. The article makes clear that there is less reason for panic that in 2007. Maybe the news of France's zero growth has something to do with it. We'll have to see, won't we.

AII

Furunculus

08-12-2011, 13:10

Adrian II

08-12-2011, 13:17

ze germans try to persuade us that we should raise taxes to the eurozone average of 44.8% of GDP:

http://www.spiegel.de/international/world/0,1518,779893,00.html

no thanks, that's just not british! :)

Don't worry, it won't happen. The greedy, disconnected British political class that is for sale to the highest corporate bidder would never allow it. :mellow:

AII

gaelic cowboy

08-12-2011, 13:24

ze germans try to persuade us that we should raise taxes to the eurozone average of 44.8% of GDP:

http://www.spiegel.de/international/world/0,1518,779893,00.html

no thanks, that's just not british! :)

What a load of speculative :daisy:

I fancy comparing apples and oranges, we should eat the skin of an orange because then we get to eat more orange so that it can be more like an apple.

Furunculus

08-12-2011, 13:38

Don't worry, it won't happen. The greedy, disconnected British political class that is for sale to the highest corporate bidder would never allow it. :mellow:

AII

never mind the british political class; i demand that taxation returns to the 37% level as soon as is humanly possible!

Adrian II

08-12-2011, 13:56

never mind the british political class; i demand that taxation returns to the 37% level as soon as is humanly possible!

I say 25%. And bring back hanging! :toff:

AII

Furunculus

08-12-2011, 14:43

I say 25%. And bring back hanging! :toff:

AII

more than 40% damages the long term growth that permits the next generation a similar standard of living to what westerners typically enjoy today.

37% at the peak of the cycle allows a little slack to maintain stable public spending without damaging the economy when its in a trough.

it's all terribly logical my dear adrian:

http://ime.bg/uploads/OptimalSizeOfGovernment.pdf

Vladimir

08-12-2011, 14:54

When is it reasonable for people to NOT want lower taxes?

When they don't pay any themselves.

Adrian II

08-12-2011, 15:15

more than 40% damages the long term growth that permits the next generation a similar standard of living to what westerners typically enjoy today.

Sure. Here's another one for ya. Growth = (skirt length x Justin Bieber) / Tory seats.

AII

Furunculus

08-12-2011, 16:08

Sure. Here's another one for ya. Growth = (skirt length x Justin Bieber) / Tory seats.

AII

thanks for the contribution, please come back tomorrow too! :)

http://www.google.co.uk/url?sa=t&source=web&cd=4&ved=0CDIQFjAD&url=http%3A%2F%2Fwww.dartmouth.edu%2F~jskinner%2Fdocuments%2FEngenSkinnerTaxEconGrowth.pdf&rct=j&q=high%20taxation%20as%20a%20proportion%20of%20GDP%20damages%20long-term%20economic%20growth&ei=V0JFTtKSLZOFhQeL6OCuBg&usg=AFQjCNFnw0X6pjj4kkbrM2eGTAiaR7TNpg&sig2=C4ebtW2w1LZCF3RdUBgSsQ&cad=rja

http://www.google.co.uk/url?sa=t&source=web&cd=6&ved=0CEUQFjAF&url=http%3A%2F%2Felsa.berkeley.edu%2F~cromer%2FRomerDraft307.pdf&rct=j&q=high%20taxation%20as%20a%20proportion%20of%20GDP%20damages%20long-term%20economic%20growth&ei=V0JFTtKSLZOFhQeL6OCuBg&usg=AFQjCNHoxs8ZfO06Rs9LaYrxtap_28n_Fw&sig2=-VNUEDTK8myMC8OkTwrKtg&cad=rja

Adrian II

08-12-2011, 16:20

thanks for the contribution, please come back tomorrow too! :)

Same to you. We don't need a young lady from the Cato Institute, Bulgaria office, rubbing our noses in the long-discarded Laffer curve.

AII

P.S. Sorry, Ms Adriana Mladenova was quite enough and I can'be bovvered to read all of that other stuff. So lalalala I can't hear you :earmuffs:

Furunculus

08-12-2011, 20:35

that is why you live in the netherlands and me elsewhere. :D

Adrian II

08-12-2011, 20:48

that is why you live in the netherlands and me elsewhere. :D

Furunculus, I love you in a manly, stock markets aren't for wuzzes sort of way. But 2 + 2 just doesn't equal 5, regardless of where you and I reside.

AII

Furunculus

08-13-2011, 12:00

Ironside

08-13-2011, 15:28

sure it is.

the laffer curve is as relevant today as the day it was invented, but importantly, it is merely a bell-curve and not a cliff-edge and therefore it is up to society to determine at which point along the bell-curve they want to sit, with all the attendant benefits and problems that brings.

that is quite evident on page ten here:
http://www.google.co.uk/url?sa=t&source=web&cd=1&ved=0CBsQFjAA&url=http%3A%2F%2Fec.europa.eu%2Feconomy_finance%2Fpublications%2Fpublication11902_en.pdf&rct=j&q=eurozone%20public%20spending%20as%20a%20proportion%20of%20GDP%20over%20time&ei=oFdGTv6pPIiD-wbS2NWgBw&usg=AFQjCNG-CoxhBAzsGJjcq0qTq2Bgctbfow&sig2=81ibLvVfh5oJYplTxerc_A&cad=rja

britain has traditionally aimed to occupy the 37%-42% region, depending on who is in power, as you sort of recognise with your Growth = (skirt length x Justin Bieber) / Tory seats calculation.

The problem with the laffer curve is that there's no conclusive studies on how it looks like. The 25% is optimal for growth report, that someone linked to earlier (I think it was you) had a nice reference to other studies. Less than half showed that it even existed at a position where we need to bother about it, even if more studies said it was better to reduce to the state than the opposite (aka that bigger state is always better). Short version: It's a mess to study and that draving all conclusions from one study is like hoping that your god is the only correct one.

Adrian II

08-13-2011, 16:19

britain has traditionally aimed to occupy the 37%-42% region, depending on who is in power, as you sort of recognise with your Growth = (skirt length x Justin Bieber) / Tory seats calculation.

Make that Elton John instead of Bieber :balloon:

Germany's tax level is around 50% and they're doing much better growth-wise than you, don't they?

Linky (http://en.wikipedia.org/wiki/Economy_of_the_European_Union#Economic_growth)

AII

Sarmatian

08-13-2011, 20:20

In Finland one of the key economist said in interview today that the only cure might be a significant drop of living standards in Western World.

Thank you very much. Finally someone who understands the issue. The entire western idea that debts don't matter if there's enough growth failed to account what to do when there's very little or no growth. Billions of people in Asia, Africa and various other parts of the world bought almost exclusively what we made 60 years ago, all the while supplying us with raw materials and energy for practically free. 30 years, they bought most stuff from us but started charging a little more for resources and selling us bits and pieces. Nowadays they sell us more than we sell them, we have to pay almost fair price for resources due to, mostly Chinese, competition.

And things are about to get worse. We can't spend now what we're going earn in the next five years because we're not going to earn much in the next five years. Waging wars and setting up coalitions of the willing are only going to slow things down, and even that only by a small margin. This is not a temporary hickup caused by irresponsible bankers or governments that will go away and things will return to old. The world is changing, days of cheap resources and energy and huge exports are over for the West. Nowadays and in the future, it's fair-priced resources and huge imports. Understand it and deal with it. The only real solution is significant drop in the standard of living in the Western world in the near future. Cutting military expenses (US I'm looking at you mostly), taxing the rich properly (no, they shouldn't be excused because they contribute to the economy, whoever thought of that maxim was obviously rich), cutting expenses, reducing debts. This will naturally reduce the standard of living but the current one is unsustainable. Do it properly and we might get through, somewhat poorer but still on our feet. Don't do it and will just have a bigger balloon bursting in ten, twenty or thirty years.

Furunculus

08-14-2011, 10:45

i agree with the prognosis, but not the cure.

promote growth.

InsaneApache

08-14-2011, 10:57

Evan Davies did a fascinating program on the BBC about how the UK exports changed in the last 30 years. From low end tech such as clothing to high end tech such as engineering.

We still do make clothes but not in the UK.

Interesting stuff.

http://www8.open.ac.uk/platform/news-and-features/made-in-britain-explore-20-years-worth-uks-imports-and-exports

rory_20_uk

08-14-2011, 11:06

We need low tech for the low tech member of society as there are not enough jobs cleaning the toilets of the high-tech offices.

Where and doing what?

~:smoking:

Adrian II

08-14-2011, 11:26

We need low tech for the low tech member of society as there are not enough jobs cleaning the toilets of the high-tech offices.

Where and doing what?

~:smoking:

Plumbing and construction (city infrastructure all over the west is derelict). Carpentry (i.e. making better furniture than IKEA's crap). Public transport (turning it into the success it should be instead of privatised failure). There are loads of useful employment possibilities of we decide that we want to be a society after all, not just a bunch of autonomous citizens.

Much of this will require more public investment and fewer bail-outs for banks. In fact, it will require a restructuring of the financial system. If that happens at all, it'll be years and years before we get there.

AII

rory_20_uk

08-14-2011, 11:56

I know the areas the UK is deficient in.

But in the UK, fame is around the corner, isn't it? Everyone is going to get rick quick by becoming a celebrity or someone famous. Trades appear to be sneered at in the UK - everyone needs a degree, right? Better to have a BA in Sociology than have the ability to build something. Scrap a lot of funding for the Universities (I'm sorry, but and have better links with Industry - especially smaller companies that focus on vocational roles.

Most of the possibilities require people to want to undertake these activities - possibly working for low wages until their skills improve and quite possibly accept that they will never be a squillionaire. Germany has a lot more respect for Engineers than the UK manages.

Most public transport was privately built and often worked quite well back then. After making it into a public enterprise and then dividing it in a nonsensical way managed the current English art of managing to make something that fails in both categories. One company owning all facilities in one area of the UK for example, rather than several which is nonsensical. Concerning the Underground, automating all the underground trains would be another aspect that should be addressed. In these days having trains that do not require drivers should be simple... Oh, we do on the Docklands - it is being delayed by the unions. What a shock. Considering the cost per driver per year is about £35,000 in salary, I am sure we are looking at a cost of over £40k each. Multiply that by the number of drivers and that is a vast sum that would be better invested.

Perhaps it needs saying again: the governments bought into the banking system at almost the bottom of the market. The bank profits remain depressed as they are paying billions to the government in insurance premiums. It was not a blank cheque of money that disappeared into salaries without any payback from the banks. If a vulture fund had done this there would be squeals of protest about the Evils of Capitalism.

~:smoking:

Adrian II

08-14-2011, 12:11

Concerning the Underground, automating all the underground trains would be another aspect that should be addressed. In these days having trains that do not require drivers should be simple...

Not if you want to re-establish social control, respect for public property &cetera. People are sick of talking to machines already. Scrapping drivers, replacing ticket-sellers and ticket-controllers by machines, replacing surveillance by CCTV - that's exactly the sort of depersonalisation of public space that invites daily violations of order and the law. One of the reasons why public transport in the west is not taking off as it should is that we have turned it into a social wasteland. We have privatised it, we want the cheapest fares, and then we are surprised when carriages collide for lack of maintenance and train and subway stations become hoodlum territory.

AII

rory_20_uk

08-14-2011, 12:31

I specifically said drivers. You could have the money spent on more people on say £15k who just walk the stations and / or trains to give out help / advice and act on low level crime. A driver has almost no human contact as it is with anyone.

In the UK carriages have usually collided when the (human) driver missed a red light or a warning noise - the computer noted it, the human screwed up.

Privatised does not have to mean inhuman. If you've been to a private hospital they are often more pleasant environments. If state institutions there is often little thought as to the best make up of staff. In my example above, one could almost double the number of staff in the system by getting rid of obsolete expensive ones and getting in more useful cheaper ones.

I'm currently doing some work on reorganising hospitals. One glaring thing is often how the staff mix is not what is required - from poor allocation of cleaners of all staff paid to work until 7 yet theatre stops at 5 - and therefore no one works on a friday and the theatres are not used. Something as simple as getting them to finish at 5pm and work on the next day makes things massively more efficient. Yet it has taken years for this change to be implemented.

~:smoking:

Fragony

08-16-2011, 09:41

For the Dutchies http://www.artikel7.nu/?p=66185

Somehow 'I told you so' doesn't quite cover it.

Furunculus

08-16-2011, 10:01

could the non-dutchies please get a precis of this valuable addition to the eurozone debate? ;)

Fragony

08-16-2011, 10:11

could the non-dutchies please get a precis of this valuable addition to the eurozone debate? ;)

It's an old column by Pim Fortuyn, he's warning against what happened. That a universal coin for strong and weak economies is madness, and it goes exactly as he says it would. Smart guy

Furunculus

08-16-2011, 11:20

It's an old column by Pim Fortuyn, he's warning against what happened. That a universal coin for strong and weak economies is madness, and it goes exactly as he says it would. Smart guy

apparently so, but in plenty of good company.

Fragony

08-16-2011, 11:39

apparently so, but in plenty of good company.

Highly doubtfull if the Dutch left was right about him at the time ;)

Adrian II

08-16-2011, 13:06

For the Dutchies http://www.artikel7.nu/?p=66185

Somehow 'I told you so' doesn't quite cover it.

He was a bit late, wasn't he? Until 1996 Fortuyn was in favour of the euro. I have argued against it from the very start, even before the Maastricht Treaty.

Lefties in The Neds were arguing against the euro long before all these latter-day converts like Fortuyn and Wilders.

Kees Vendrik, Robert Went, many many more.

Ook was Vendrik al een lange tijd bezig met het onderwerp van de Europese munt. Al in 1998 publiceerde hij het boekje De prijs van de euro over de financiële gevolgen van de invoering van de euro. In de Groene Amsterdammer vertelt hij over de huidige eurocrisis dat “Financiële markten in de gaten [hebben] gekregen dat de huidige monetaire unie rammelt. Eén munt zonder vergaande economische, ﬁscale en politieke integratie is geen houdbaar recept gebleken. Als Europa de euro wil behouden, heeft ze een nieuwe menukaart nodig.”

link (http://tegenlicht.vpro.nl/nieuws/2011/februari/Kees-Vendrik.html)

AII

Fragony

08-16-2011, 13:18

He was a bit late, wasn't he? Until 1996 Fortuyn was in favour of the euro. I have argued against it from the very start, even before the Maastricht Treaty.

Lefties in The Neds were arguing against the euro long before all these latter-day converts like Fortuyn and Wilders.

Kees Vendrik, Robert Went, many many more.

AII

Excuse us rightwingers for not wanting a political union either

Adrian II

08-16-2011, 13:23

Excuse us rightwingers for not wanting a political union either

Quick, change the subject.

AII

Fragony

08-16-2011, 13:25

Yeah, change the subject.

AII

I don't 'Eén munt zonder vergaande economische, ﬁscale en politieke integratie is geen houdbaar recept gebleken.'

for non Dutchies 'one coin without excessive economical, fiscal, and political integration, has turned out to be ineffective'

gaelic cowboy

08-16-2011, 20:04

Sarkozy, Merkel want eurozone government (http://www.rte.ie/news/2011/0816/eu.html)

The leaders of France and Germany have called for the formation of a common eurozone government after a meeting in Paris on the debt crisis.
French President Nicolas Sarkozy said the proposals would ask eurozone countries to put limits on their budget deficits in their constitutions by summer 2012.
The two leaders are also proposing a new collective economic 'government' for the eurozone consisting of heads of state or government that would meet at least twice a year.
They are proposing that this body would be led by the Herman Van Rompuy.
They also proposed a new tax on financial transactions.
Ms Merkel said eurobonds were not answer to the debt crisis 'today'.
Mr Sarkozy said France and Germany were at one on the issue, but he said eurobonds could be imagined, but only at the end of a process of euro zone integration.
Most European stock markets ended down this evening ahead as investors awaited the outcome of the meeting Mr Sarkozy and German Chancellor Angela Merkel.
Shares were affected earlier by weak growth figures from Germany and the eurozone, but gained back some ground this afternoon after better than expected US industrial production figures.
London's FTSE edged up 0.1% to finish at 5,358. In Frankfurt, the main DAX index fell 0.5% to 5,995, while in Paris the CAC dropped 0.3% to 3,231.
Last week's decision by the European Central Bank to buy €22bn worth of bonds in heavily indebted nations has calmed markets, however it is seen by many as a temporary fix.

Debt limits dont fix the problem we have NOW what are these people at they decided they needed another meeting twice a year in which they will do as little then as now.

Adrian II

08-16-2011, 20:09

Sarkozy, Merkel want eurozone government (http://www.rte.ie/news/2011/0816/eu.html)

Oh yes, let us create more undemocratic mechanisms. Be my guest if you want rocks flying through windows in 24 capitals.

I still have a hope that European leaders, like their American counterparts, will do the right thing - after they have tried everything else.

But it is going to take decades to undo the damage that these knuckleheads have done in just two years time.

AII

Vladimir

08-16-2011, 20:11

Maybe you should establish a Department of Debt. It could be modeled on our Department of Jobs (http://www.google.com/search?q=obama+department+of+jobs&hl=en&client=firefox-a&hs=aek&rls=org.mozilla:en-US:official&biw=1680&bih=865&prmd=ivnsu&source=univ&tbm=nws&tbo=u&sa=X&ei=fMBKTvDxKcTAgQfc8o1z&ved=0CCAQqAI).

gaelic cowboy

08-16-2011, 20:12

Oh yes, let us create more undemocratic mechanisms. Be my guest if you want rocks flying through windows in 24 capitals.

I still have a hope that European leaders, like their American counterparts, will do the right thing - after they have tried everything else.

But it is going to take decades to undo the damage that these knuckleheads have done in just two years time.

AII

The problem as they see it is that governments made mistakes ergo we need a bigger government. (which we have no say in hiring or firing)

They better have some grand plan for avoiding a referendum in Ireland on this because I'm most certainly already in the NO camp.

Adrian II

08-16-2011, 20:18

They don't 'do' grand plans anymore, they do whatever 'the markets' tell them.

AII

gaelic cowboy

08-16-2011, 20:40

They don't 'do' grand plans anymore, they do whatever 'the markets' tell them.

AII

Then those market types will be mad as hell there are no Eurobonds.

All they did was basically set up another two summits to go to.

Oh and I nearly forgot debt ceilings never cause any crisis right hey wait a minute United States debt ceiling crisis (http://en.wikipedia.org/wiki/United_States_debt-ceiling_crisis)

It will never pass here because they cant change the constitution without referendum and anyone who tries to get one passed will be soundly kicked out the gate.

So one of the key pieces of this agreement will be unworkable for Ireland, logically we will prob be out of the Euro within a few years.

not before the bailout ends naturally due to the ECB wanting there money back an all

Fragony

08-16-2011, 21:36

Does it help at least a tiny little bit if I understand why you are so angry

gaelic cowboy

08-16-2011, 21:47

Does it help at least a tiny little bit if I understand why you are so angry

It's ok Frag I repented ages ago on the europhillia

It's been No for a while now

Philippus Flavius Homovallumus

08-16-2011, 22:02

Oh yes, let us create more undemocratic mechanisms. Be my guest if you want rocks flying through windows in 24 capitals.

I still have a hope that European leaders, like their American counterparts, will do the right thing - after they have tried everything else.

But it is going to take decades to undo the damage that these knuckleheads have done in just two years time.

AII

I must say, I am starting to have very French thoughts about some politicians

Can I just point out: UK Conservatives were widely derided for being anti-Euro and decoupling from the Cntre-Right-pro-Euro Bloc in the EU Parliament.

This Emperor never had any clothes, but despite lots of people saying so no one listened.

gaelic cowboy

08-16-2011, 22:08

I must say, I am starting to have very French thoughts about some politicians

Can I just point out: UK Conservatives were widely derided for being anti-Euro and decoupling from the Cntre-Right-pro-Euro Bloc in the EU Parliament.

This Emperor never had any clothes, but despite lots of people saying so no one listened.

I'm having very Irish thoughts on this basically Michael Collins 2.0 I cannot see people here letting this go lightly.

We have not had any disturbances here at all however this could be a very dangerous spark in my country.

The more I think on it the more I think it is a way to engineer a some kind of new FrancMark without the PIGS.(if it is that would actually solve it)

And to think I thought Jim Corr was mad

Furunculus

08-16-2011, 22:58

It's ok Frag I repented ages ago on the europhillia

It's been No for a while now

i am actually cheering on osborne with his calls for fiscal federalism within the eurozone because it is the one great hope that we will be offered an EEA/EU or EEA/EFTA referendum question.

so much of politics of positioning based on events and they have spent a long 'positioning' but at last the event is here, now!

Philippus Flavius Homovallumus

08-16-2011, 23:57

I'm having very Irish thoughts on this basically Michael Collins 2.0 I cannot see people here letting this go lightly.

We have not had any disturbances here at all however this could be a very dangerous spark in my country.

The more I think on it the more I think it is a way to engineer a some kind of new FrancMark without the PIGS.(if it is that would actually solve it)

And to think I thought Jim Corr was mad

Ireland is particularly screwed here - other than Euro-integration her best option is good old Blighty, either one can go over very badly politically.

gaelic cowboy

08-16-2011, 23:59

Ireland is particularly screwed here - other than Euro-integration her best option is good old Blighty, either one can go over very badly politically.

Personally I have no problem pegging to sterling, we had that before anyway our economy is hyper-plugged into UK. Just cos we track sterling does not keep me up at night we still get to decide to peg a currency, I don't see any need to go back to the UK neither side wants it anyway.

My problem is purely emotional in reality I will not vote for this

It's pretty obvious we will have to be eased out of the euro in order to achieve this plan, after the ecb gets its money back as it always wanted.

They cannot pass a referendum here now not a hope in hell, no matter how much they badger or how much debt they hold we still have to vote.

Since the plan calls for constitutional debt limits I suspect it is a way to remove Ireland from the euro, and if by some miracle we vote yes they still have what they want.

Personally I want out of the Euro we can all truthfully say it is no good for Ireland and I suspect that is what they really want.

InsaneApache

08-17-2011, 00:18

It's ok Frag I repented ages ago on the europhillia

It's been No for a while now

As I did.

Now when will people learn that the politicians are the problem. Not the answer.

Furunculus

08-17-2011, 00:23

slightly after those of us who are of sufficiently dyspeptic a nature to remain sceptical to the political designs of jejune euro enthusiasts?

gaelic cowboy

08-17-2011, 00:31

slightly after those of us who are of sufficiently dyspeptic a nature to remain sceptical to the political designs of jejune euro enthusiasts?

Ireland is going to change overnight in to the eurosceptic camp, trust me it's practically guaranteed.

Even when we voted against lisbon people still had a fairly good view of the EU but not anymore they dont though, we actually have a higher opinion of the IMF now than EU

Philippus Flavius Homovallumus

08-17-2011, 00:33

Personally I have no problem pegging to sterling, we had that before anyway our economy is hyper-plugged into UK. Just cos we track sterling does not keep me up at night we still get to decide to peg a currency, I don't see any need to go back to the UK neither side wants it anyway.

My problem is purely emotional in reality I will not vote for this

It's pretty obvious we will have to be eased out of the euro in order to achieve this plan, after the ecb gets its money back as it always wanted.

They cannot pass a referendum here now not a hope in hell, no matter how much they badger or how much debt they hold we still have to vote.

Since the plan calls for constitutional debt limits I suspect it is a way to remove Ireland from the euro, and if by some miracle we vote yes they still have what they want.

Personally I want out of the Euro we can all truthfully say it is no good for Ireland and I suspect that is what they really want.

Pegging into Sterling won't help you very well, it'll be like pegging into the Euro, unless you get either cheap credit or have a transfer Union.

Ireland can accept Euro oversight, de-couple and devalue, or snuggle up to the UK.

So... de-couple and devalue really.

Philippus Flavius Homovallumus

08-17-2011, 00:38

As I did.

Now when will people learn that the politicians are the problem. Not the answer.

Our politicians are a refelction of us. Cameron hiring Andy Coulson because he was a Murdoch flunky is a case in point.

Who gives Murdoch power, after all?

gaelic cowboy

08-17-2011, 00:40

Pegging into Sterling won't help you very well, it'll be like pegging into the Euro, unless you get either cheap credit or have a transfer Union.

Ireland can accept Euro oversight, de-couple and devalue, or snuggle up to the UK.

So... de-couple and devalue really.

When we had our own currency we had to track sterling and the dollar due to our trade patterns, the reality is we still should be doing that today.
Basically we were fine before whats wrong with admitting a mistake and starting over, the level of disconnect I hear all the time about how you cannot go back blah blah is just daft.

I not stupid enough to think it would be painless to leave the Euro, but I have enough brains to cop this cannot pass and therefore it is another crisis for the Euro.

Do they really want to have deal with an Irish no vote again I doubt it, were heading for the door bye and it's what europe wants