A
great piece by the Canadian Finance Minister. The Canadians took their medicine
some years ago (along with the Swedes) and are much the better off for it. So
they are well placed to prescribe the same treatment be ingested by those
suffering similar ailments.
My
favourite member of the UK Labour Party/Trade Union alliance - Dan Hodges -
telling Francois Hollande that he can make as many ridiculous promises to the
French people as he may choose. It will make not a hill o’ beans difference to
the music the French will ultimately have to hear play. For the moment they
have voted for the tooth fairy approach to economics; accompanied by making
like the ostrich, placing their hands over their ears and singing la-la-la. It
will afford them nothing but a bigger dose of heartburn in the fullness of
time. Time which will not be very full.
Le
dénouement de Paris ést complét. Being President of France is like being
Governor of Illinois or of Haiti or PM of Italy. You have to be a crook even to
apply. In due course you get found out, indicted and given a slap on the wrist
(sorry Blago – 14 years in the big house, aka the Pen). Sarko is traveling a
well-worn path from the Elysée to the dock. De Villepin, equally nasty, but
more clever than Sarko, will be laughing all the way to an Énarque réunion.
Spain
takes another look over the precipice.
Well
the Greeks also voted. We know not for what. Not fat-man Venizelos of PASOK
(failed). Not for Papademos the EU technocrat (failed). Not for Samaras and a
return to some semblance of rationality. Not for Tsipras the Leftist firebrand,
not for any of the above. Only they gave the neo-Nazis and the Commies a big
vote of confidence. Poor old Carolos Papoulias might as well give it a shot and
rule by decree. No one else has a prayer. The constitution says another
election in three weeks. By which time of course the Greeks will have come to
their senses and vote for …. More of the same? Maybe they’ll just vote with
their feet (like lemmings).
So
the dominoes are really falling. Sarko gone, no Greek government, no Dutch
government, Merkel about to get an electoral bruising in Nord-Rhein Westphalia
for being too generous with the Deutsche Euros to Club Med, and Rajoy is
getting busy finally taking Spain’s bust banks onto the State’s books. (Where
he’ll find a boat-load of his own government Bonds (worthless)). The sky could
well be falling. What we really need is a full frontal Christine Lagarde au
foulard to ride to the rescue. Don’t count on it. She may have little Georgie
O’s 10 billion quid from John Bull taxpayer but her Louis Vuitton begging bag
has a hole in the bottom.
The
scene of this tragi-comedy (of errors) now switches back to the
Frankfurt/Berlin axis. The play that sought to rein in the siren of Lebensraum
im Westen und im Osten and shackle the Wehrmacht aka Bundeswehr safely within
the FRD’s own post 1945 borders has produced a nightmare – especially for those
great geo-political thinkers, the Énarques playwrights. Some achieve hegemony,
some have hegemony thrust upon them – une hégémonie allemande malgré eux-mêmes.
Mario Draghi and the ECB Board have shot both their LTRO barrels and are fresh
out of cartouches to reload. So it’s a German morality play now. Who knows
which director will call the shots – Die Haus Frau Kanzlerin, Herr Schäuble, Herr
Weidmann, Herr Wetserwelle, the Bundestag, the Pied Piper of Hamelin oder der
Herr am Frankfurter Autobus? My hair-shirt is hairier than your hair-shirt.
Let’s see what the Greeks do. (They’ll blame the Germans for all their troubles
for sure. Debtors/profligates always wind up hating their thrifty creditors).
Well
my guess is the Greeks are going to wake up one fine Athens morning in the
unfullness of time and find to their shock-horror that they can’t make payroll.
The banks will stay closed that fine morning because the truck with the Euros
from the central bank isn’t coming today on account the CB doesn’t have any
real Euros (the ones not printed in Greece) and the driver didn’t get paid on
Friday. Le chat, la merde, les pigeons et le ventilateur seront trés intimes.
So the Greeks will blame the Germans. Herr Schäuble will slap his lederhosen
and call it a good day’s work. Europe will stagger to its knees. Final curtain.
Epilogue. Seul une rêve effrayante.
The
horrible dilemma of EU/Euro is clearly laid bare by Ambrose. The Germans own
the moral high ground. The Greeks own the wooden spoon, the pillory and
debtors’ prison. They have much company. Unfortunately the hard and brutal
reality is that the Germans and their hair shirt acolytes are dead wrong. They
are pouring fuel on a fire which will blaze fiercely. The Euro is in its death
throes and the Club Med soft under-belly will pay a terrible price in human
misery.
It
is not a prospect that anyone should see as salutary.
Simon
PS
Sorry about all the links. Don’t feel obligated to read them all!
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