Huff and Puff

http://news.yahoo.com/greek-conservatives-hope-seal-coalition-deal-053426235.html

The Greeks claim to have a government. But it looks like a minority one out of the chute. Vangy and the lefties are playing a cute game; taking no ministerial positions but agreeing to support Samaras if needed with the renegotiation thing, at least as long as he seems to making headway. They’re hoping to avoid too much responsibility when it all goes horribly wrong (which like all things Euro-bail-out is subito, when the rubber of the Greek jalopy’s tyres (tires) meets the road of Angela’s Nein, Nein, Nein).

http://www.telegraph.co.uk/finance/comment/jeremy-warner/9345313/Debt-crisis-markets-bet-Germany-will-be-dragged-down-with-everyone-else.html

http://www.telegraph.co.uk/news/worldnews/europe/france/9337631/Marion-Le-Pen-becomes-youngest-French-MP-in-modern-history.html

http://www.telegraph.co.uk/finance/financialcrisis/9345571/Debt-crisis-bond-buying-plan-to-ease-euro-debts-only-theoretical-says-Angela-Merkel.html

Uh, Oh – the dreadful French duo of Benoît Cœuré (what sort of a man has a dipthong in his name?) and M. Francois des deux Maîtresses are trying to bounce the long suffering Kanzlerin into opening the EFSF/ESM bond buying spigot at the ECB to firewall Spanish and Italian credit. However, the BuBankers have her locked down and under 24 hour guard to get her back to the safety of the Berlin Bunker before the French can put any more words in her mouth for myopic, story-hungry journalists to report as fact. One might have thought the conniving, dissembling, pusillanimous, cynical, self-serving French would have wanted to keep the EFSF/ESM big bazooka (pretend) powder dry for a rainy day in Paris, but I guess they are still in the first flush of power. They calculate that it’s all coming from the Germans anyway and better to try to draw the line at the Pyrenees and Les Alpes Maritimes than reactivate the Maginot Line. The French haven’t a clue as to what Hollande has in store for them, and it ain’t gonn’a be fun. A few more stunts like this and the frost will really set in across the Rhine. Even Snarkozy knew to cosy up to Frau Angela and the BuBankers.

Here is the BuBank walk-back, as dictated to Louise Amistead of the DT (I hate to say I predicted as much right after the announcement. The Los Cabos done-deal story probably originated from l’Élysée):-

“The German Chancellor agreed that the European Financial Stability Facility (EFSF) and the European Stability Mechanism (ESM) had the "possibility of buying bonds" but said no discussions were being held about such a move. (And you can tell Messieurs Hollande, Mario 1 and Rajoy I said so)”.

In other words the BuBank has paraphrased Die Kanzlerin to have said with reference to the €650 bil big bazooka cannonade (all hat and no cattle) that she’s happy to talk about anything. It’s all on the table (except any idea of pledging the FRD’s credit for any more deadbeats). So she is reported now to have said the whole bond buying thingy is “theoretical”. (Does Cœuré mean heartless, cured (as in well salted) or Curate in English? My dictionary says écœurer means to disgust or sicken. That could be it).

http://www.realclearpolitics.com/articles/2012/06/21/greece_alone_and_broke_--_again_114553.html

Victor Davis Hanson gets to the heart of the matter for the pbg’s; as he usually does. He picks up on my neo-Ottoman theme (or maybe I plagiarized it from him). The Greeks live in a nasty neighborhood. Islamic Balkans and recently ex-Commies to the north and Turkey everywhere else, including the northern part of Greece’s Achilles heel – the island of Cyprus. OK, a bit of Italy to the west, but that’s not much solace. The Euro-Greek part of Cyprus is looking for a bailout but is probably betting the Russians will come through with real money, no strings, before the EU does. If Vlad Vlad loses his naval base in Latakia thanks to Assad/Alawite genocidal tendencies, he’s no doubt got an eye on Limassol. (Which might be uncomfortable for RAF Akrotiri).

The real issue for the pbg’s is tied up with European defense and NATO; as Hanson rightly observes. Not that the big Greek defense budget is anything to do with NATO – it’s more directed to watching Turkey and Cyprus (both of course also NATO members). In any event that budget will be the first to go when the Euro flow dries up. The European part of NATO is already withering on the vine with endless defense cuts starting from a low base and burning men and matériel they can ill afford (mostly the Brits) in the Third Afghan War. But that’s a whole other story.

Right now, I imagine the Berliner Kanzlerei is up nights trying to figure out exactly how to leap out of the Euro-cauldron before the other frogs notice just how hot it’s getting. Ideally, without being blamed for bringing down the house of straw. They’ll huff and they’ll puff but they won’t be able to blow Angela’s house down.

Simon