Niall
is on form here – but I think he misses the wind from Wisconsin.
Here’s
a medley of Euro-Songs to lighten your Monday gloom. The markets behaved
predictably. An early dealer self-protective, short-covering bounce, followed
by more selling by those facing the reality, if not the horror, of the week to
come (the weak to go – down or to the wall). The bailout (of Spain) that cannot
speak its name. Debt on debt, mumbo on jumbo, kant on can’t (or won’t) and not
a coherent story in sight. Rajoy puts on a brave face but knows that the
Eurocrats have offered him only the hemlock of more debt. Will it be EFSF, will
it be ESM (not yet in existence, not yet ratified by the Bundestag), what will
the interest rate be, will all other lucky Spanish creditors see themselves
subordinated as a prelude to the Greek barber taking his Affens ‘aircut and
setting up shop in Madrid? Rajoy says it’s only for the banks, but it’s a new sovereign
obligation however he cuts it – but does it enter the banks as equity, debt,
paella? Rajoy says no external new conditions. But if it rides like a troika,
smells like a troika and waddles like a troika and has Mme Lagarde at the
reins, it sure isn’t a duck. He’ll have to eat crow soon enough: the Eurocrats
say Spain will be “supervised”. How does that sovereignty feel, Mariano? So the
medicine failed to reduce the patient’s fever even for one trading session. Was
für eine encore (Zugabe), Angela?
Our
local world-class daily rag, the Orange County Register (you know – where the
Housewives come from) inadvertently gets the sub-headline right on the money.
“Spain not spared Pain – Prime Minister gloomy as country gets lifeline to short
(sic) up banks. Who needs Euro-friends with what must feel like an enema to
Mariano? Can he resist the temptation to emulate Christina’s coup de
Repsol and divert attention from his troubles by sending the Armada to
Gibraltar (it’s much closer than Flanders, Mariano). Sic transit gloria mundi.
We
just don’t know and we cannot be told – because the Euro-brains don’t know
either. Can Italy fund its share of the bailout, can Spain, will Spain, should
Spain? Will the Finns continue to demand collateral (something they can take to
the BuBank with a straight face)? Loads of dirty laundry, all waiting to be
mutualized. No more promises – show us the money!
Ambrose
returns to his monetary contractions and lays the blame squarely at the door of
the Frankfurt/Berlin Axis. He advocates that Latins outvote the Teutons at the
ECB and direct Mario 2 to buy all Spanish and Italian paper on offer (via the
printing press, of course). Let Nord-Europa head out in a huff, he suggests. On
which side would the French come down, one wonders? Hollande cannot want to
preside, right after his election, over the biggest bust-up across the Rhein
since …. The French could not live in the Deuro for long. Would Mario 2 dare to
follow such direction – und hochheben der mittler Finger als BuBank? Another
ECB resignation could be Der Kuss des Tod.
And
after more Sturm und Drang than we can all handle, we must await all week with
breath suitably bated the Greeks to get their do-over right on Sunday. Very
hard to imagine they’ll get the third shot. Much like a North Korean rocket
launch, this one could dive rapidly into the Aegean. My prediction – there will
be another hung-parliament. (Not hanged, note). Papoulias will have to try again with an
infinite series of permutations and combinations of left, left, left, right, left.
It’s unlikely to be synthesis, catharsis, stasis – just Sweeney very Agonistes,
Melodrama Aristophanic.
I
commend you to Peter Popham’s piece in the Indie link above. He takes a very
contrary view to my own. Which is to say that, having tried very hard and with
no fear of breaking a lot of crockery to create an edifice that could stand
tall in its own right and volition, and having found that edifice to be
inherently unstable, shaken repeatedly to its very foundation, the faith of its
congregation sapped at every turn, he advocates only one sure course is to be
recommended. More from the same architects must be offered. We must have and
clearly we desperately need “more Europe”. It dates me, but I vividly recall
the mantra of Anthony Wegdwood-Benn after another Worzel Gummidge poll fiasco
(or was it the Welsh Windbag), that the answer could only be “more full
red-blooded socialism”. For ever doubling-down and coming up snake-eyes.
Jeremy
comes through late in the day with an analysis which won’t make for jolly
reading in Madrid nor in other Euro-points-east.
For
you Harvey-Nicks habitués, a horror story of utter tastelessness from today’s
DT thanks to Christina Odone - http://www.telegraph.co.uk/comment/columnists/cristina-odone/9323520/How-could-Harvey-Nicks-get-it-so-wrong.html
(This story is unsuitable for young eyes and ears). But it does gel with another
less than tasteful analogy drawn by a waggish commentator describing the
Spanish bailout. “It’s a bit like peeing your pants at the North Pole. The
initial warm feeling is shortly followed by less pleasant sensations”. With
apologies to those of you with very sensitive constitutions. Head for Fortnums.
Almost
as an afterthought we learn that Cyprus will this week request a Spanish
style bailout, albeit on a rather lesser scale. It must be announced this
weekend prior to the Greek poll results becoming known and rendering the whole
exercise null and void.
It’s
setting up to be a long and exciting Euro-Woche for all the wrong reasons. Arme
Angela.
Simon
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