Wednesday, June 20, 2012

“Nice Euro you got here. Be a shame if somebody broke it.”

I get the impression the Euro elite, and especially the Germans, are very disappointed with the Greek vote. A Syringia vote would have been the signal for no EU money, bank runs, Euro exit within a few days.

Spain, Portugal, Italy would all get the message loud and clear.

“Nice Euro you got here. Be a shame if somebody broke it.”

Now the Greeks are in for more years of misery and unemployment - and IMHO they'll still end up out of the Euro. The same may well apply to Spain.

The analogy is a girl – as it might be Angela – with a hopelessly dependent boyfriend, Alexis. She doesn’t want to hurt him, but wants to dump him, so treats him badly in the hope he’ll find a pair from somewhere and break it off himself. Better for her, better for his self-respect.

Instead, he takes all the abuse and promises to be a better boy in future. Angela’s heart sinks … she’s still stuck with him…


It would certainly have been “interesting” in a Chinese curse sense had Syringia won. As I understand it from here, Syringia’s policies are

a) stay in the Euro
b) no to the austerity package

People voting for that platform would have been terribly disappointed one way or the other. If b) had been implemented, the plug would be pulled on Greece “pour encourager les autres”.

At the other end of Europe, Mrs Merkel campaigns on

a) no money printing, no German taxpayer subsidising the periphery
b) total commitment to the Euro project

Again, one way or the other voters believing both of those things are going to have a bit of a rude awakening.

Merkel is slowly, by inches, being dragged down the path of currency debasement and inflation, having sworn against it. The German people, having given up the Deutschmark on the understanding that the ECB would never countenance currency debasement and inflation, are also in for a rude awakening. The Euro elite don’t want to go down that path, but they’re running out of options, and Obama and Cameron are telling them “we’ve done it – what’s your problem?”

I personally find the prospect of the German electorate becoming massively disillusioned with their political leadership a lot more scary than a few thousand Greeks throwing things at the police. But then I’d never have thought that the leadership of the British working class would tolerate having their wages and conditions driven down by cheap imported labour, and I was wrong about that.









UPDATE - Jeremy Warner in the Telegraph on what some hedge funds are thinking :

Angela Merkel, the German Chancellor, has said no to virtually every form of debt mutualisation so far proposed. But kicking and screaming, she's in practice already agreed to some – the bail-outs – and if the single currency is to survive in its current form, she'll eventually have to go a lot further. The German Chancellor is something of a tease – she says no until she says yes. Numerous lines in the sand have been drawn only eventually to be surrendered as the crisis intensifies.

5 comments:

Peter Risdon said...

What a good post.

MarkyMark said...

If the German electorate become disillusioned and throw out Merkel the irony will be they will get a new left-wing government which is even more pro-Europe/bailout/money printing.

Bobo said...

"But then I’d never have thought that the leadership of the British working class would tolerate having their wages and conditions driven down by cheap imported labour, and I was wrong about that"

The English working class is no longer a political force: industry is only a marginal element in the economy, and therefore the workers are only marginal in politics. The label "working class" has been replaced in political discourse by "hard working families", which is meaningless. Multiculturalist pluralism has been subjected for proletariat hegemony. Employment,trades, and skills have been replaced by the dole, easy access to drugs, and a lenient judiciary: fame and crime are the only two avenues apparent to many youngsters. My own personal belief/nutjob theory is that the governing classes have deliberately neutralised the challenge to their own power and position by defusing the working class threat to seize the levers of power, logically the next step in 'socialism'.

Anonymous said...

This may be of interest:

EU should 'undermine national homogeneity' says UN migration chief

http://www.bbc.co.uk/news/uk-politics-18519395

Simply incredible.

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