Friday, 5 August 2011

Markets Collapse, Politicians and the Inselaffe

Germany's clutural contribution

Due to a lack of faith in the “Too big to fail” Spanish and Italian bond market (Italy has the 3rd largest Bond market in the world) and the ECB to prop up these countries; people are once again questioning the Euro. The Eurosceptics are saying “I told you so” with increasing frequency; and the break up of the Euro is a very large possibility. Of course Italy and Spain are not the only country in trouble over its debts, the US springs to mind. But the US doesn’t have a Head of state who is more famous for orgies than sound Macro-Economic policies. The US is also the world’s reserve currency who can keep the printing presses running, and have a lender of last resort to keep their banks ticking over.

So what is the point of all these musings? Well Germany, the Netherlands and Finland are up in arms about having to bail these countries out too. The Germans historically have been a pain in the Jacobs about the British will to commit to Europe, calling us Inselaffe or “Island Monkeys” due to our unwillingness to join with Europe both monetarily and intellectually. It’s too easy to mock the Germans (although that’s hardly a reason not to of course) despite their friendly volk, good beer and cultural achievements they have given the world – Heidi Klum, Claudia Schiffer and the hit 80’s tune 99 Luftballons. So I say to meine Deutsche freunde “How’s that forward progressive Europe working out for you?”.

We also have the joy of seeing politicians shutting the hell up over this. Oh how they crapped on about the City Boys being a shower of incompetent fuckwits when they did what the government wanted – borrowed lots of money to lend to the public to piss away on overinflated houses. Now we have the spectacle of the Politicians being a shower of incompetent fuckwits borrowing lots and lots and lots of money to lend to the public sector to piss away on overinflated government. Will we get a “Sorry” from the politicians for dumping us in this mess, taxes on the bonuses of the Public Sector wonks who never saw a privately earned Pound they didn’t want to take? Will we see their Vilification in the Guardian? I somehow doubt it.

At the end of the day this isn’t funny- at all. Government debt and a Eurozone collapse could mean years of misery and depression levels which if we’re lucky will mean a lost Decade like Japan. The markets have priced in a double dip recession, the answer to which is a napalming of public sector spending and regulation; lets hope the second dip is a short one.


Recusant said...
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Recusant said...

I remember at the launch of the Euro - I, like an idiot, was a 'pro' fanatic at the time - Newsnight dragged on some chap from the Cato Institute to have a good bien-pensant laugh at. He had just produced an essay claiming that not only wouldn't the Euro work, but that it was the most likely catalyst for new war in Europe: people wouldn't take a straight jacket imposed by Germany; they'd rebel and the richer countries would rebel against their rebellion, as it were.

How we laughed at the ignorant hysteria from this right-wing American. It's not so funny now.

1:11 PM

Single acts of tyranny said...

I have several wagers that the ECB will print to save Italy and serious inflation will be the consequence, not a deflation decade.

I maybe quite wrong of course.

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