Yesterday was a long day. For me. It was longer for Europe's senior politicians. But at least IU got home late and tired feeling like I'd achieved something. What did the Euro politicians achieve?
Well, forgive my cynicism please, but the answer is 'not a lot'. A deal that does not say how much money is going to Greece, how much is left over for Italy and how much is going into banks to cover the mess left for them, plus where any of it is coming from is somewhat less than a filling short of a sandwich; it's just more talk with no substance.
There are simple choices to be made on the Euro. Debt has to be written off or we lose more than a decade of growth: we also face the breakdown of Europe itself with all the risks that go with that. Banks have to be nationalised: the system has obviously failed. Wealthier Euro nations have to bear a serious cost or face social turmoil at their doors which will sweep into them, inevitably, if the terms of any bailout are unsustainable on the countries affected. And the realities of differing economies have to be recognised whilst at the same time the mechanisms to support effective tax systems, the elimination of corruption and the end of political patronage have to be put in place in those countries worst affected.
They're not options. All of them are necessary. And they're a package, not parts. The 'haircut' is pointless without the reform. Failing to address the real scale of losses will simply allow the contagion to spread. And right now self-interest is a very poor guide as to what to do as a result, but it seems to still be the prevalent sentiment.
All of which makes me wonder of the Germans learned anything from Versailles. The worst thing that come happen now is that this deal could give rise to the need for a twenty first century version of 'The Economic Consequences of the Peace' but I still fear it might. And that's why so far this is no deal.
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A good start would be to “harmonise” the German work ethic with that of the Spanish.
Either raise or lower — it doesn’t matter providing they are the same.
Perhaps the Germans would eventually get used to lazing around on interminable siestas and when in due course forced to do some work have to accept medieval work practices.
“A good start would be to “harmonise” the German work ethic with that of the Spanish.
Either raise or lower — it doesn’t matter providing they are the same.
Perhaps the Germans would eventually get used to lazing around on interminable siestas and when in due course forced to do some work have to accept medieval work practices.”
Oh dear…..I wouldn’t know even where to begin to say what is wrong with the above. Of course, as this has just clearly been written to provoke, I won’t waste my energy.
Shame that you can’t be bothered to “waste your energy”.
Having lived and worked for many years in both countries I though I had obtained a realistic understanding of the disparity between German and Spanish work ethics. And why in a suitably harmonised EU this may create obstacles
It appears I am wrong – but your reluctance to disipate energy will prevent me from knowing how/why.
Overlooked to mention: _
You note: – “Of course, as this has just clearly been written to provoke,”
So “provocation” has no place in (open) debate.
But it’s OK to “provoke” by hijacking a pseudonym already adopted by another contributor.
Actually I am not really interested in whether you can summon the energy to reply or not.
The Germans, unlike for instance us in the UK, at least have the option to exercise their work ethic. They have an alternative banking system there as well as the more main stream one we’d recognise. This supplementary model exists solely to keep SMEs provided with ‘funding’ if you can call it that as it’s virtual, which keeps demand high and manufacturing going. What have we got? Austerity. Economic policy in this country isn’t aiming at any kind of recovery, it’s about reinforcing the status quo. When you’ve got a bunch of empty-headed little rich kids in charge, what else can you expect?
BB
Here hear Bill.
But the bit I don’t understand is where was the outcry when Mervyn King said that the latest bout of QE may not lead to extra lending to businesses? Or have I missed the point and that actually the £75 billion is not real money at all, but just more chips for the square mile casino
Without the book in front of me, I am not sure if I am describing Mike Rowbotham’s debt solution accurately here, but here goes anyway.
As I understand it, in his book “The Grip of Death”, this method was meant to be attributed to third world debt, but could easily be adapted to the EU situation.
Either the World Bank, IMF or the EU, (though the EU might have to change their constitution first) could simply create the money much in the same way as QE and buy all the EU the debt, but instead of the banks being able to use these new funds, they would have to sit on them as an accounting procedure.
Any thoughts on this?
It works
The funds created are returned to government’s as Treasury deposits at very low interest but everyone is then solvent again
Contrary to popular belief (and computer modelling) “economics” are neither “predictable” or “consistent” — otherwise we would have foreseen that the credit bubble was unsustainable and both banks and governments would have prevented it.
Similarly for the EU to become fully integrated requires economic, political and cultural predictability and consistency — but when these three dynamics collide nothing is predictable.
National work ethic is clearly not predictable or consistent and difficult to absorb into pan-European integration because the most inconsistent and unpredictable element is simply — people.
The best thing the EU could do for EU countries is to let them have their own central banks again to control their own economic and monetary policy.
With hindsight, monetary integration was never going to work. All that has happened since the global recession is that EU countries have been left wide open to financial speculation.
Steveo! Pardon my ignorance but if all the bond holders were paid off in one fell swoop, what would they do with the money? Would it then be available to invest? Would the sheer amount available drive down the cost of borrowing?
And if governments weren’t paying back debt with interest, they would be billions better off and could either cut taxes or invest?
Have i got it right?