Friday, October 28, 2011

MIDDAY(ISH) EU SPECIAL  (Please return later for tonight's post)

First off, here's a brilliant and funny explanation of the European financial crisis. I believe I posted this a while back but it certainly merits another airing.

video


Now for the heavier stuff . . . .

Here's our Ambrose making the widely-supported point that there can be no solution to the problems of the eurozone without the ECB becoming a bank of last resort, able to print money. Which is rather hard to see Germany agreeing to, for one reason and another. And here he is addressing the Portuguese monetary contraction, with which we could all become a lot more familiar in the weeks to come.

And here's the always-superb Simon Jenkins of The Guardian, putting things in the way I wish I could. The bastard.

From the other side of the pond, here's Paul Krugman, taking a wider perspective on the critical capacity of the eurozone countries to generate growth via the hair-shirt measures they've either willingly introduced or had thrust upon them. In the latter case, effectively by Germany, unfortunately. No longer "Europe", "the EU", or even the Franco-German duovirate. But Germany. With all the gut reactions that causes. And the exact opposite of what the French objectives were in setting up the Common Market fifty years ago. 

As some cynic once said:- The effect of every major reform is the exact opposite of that for which it was designed. Though it sometimes takes a while. And often gives the nay-sayers no comfort at all in being proved right. Everyone goes down with the ship.

Finally, on this Titanic note, here's an on-the-ball editorial from The Guardian:- 

Under the principle of Occam's razor, every assumption is shaved away until – in Bertrand Russell's phrase – as much as possible is explained by known entities, and reliance on unknown entities is reduced to the minimum. In fashioning a response to the woes of its currency, Europe has taken the opposite tack.

The continent's leaders emerged bleary-eyed into yesterday's grey Brussels dawn not with straightforward orders to institutions which actually exist, but with baffling plans to magic money out of somewhere.

It is to be very much hoped that their fiendishly complex plan can be delivered, since the alternative is certain depression. Despite an excited reaction on the markets yesterday, however, the obstacles to success are legion.

Even if all the varied components come off, none will stimulate growth in the way the ECB could. And growth is what the angry, unemployed voters in all those disparate countries will demand. If, in the end, Europe cannot grow an economy big enough to shoulder its debts, the crisis will not go away.


Bottom line - It's hard not to be pessimistic, whatever hopes you entertain, be they europhilic or europhobic. Whatever happens next, there isn't going to be a soft landing. 

So . . . Where do I put my money, Charles?  China? Even if (because?) they're refusing to play ball and come to the party dressed as the Seventh Cavalry. Or the Sixth Fleet.

2 comments:

Midnight Golfer said...

The Games, which I believe pre-dated, and was more entertaining than The Office, had a few of these actors in it.

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