Spanish life is not always likeable but it is compellingly loveable.
- Christopher Howse: A Pilgrim in Spain.
If you've arrived here because of an interest in Galicia or Pontevedra, see my web page here. Garish but informative.
Matters Hamburg
- I enjoyed half an hour or so in 'the world's only spice museum' yesterday. Though it didn't quite take my breath away as much as a visit to Bombay's spice market drastically did many years ago. Given their aversion to hot(picante) foods, I wondered if many Spaniards visited the place.
- I also wondered if this brand had ever been a success in the Anglosphere:-
- Then I went to take a look at Hamburg's 'Little Turkey', intending to have a kebab of some sort. But I noticed a Persian restaurant and plumped for a chelow kebab there. Which took me back:-
- But my attempts to dredge my brain for Farsi conversation with the owner were not terribly successful.
- Walking through the barrio to the main station, I had the impression mine was the only (very) pink face on the street. Well, mine and those of couple of blond women who were standing around with apparently very little to do. Possibly there in a professional capacity.
- Hamburg's population in 1900 was 0.7m, by coincidence close to Liverpool's 0.8m. Since then, Hamburg's has grown to almost 2m, whereas Liverpool's peaked in the 1930s, at 0.9m, and is now only 0.5m. Their respective metropolitan areas are 5.1m and 2.2m. As I said yesterday, very different trajectories. And wealth characteristics. Bits of Liverpool are very elegant but many parts of Hamburg are.
- Hamburg is actually growing in physical size as well, with the newish district of Hafen City being expanded into the Ubersee Quartier. Beyond the flashy new Philharmonic building:-
- Here's a foto taken from this, showing rather more working cranes than you'd ever see in Liverpool docks these days. If you could find what remains of these:-
- Hafen City contains the Speicherstadt (the warehouse district), which rather overshadows Liverpool's popular but much smaller Albert Dock development. And contains several museums and places of interest such as the phenomenal Miniatur Wunderland model railway complex.
- There's naturally a lot of talk around the future of Mrs Merkel and of Germany, following further setbacks for both her party and that of her main coalition partner in Sunday's regional elections in Hesse. Below is a relevant Times article.
- Here's a sentence from this with wider import: Parisian spin doctors may see this as a chance for “Jupiter” Macron to be the undisputed voice of Europe. But there is another scenario: that without Merkel the European centre collapses and the European “project” becomes little more than a pipe dream. Which I've always seen it as, of course.
- Meanwhile, it doesn't look like we'll be sticking to summer time any time soon.
Matters French and Italian (but not Martinis)
- Here's Don Quijones with his latest comments on the ongoing Italian bout with the European Commission. France has great cause to be worried, it emerges.
Matters Spanish
- The Vatican, as expected, is refusing to play ball over the transfer of Franco's remains.
- The world's 'coolest neighbourhood' is said to be in Madrid. But, thanks to Airbnb, this not as cheap as it was.
Matters UK
- Still on Liverpool . . . The final scenes of this film - The Clouded Yellow – show a woman running through Liverpool docks and using the overhead railway that used to run through them and beyond. Hamburg's fine overhead/underground railway system, in contrast, still exists and has recently been expanded into the Ubersee Quartier. BTW . . . The letters on the train engine MD&HB, stand for the Mersey Docks and Harbour Board, still an important institution when I was a kid.
Matters Galician
- Some camino tips, albeit mostly for 'girls'. Not sure if this includes 'women' these days. Though it might do if women use the term. But not men. Who risk being hung, drawn and quartered for doing so.
Spanish
- Word of the day: Camilona
Finally . . .
- A headline in a German newspaper called the Barcelona player, Luis Suarez, 'Baby-Bomber'. Possibly a reference to him displaying a picture of his baby on his undershirt having scored against Real Madrid recently. Baby Bomber??
© David Colin Davies, Hamburg: 31.10.18
THE ARTICLES
1. Merkel’s swift exit will be Europe’s loss: Roger Boyes, The Times
The German chancellor’s end is closer than she thinks and with her may go a chunk of the EU’s clout
The Merkel bubble has burst. Only recently hailed as the true leader of the free world, the anti-Trump, she can now barely lead her own party. The future of the centre-right in Germany is going to be constructed without her. The chancellor has become a spectator. Nobody seriously believes she can serve out her term, shape Europe or continue to be a standard-bearer for liberal values.
Angela Merkel’s decision to go, I’m told, was taken after she watched a performance of Richard Wagner’s Parsifal in Munich this summer. She had been battered for weeks by a row with her interior minister, Horst Seehofer, who had insisted that migrants turning up in Germany should be immediately deported if they were previously registered in another EU country. Merkel resisted. Seehofer was adamant: “I’m not going to be sacked by a chancellor who is only chancellor because of me.” Merkel fudged.
The chancellor, sensing trouble ahead and drained by the row, decided not to take her usual hiking holiday in the South Tyrol. But she and her Wagner-loving husband did find time for a private visit to the opera. Parsifal has always been a favourite: a newcomer, unfrightened by the dangers of the German forest, defeats opponents to grasp the Holy Grail. A metaphor for her own ascent as an east German outsider who saw off plenty of arrogant males. “Music helps clear my head,” she has said of her decision making. This time apparently Wagner gave her insight into an almost complete political life; it was the moment to prepare an orderly retreat from office, if only to head off looming chaos.
Merkel may really believe she is ending her reign on her own terms. In fact her options have run out. The gruelling months of trying to form a government after last September’s election, successive losses in regional elections, and the lurking presence of the far-right Alternative for Germany (AfD) in every state parliament are all the enduring consequences of her biggest error of judgment: the opening of Germany’s borders to a barely controlled influx of almost a million migrants and refugees in 2015-16.
It was a decision, a sequence of blunders, that eroded trust in her and in her grand coalition of Christian Democrats and Social Democrats. Her self-congratulatory “welcome culture” started to sour in November 2015. She was being driven to a Germany-Netherlands football game in Hanover. The fans were due to sing the Marseillaise before kick-off out of solidarity with the victims of the Paris terror attack four days earlier. But the game was called off because of a new terror alert. Nothing happened and the public began to associate the threat of terror with the arrival of migrants from the Middle East and north Africa. Then on New Year’s Eve, in the large square outside Cologne railway station and under the shadow of the cathedral, dozens of young women reported being sexually assaulted by migrants.
This may come to be seen as the inflection point for Merkel, even if the number of migrants arriving has slowed and the number of deportations has risen. It was the moment when government action made many citizens feel unsafe. It ended up shattering Schengen, exposing those EU states with external borders. It forced Merkel into an agreement with Recep Tayyip Erdogan that would give the autocratic Turkish leader leverage over the EU. And it stoked support for the AfD and for right-wing populist parties across the continent.
The result has been deep disenchantment. Emmanuel Macron, the French president, had counted on Merkel’s co-leadership of the Franco-German axis to overhaul the EU, give it a clearer federal definition and in so doing help him to push through reforms at home. Instead Merkel was caught up in an election campaign then, after a historically poor result, a long scramble for a government. Now she is a lame duck.
Parisian spin doctors may see this as a chance for “Jupiter” Macron to be the undisputed voice of Europe. But there is another scenario: that without Merkel the European centre collapses and the European “project” becomes little more than a pipe dream. Macron without a reliable German partner flounders. Two of the candidates to be Christian Democrat party chairman, Jens Spahn and Friedrich Merz, are considerably more Eurosceptic than Merkel. Without her, the small central European and eastern states are cut adrift. The plans to expand the EU deeper into the western Balkans come apart, opening it up for Russian influence. The European brokerage of the Ukraine crisis grinds to a halt.
Merkel thinks she can impede all this. Her plan: to place an ally as CDU party chairman in December, and to work out a strategy for the European elections in May that will stem the bleeding. The reality: an open succession struggle and the ebbing away of power. Elections in eastern German states in 2019 will see her party trounced and perhaps put the AfD in charge. If she lasts that long, the Social Democrats will desert her coalition, having nothing to gain from association with her. She will be finished off as surely as she once finished off her mentor Helmut Kohl. There will be another messy election.
Germany, still the most powerful economy in the EU, is in the process of marginalising itself. The chancellor is tired; it shows at EU summits, in her sometimes erratic personnel decisions. Thirteen years in power strains the brain and body of a democratic leader. The real lesson from that Wagner performance this summer? Even great works of art can go on for too long, and end badly for some.
The German chancellor’s end is closer than she thinks and with her may go a chunk of the EU’s clout
The Merkel bubble has burst. Only recently hailed as the true leader of the free world, the anti-Trump, she can now barely lead her own party. The future of the centre-right in Germany is going to be constructed without her. The chancellor has become a spectator. Nobody seriously believes she can serve out her term, shape Europe or continue to be a standard-bearer for liberal values.
Angela Merkel’s decision to go, I’m told, was taken after she watched a performance of Richard Wagner’s Parsifal in Munich this summer. She had been battered for weeks by a row with her interior minister, Horst Seehofer, who had insisted that migrants turning up in Germany should be immediately deported if they were previously registered in another EU country. Merkel resisted. Seehofer was adamant: “I’m not going to be sacked by a chancellor who is only chancellor because of me.” Merkel fudged.
The chancellor, sensing trouble ahead and drained by the row, decided not to take her usual hiking holiday in the South Tyrol. But she and her Wagner-loving husband did find time for a private visit to the opera. Parsifal has always been a favourite: a newcomer, unfrightened by the dangers of the German forest, defeats opponents to grasp the Holy Grail. A metaphor for her own ascent as an east German outsider who saw off plenty of arrogant males. “Music helps clear my head,” she has said of her decision making. This time apparently Wagner gave her insight into an almost complete political life; it was the moment to prepare an orderly retreat from office, if only to head off looming chaos.
Merkel may really believe she is ending her reign on her own terms. In fact her options have run out. The gruelling months of trying to form a government after last September’s election, successive losses in regional elections, and the lurking presence of the far-right Alternative for Germany (AfD) in every state parliament are all the enduring consequences of her biggest error of judgment: the opening of Germany’s borders to a barely controlled influx of almost a million migrants and refugees in 2015-16.
It was a decision, a sequence of blunders, that eroded trust in her and in her grand coalition of Christian Democrats and Social Democrats. Her self-congratulatory “welcome culture” started to sour in November 2015. She was being driven to a Germany-Netherlands football game in Hanover. The fans were due to sing the Marseillaise before kick-off out of solidarity with the victims of the Paris terror attack four days earlier. But the game was called off because of a new terror alert. Nothing happened and the public began to associate the threat of terror with the arrival of migrants from the Middle East and north Africa. Then on New Year’s Eve, in the large square outside Cologne railway station and under the shadow of the cathedral, dozens of young women reported being sexually assaulted by migrants.
This may come to be seen as the inflection point for Merkel, even if the number of migrants arriving has slowed and the number of deportations has risen. It was the moment when government action made many citizens feel unsafe. It ended up shattering Schengen, exposing those EU states with external borders. It forced Merkel into an agreement with Recep Tayyip Erdogan that would give the autocratic Turkish leader leverage over the EU. And it stoked support for the AfD and for right-wing populist parties across the continent.
The result has been deep disenchantment. Emmanuel Macron, the French president, had counted on Merkel’s co-leadership of the Franco-German axis to overhaul the EU, give it a clearer federal definition and in so doing help him to push through reforms at home. Instead Merkel was caught up in an election campaign then, after a historically poor result, a long scramble for a government. Now she is a lame duck.
Parisian spin doctors may see this as a chance for “Jupiter” Macron to be the undisputed voice of Europe. But there is another scenario: that without Merkel the European centre collapses and the European “project” becomes little more than a pipe dream. Macron without a reliable German partner flounders. Two of the candidates to be Christian Democrat party chairman, Jens Spahn and Friedrich Merz, are considerably more Eurosceptic than Merkel. Without her, the small central European and eastern states are cut adrift. The plans to expand the EU deeper into the western Balkans come apart, opening it up for Russian influence. The European brokerage of the Ukraine crisis grinds to a halt.
Merkel thinks she can impede all this. Her plan: to place an ally as CDU party chairman in December, and to work out a strategy for the European elections in May that will stem the bleeding. The reality: an open succession struggle and the ebbing away of power. Elections in eastern German states in 2019 will see her party trounced and perhaps put the AfD in charge. If she lasts that long, the Social Democrats will desert her coalition, having nothing to gain from association with her. She will be finished off as surely as she once finished off her mentor Helmut Kohl. There will be another messy election.
Germany, still the most powerful economy in the EU, is in the process of marginalising itself. The chancellor is tired; it shows at EU summits, in her sometimes erratic personnel decisions. Thirteen years in power strains the brain and body of a democratic leader. The real lesson from that Wagner performance this summer? Even great works of art can go on for too long, and end badly for some.
2. ECB heading for 'Titanic iceberg' as Italy crumbles and eurozone slows to five-year low: Ambrose Evans-Pritchard
Italy’s economic growth has slumped to zero and the eurozone is facing the steepest slowdown since the debt crisis five year ago, prompting fears of a 'policy error' by the European Central Bank.
Eurostat’s flash estimate for the eurozone halved to 0.2% in the third quarter as the region grappled with vanishing global liquidity and a trade shock from China and emerging markets.
The region is uncomfortably close to stall speed yet the ECB is pressing ahead with plans to wind down quantitative easing and will reduce its bond purchases to zero at the end of the year.
“We are moving into ‘policy mistake’ territory," said Lars Christensen from Markets & Money Advisory. Growth is slowing across the world. The ECB needs to change to a dovish stance and start expanding its balance sheet once again. If they don’t do that, we will be moving into a recessionary situation and a re-emergence of the eurozone debt crisis. Italy is already bringing us back to the brink,” he said.
Desmond Lachman from the American Enterprise Institute said the ECB was heading straight for a "Titanic iceberg". He compared the picture to July 2008 when the bank raised rates in the teeth of recession and a financial storm.
Italy’s economy failed to eke out any growth in the third quarter and is close to stalling. This can quickly threaten the sustainability of Italian public debt, which is highly sensitive to the trajectory of nominal GDP.
The insurgent Lega-Five Star government in Rome is counting on future growth of 1.5% to meet its budget targets but this is far beyond reach.
Lorenzo Bini-Smaghi, chairman of Societe Generale, said Italy was “going straight into a wall” and may be in recession by the end of the year, pushing the budget deficit to 3.5% of GDP in short order. “The crash is going to be violent,” he added.
Giada Giani, from Citigroup, said there was no sign of a pick-up in exports. Leading indicators point to a possible decline in GDP over the fourth quarter.
The worry is that Italy could now slide into trouble even if the Lega-Five Star coalition backs away from its budget showdown with Brussels. “If growth tanks, simply reversing the fiscal relaxation plans may not be enough to address debt sustainability concerns,” she said.
Markets may take matters into their own hands. Yields on 10-year Italian bonds jumped 16 basis points to 3.48% on news of the growth shock, causing a further pro-cyclical tightening.Rising yields in this situation is a perverse feature of monetary union. Developed countries with their own currencies and central banks usually enjoy falling yields when growth slows, which acts as a shock absorber. The euro structure amplifies the damage.
Italy's bond sell-off is eating into the capital buffers of the banks, which hold €380bn (£339bn) of Italian state debt. This in turn is causing an incipient credit crunch.
The Bank of Italy’s lending survey released last week shows that banks are facing shrinking margins. Borrowing costs are rising for Italian companies. Small business is being squeezed out of the loan market.
“The most sensitive figure in the world right now is Italian funding costs versus Italian nominal GDP (the sustainability threshold) and sadly zero real growth is not adequate,” said Andrew Roberts, head of macro-strategy at NatWest Markets.
Mr Roberts said the ECB had been inching back from its plans to normalize policy. “They are worried that Asia is turning over and taking Europe with it. They don’t want markets getting ahead and pricing in rate rises for next year. That would be an issue,” he said. “Europe is facing a double whammy because the tap of debt accumulation in emerging markets is being turned off and QE is turning into quantitative tightening in developed markets,”.
For now the ECB’s public posture is that the eurozone’s mid-2018 slowdown is a hiccup - partly caused by disruption in the car industry from new rules - and that growth will return to a 2% annual rate next year. Yet the monetary data point to further malaise deep into 2019. “Such a re-acceleration now seems wildly optimistic,” said Simon Ward from Janus Henderson.
His gauge of the money supply - six-month real M1 - suggests no better than stabilization at very weak levels. Growth of the broader M3 measure is falling mechanically as QE is cut off and may reach the danger line of 2% by early next year.
Monetarists say this would leave the eurozone economy vulnerable to recession if there is the slightest external shock. This could come from China, where equities are probing a four-year low and the authorities are having difficulty pulling the economy out of the latest downturn.
For now, the British economy is holding up better than the eurozone. It has outperformed by a wide margin over the last six months. Yet schadenfreude would be ill-judged. Better growth has been sustained only by dipping into the family silver. The household savings rate is close to a 60-year low at 4.4%.
Growth of Britain’s M4x money supply has dropped to a 1% rate over the last four months. This is flashing amber recession warnings for early 2019.
The Chancellor’s Budget offers a cushion by switching from net fiscal tightening of 0.2% of GDP next year to net loosening of 0.3%. Yet this may not be sufficient in itself to offset the effects of a global slowdown and synchronized monetary tightening.
Britain and the eurozone are in the same cyclical boat.
Italy’s economic growth has slumped to zero and the eurozone is facing the steepest slowdown since the debt crisis five year ago, prompting fears of a 'policy error' by the European Central Bank.
Eurostat’s flash estimate for the eurozone halved to 0.2% in the third quarter as the region grappled with vanishing global liquidity and a trade shock from China and emerging markets.
The region is uncomfortably close to stall speed yet the ECB is pressing ahead with plans to wind down quantitative easing and will reduce its bond purchases to zero at the end of the year.
“We are moving into ‘policy mistake’ territory," said Lars Christensen from Markets & Money Advisory. Growth is slowing across the world. The ECB needs to change to a dovish stance and start expanding its balance sheet once again. If they don’t do that, we will be moving into a recessionary situation and a re-emergence of the eurozone debt crisis. Italy is already bringing us back to the brink,” he said.
Desmond Lachman from the American Enterprise Institute said the ECB was heading straight for a "Titanic iceberg". He compared the picture to July 2008 when the bank raised rates in the teeth of recession and a financial storm.
Italy’s economy failed to eke out any growth in the third quarter and is close to stalling. This can quickly threaten the sustainability of Italian public debt, which is highly sensitive to the trajectory of nominal GDP.
The insurgent Lega-Five Star government in Rome is counting on future growth of 1.5% to meet its budget targets but this is far beyond reach.
Lorenzo Bini-Smaghi, chairman of Societe Generale, said Italy was “going straight into a wall” and may be in recession by the end of the year, pushing the budget deficit to 3.5% of GDP in short order. “The crash is going to be violent,” he added.
Giada Giani, from Citigroup, said there was no sign of a pick-up in exports. Leading indicators point to a possible decline in GDP over the fourth quarter.
The worry is that Italy could now slide into trouble even if the Lega-Five Star coalition backs away from its budget showdown with Brussels. “If growth tanks, simply reversing the fiscal relaxation plans may not be enough to address debt sustainability concerns,” she said.
Markets may take matters into their own hands. Yields on 10-year Italian bonds jumped 16 basis points to 3.48% on news of the growth shock, causing a further pro-cyclical tightening.Rising yields in this situation is a perverse feature of monetary union. Developed countries with their own currencies and central banks usually enjoy falling yields when growth slows, which acts as a shock absorber. The euro structure amplifies the damage.
Italy's bond sell-off is eating into the capital buffers of the banks, which hold €380bn (£339bn) of Italian state debt. This in turn is causing an incipient credit crunch.
The Bank of Italy’s lending survey released last week shows that banks are facing shrinking margins. Borrowing costs are rising for Italian companies. Small business is being squeezed out of the loan market.
“The most sensitive figure in the world right now is Italian funding costs versus Italian nominal GDP (the sustainability threshold) and sadly zero real growth is not adequate,” said Andrew Roberts, head of macro-strategy at NatWest Markets.
Mr Roberts said the ECB had been inching back from its plans to normalize policy. “They are worried that Asia is turning over and taking Europe with it. They don’t want markets getting ahead and pricing in rate rises for next year. That would be an issue,” he said. “Europe is facing a double whammy because the tap of debt accumulation in emerging markets is being turned off and QE is turning into quantitative tightening in developed markets,”.
For now the ECB’s public posture is that the eurozone’s mid-2018 slowdown is a hiccup - partly caused by disruption in the car industry from new rules - and that growth will return to a 2% annual rate next year. Yet the monetary data point to further malaise deep into 2019. “Such a re-acceleration now seems wildly optimistic,” said Simon Ward from Janus Henderson.
His gauge of the money supply - six-month real M1 - suggests no better than stabilization at very weak levels. Growth of the broader M3 measure is falling mechanically as QE is cut off and may reach the danger line of 2% by early next year.
Monetarists say this would leave the eurozone economy vulnerable to recession if there is the slightest external shock. This could come from China, where equities are probing a four-year low and the authorities are having difficulty pulling the economy out of the latest downturn.
For now, the British economy is holding up better than the eurozone. It has outperformed by a wide margin over the last six months. Yet schadenfreude would be ill-judged. Better growth has been sustained only by dipping into the family silver. The household savings rate is close to a 60-year low at 4.4%.
Growth of Britain’s M4x money supply has dropped to a 1% rate over the last four months. This is flashing amber recession warnings for early 2019.
The Chancellor’s Budget offers a cushion by switching from net fiscal tightening of 0.2% of GDP next year to net loosening of 0.3%. Yet this may not be sufficient in itself to offset the effects of a global slowdown and synchronized monetary tightening.
Britain and the eurozone are in the same cyclical boat.
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