Is the end nigh for the Euro? [vol. 2]
Discussion
[Devils Advocate]
The EU does have a financial bazooka capable of sorting out this mess and saving the euro, it's called federalization, a word that's not nearly as dirty or as left wing as some in this thread would have us believe.
References to the EUSSR are powerful propaganda but ultimately misleading because all indicators point to an American model of federalization, which last time I looked was firmly in the capitalist camp, indeed may even have some history with regards to communism.
The reason this is achievable is because very few people have an understanding of money beyond what's in their own bank account. It would in theory be possible to introduce eurobonds, give the ECB power to issue money directly and provide continuous subsidy through Hollande's 'growth pact', thus creating a federal superstate while simultaneously preserving the illusion of being independent sovereign countries.
Arguably this is the only way to move forward without encountering Steffan's much vaunted crunch. 40 years of democracy is exactly what's got Greece in to this mess because the population at large doesn't understand that PASOK/ND/New Labour/insert left leaning party here are buying votes with money they don't have.
So long as this perverse incentive to buy votes exists within democracy there will be space for the EU to consolidate their power, after all cutting back on public spending and then supporting wealth creating entrepreneurs is the only realistic way out of a hole.
The EU has already proven itself far more adept at cutting public spending than PASOK/ND and depending on what Hollande comes up with may well prove better at spurring growth too.
Underlying this is a schizophrenia among the people of Europe who want both closer union and respect for national sovereignty, so perhaps it's unsurprising that we are seeing fiscal unity while each country maintains a monopoly of force within their own country (police/army). It is after all exactly what people are asking for.
This can be seen most clearly in the way Greek people want to stay in the euro, even the anti austerity parties are talking of renegotiating the bailout rather than leaving the euro. This gives Hollande a huge lever because there are only two choices on the table - fiscal union or bust.
IMO what we are seeing is a perfectly predictable outcome of the single currency, the southern countries are already submitting to the EU plan and within the next six months we will see the Northern countries submit too, even if only to protect Germany from reverting to a strong deutschmark.
Given the strength of will among both people and politicians the above is more of a when than an if.
[/Devils Advocate]
The EU does have a financial bazooka capable of sorting out this mess and saving the euro, it's called federalization, a word that's not nearly as dirty or as left wing as some in this thread would have us believe.
References to the EUSSR are powerful propaganda but ultimately misleading because all indicators point to an American model of federalization, which last time I looked was firmly in the capitalist camp, indeed may even have some history with regards to communism.
The reason this is achievable is because very few people have an understanding of money beyond what's in their own bank account. It would in theory be possible to introduce eurobonds, give the ECB power to issue money directly and provide continuous subsidy through Hollande's 'growth pact', thus creating a federal superstate while simultaneously preserving the illusion of being independent sovereign countries.
Arguably this is the only way to move forward without encountering Steffan's much vaunted crunch. 40 years of democracy is exactly what's got Greece in to this mess because the population at large doesn't understand that PASOK/ND/New Labour/insert left leaning party here are buying votes with money they don't have.
So long as this perverse incentive to buy votes exists within democracy there will be space for the EU to consolidate their power, after all cutting back on public spending and then supporting wealth creating entrepreneurs is the only realistic way out of a hole.
The EU has already proven itself far more adept at cutting public spending than PASOK/ND and depending on what Hollande comes up with may well prove better at spurring growth too.
Underlying this is a schizophrenia among the people of Europe who want both closer union and respect for national sovereignty, so perhaps it's unsurprising that we are seeing fiscal unity while each country maintains a monopoly of force within their own country (police/army). It is after all exactly what people are asking for.
This can be seen most clearly in the way Greek people want to stay in the euro, even the anti austerity parties are talking of renegotiating the bailout rather than leaving the euro. This gives Hollande a huge lever because there are only two choices on the table - fiscal union or bust.
IMO what we are seeing is a perfectly predictable outcome of the single currency, the southern countries are already submitting to the EU plan and within the next six months we will see the Northern countries submit too, even if only to protect Germany from reverting to a strong deutschmark.
Given the strength of will among both people and politicians the above is more of a when than an if.
[/Devils Advocate]
Globs said:
DJRC said:
and it has put hundreds of billions of its own surplus savings on the line by providing the periphery banking system with the liquidity it requires to stay afloat."
Makes you wonder how much say the ordinary german had about that!And Croyft...what strings? They havent got any strings to attach.
"Do this or else!"
"Or else what?"
"Er, or else we will threaten not to talk about making anymore loans."
"OK, we will default and leave you all fooked."
"Er, well look, how about you pay us a little and we might lend you some more?"
"OK, thanks."
There has been *no* strings attached to any of this dosh because nobody had any leverage to attach them.
Tartan Pixie said:
The EU has already proven itself far more adept at cutting public spending than PASOK/ND
Devilish advocacy point possibly taken but can we look at EU public spending cuts in terms of the EU? Overall there aren't any, are there?The EU’s annual budget is projected to increase from €112bn in 2000 (at 2011 prices) to €138bn in 2020 (also at 2011 prices) a cool 23% increase in real terms.
Then there's this. EU pensions and allowances.
The EU is a bottomless pit of waste, cronyism, troughing snouts, and accounts that nobody seems keen to sign off. We're paying hand over fist for membership of a profligate, out-of-touch and antidemocratic club that's full of people who love us dearly, and we get such good value for money from their expensive vanity projects and overall inefficiency that only the lack of a referendum keeps us in.
It's about
Edited by turbobloke on Friday 11th May 19:42
DJRC said:
Globs said:
DJRC said:
and it has put hundreds of billions of its own surplus savings on the line by providing the periphery banking system with the liquidity it requires to stay afloat."
Makes you wonder how much say the ordinary german had about that!And Croyft...what strings? They havent got any strings to attach.
"Do this or else!"
"Or else what?"
"Er, or else we will threaten not to talk about making anymore loans."
"OK, we will default and leave you all fooked."
"Er, well look, how about you pay us a little and we might lend you some more?"
"OK, thanks."
There has been *no* strings attached to any of this dosh because nobody had any leverage to attach them.
I have always thought that the reality for the EU was that being the lender in the last resort and dependent on the defaulters for market confidence, is actually a real weakness. If the HBAT's drop out then the EU really is bust.
The losses on Spain, Portugal and Italy defaulting would bring down France through the collapse of the French Banks which France simply cannot fund. The EU has always had more to lose than the defaulters. If the defaulters collapse the rest of the EU will be pulled down to their level in one fell swoop of confidence collapse.
The defaulters are already in the penury, mass unemployment and mass unrest difficulty whilst still within the EU. France and the rest of the EU must be desperate not to join them.
The defaulters having already lost pretty well everything, have little to lose. IMO the EU clearly has more to lose in all of this. Being lender of the last resort AND being directly dependent on the defaulters not defaulting is a real Rock and a Hard Piece problem. No easy answers here.
Steffan said:
I am rather inclined to agree with DJRC here.
I have always thought that the reality for the EU was that being the lender in the last resort and dependent on the defaulters for market confidence, is actually a real weakness. If the HBAT's drop out then the EU really is bust.
The losses on Spain, Portugal and Italy defaulting would bring down France through the collapse of the French Banks which France simply cannot fund. The EU has always had more to lose than the defaulters. If the defaulters collapse the rest of the EU will be pulled down to their level in one fell swoop of confidence collapse.
The defaulters are already in the penury, mass unemployment and mass unrest difficulty whilst still within the EU. France and the rest of the EU must be desperate not to join them.
The defaulters having already lost pretty well everything, have little to lose. IMO the EU clearly has more to lose in all of this. Being lender of the last resort AND being directly dependent on the defaulters not defaulting is a real Rock and a Hard Piece problem. No easy answers here.
Indeed - hard to believe that they wouldn't take us with them as well I have always thought that the reality for the EU was that being the lender in the last resort and dependent on the defaulters for market confidence, is actually a real weakness. If the HBAT's drop out then the EU really is bust.
The losses on Spain, Portugal and Italy defaulting would bring down France through the collapse of the French Banks which France simply cannot fund. The EU has always had more to lose than the defaulters. If the defaulters collapse the rest of the EU will be pulled down to their level in one fell swoop of confidence collapse.
The defaulters are already in the penury, mass unemployment and mass unrest difficulty whilst still within the EU. France and the rest of the EU must be desperate not to join them.
The defaulters having already lost pretty well everything, have little to lose. IMO the EU clearly has more to lose in all of this. Being lender of the last resort AND being directly dependent on the defaulters not defaulting is a real Rock and a Hard Piece problem. No easy answers here.
Apache said:
J.Paul Getty's quote seems apt right about now
As is the Lincoln quote and the H C Anderson story. Very apt indeed.I wonder how long this can go on?
Clearly the EU will continue printing funny money by the Trillion. But the EU cannot actually save the defaulters. Their economies are way beyond help. Any suggestion of recovery is cloud cuckoo land.
The doubts over the viability of the EU must be growing in the Bond market.
Will the Greeks go into a second election and the default? Will the Spanish Banks pull Spain over finally? Will Portugal seek addition EU loans? Will Italy become unable to obtain economically realistic, Bond prices? Who knows?
Any One of these would do it. Over the defaulters will go. Shortly.
turbobloke said:
Devilish advocacy point possibly taken but can we look at EU public spending cuts in terms of the EU? Overall there aren't any, are there?
The graph you posted has nothing whatsoever to do with the genuine cuts in public spending being made by the Spanish, Greek and other governments. Cuts that I'm arguing are necessary and would never have happened without the intervention of the troika, indeed would never have happened under a democratic government because people won't vote for pain.The Sir Hümpreys running Europe know this and have played a blinder, the ECB has most of Europe in its pocket and now all the southern
k you all up."Perhaps I'm being tinfoil hatish but I don't think the current situation is entirely accidental. I've started to think of it as the Rothschild plan and, like it or not it's the situation we're in.
IMO over the next few weeks we're going to see Hollande pointing the currency gun at Germany and the north, "Do you feel lucky punk, well do ya?" He'll have the Spanish president at his side yammering on about eurobonds and if they get their way the euro will survive via federalization.
I'm not saying this is my preferred outcome, just that the possibility exists but is being ignored by this thread.
{Just to be clear about the devils advocate posts, my own position is that Shengen and EFTA were good but that building a European parliament was a stupid idea. What should have been a beautiful sight of Europeans integrating themselves without interference from politicians has, because of the parliament and single currency, become a power grab by a small group of self serving elites.
As such I am pro-european but am frankly sickened by the methodology being used to bring it about, I'd love to see the EU parliament disappear in to a hole in the ground along with its occupants and the euro.}
Tartan Pixie said:
the ECB has most of Europe in its pocket and now all the southern states countries are banging on the door of the north shouting "Fedralize or we'll pull the financial plug and fk you all up."
Perhaps I'm being tinfoil hatish but I don't think the current situation is entirely accidental. I've started to think of it as the Rothschild plan and, like it or not it's the situation we're in.
I agree, that's the plan and it's working out - the pressure to hand over europe to the central banksters is immense.k you all up."Perhaps I'm being tinfoil hatish but I don't think the current situation is entirely accidental. I've started to think of it as the Rothschild plan and, like it or not it's the situation we're in.
But then throughout history the money changers always have been running the show.
Steffan said:
Apache said:
J.Paul Getty's quote seems apt right about now
As is the Lincoln quote and the H C Anderson story. Very apt indeed.I wonder how long this can go on?
Clearly the EU will continue printing funny money by the Trillion. But the EU cannot actually save the defaulters. Their economies are way beyond help. Any suggestion of recovery is cloud cuckoo land.
The doubts over the viability of the EU must be growing in the Bond market.
Will the Greeks go into a second election and the default? Will the Spanish Banks pull Spain over finally? Will Portugal seek addition EU loans? Will Italy become unable to obtain economically realistic, Bond prices? Who knows?
Any One of these would do it. Over the defaulters will go. Shortly.
Tartan Pixie said:
turbobloke said:
Devilish advocacy point possibly taken but can we look at EU public spending cuts in terms of the EU? Overall there aren't any, are there?
The graph you posted has nothing whatsoever to do with the genuine cuts in public spending being made by the Spanish, Greek and other governments. Cuts that I'm arguing are necessary and would never have happened without the intervention of the troika, indeed would never have happened under a democratic government because people won't vote for pain.The Sir Hümpreys running Europe know this and have played a blinder, the ECB has most of Europe in its pocket and now all the southern
k you all up."Perhaps I'm being tinfoil hatish but I don't think the current situation is entirely accidental. I've started to think of it as the Rothschild plan and, like it or not it's the situation we're in.
IMO over the next few weeks we're going to see Hollande pointing the currency gun at Germany and the north, "Do you feel lucky punk, well do ya?" He'll have the Spanish president at his side yammering on about eurobonds and if they get their way the euro will survive via federalization.
I'm not saying this is my preferred outcome, just that the possibility exists but is being ignored by this thread.
{Just to be clear about the devils advocate posts, my own position is that Shengen and EFTA were good but that building a European parliament was a stupid idea. What should have been a beautiful sight of Europeans integrating themselves without interference from politicians has, because of the parliament and single currency, become a power grab by a small group of self serving elites.
As such I am pro-european but am frankly sickened by the methodology being used to bring it about, I'd love to see the EU parliament disappear in to a hole in the ground along with its occupants and the euro.}
Edited by DJRC on Saturday 12th May 16:18
Tartan Pixie said:
turbobloke said:
Devilish advocacy point possibly taken but can we look at EU public spending cuts in terms of the EU? Overall there aren't any, are there?
The graph you posted has nothing whatsoever to do with the genuine cuts in public spending being made by the Spanish, Greek and other governments. DJRC said:
Ignored by the thread? Except that Ive been pointing out all along that France has been aiming the gum at Germany. You are roughly about 8 months too late to the party.
Indeed you've made some good posts, I was more trying to point out that there's a credible alternative to the repeated assumption that just because the defaulters are defaulting then the euro must fail.speedy_thrills said:
Tartan Pixie][Devils Advocate said:
The EU does have a financial bazooka capable of sorting out this mess and saving the euro, it's called federalization[/Devils Advocate]
That is true but I can't see many EU countries consenting to this yet.Failure of the euro means northern manufacturing will take a huge hit by returning to the deutschmark et al, possibly ending up with BMW's being built somewhere with 3rd world pay and conditions, like Greece. I'm not sure that would help anyone. The banksters really have created a nasty catch 22.
turbobloke said:
Tartan Pixie said:
turbobloke said:
Devilish advocacy point possibly taken but can we look at EU public spending cuts in terms of the EU? Overall there aren't any, are there?
The graph you posted has nothing whatsoever to do with the genuine cuts in public spending being made by the Spanish, Greek and other governments. speedy_thrills said:
Tartan Pixie][Devils Advocate said:
The EU does have a financial bazooka capable of sorting out this mess and saving the euro, it's called federalization[/Devils Advocate]
That is true but I can't see many EU countries consenting to this yetspeedy_thrills said:
Tartan Pixie][Devils Advocate said:
The EU does have a financial bazooka capable of sorting out this mess and saving the euro, it's called federalization[/Devils Advocate]
That is true but I can't see many EU countries consenting to this yet.The 'mess' is debt, and most of the debt will need to be written off by a series of defaults - that's the only way of killing debt.
Federalism just locks in the debt - look at the Federal Reserve in the US - basically everyone is in debt (including companies and government), most of which is owned by the FED. So effectively the FED owns America.
Federalism is not the answer, it is The Final Solution.
We fought against this in WWII by the way Pixie...
Globs said:
speedy_thrills said:
Tartan Pixie][Devils Advocate said:
The EU does have a financial bazooka capable of sorting out this mess and saving the euro, it's called federalization[/Devils Advocate]
That is true but I can't see many EU countries consenting to this yet.The 'mess' is debt, and most of the debt will need to be written off by a series of defaults - that's the only way of killing debt.
People in Greece still believe, at least amongst politicians, their sovereignty is worth all this to maintain. We'll see what their consensus is in 5 to 10 years after rolling defaults and austerity. I'm not sure about how Germans would feel on political union but overall they seem quite pro-EU (with good reason) so they might spring for it.
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