Greek Election

So what can we expect from the Greek Election?

Based on the latest polls and the positions of the various parties, the 'stay in the Euro' camp has overwhelming support. 

The actual outcome of the vote though, hangs in the balance between those parties that simply want to mildly 'tweak' the bailout and those that want to radically alter it or even tear it up. 

Both camps depend on strange bedfellows actually co-habiting  New Democracy and Pasok?  Syriza and Golden Dawn?

Interestingly, the anti-bailout parties at least command something close to a majority - a government of national unity while they re-negotiate then new elections?  Might sound tempting.

The worrying thing is the impact that the election is forecast to have on the Euro and the Eurozone economies - particularly Spain and Italy.  Consider though that from an economy position, relative to the rest of the Eurozone, Greece is very small and unimportant.  This suggests that the 'market' which is infinitely smarter than EU politicians, has moved on from Greece and now the focus is Spain and the underlying concern is the Euro itself and its in-built contradictions.

Italy might survive seeing great pressure by selling off its massive gold reserves.  Say what you like about Berlusconi, he's no Gordon Brown!  I honestly can't believe I wrote that - Berlusconi smarter than Brown - now there's a thing!

The smart money has to be on continued capital flight from Spain and increasingly so from Italy.  Imagine all that 'black economy' Italian money just sliding over the border (if it isn't already there!)

We live in dangerously interesting times.

My prediction? 

I don't think that this election will solve too much for Greece but once it's out of the way, where does the Euro and Spain hide?

Euro Fraud and Danger - Germans and Dutch beware!

The European Central Bank (honestly, that's what they arrogantly call it!) is flooding the wholesale money market with loans at low rates.  So much so that, given the favourable rates, British banks have waded in and are having a slice of the pie.  The British banks seem to be using these funds to prop-up their subsidiaries in the troubled Southern European economies.

This money is, in some ways, akin to the Quantitative Easing practised by the Bank of England and the US Federal Reserve.

In some ways.  One key way in which it isn't the same is that the people whose pockets and wallets stand behind this largesse, are not being told about it.  When does financial sleight of hand become fraud?  You decide!

National Central Banks in the EuroZone  countries ultimately provide the funding for the ECB.  There is no way that the Eurocrats have the courage to directly ask the governments of Germany, Netherlands Finland etc., to fund this folly.  So they are doing it by the back-door.  They are creating a situation where the ECB, will at some point, have to go to those national governments for funding and the hope is that the national governments will conclude that they have no choice, will dress this up as unrelated to the actual Eurozone crisis and will pay-up.  Good news is that the citizens of those countries won't be asked to vote on the process - just to pay up!

Most of these ECB loans are being used to buy-up government bonds from the failing economies of Southern Europe.  In doing so, the cost of this government paper comes down - because, it is suddenly so popular!  However, in order to get the loans, the European banks must lodge, as collateral their highest quality assets.  In doing so, they weaken their own balance sheets and make the likelihood of a need for a government bailout, shortly down the road,  that much more probable.  Spanish and Italian banks are heavily tied into their own country's fate but German and particularly French banks also have heavy exposure here.

 Rumour has it that there is a proposal doing the rounds of the European governments to change the alphabet.  The proposal is to drop the letter D.  The proposers suggest that without this letter we wouldn't have a deficit, there would be no debt, the actual depression in Southern Europe wouldn't exist and that pesky old Greek word democracy, wouldn't be bothering us (not that it does too much, anyway!!) 

By the way, other than giving us the word democracy, what have the Greeks done for us (Life of Brian followers, only please!).

Seems that, not for the first time, the Germans are proving to be a barrier to this necessary reform on the pathway to a federal European utopia.  Seems that a country that is less than 200 years old, has grown accustomed and has invested a lot of its national prestige in being called Deutschland!  Hopefully a way can be found to eliminate the letter D without the German parliament or Constitutional Court being called into the discussion.  The problem with the Dutch is easily solved, we just call them Hollanders.  The Danes can be Vikings.

      

Cameron pledge on EU

Per the biased BBC and in an incredibly rude interview, on Radio 4's Today programme David Cameron  

has promised to do "everything possible" to stop other EU states discussing the single market without the UK.

He said it would be "wrong" for states which signed up to a new eurozone pact to use EU institutions to discuss issues affecting other member states.
But he said the legal position was unclear and there were "difficulties" with the European Court of Justice.

Does  this mean that the UK is not a member of the Single Market, anymore?  Can we stop being a net contributor to the EU budget?

How can this even be being discussed and why isn't the biased BBC asking EU representatives how they could justify excluding the UK?

The biased BBC use the term 'Pressed' in their report of the interview.  The interviewer, Evan Davis, didn't so much 'press' as badger the UK Prime Minister.  He would not let Cameron answer the questions that he was being peppered with and only shut up when Cameron stopped trying to answer and shut-up.

Then Cameron said 'Finished?' and, while Davis was obviously perplexed (courtesy seems to throw the biased BBC!), then proceeded to answer the questions and specifically why what he did in Brussels (using the UK veto) was in the interests of the UK and, going back to the opening of this post, re-iterated that the UK wants to remain in the EU and stressed that our number one reason for the UK's membership was the Single Market because we are a trading nation.

I suspect that Cameron reflects the desire of most Britons - we are happy to remain in the EU but want it to be an organisation focused on the Single Market rather than anything 'closer'.   Of course, if some of the members of the EU want to move towards closer union then that is up to them.  We wouldn't stand in their way (it's none of our business!) but neither should we pay anything towards it.

If you get a chance to hear the interview, please do so.  If I were in Cameron's shoes, I would refuse to be interviewed by the biased BBC again. Or at least until the Today programme has been purged of its liberal lefties!