Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#1
George Soros has been looking at the new European Central bank bond deal to bail out the debtor countries and it makes worrying reading. Apologies if it a bit technical but here are some extracts:
(from New York Review of Books)
"Unfortunately, even unlimited intervention may not be sufficient to prevent the division of the euro area into creditor and debtor countries from becoming permanent. It will not eliminate the risk premiums, only narrow them and the conditionality imposed on the debtor countries by the EFSF is likely to push them into a deflationary trap. As a consequence, they will not be able to regain competitiveness until the pursuit of debt reduction through austerity is abandoned." ....."The line of least resistance leads not to the immediate breakup of the euro but to the indefinite extension of the crisis." .....
"It will be a hierarchical system built on debt obligations instead of a voluntary association of equals. There will be two classes of states, creditors and debtors, and the creditors will be in charge. As the strongest creditor country, Germany will emerge as the hegemon. The class differentiation will become permanent because the debtor countries will have to pay significant risk premiums for access to capital and it will become impossible for them to catch up with the creditor countries." .....
"Both human and financial resources will be attracted to the center and the periphery will become permanently depressed. Germany will even enjoy some relief from its demographic problems by the immigration of well-educated people from the Iberian Peninsula and Italy instead of less qualified Gastarbeiter from Turkey or Ukraine. But the periphery will be seething with resentment." .....
"Prospect of a prolonged depression and permanent division into debtor and creditor nations is so dismal that it cannot be tolerated. What are the alternatives?"
....................
That is serious stuff.
To paraphrase this - the ECB bailout will just prolong the economic depression, not generate recovery. Debtor countries will just sink into more and more poverty with their talent moving to more prosperous regions. This is a recipe for a disaster social, economic and potential internal and external conflict.
The UK really must redouble efforts to develop markets outside Europe, get out of the EU and try as far as possible to insulate us from the disaster happening over the channel. We must hope that common sense prevails and the Euro is broken up.
Brian Dixon
- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
#2
barryw,when you say unstable europe,do you include the uk in the mix,as you may no that the uk is classed as a european country.if not why.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#3
No Brian. This refers to the Eurozone and we are thankfully not members of that. Read the detail. I am pointing out that we need to distance ourselves from the EU and Eurozone in particular.
Guest 710- Registered: 28 Feb 2011
- Posts: 6,950
#4
You seem to be riding two horses Barry. Most of the time your push for, and joy at, a 'worsening' of the situation in much of Europe to attract the moneyed into 'Tax Haven' UK.
The first section quoted ends, "What are the alternatives?" I take it that the piece ended there, with that encouragement to buy the book?
The split into Debtor and Creditor countries within Europe is surely more correctly within the Euro-bloc. The alternative of some or all the 'debtor' countries leaving the Euro must still be a reality, but in many respects that would leave the 'problem' with those responsible for it. In that the inclusion of many (if not in fact all) the debtor nations into the Euro-bloc was a bit of a scam in the first place.
The UK leaving the EU under these circumstances is bound to leave a bitter taste in the mouths of many;here and in the broader EU. Our own economy 'benefited' to a large extent [the arms sales I have already mentioned being a large part of 'our' gain] when we seized upon the fact that we could play rings around Greece etc. while being able to rely on Germany to bail us out. We are in this up to our necks.
Ignorance is bliss, bliss is happiness, I am happy...to draw your attention to the possible connectivity in the foregoing.
Guest 716- Registered: 9 Jun 2011
- Posts: 4,010
#5
# 4....yes indeed..........heads firmly in the sand with the only orifice unable to
see the wood for the trees........time will tell.......feel another wager coming on.....
Keith Sansum1
- Location: london
- Registered: 25 Aug 2010
- Posts: 23,948
#6
reg;
how many real ale pints of barryw's can you drink in a night???
ALL POSTS ARE MY OWN PERSONAL VIEWS
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
#7
the main problems are with countries that have fairly recent records of non elected governments i.e. spain, portugal and greece.
the protests against cuts in those countries could reach a stage when the military could take control.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#8
Howard - that is the kind of thing that could result from what is happening.
The alternatives Tom is a Euro break up as I have said before.
Not two horses at all and I certainly do not take any kind of joy at the mess the Eurozone has placed itself in. I am only keen for it to be resolved in the only sensible way, a break up of the Euro.
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
#9
Post 1 is an alarm bell.
Oh my God! The train is careering along the track, heading for a brick wall, and no-one can stop it....
Which train, Guv?
Errr errm, these European trains...
Brian Dixon- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
#10
barry,i beg to differ,the uk all though not in the eurozone as you put it,is in just as much strife as europe.with all the cut backs,double dip ression etc.europe looks in better shape.
Brian Dixon- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
#11
oh by the way barry,as kieth keeps saying about you buying young reg a beer,i hope you got a fund going if reg and kieth are right.other wise it might prove an expencive evening.
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
#12
Brian, Europe is known as the Eurozone, Britain is currently known as the Pound shop.
This is the real economy.
Then we have Soros and Co., but that's a different planet.
Brian Dixon- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
#13
are but alex your forgetting the euro shop.now thats the real deal.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#14
A bit more for you from Soros on solving this crisis.
He suggests rather than a piecemeal break-up of the Euro with the weaker countries leaving, which would be chaotic, that Germany should leave it.
Without Germany the Euro would devalue and help inflate a lot of the debt away and will make the remaining members of the currency more competitive. This, he says, would be the least economically disruptive option - or words to that effect.
He has a point.
One thing for sure - the Euro cannot carry on as now.
Guest 683- Registered: 11 Feb 2009
- Posts: 1,052
#15
The Euro is not the real issue, rather it is one of European political union and the sooner we get on with that the sooner all this will be sorted. Weak politicians, cowed by the cries of the insular and reactionary, are holding back on the decisive action that we need.
Guest 698- Registered: 28 May 2010
- Posts: 8,664
#16
Now, I'm not saying old George Soros is wrong on this one. But we know him of old; his investment strategy is to build risk positions in various markets quietly over a long period of time and then start loudly talking his book until the markets start believing him.
I think we can take it as read that he has built up large asset positions in distressed PIGS bonds and is now seeking to convince the markets that the spread between Greek paper and Bunds will narrow, to his advantage.
I'm an optimist. But I'm an optimist who takes my raincoat - Harold Wilson
Guest 716- Registered: 9 Jun 2011
- Posts: 4,010
#17
EU heavyweights call for radical foreign and defence policy overhaul.
Five of six biggest EU plan a pan-European foreign ministry and majority voting to by
pass UK`s veto and possible Euorpean Army and single market for EU defence
industries.
It will prove hugely contentious and if implemented will increase the pressure on Britain
to quit the EU.......... Flashmouse`s `ego` veto certainly isolated Britain......
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#18
I suspect that you are right Peter but nevertheless there is certainly a sound basis for his analysis.
Mark - a European superstate is neither desirable or wanted by most of the people in the EU, not even Germany. It is only these (I agree, weak) politicians who want it and they are running scared of their electorate and quite rightly too. They have progressed their superstate aims by deceit and lies so far and tried to force it through the single currency which was never an economic and only a political issue. The result being the Eurozone crisis which was inevitable and predicted by many. Now they have a problem with abandoning their single currency and admit defeat while changing the whole European project or being dictatorial pushing the European superstate against the wishes of the electorate. The truth is it is only their conceit that is holding the Euro together and in so doing devastating the weaker economies.
Thankfully we were not foolish enough to join the Euro and are in a better position now than we might have been. But nevertheless we are still affected by their errors, not only the currency, but their failure to balance their budgets (a problem the UK shares) - again the fault of foolish big spending politicians.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
#19
political union will never happen mark and the disaster it would bring would will be averted. germany as the economic power would have the whip hand and the rest - especially the new smaller states - would have no say in their own destiny.
various referenda around europe clearly state the when people are asked about further integration they don't want it.
Guest 716- Registered: 9 Jun 2011
- Posts: 4,010
#20
# 15 Agree and it will happen eventually....with or without Britain...
