In the past week, Europe has resembled something like school playground. Due to David Cameron using his Veto last week, the French have lashed out with several, vindictive and frankly, rather childish statements about the state of the British economy; despite the fact that Angela Merkel pointed out that Britain still had an important role to play in helping to sort out the Eurozone Crisis. It’s worth pointing out I feel, that in a note of poetic irony, Standard & Poor are expected to downgrade the French credit rating within days, whilst Britain’s remains as stable as ever. There have been calls from many influential people, that to ensure the survival of the Eurozone, that Greece should be allowed to bow out gracefully, and with as much dignity as it can muster.
The Prime Minister is in the unenviable position of trying to appease Tory backbenchers whilst trying not to alienate Europe; I must say I’m not sure he’s succeeding at both. There seems to be a huge wave of support for his stand veto at the Euro summit on Thursday, many will see this as the defiant stand of a strong Prime Minister, finally listening to the views of the people who elected him. There has however been a considerable backlash despite the support of some members of the press as well as the majority of Conservative MPs. The Deputy Prime Minister has decided that he is angry about it, and this, if the Mail is to be believed (don’t laugh), could, more than the question of AV, be the make or break issue for the Coalition; this is something that Danny Alexander has strongly denied. Read the rest of this entry
A black cloud still looms over Europe and yet any economic agreement seems like an unlikely task among the European leaders to save the EU from this debt crisis. A series of negative events hasn’t helped with the confidence in Europe either. Economic integration is a fundamental part of the Eurozone but we have witnessed the obliteration of the economies of Greece, Ireland, Portugal, Spain and Italy. Last week, the Bank of England governor Mervyn King told a committee of MPs that growth didn’t seem likely in the Eurozone. He predicted that the Eurozone would shrink both in the first quarter and in the first quarter of 2012. Read the rest of this entry
The Eurozone states seem to be stuck in quicksand, and yet no one seems to be able to do anything to stop it. Sir John Major has been lamented by many as being one of our more underwhelming Prime Ministers, but he is intelligent and savvy in his way, and knows when to hold his tongue; it is all the more pertinent therefore to take notice when he does speak. His views on how the Eurozone should try to make its way out of its current mess seem to make a great deal on sense, but so far nobody seems to be listening. For anyone who has not heard what he said (and with all the shouting about the Rugby and important things like that, it’s quite understandable), he suggested the banks recapitalising and then Greece defaulting on her loans. If the European Financial Stability Facility were then given a banking licence, he says, they could either buy Greek government bonds centrally, or else use the money to recapitalise the bank. This move could not only restore confidence in the Eurozones ability to control the extent of the crisis, but also allow countries like France and Germany to focus on the fate of other countries such as Italy and who knows, even the possibility of a spanish bailout. Read the rest of this entry
It is a very interesting time for anyone watching the events of the European economy; recently it has had more ups and downs than an episode of Skins (young people, please explain this to the old folks). The Americans appear to believe that the best way to deal with their financial crisis, as with all other problems in life, is to sue someone else. As a direct consequence of this it seems the FTSE has taken one hell of a pounding last Monday. £49 billion is not a number to which mere mortals such as I can really equate. Traders were obviously quite peeved about the loss however, and clearly it is not a good time to own shares, or have a pension (not a thing my generation will have to worry about, because we probably won’t be able to retire). Read the rest of this entry