If there is an entente between France and Germany at all any more, it’s getting less cordial by the day. For over a year now, this has been the eurozone (and Europe’s) biggest problem by miles. Forget the debts for a minute: the problem isn’t finding the short-term money to solve the euroblown fiasco, the problem is getting the two biggest players to agree on what to do.
Meanwhile, as the Sprouts spout poetry and design bond issues from the rags of derelicts, the sound of death knells, final trumps and folks heading for the hills is getting louder than Eastenders during an argument in the Queen Vic. Moody’s cut Spain’s credit rating by three notches yesterday, and withdrawals from Greek banks continued to accelerate. Crédit Agricole, France’s third-largest bank and itself on the sick list which dare not release its names, is making plans to ‘walk away’ from its wholly-owned Greek lender if Athens winds up quitting the euro. If it does, this will be the first time in history the French walked away from the sound of gunfire, but the reality of its ownership of Emporiki Bank is not quite as simple as chucking some keys through the door and sauntering down to Starbucks for a coffee. Everyone with half a brain knows this, but the MSM hoovered up the French spinette with its usual appetite.
As a result, pretty well all the Asian stocks finished much lower last night – and trust me, this is not because the Cryogenic Experiment formerly known as the Glaser family decided to move Manchester United’s Asian IPO to the US. This one too is about a great deal more than anything the financial press is up to speed with, and I hope to post upon the fascinating finances of this family shortly. Their gallant attempt to clone each other forty years ago hasn’t worked out that well on the whole, but in Delaware (where, like all the world’s crooks, they are based, and may thus file accounts in a fast and free manner) people with their eyes informally arranged and beards where the forehead should be are not that remarkable.
But if the Europeans are in a loveless marriage between the Don’t Knows and the Don’t Budges, Timmy Geithner is very much on their case. He ‘seeks more eurozone measures’ Reuters tell us this morning – but whether this is a switch away from metric or more bazookas remains unclear. He seeks them here, he seeks them there, he seeks those measures everywhere…but the Lady’s not for leveraging. The Fuhrerin remains as always for Gotterdammerung, the only problem being that she ain’t Gottadamnedidea how that’s going to work without everyone but Germany starving.
But Mr Geithner’s in luck, because Paris is set to propose a package of measures. A package means…a lot, right? Sadly, it’s the same lot we’ve seen a lot of times already. What we have here is a lottery.
Francois Hollande, being un homme des grands reflections, has spotted that €100bn for Spain is viewed by the markets as a sub-atomic amount compared to the ClubMed and peripheral problems as a whole. So while homoaeopathy is the Brussels weapon of choice when dealing with tertiary bubons, our Francois is clear that more is needed – and more directly, it’s needed by the banks. Especially the French banks, although far be it from me to suggest a less than noble motivation being involved.
What the markets need is the sight of a lot of hitherto laid-back people dashing about building up a genuinely fat wad, rather than engaging in onanism with a Beijing that clearly has no intention of offering help beyond the hectoring thing. And indeed, Frau Doktor Merkel is certainly up for the dashing: she dashes everyone’s hopes on a daily basis. I wouldn’t say the German leader has set out her stall, so much as opened a fortress selling sackcloths, ashes, and death if you don’t buy. So even though Paris is set to propose its package at the next summit on June 28th, it isn’t going to get anywhere. Better men than Monsieur Hollande have attacked this redoubt, and the dead bodies are there for all to see who wish so to do.
In the US, where Obama’s ‘genuine’ recovery has finally been revealed as a cheap knock-off made in Singapore, Mitt Romney seems at last to cottoned on to the possibility that his Second Coming may be at hand. The Black Dude over-reached himself last Friday by overtly stating “the US private sector is doing just fine” when it palpably obviously isn’t, and now oven-ready Mitt has offered American business the promise that Help is at Hand, and he is the main helper. Time magazine called this ‘faith before evidence’ ( a neat line given Romney’s odd beliefs) but th challenger goofed bigtime by saing that all Obama wants is “more fireman, more policeman, more teachers”. It turns out that most everybody in every community everywhere wants that too, so now Mitt is backtracking like a V8 Italian tank.
In fact, he has plenty to go at: foreclosures rose year-over-year in May for the first time in more than two years (as predicted here in April) and Obama’s much-trumpeted bobs and economic activity is clearly a sham if one has the eye for it. But Romney isn’t going anywhere other than back ino the footnotes of history. Just when it seemed like the GOP could choose a one-legged duck as the Candidate and win, they chose a paraplegic duck with a penchant for kamikaze.
And just as Spain asked Europe for a bailout topping $125 billion, Amancio Ortega, the Spaniard who founded retailer Inditex, was confirmed as the eurozone’s trichest man. The tycoon’s fortune rose €2.7bn billion to around €36 billion yesterday – according to the Bloomberg Billionaires Index. On the Bloomberg site, however, the septuagenarian’s stonking wealth was expressed in dollars. I’d imagine it is indeed in dollars.
The Slog 