GERMANY GIVES UP ON GREECE, JUNCKER DRONES ON IN BRUSSELS, OSBORNE SELLS SNAKE-OIL IN THE COMMONS

all quietGeorge Osborne gamely attempts to revive the British economy

All Quiet on the Western Front

After the euphoria of OXISunday comes a disturbingly normal day in Europe. The one-eyed Merkel hoped for by The Slog in the EU of the Blind hasn’t materialised: on the contrary, the word from Berlin and Frankfurt is not good.

The German leader said she would “listen politely” to what Tsipras has to say later today at the eurogroupe, which sounds less than engaged. Asked of ‘bridge funding’ for Greece while a new bailout programme is being negotiated could be a possibility, European Central Bank Governing Council member Ewald Nowotny said “Whether it’s possible is something that has to be discussed.” Right. We’ll do that then.

The mood in Berlin can be summed up in three words: Grexit or Bust. That could of course add up to Grexit and Bust, but the inflexible Hun mind has moved on from glorified slavery to amputation. I understand this hasn’t gone down well with the Black Dude, although I’m sure the new Greek finance minister Euclid Tsakalotos is delighted: a confirmed eurosceptic and respected Marxist economist, Mr Tsakolotos is among those who quite rightly see the EU as just another citizen-crushing superstate. Privately, for instance, he is keen to fire the BoG boss Yannis Stournaras – a move which, to my mind, is long overdue.

There is talk in Frankfurt that the eurogroupe session will make everything “crystal clear”. Oh dear.

I’ve been reading a Twitter feed this morning about Jean-Claude Juncker’s speech in the European Parliament. I think I can say without fear of rebuke that he didn’t come out of it very well. Probably pissed, possibly demented. Either way, the hypocritical woffle counter was clicking away noisily throughout.

Today of course Juncker will be at the Emergency Summit meeting along with most of the other pillocks responsible for destroying the Greek economic infrastructure. Lagarde won’t be there – she’s boycotting it, another helpful fit of pique – which is probably just as well, as perhaps it would’ve given Alexis Tsipras a chance to point out how terrific her contribution was to the French economy in her previous position:

Screenshot_070715_100640_AM

An EU accountable to the People and on the ball (as opposed to the make) would’ve wrapped up the Greek deal months ago and then started to tackle two far bigger problems the Union faces: that of the French economy going to Hell in a bucket, and the biggest EU economy outside the eurozone possibly heading for secession.

I say ‘possibly’ because UKip’s leaders have made such a balls of presenting the truly dysfunctional and anti-democratic nature of the European Union to the British People, for the time being it looks as if the IN campaign may well carry the day. Looked at in terms of empirical reality – and without the usual stream of media bollocks – the case for leaving the EU before things get any worse is irrefutable. But even one of the most prominent eurosceptic Tory big beasts admitted in private last week that the UK electorate has been persuaded the risk of abandoning the EUsitania is too great.

That may well change once the eurozone’s implosion starts to accelerate. The fact that the ECB is still providing ELA to the Greek banking system shows yet again that, for all the bluster, brown trousers are now de rigueur at the central bank. Since the OXI vote last Sunday, the battered € has slumped back to 1.41 to the £. German 10-year bunds saw investors steaming into the safe port, but the Italian equivalent yields shot up by eight basis points.

In the meantime, today we can all look forward to a George Osborne Budget crammed to the gunnels with dissembling half-truths, and apples being compared to pears on the quality dimension of size. Fib-watching has become a national sport in the Budget speech since the The Draper took over at The Treasury, but for myself I won’t be watching because he gives me that same vaguely creepy feeling I sometimes got when Basil Fawlty was lying to the clientele. “The Chef sends his apologies but he can’t make a Waldorf salad today because we’re right out of waldorfs” and so forth.

This unease I have is aggregated when I remember that the Chancellor does know what he’s up to, but not what he’s doing: he has, after all, no qualifications whatsoever for the job. He read History at Magdalene and was briefly a researcher in the Ministry of Ag Fish & Food. So he’d be good on use-by dates, but not a lot else. His maths results at school were OKish, no more; he has no grounding in economics, never worked in the City, and failed miserably at every attempt to get a proper job as a journalist.

Yet somehow, having failed to clear the UK deficit, failed to keep Britain’s Triple-A ratings status and failed to diversify our ludicrously financial services top-heavy economy, George has convinced even a large proportion of seasoned financial journalists that he knows the difference between deficit and defaecate. And to top it all, the National Debt is accelerating at a higher rate than at any time: when Osborne took office, the Debt was 50.2% of gdp. It is now 80.4%.

Whichever way you cut it, the austerity policy has been a farcical, mathematically simplistic failure. Today, Britain stands out among thinking fiscal economists as the most exposed, lopsided and heavily import-dependent economy in the First World. Still, I suppose if your best friend is Charlie, the chances are you can bluff your way through anything.

So there we have it: all quiet on the Western Front. Nothing to worry about at all and this won’t hurt a bit. Breathe deeply now please….

Last night at The Slog: God rest ye Jerry Mentalmen

36 thoughts on “GERMANY GIVES UP ON GREECE, JUNCKER DRONES ON IN BRUSSELS, OSBORNE SELLS SNAKE-OIL IN THE COMMONS

  1. Brilliant dissection of greek situation, beginning with the fudging that let it into the € and the lender’s role during the mismanagement of 2008:

    “…the term moral hazard traditionally applies to creditors. It describes the hazard to the real economy that might result if investors fail to discriminate between valuable and not-so-valuable projects when they allocate society’s scarce resources as proxied by money claims. Lending to a corrupt, clientelist Greek state that squanders resources on activities unlikely to yield growth from which the debt could be serviced? That is precisely, exactly, what the term “moral hazard” exists to discourage.”

    http://www.interfluidity.com/v2/5965.html

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  2. Just business as usual then. We won’t be leaving the EU in any event as long as the current incumbents are in charge, and the British public are so distracted they haven’t a f*cking clue what’s going on in the real world.
    The govt. must wet themselves laughing at just how easy it is to pull the wool over everybody’s eyes. When they say, ‘We have never had it so good’, they ain’t joking.
    My eldest son is a copper, and I won’t say where exactly he is working suffice to say it’s in the South East, and when he is on nights there are 4 coppers and two cars for, wait for it, 180 square miles! and they are expecting cut backs. Not long now and crime will pay.
    We are not going to Hell on a handcart, some f*cker will have nicked the handcart…

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  3. If Europe does not address the banks role in Greece and other countries (Spain, Portugal, Italy) then debt can only get worse. With even Germany sitting at 80% debt-GDP ratio, it could find itself in a similar situation if 2008 were to happen again.

    Great discussion here of banks role in the Greek debt starting with fudging the entry into the Euro: http://www.interfluidity.com/v2/5965.html

    …the term moral hazard traditionally applies to creditors. It describes the hazard to the real economy that might result if investors fail to discriminate between valuable and not-so-valuable projects when they allocate society’s scarce resources as proxied by money claims. Lending to a corrupt, clientelist Greek state that squanders resources on activities unlikely to yield growth from which the debt could be serviced? That is precisely, exactly, what the term “moral hazard” exists to discourage.

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  4. Yes, I read that William Engdahl article about Varoufakis the other day. I must admit, it did make me stop and think. Engdhal is normally pretty much on the money. As far as I’m concerned anyway.

    Who the hell do you believe in this whole stinking mess.. ???

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  5. Totally agree kfc +1 We won’t be leaving the EU in any event as long as the current incumbents are in charge, and the British public are so distracted they haven’t a f*cking clue what’s going on in the real world.

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  6. Don’t if anybody else saw it but there was a picture in the DM earlier (removed now) but it caught Merkel off guard as it were, Christ, she looked 20yrs older! Somebody, no guesses on who must be piling the pressure on her to resolve the Greek situation before there are Russian/Chinese ports in Greece.
    Don’t matter which way you look at it, 99% of all the world’s ills emanate from one place……

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  7. Arf,arf,same old same old then! The bonobos are still running the show and no one in sight who will pull them up on their bullshit. Tra la la la la la!

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  8. Oh, Schulz mentioned something about Armageddon the other day, anybody know what time that starts, do you need tickets or, can you just turn up?
    Although I did hear that it’s been postponed….

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  9. Will Lef………When the Syriza walked out of the talks with the troika and threw the whole mess into the voters hands it did not seem like a move someone who had studied game theory would do unless that person A. had a secret plan or B. was a trojan horse. First Varoufakis said he would quit if they voted “Yes” and later he resigned after they voted “No”. It appears that his work was done which was blowing up any hope of a carefully planned exit from the Euro. This seemed strange to me at the time and it still does. We will have to wait and see how it all plays out but it’s looking right now like it’s going to be a messy exit one that didn’t need to be so messy………..which is cause for suspicion

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  10. Remember Attlee’s limerick about himself:

    ‘There were few who thought him a starter,
    Many who thought themselves smarter.
    But he ended PM,
    CH and OM,
    an Earl and a Knight of the Garter.’

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  11. According to the IMF, to get Greece back on its feet will cost €60bn, or just 6% of the expected €1tn EU spending on QE over the next year.
    It is a political choice to deny this to Greece.

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  12. The Master’s mate was Carter,
    By Christ he was a farter,
    When the wind didn’t blow
    And the ship wouldn’t go,
    They asked Carter the Farter to start ‘er.

    I am so sorry, Chris, you prompted memories of yester-year there … young Caratacus barely able to stand (one or two shandies, I think) and weaving his unsteady way from The Grapes to barracks. Happy days

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  13. Worth giving this another airing!

    To commemorate Osborne’s many achievements, (the only proper job he’s ever had was folding napkins at a London department store). Here’s a rewritten well-known Gilbert and Sullivan song:

    When I was a lad I served a term
    Folding napkins at a well-known firm
    I folded napkins and I swept the floor
    And I sold some bits and pieces at the well-known store

    Chorus: He sold some bits and pieces at the well-known store

    I folded those napkins so carefully
    That now I am the Ruler of the Treasury

    Chorus: He folded those napkins so carefully
    That now he is the Ruler of the Treasury

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  14. I note that Obama has intervened in the latest round of talks aimed sorting out the Greek problem.
    He said that he hoped for a successful outcome to the US’s problem.

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  15. I can’t keep up ! never have …. 6 days holiday ..5 away from the web …and so far behind it’s pitiful.
    What I do remember, is some mention of rare metals and oil in the Cyprus/Greek continental shelf .
    Could this be the reason for the criminal methods to help Greece into the EU Soviet?

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  16. A few thoughts from the south-eastern front:
    a) The outcome of the referendum proved that the Hellenic people are not anatomically and/or physiologically challenged (i.e. we do have spines and guts).
    b) The meaning of OXI (NO) is quite simple for most people (with the notable exception of mr. Jean-Claude Juncker): no to the continuation of the meaningless, ineffective, vindictive and plainly stupid “policies” imposed for the “salvation” of Hellas. Two very simple examples:
    1) How will the imposition of VAT of 23% on one of the 2 or 3 remaining pillar-industries of the Hellenic economy (i.e. tourism), whose demand characteristics are extremely elastic, be of any real help? The example of the same VAT imposition on restaurants has been proved a total disaster in terms of tax revenues, job losses and business closures, and
    2) How will lower nominal wages and pensions (not to mention the extremely lower actual disposable income) help support the domestic production of goods and services? etc. etc.
    c) As far as the meaning of what do the Hellenic people want: SNAFU. Ask any three random persons and you will receive more than 20 different answers. This fact along with one major structural weakness of the Hellenic political and social life (i.e. the total inability to conduct a civil, meaningful and honest dialogue) is what worries me the most about the next day as far as the domestic front is concerned.
    d) The first responses from the side of the other parts are not really encouraging: The same and usual Euro-jargon BS by the apparatchiks (the failed Gouda&Hairdresser hybrid, the unbelievable Martin Schulz president of the EP no less!!! etc. etc.), the usual hardline by Wolfie and his sattelite baddies in the EG, the unclear double-speak by various PMs.
    e) Will there be a solution? Can there be a solution? Is there room for a mutually acceptable solution? Here things look rather desperate. No need to reiterate thoughts and comments expressed in previous posts. However, it seems to me that the metamorphosis of the European Communities of the 50’s to the modern-day Kafkaesque monstrosity means that a mutually acceptable solution is, by definition, impossible. Thus, I do not expect a happy end.
    f) On a more general scale it seems that the present crisis of the western world is very difficult to be analysed by the available theoretical frameworks/tools and even more difficlut to be tackled or resolved. A very insightful comment in a previous post reminded me that I need to read again the book by Jean-Claude Michéa “Impasse Adam Smith: Brèves remarques sur l’impossibilité de dépasser le capitalisme sur sa gauche”.

    Best regards from the front.

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  17. I have been thinking endgame or tipping point for sometime now, but the can just kept getting kicked down the road. China is financially imploding it seems & in our globalised world, who knows where those ripples will lead. I remember as a kid being very troubled by a ‘ Twilight Zone ‘ episode in which an astronaut was doomed to orbit the earth for eternity – I am beginning to think we are in a financial version of that.

    Meanwhile here’s a nice headless chickens pic with what looks like Tspirus & Draghi at the start of a punch up – I hope T has on him some handy confetti :
    https://scontent-lhr3-1.xx.fbcdn.net/hphotos-xap1/v/t1.0-9/11665578_10153422465171678_2986905294837400675_n.jpg?oh=6b828f9b08bd7705c0f2ab3194762319&oe=56235F66

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  18. “Until now we used to say that the Greeks fight like heroes. Now we shall say: The heroes fight like Greeks.”
    Churchill

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  19. “Until now we used to say that the Greeks fight like heroes. Now we shall say: The heroes fight like Greeks.”
    Churchill

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  20. It seems to me that Varoufakis has got out to avoid any association with what will almost certainly be Tsipras’s acceptance of humiliating terms at Brussels

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  21. Well articulated, Phaedrus, it’s always useful to have good intelligence. I’m beginning to realise (I have been known to be slow on the uptake..) that the so called ‘debts’ of certain EU countries have almost nothing to do with money at all and everything to do with politics. In other words, the euro is a political construct before it is a financial one and not the other way around. This, of course, makes it even more worthless than any (marginally less worthless) sovereign fiat. Thus, the term ‘political currency’ has been turned into an overvalued double entendre and the devious demagogues are hiding their most diabolical ideas exactly where they know all too many people never look – in plain sight. Only a country with a reputation for being humourless would think of a joke like that..

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  22. JW

    As of 9.50 UK time bbc marked data was showing the pound to euro rate at 1.3974 a strengthening of approx 1% since yesterday, is it central bank intervention or actual progress to interim resolution (Greece will never, as even imf reported be able to repay the crazy debt it incurred aided by the vampire squid) or just very loud noise?

    1% is a very large movement even for the euro.

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