AND NOW?

And now?

14 juin 2012 par Paul Jorion

And now? What are we going to do? Now that Spain has lost access to capital markets for its debt?

True, the downgrading yesterday evening of Spain’s rating by three notches by Moody’s, from an A3 to Baa3 has not helped matters. But after all, it hasn’t taught us anything that we didn’t already know last weekend: with a 10 year sovereign debt rate stuck around the level of 6.75% (*), the game was up anyway when it comes to financing its debt on the capital markets.

The cause of all this? The additional 100 billion euros obtained by Spain from the European funds, and for which the nation itself is directly liable, European regulations forbidding direct bail-outs from its institutions.

Have you noticed that the European regulations are packed with suicidal clauses, the implications of which we are still discovering today, in emergency situations? Some people, convinced of the unlimited power of the human will, will explain to you that this is deliberate: foreseen long ago for the setting in motion, one day, of the Great Secret Plan. A more down-to-earth explanation is that it is the result of human inventions which natural selection has not yet had the time to sort out.

But didn’t the Americans succeed, managing to found a great nation with lots of little bits?! True, but that is indeed the point: in that particular instance, the method of trial and error was used on a grand scale – the United States of today has had to endure a vicious civil war to clear things up somewhat. And some of the scars are still fresh.

Already, keeping the Greeks in the family is very hard. Add to that Portugal, plus Ireland, plus Cyprus (today, at the end of the morning). Nevertheless, Spain – and this was said from the start, right after the initial alert at the beginning of 2010 – is too big a morsel to swallow for the Euro zone to rest intact: it is just not possible. Not to mention Italy, also very pale, on a chair in the corridor of the clinic.

On the 5th April 2010– already two years ago! – I had explained it in an article for the Monde-Economie entitled “The red line”: “There will soon be national unity governments, when it becomes evident to everyone that no single party is able to get to grips with the irresolvable problems being posed; subsequently this will be followed by a Committee of Public Safety when it becomes clear that even working together they understand nothing; and – if God takes pity on us – this will be followed finally by a new National Resistance Council, at the moment when it will be necessary, beyond the differences considered irreconcilable today, to launch an ultimate attempt to save what can still be saved.”

M. Hollande has not yet reached this stage, convinced as he is, that if what France needs is growth, the Greek temperament is far better suited to aggressive austerity measures. What he wishes for the Greeks is for Pasok and New Democracy to come out victorious in the Greek elections. And he hasn’t hesitated to tell them. Without doubt, this would be a miniature reproduction of the ill-matched Franco-German couple which is currently offered to us. The winning formula seems, to him, to be that of the union of a right-wing Socialist party with a Liberal party, both of them convinced that mothballing the welfare state is a much more urgent priority than reining in the world of finance

It is to be noted that the Americans are in much the same state of mind. Yesterday, Jamie Dimon, the boss of J .P. Morgan Chase was being grilled by the Banking Committee of the American Senate. He was asked how his bank had managed, by inadvertence, to lose between 3 and 10 billion dollars. The Republican Party Senators used up all their allocated speaking time to maintain – wanting Mr. Dimon to confirm it enthusiastically – that at the moment the greatest worry is that of an over-regulation of the financial sector. This is how it is at certain periods, you can take my word for it: programmed suicide is to be found everywhere. And I am sparing you the most comical examples.

Finally, let’s wager that people in Brussels are working hard at the moment to find solutions, that further cunning plans are being concocted in order to be put into practice in 2014 or 2018. Why are these miracle solutions always being delayed, it would not be an exaggeration to say, indefinitely? All in good time. Except that today, on the 14th June 2012, this is what is missing the most – time that is.

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(*) 6.974% at 10:51

5 thoughts on “AND NOW?

  1. “Some people, convinced of the unlimited power of the human will, will explain to you that this is deliberate: foreseen long ago for the setting in motion, one day, of the Great Secret Plan.”

    Not that great plans dont happen, but allways remember Hanlons Razor:

    “Never attribute to malice that which is adequately explained by stupidity. “

  2. Since there are comments on the French site showing disappointment at no comments on the English version, here is a comment in English by a Californian. ….

    In my opinion the biggest problem with the EU is the almost total lack of Democracy. I see there was a vote in 2005 where the people of France voted against the very things that were made into law only a few years later by Sarkozy and the other elected officials. That was a big slap in the Face to all French people who think they still live in a sovereign state ruled via Democratic principals.

    Recently, when Papandreou in Greece announced a referendum for the Greeks, he was ousted and replaced at the behest of the technocrats in Brussels. No votes for the Greeks at that time!!

    ‘Like all 27 EU member states, and especially the 17 who have adopted the euro as their common currency, France is now under what European Commission chairman Jose Manuel Barroso calls “the new European system of governance”. This is comparable to what happens when an individual is judged to be incapable of managing her affairs and is made a ward of a legal guardian or of the state. Little by little, the EU Commission is taking on the role of legal guardian of the economic affairs of the member states.’ Diane Johnstone/
    http://www.counterpunch.org/2012/05/07/the-french-chose-a-new-president-will-the-eurocrats-let-him-do-anything/

    What can Hollande really do other than cosmetic stuff? I wish him well, but really believe it would be best to exit the Euro and start again on a Europe well-designed, leaving each country with borders and a currency that they can control. Is Europe there to enrich International Finance or to just improve and protect the lives and well-being of the people? I vote for the latter.

    As an American, however, I feel unease in saying the above, when my own country is so messed up/owned by International Finance and the Military. Talk about a President of a country with no real power …. see the White House. And then cry.

  3. @Jeannette Marie Pontacq. I agree with you on just about everything!!! Interestingly, according to Okeanews it was Nicolas Sarkozy who torpedoed the Greek referendum, and Merkel would have let it go ahead. I don’t think Sarkozy has too much faith in democracy!!!

  4. Hi Mr. Gupwell …

    Duh, obviously Sarkozy is/was an integral part of the Plutocracy that now rules the Western World. The Plutocrats don’t believe in Democracy, basing their elitist beliefs on such gurus as Edward Bernay (nephew of Sigmund Freund) and Leo Strauss (died in 1973). To them, the people are ‘the mob’ and not to be trusted with power, even shared power. The mob, they think, can be controlled via elemental religion and social issues that go with fundamental religion. The elites, of course, do not believe in that religious stuff, but they need the mob to do so in order to control them and stop them from understanding the distaste they have for the mob.

    ON ANOTHER SUBJECT: I really like Paul Jorion’s site in French and hope his thinking can translate into being popular in English. To that end, I would like to suggest that the address of his site in English be added to comments, for example, to articles in the New York Times. Also on the Huffington Post in English. One can quote his writings in those venues to get it going. In the meantime, I am asking a few friends here to add comments to kick start it.

    It would be good if his site could be listed on the Huffington Post and on other Leftist sites in the States and in England. Those are just some thoughts I have and offer here. Mr. Jorion would also do well to become a contributor to both AlterNet and even CounterPunch. On the French side, Le Grand Soir would be good as well. Most important, however, is the Huffington Post, since it is so mainstream.

    Best, Jeannette Marie Pontacq / Point Reyes Station, CA 94956

  5. Amsterdam, 19 June 2012

    Dear Ms. Pontacq,

    Please find herewith the commentary I just sent to the French page of the Jorion Blog, mentioning your name.

    Best regards,

    Johan Leestemaker, Amsterdam, the Netherlands
    (leestem@ision.nl)

    Johan Leestemaker
    19 juin 2012 à 12:21
    Amsterdam, 19 juin 2012

    Chèr Germanicus / lieber Germanicus,

    1. Je partage votre expression de reconnaissance à M. Jorion et, évidemment, de Tim Gupwell, en ce qui concerne le début modeste de traductions du BLOG. Malheureusement SANS la traduction simultanée des contributions et de réactions aux Billets…..

    2. Je partage également votre éloge à l’adresse des TRES PEU personnes qui ont réagi à la version Anglaise, entre autres Mme. J.M. Pontacq (voir ci-après). Conclusion: la Commission Européenne et la BCE nous dominent PARFAITEMENT avec leurs « machines » de traduction simultanée, probablement leur vraie et presque unique ‘capital’.

    ‘Dans « La tour de Babel », c’est le traducteur/la traductrice qui est roi/reine’, pourrait devenir le slogan.

    3. Je m’attends avec de l’inquiétude des initiatives annoncées par M. Jorion et Alesandro Moretti concernant un élargissement de la structure du BLOG.
    J’aimerais répéter ici ma proposition pour améliorer de tout un coup la position financière de M. Jorion par des contributions minimales mais constantes par des paiements par SMS (téléphone mobile).
    La fin de semaine passée j’en ai parlé avec le dr. Rudi Westerveld (université de Delft aux Pays-Bas), qui s’occupe depuis de décennies de la télécommunication, au Mozambique et en Afrique du Sud, et qui tout récemment a pu construire un grand réseau de génération de revenus en Afrique du Sud par des paiements massifs de très petits montants par SMS, faisant…. des traductions des mots uniques! (Anglais – Zulu, Zulu – Anglais etc).
    Rudi Westerveld m’a assuré d’être disponible pour nous aider avec sa connaissance technique.

    4. Dernièrement: comme Lars Olofsson a fait scandale comme PDG à Carrefour, il me paraît e moment très logique maintenant pour développer des noeux d’activisme en France pour conquérir ce géant de la consommation.

    Où restent mes ami(e)s Français(es) pour se battre pour leurs propres intérêts?

    Bien à vous tous,

    Johan Leestemaker

    (voir:Jeannette Marie Pontacq au BLOG anglais Paul Jorion
    June 16 12 at 3:48 am
    Hi Mr. Gupwell …

    Duh, obviously Sarkozy is/was an integral part of the Plutocracy that now rules the Western World. The Plutocrats don’t believe in Democracy, basing their elitist beliefs on such gurus as Edward Bernay (nephew of Sigmund Freund) and Leo Strauss (died in 1973). To them, the people are ‘the mob’ and not to be trusted with power, even shared power. The mob, they think, can be controlled via elemental religion and social issues that go with fundamental religion. The elites, of course, do not believe in that religious stuff, but they need the mob to do so in order to control them and stop them from understanding the distaste they have for the mob.

    ON ANOTHER SUBJECT: I really like Paul Jorion’s site in French and hope his thinking can translate into being popular in English. To that end, I would like to suggest that the address of his site in English be added to comments, for example, to articles in the New York Times. Also on the Huffington Post in English. One can quote his writings in those venues to get it going. In the meantime, I am asking a few friends here to add comments to kick start it.

    It would be good if his site could be listed on the Huffington Post and on other Leftist sites in the States and in England. Those are just some thoughts I have and offer here. Mr. Jorion would also do well to become a contributor to both AlterNet and even CounterPunch. On the French side, Le Grand Soir would be good as well. Most important, however, is the Huffington Post, since it is so mainstream.

    Best, Jeannette Marie Pontacq / Point Reyes Station, CA 94956)

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