Category: Europe

  • This was what Brexit was preparing and enabling the British to do, by Duncan Sutherland

    Last night I dreamed a dreadful dream. The world as we knew it ceased to be when a global pestilence descended upon it while its climate changed disastrously and uncontrollably. Standing among the ruins of the ancient Roman forum, the leader of the British revealed that he had had a vision. He had perceived that climate change was like unto the decline and fall of the Roman empire, the collapse of a civilized world.

    Himself instrumental in undermining the present-day European empire by releasing the British from its grasp, he now contemplated the chaos and collapse to come when wave … Read the rest

  • Let us explain to Germany what we expect of it TODAY

    Published here in French.

    For ten years now, we have been hearing the same refrain from other European leaders to justify their procrastination towards the German authorities: “After the elections, things will be clearer”! However, from German election to German election, things are not clearer once the vote has been completed, but more turbulent and, from this point of view, we’ve hit the jackpot today. Let us draw the right conclusions: let us explain to Germany what we expect of it TODAY. That would be impossible because there is no government? nor a coalition? nor maybe even a chancellor? Let … Read the rest

  • Catalan leaders in court facing crimes of more than 30 years in prison, by Duncan Sutherland

    Guest post. Open to comments here.

    Disloyalty or Dissent?

    Political dissent is still evidently constitutionally defined as disloyalty in some instances in Spain. Is this a sound basis for the rule of law in a democracy? Discuss with reference to the Spanish constitution of 1978 and the founding principles of the European Union.… Read the rest

  • Scotland – “A Terrible Beauty Is Born”, by Duncan Sutherland

    Guest post.

    Since Sunday morning, when the First Minister of Scotland, Nicola Sturgeon, answered a question on a BBC Scotland television programme known as Politics Scotland concerning a House of Lords advice note which had been circulated on the subject of legislative consent in relation to legislation giving effect to Brexit which would have to be submitted to the Scottish Parliament, her answer has been picked up and spread around Europe by distinguished media organizations from ARD in Germany to La Stampa in Italy (not forgetting VilaWeb in Catalonia).… Read the rest

  • Scotland and Brexit, by Duncan Sutherland

    Guest post.

    Dear Mr. Jorion,

    Having read what has appeared in your blog so far about the complexities of the decision taken by the people of England on Thursday (but not by the people of Scotland), I wonder if you are yet aware of a complexity which has just been raised in Scotland today.… Read the rest

  •, Paul Jorion : ‘Jean-Claude Juncker’s moral authority has been damaged’, 14th November 2014, Paul Jorion: ‘Jean-Claude Juncker’s moral authority has been damaged’

    Does the LuxLeaks scandal represent a risk for the Commission?

    Paul Jorion: Jean-Claude Juncker’s moral authority has been damaged. Of course, he hopes his investment plan will bring confidence, and it is a good idea. Especially if it can create employment and give purchasing power to European citizens. But his credibility has been tainted by the revelations about Luxembourg’s fiscal practices.

    The current head of the Commission is the man who led the implementation of austerity policies within the Eurogroup, at the same time as organising tax evasion for big … Read the rest

  • On Europe, an answer to Mr François Hollande, president of the French Republic, by Pierre-Yves Dambrine

    An English translation of Sur l’Europe, en réponse à Monsieur François Hollande, président de la République, par Pierre-Yves Dambrine by Johan Leestemaker

    Invited commentary, in response of a tribune de François Hollande published today May 8 in the daily newspaper Le Monde, Paris, France.

    Mr. President,

    I have carefully read your speech on Europe, published today in the newspaper Le Monde, in the perspective of the very near European elections. I hold no doubt that you are a European by conviction. As many of us still are, because, as you remind us, the Union was a great and beautiful … Read the rest

  • European Parliament, Committee on Economic and Monetary Affairs, November 5, 2013

    My intervention is part of the filmed account of the session on the Parliament’s own TV channel.

    Read the rest

  • “The future of the Eurozone from an interest rate standpoint”, European Parliament, November 5, 2013

    Here my contribution to European Parliament, Committee on Economic and Monetary Affairs, November 5, 2013, 3:30 to 6:30 p.m.

    The future of the Eurozone can be approached as a logical problem. If not solved, it can at least be significantly clarified when the issue is examined from the single standpoint of the sovereign debt’s coupon for the nations belonging to the zone.

    Within the economic zone where a currency applies, a single coupon level only should be in existence for each obligatory maturity. The founding fathers of the Eurozone assumed no doubt that such would be the case also … Read the rest

  • A mail exchange about JP Morgan’s “The Euro area adjustment: about halfway there”, Europe Economic Research, 28 May 2013

    From : Paul Jorion
    Object : The Euro area adjustment: about halfway there
    Date : 21 June 2013 21:33:20 UTC+02:00
    To : Malcolm Barr, David Mackie

    Good day MM. Barr and Mackie,

    I’m writing to you as I receive several mails drawing my attention to the following paragraph of your recent May report:

    “The political systems in the periphery were established in the aftermath of dictatorship, and were defined by that experience. Constitutions tend to show a strong socialist influence, reflecting the political strength that left wing parties gained after the defeat of fascism. Political systems around the periphery

    Read the rest

  • LE SOIR, ‘The only solution is to pool all the debts’, September 4, 2012

    Translated from the French by Tim Gupwell.

    4 September 2012

    An interview with Dominique Berns which appeared today in the economy pages of the daily newspaper, LE SOIR.

    “To save the Euro, we must mutually pool the debts”

    Q : The president of the ECB, Mario Draghi, has pledged to do “everything within his power to save the Euro”. Numerous observers expect the ECB to start buying up sovereign securities once again, only this time in a far more pro-active manner, in order to reduce the interest rates for the countries in difficulty, in particular for Spain and Italy. … Read the rest


    Translated from the French by Tim Gupwell

    In my articles here, I generally address myself to anyone who wants to read me, but just this once, I would like to direct my address to my fellow financial engineers, and moreover in a tone – also just this once – of provocation which is blatant but, let us hope, efficient as well.

    Here we go: a monetary zone has to be able to default in its entirety and restructure its debt (namely, to be able to say, “I can only pay back X centimes for every Euro I have borrowed”) and … Read the rest

  • PROGRESS, TOO GOOD TO BE TRUE, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell

    When there seems no way out, and the future seems unclear, it is then that promising visions of the future seem to abound.

    The Bundesbank, accompanied by all those who take their cues from it, never miss an opportunity to remind us of the formula they stick to so stubbornly: their promise of growth at a later date once labour costs have been reduced and a renewed competiveness in the international markets.

    Jens Weidmann, its enlightened president, has even suggested immediately extending the European aid provided to Spanish banks to the … Read the rest


    Guest post. Translated from the French by Tim Gupwell

    The European Finance Ministers managed during the course of the night to finalize a minimal agreement, which needs, as usual, to be examined in detail due to its grey areas. They put together a set of nominations to the ECB and the ESM based upon the provisional re-appointment of Jean-Claude Juncker at its head, in the absence of any other solution. Then they reached a “tentative agreement” (another way of saying a broad outline) with regard to the particular case of Spain which needs to be wrapped up for adoption on … Read the rest

  • GUILTY PARTIES WANTED !, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell

    In accordance with the predictable script, the bond market is under pressure again. The cost of servicing Spanish and Italian debt has continued to increase as their financing plans move forward in little measured steps. The effect of all this is to place an additional burden on the budgets, undermining those measures which are intended to reduce the deficits.

    The statistical institutes INSEE (France), IFO (Germany) and ISTAT (Italy) all agree: Europe is sinking into a recession which they describe as ‘technical” in an attempt to make it sound innocuous, but … Read the rest


    The Spanish risk premium

    There were two bond issues today, one in Spain, the other in Denmark, which allow us to carry out an interesting little calculation of the risk premium required of Spain when it borrows on the capital markets.

    A short while ago the Spanish Treasury department issued more than 3 billion Euros of debt for 12- 18 month securities.

    Because we must always look on the bright side of life, it was pointed out that for an offer of only 3 billion there was a demand up to 8 billion – which is always nice to know, … Read the rest

  • 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? … Read the rest


    Spain in stormy waters

    12 juin 2012 par Paul Jorion

    The 10 year rate for Spanish debt has just reached a historic high. On the 25th November of last year, the rate had beaten a record when it reached 6.72%. Yesterday early in the morning, when the European markets were in ecstasy about the news of an 100 billion euro aid package for the Spanish banks via the Spanish state, the rate had dropped back down to 6.02%. It has just reached 6.809% (at 16:27 Paris time).

    Of course the danger of this type of progression is that an … Read the rest

  • A WAIT DESTINED TO LAST, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell.

    The European Commission in Brussels is getting ready to unveil a project aiming to prevent and cure the banking crises, destined to enter into service in 2014, certain procedures being foreseen for 2018. There is a certain sense of timing, but certainly not a sense of urgency.

    The Spanish are now appealing for help, admitting that they have been cut off from the markets, ready to sell off whole swathes of their banking system to save it, calling for direct aid so as not to fall into the clutches of the … Read the rest