Tag Archives: France

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 idea, and remains so. Undeniably she has been a factor of peace and has contributed to the economic rise that followed upon the Second World War. However you forget that for a great deal this peace has been also the result of the balance of terror, as Europe owes a part of its security to the American nuclear shield. Certainly, the peace could be maintained based on specific positive grounds, but also somehow by imperfection.

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

0Shares

UNDERSTANDING THESE TIMES IN WHICH WE LIVE

Translated from the French by Tim Gupwell.

In the Wall Street Journal today:

Since the beginning of the crisis in 2007, one thing has become clear in European politics: the outgoing parties are not voted back in. Confronted by the incapacity of the governments and the majorities in place to resolve the problems of the moment, the electors – at least, those increasingly few and far between who still go to the trouble of travelling to the urns – vote for the opposition, whoever it may be.

In these conditions, the merry go-round can only make a restricted number of turns before passing to national unity governments, which are really warm-ups for some kind of dictatorship.

The French Government has only just celebrated its first 100 days in power, but it is not too early for it to start thinking about this new trend which is starting to emerge in the European electorates.

“What we need is audacity, more audacity and then yet more audacity!” This is exactly what is needed if we are to get out of the rut we are stuck in; even more so when this rut is merely symptomatic of the immense quagmire that the Eurozone has now become in its entirety.

Nonetheless, the European treaty which France has to ratify in October is anything but audacious. The famous balanced budget offers a false sense of security when things are going well – if indeed this could ever go well again– and it dramatically worsens the situation when things are going badly.

A nation’s expenses are not measured in Gross Domestic Product points; they are measured rather more mundanely by its fiscal receipts. The GDP is a poor yardstick at the best of times since the more it contributes to the destruction of the planet, the better it seems. But that isn’t even the point: in a world where jobs are fast disappearing and where the concentration of capital is scaling new heights due to the excessive manner in which the wealth created is distributed (and which we tolerate) the GDP of nations nowadays are like bodies attacked by a fever, and it seems therefore a very inappropriate moment to use it as a thermometer.

If, since 2007, those leaving power are no longer being re-elected in Europe, it is because they have kept a low profile, gone with the flow, waited for things to sort themselves out. However, unfortunately things won’t sort themselves out any more: the crisis we have endured since 2007 – a crisis stemming from substituting leveraging and easy credit for salary – is within a whisker of being transformed into a full-blown depression. This is what all this is about; this is what needs to be attacked, since there has already been a tremendous delay – five years in fact.

“The means must be commensurate with the gravity of the situation” said Barroso a few years ago. But neither him, nor any of his European colleagues, nor anyone at the head of one of the 17 nations making up the Eurozone, has really understood the true meaning of these words. Those who in the future speak as members of government, or as representatives of the French nation, need to bear these words in mind.

Marching in perfect unison works well for a regiment which is progressing calmly through the countryside, but here there is something else at stake: saving one’s skin as the bombs rain down!

 

0Shares

SURRENDER, YOU ARE SURROUNDED!, by François Leclerc

Guest post. Translated from the French by Tim Gupwell

It is not just Italy and Spain causing problems, after the decisions taken during the last summit suffered a setback, in view of the spectacle of great confusion and nervousness we have witnessed with regard to the joint press release – which wasn’t one – from Spain, Italy and France demanding immediate implementation. Simultaneously, Greece is providing an example of the strategic retreat of the European authorities and of the IMF.

It is now the ECB and the Eurosystem which hold the vast majority of the Greek debt, a fact which has allowed the commercial banks to consider the countdown which has already begun with a far greater degree of equanimity. The same cannot be said for the European authorities.

Continue reading SURRENDER, YOU ARE SURROUNDED!, by François Leclerc

0Shares

A BIG BANG, OR NOTHING , by François Leclerc

Guest post. Translated from the French by Tim Gupwell

With the G20 meeting being held in Mexico at the start of the week, our perspective will find itself altered, falsely accustomed as we are to only seeing the debt crisis from a European angle. On the 18th and 19th June, the greats of this world are going to gather in Los Cabos, a tourist resort in Southern Lower California, under the double auspices of debt and global recovery.

To avoid standing idly by whilst confronted by a disaster of its own making, the British Government has just announced a plan to relaunch the economy with banking credit, funded by a Bank of England liquidity programme. In the context of an overall 80 billion programme, there are plans for monthly injections of around 5 billion Pounds (6.1 billion Euros). But the question that needs to be asked is whether the results will be as inconclusive as those obtained from the ECB’s massive injections, or indeed the tireless pursuit of zero-rate loans (from 0% to 0.1%) by the Bank of Japan – still without any further success – and whose 700 billion Euro acquisition programme of private and corporate securities is still in force.

The British Government wants to make these banking loans conditional on the latter making specific commitments, but hasn’t this been heard before? The monetary policy instruments of the Central Banks merely allow more time to be bought, and do not resolve any of the unanswered questions.

Continue reading A BIG BANG, OR NOTHING , by François Leclerc

0Shares

SPAIN: A WEAK LINK, OR A VICTIM OF DEBT TRANSFER AND OUTRAGEOUS CONDUCT ON THE MARKETS?, by Sébastien Bano

Guest post

A few days ago, I was contacted by a friend of mine, in New Zealand, who was concerned about the bad news affecting the economy and, particularly, Spain, where I currently work. In answering the two questions he asked me, I have tried to describe what seems to be the main problem of this country (and many others, but Spain is indeed a glaring example), and in doing so, hope to provide an alternative insight to counter the facile accounts of idle Mediterranean workers and “Club Med resorts lifestyle”, frequently advanced as the logic for Spain’s demise. As a regular reader of Paul Jorion’s blog, I asked him if he would do me the favour of reading my text. Not only did he kindly agree to do so; he also proposed that I publish it.

First Question : “It would be very interesting to hear your views on the economic situation in Spain.”

Answer : Well, in reality, it is a question of sorting through the views presented in the media. To go straight to the most covered subject, employment, one has to consider that there’ve always been a lot of “under the table” jobs in Southern European states, but this is not what can drive the public deficit to a critical point. Of course, tax inflows are reduced that way, but this didn’t prevent Spain from having a positive balance before the crisis, i.e. no deficit! On the contrary, this black market means the authorities still have some room to manoeuvre. In spite of this, many analysts say that this is too bad, that 20 % unemployment is unbearable. Well, shall I remind them that the unemployment in the USA is officially over 9 %, but if you add the part-time jobs of only a few hours per month, then you reach… 20 %! The only difference is that in Spain these part-time jobs are often undeclared. Gosh, this is such a “tradition” in the Mediterranean, that if what the mass media say were true, then Spain and consorts should have already collapsed at least ten times in the last 50 years!

Continue reading SPAIN: A WEAK LINK, OR A VICTIM OF DEBT TRANSFER AND OUTRAGEOUS CONDUCT ON THE MARKETS?, by Sébastien Bano

0Shares