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So Let's Review....
The United Kingdom, after staging its first contrived and scripted presidential debates as a path to anointing a Prime Minister (emulating the United States in this particular farce of electoral choreography can only have been the brainchild of the unholy spawn of Gordon Brown and Sky News) expresses the kind of public confusion not known in General Elections on the island since 1979. In retrospect, the UKIP's Nigel Farage came out looking like a timeless and contemplative work of bronze and marble by Auguste Rodin compared to the rest of the UK's political class- and he had just walked away from a near fatal election stunt (read: plane crash). Welcome to personality politics, gentlemen. Ironic, isn't it, that personality politics have served the current administration in the United States (headed by "the great orator" himself) so poorly that calls for "Presidential Question Hour" continue to echo from those who believe "separation of powers" is merely the bolded heading atop a paragraph in their divorce settlement document. But then the United States seems entirely dedicated to adopting as many destructive European habits as possible before anyone notices.
But it is difficult to chastise the United Kingdom all together completely. After all, they somehow managed to dodge the Euro bullet. Though one wonders why it was not more obvious that relaxing underwriting requirements for EU admittance to the point where even Greece would be sent an acceptance letter was a daunting omen. The kind of thing you would expect from an arrangement that paradoxically cedes the power to compel endless bailouts from the most productive members to the least frugal participants. Given that Greece willingly gave up the power to inflate away its own debt after a long history of spending lust, why did no one wonder after the motives a gated Mediterranean retirement community (admittance only for civil servants over 56 58 62 [TBD]) had for joining? Given the palpable stupidity that seems to grip all things EU, is it any wonder that the most obvious response to a biting fiscal crisis directly linked to overpaid state workers is rioting by overpaid state workers?
Any attorney who crafted a partnership agreement for a client that did not include a clause providing for the removal of a bankrupt partner should carefully check to see their malpractice insurance is exactingly up to date. Apparently, no one quite thought to write such a clause into the millions of pages that collectively formed the legal evolution of the EU. This is what one might call a "bit of an oversight." (If one is predisposed to dramatic understatement, that is).
Apparently, however, the deep lust to fund fraudulent agricultural subsidies for whichever Greek, French, Italian, Spanish (and the list goes on) farmers might have been literate enough to fill out a form or two, was too burning to resist. For most, in any event. But, while we are looking for heroes, consider the shellacking Baroness Thatcher took for resisting the advances of the Borg:
Margaret Thatcher's Attacks on the Single European Currency Miss the Point
Now that the pound is in the exchange-rate mechanism of the European monetary system, the British government's most urgent task is to keep explaining what the failure to restrain pay and prices will soon mean for jobs and output. Unsurprisingly, Margaret Thatcher prefers for the moment a theme with more electoral charm. The government's new interest in European monetary integration, she says at every opportunity, stops well short of full economic and monetary union (EMU).1
Contempt for her independent streak didn't stop there. Twelve years later The Economist still hadn't forgiven her:
Lady Thatcher has not hidden her mounting revulsion for Europe during the last decade, but the extent of her current apostasy is breathtaking. This is, after all, someone who was happy to serve in Ted Heath's cabinet when the arch-Europhile negotiated the terms of Britain's entry into the then EEC, who, as prime minister, appointed a succession of Euro-enthusiastic foreign secretaries, signed up to the Single European Act in 1986 and who, during her last weeks in power, took sterling into the exchange-rate mechanism.
The former premier feels so terrible about all this that she devotes about 100 pages to explaining how she could have got it so horribly wrong and why there is no hope for Britain unless a future Conservative government has the courage to pull out of a project that is not only doomed but fundamentally hostile to Britain's national interest.2
Awfully harsh for someone who, in the end, had it right on the money (so to speak)- though it remains to be seen if the United Kingdom won't spend itself into oblivion anyway. Voters seem not to mind anymore. Perhaps, as skydivers without parachutes, the inevitability of the ground rushing towards them has lulled them into a kind of trance-like serenity.
There is, at least, the consolation that Jacques Lucien Jean Delors seems poised to live long enough to see the EU gripped with the beginnings of anaphylactic shock caused by the Maastricht Treaty suppository he so aggressively (but unsuccessfully) assaulted the many political orifices of United Kingdom with all those years. Pity the Baroness (problem patient that she was) is not around to gloat. Just a little.
What is the lesson? Ask Angela Merkel, who can't win whatever she does. Fund bailouts? Anger voters. Cut back local spending? Anger voters. Let Europe crash? Anger voters. Whoever you are and whatever you stand for, you are about to anger voters. Might as well kick the can just a bit farther down the road, no?
So the Europe, beyond adopting vapid television debates, now embraces Quantitative Easing like a Frenchman returning to work the first week of September. A quick pair of kisses, some overacted pleasantries, and the last month of workless sloth and all the havoc it hath wrought is all but forgotten.
And so, swaps from the Federal Reserve blow open like a deep water well, CDS prices on European banks have blown out only slightly less violently as markets anticipate a replay of the post Lehman credit crunch (expect the word "repo" to strike the kind of carnal Hannibal ante portas fear you always wanted to see in central bankers' eyes), whispers that the Euro might hit parity with the dollar have become shouts,
But never fear. That's just Europe. And the problems of a small and somewhat maligned member of the EU's have little or no bearing on the future of the United States. Right? After all, GM has repaid converted taxpayer debt to taxpayer equity (without so much as an S-1, one notices), officials (apparently with no sense at all of Orwellian irony) are keeping a "boot on the neck of BP" (one cannot, after all, allow oil spills to go unpunished, even when a mere sliver of a fraction of that released into the sea naturally every year), Obama will slash spending immediately (if only he could use that Line Item Veto scalpel for just a little awhile- won't hurt a bit), Fannie and Freddie can "see the light at the end of the tunnel" while the FHA is spitting out 3% down home loans, and Dallas Braden managed to throw a perfect game on Mother's Day. So figures like this:
GDP of:
European Union: ~$16.2 trillion
Spain: ~$1.3 trillion
Greece: ~$350 billion3
Portugal: ~$165.4 billion
United States ~$14.3 trillion
California: ~$1.8 trillion
New York: ~$1.1 trillion
Illinois: ~$633.7 billion
...shouldn't really bother you.
(Oh, and S&P 500 futures are up 4.40%, by the way).
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Ya the gap up is alarming..HOWEVER... remember back in '08 (end oct or november) the futures were up hard and a day or so later gave back their tremendous 4% gap up.
Hoping for the same here, and then some.
Obama's theme song is cued!
http://www.youtube.com/watch?v=7xxgRUyzgs0
Look into my eyes, what do you see?
Cult of Personality
I know your anger, I know your dreams
I've been everything you want to be
I'm the Cult of Personality
Like Mussolini and Kennedy
I'm the Cult of Personality
Cult of Personality
Cult of Personality
Neon lights, A Nobel Price
The mirror speaks, the reflection lies
You don't have to follow me
Only you can set me free
I sell the things you need to be
I'm the smiling face on your T.V.
I'm the Cult of Personality
I exploit you still you love me
I tell you one and one makes three
I'm the Cult of Personality
Like Joseph Stalin and Gandi
I'm the Cult of Personality
Cult of Personality
Cult of Personality
Neon lights a Nobel Prize
A leader speaks, that leader dies
You don't have to follow me
Only you can set you free
You gave me fortune
You gave me fame
You me power in your God's name
I'm every person you need to be
I'm the Cult of Personality
nice Living Colour reference. very fitting.
i miss those body glove sportin' days btw...
What happens with the pound (and the UK bonds) today? Now the Euro is saved (for a short while) the Tommies should start feeling the heat, right?
The election came a bit early for UKIP. Their policy for a serious reduction in immigration is hugely popular but people think being anti EU is "nuts" and "unrealistic". Thank god we weren't in the Euro!
Oh gee, Fannie Mae is asking for yet another $8.6 billion in aid.
And things are supposed to be all rosy again right?
http://finance.yahoo.com/news/Fannie-Mae-seeks-84B-in-aid-apf-687711093....
That Fannie. She's just a dirty, toothless gold digger.
Hope your feeling good Marla.
We love you Marla!!!
I can't even finish reading your posts without my brain "coming" by the second sentence...
Sorry Marla, don't want to play the third year associate here. Double check your GDP numbers. Spain should read "trillion" and POR and GR should read "billions".
You are absolutely correct, of course.
Corrected.
Must have been a fat fingered typo, right Marla?
Marla,
Very nice to see your avatar face at the top of another great piece of writing. Welcome back and I hope you have exercised all the illness demons from your body for the next 10 years.
"...emulating the United States in this particular farce of electoral choreography can only have been the brainchild of the unholy spawn of Gordon Brown and Sky News...."
The US is definitely number one in spawning bastard children.
"Greece: ~$350 billion3 (3. Performance enhancing drugs suspected)
It these little touches that make your writing richer than that double chocolate sundae I had over the weekend.
Agreed. It's been far too long since we've been treated to Marla's coherent, shark-mounted wrath.
Hate the Economist, they write like analytic masturbation, always hedging, lack of conviction, not technically strong, just cowardice.
Cowardice indeed. If an attorney betrayed their cases like the Economist hedges they'd be making coffee for some personal injury ambulance chaser in Barstow, CA. Apologies to Barstow.
Welcome Back,
Try not to slip and fall, once you have your legs under you again...
Your Condottieri
Why so snarky and sullen? Everything's coming up roses, dontchaknow? If you keep putting out such negative vibes, TPTB will have no choice but to declare you a public enemy and to tax you for your contribution to the problem rather than the solution.
I like all being bailed out, everyone get a Porsche 911, and drinking Martini all day long. My basic question is this, where is the money coming from? coming from the tree? Chinese economy is around $4T. can we all borrow from the Chinese, and everyone survive really well?
If you have to ask where the money is coming from, you don't deserve the bailout. Sorry, but you can still play the Lotto.
Not so off-topic here....
Urgent: Deepwater Horizon Spill Solution
Hi Everyone. Please see:
http://www.squareandc.net/
This is me and I have a “Eureka” moment breakthrough to help solve the Deepwater Horizon crisis.
Please publicize this URL widely. E-mail it to your contact lists, send it to your senators, appropriate contacts in media, post it on other blogs like oil drum where you might be a member, industry contacts etc. Time is of essence and the solution is awesome.
If Tyler or Marla see this, they can mail it to higher contacts in media or put it somewhere on the site. I’d even pay for a prominent ad spot for the day if needed.
I’m getting it out on as many outlets as possible.
I know there are folks here from the industry or tangentially or historically connected with it. Please don’t e-mail me for details at this point, will take too much time to respond.
If you’ve read any of my comments, you know I’m sane. Right? ;-)
It’s real and needs to get seen/heard at the highest/right places.
Thanks in advance.
VivekAnand