The EU Just Lost Another Prop

Phoenix Capital Research's picture


Meanwhile, as Greece continues to distract the markets, France, the other primary prop for the EU besides Germany, is now experiencing an economic contraction on par with that of 2008-2009.


Indeed, France’s September’s auto sales numbers were worse than those of September 2008 (the month Lehman collapsed). The country’s PMI reading is back to April 2009 levels. Even the French Central Bank, which would hold off as long as possible before unveiling bad news, has announced the country will re-enter recession before year-end.


Over the past few weeks, an extraordinary cry of alarm has risen from chief executives who warn that the French economy has gone dangerously off track. In an interview to be published on Nov. 15 in the magazine l’Express, Chief Executive Officer Henri de Castries of financial-services group Axa (CS:FP) warns that France is rapidly losing ground, not only against Germany but against nearly all its European neighbors. “There’s a strong risk that in 2013 and 2014, we will fall behind economies such as Spain, Italy, and Britain,” de Castries says.


On Nov. 5, veteran corporate chieftain Louis Gallois released a government-commissioned report calling for “shock treatment” to restore French competitiveness. And on Oct. 28, a group of 98 CEOs published an open letter to Hollande that said public-sector spending, which at 56 percent of gross domestic product is the highest in Europe, “is no longer supportable.” The letter was signed by the CEOs of virtually every major French company. (The few exceptions included utility Electricité de France, which is government controlled.)




We get additional confirmation that France is in big trouble from its partner in propping up the EU, Germany.


German Finance Minister Wolfgang Schaeuble has asked a panel of advisers to look into reform proposals for France, concerned that weakness in the euro zone's second largest economy could come back to haunt Germany and the broader currency bloc.


Two officials, speaking on condition of anonymity, told Reuters this week that Schaeuble asked the council of economic advisers to the German government, known as the "wise men", to consider drafting a report on what France should do…


"The biggest problem at the moment in the euro zone is no longer Greece, Spain or Italy, instead it is France, because it has not undertaken anything in order to truly re-establish its competitiveness, and is even heading in the opposite direction," Feld said on Wednesday.


"France needs labour market reforms, it is the country among euro zone countries that works the least each year, so how do you expect any results from that? Things won't work unless more efforts are made."


France will be a bigger problem than Spain or Italy for the EU?!?! That is one heck of an admission from a German official. If France deteriorates then it’s game over for the EU.  The current bailouts mean Germany is already on the hook for an amount equal to 30% of its GDP. If France tanks the amount will balloon astronomically. At that point it’s game over.


This is why the Powers That Be in Europe are absolutely terrified of what’s happening there.


If you’re looking for ideas on how to navigate this mess, we have produced a FREE Special Report available to all investors titled What Europe’s Collapse Means For You and Your Savings.


This report features ten pages of material outlining our independent analysis real debt situation in Europe (numbers far worse than is publicly admitted), the true nature of the EU banking system, and the systemic risks Europe poses to investors around the world.


It also outlines a number of investments to profit from this; investments that anyone can use to take advantage of the European Debt Crisis.


Best of all, this report is 100% FREE. You can pick up a copy today at:


Best Regards,


Graham Summers


PS. We also offer a FREE Special Report detailing the threat of inflation as well as two investments that will explode higher as it seeps throughout the financial system. You can pick up a copy of this report at:




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Vegetius's picture

Those crazy Frenchies just keep going down the rabbit hole -

“But I don’t want to go among mad people," Alice remarked.
"Oh, you can’t help that," said the Cat: "we’re all mad here. I’m mad. You’re mad."
"How do you know I’m mad?" said Alice.
"You must be," said the Cat, or you wouldn’t have come here.”

- Lewis Carroll

Jack Sheet's picture

You could read this a week ago in the MSM.

Zero Govt's picture

you could read this 4 weeks ago on Grahams column

we go around in circles/recycles about 5 times on average

dumpster's picture

throw as much shit on the wall see what sticks

knukles's picture

Vwww shall teach zoos arrogant froggez. 
Hans, Andrea sez to fires up zee LeopardIIIs

Taterboy's picture

Those 98 CEOs need to be sent to an Obama re-education camp. You know, like Harvard.

Zero Govt's picture

Capitalisms Grim Reaper is coming to the educational establishment too ...the sooner the better.

bye bye Krugman you f'n toerag

ebworthen's picture

Sacre bleu!

Mon Dieu!

France will be the last holdout for the Euro, to the bitter tragic end.

Redux of the Maginot Line but in modern warfare terms (financial weapons), with Germany going to Deutschmarks overnight and leaving France holding the bag.

knukles's picture

Hah ha ha ha ha ha ha
Arbeit Macht Frei

Joebloinvestor's picture

France will be the last "bailout" if there is gonna be one.

The real story of France is not being told.

It is FUCKED up.

The cure for a failing socialist state is not to elect a bigger socialist.

Zero Govt's picture

"The cure for a failing socialist state is not to elect a bigger socialist"

The cure for a failing State is not to elect a Govt.

Fixed it.

BraveSirRobin's picture

If the world is going to end, why do I need to buy a newsletter? I should rather buy liquor and women while they can still be had.