Labor Minister Says France Is "Totally Bankrupt"

Tyler Durden's picture

Things in France must not be very serious, because the French labor minister accidentally let the truth come out a little earlier today. As the Telegraph reports, France's labour minister sent the country into a state of shock on Monday after he described the nation as “totally bankrupt."

Remember: France is one of the supposedly stable countries in Europe.

"Michel Sapin made the gaffe in a radio interview, which left French President Francois Hollande battling to undo the potential reputational damage. "There is a state but it is a totally bankrupt state,” Mr Sapin said. “That is why we had to put a deficit reduction plan in place, and nothing should make us turn away from that objective." It appears that once one wipes out the propaganda and the smooth politico talk, things are bad and getting worse at Europe's core. "Data from Banque de France showed earlier this month that a flight of capital has already left the country amid concerns that France’s Socialist leader intends to soak the rich and businesses. The actor Gérard Depardieu has renounced his French citizenship and decamped to Russia in protest, while David Cameron said Britain will “roll out the red carpet” to attract wealthy individuals. Pierre Moscovici, the finance minister, said the comments by Mr Sapin were “inappropriate”."

At least France can hike the tax on the millionaires to 75% to generate more money. Oh wait, no it can't.

But if capital is leaving France, where is it going? The FT has the answer:

Almost €100bn of private funds flowed back into the eurozone’s periphery late last year after action by the European Central Bank encouraged reinvestment in the crisis-hit countries.


The scale of the net inflows, equivalent to about 9 per cent of the economic output of Spain, Italy, Portugal, Ireland and Greece according to calculations by ING, the Dutch bank, highlight the revival in investor confidence in Europe’s monetary union after Mario Draghi, ECB president, pledged to preserve its integrity.


The return of capital has encouraged policy makers to believe the eurozone crisis is over, with Mr Draghi this month pointing to “positive contagion” in the region. The euro has also moved sharply higher.

Turns out it isn't, and the capital was merely rotating from the frying pan and into the 9th circle of insolvency hell. But at least the SNB is still buying up every French bond it can get its hands on to indicate that all is well with the "totally bankrupt state."

And speaking of private capital rotation, well Europe needed it. Recall the chart of European M3 loans to non-financial corporations we showed earlier based on central bank data:

Yup - a record outflow.

So if it wasn't for the private capital scrambling to fill the hole, Q4 in Europe would have been an absolutely epic disaster. One can only hope that private funds are as bottomless as the public central banks backstopping them, because should there be a reflaring of risk, all bets for Europe are off, precisely at a time when everyone is hoping that the worst is behind and that Europe, as every European politician was quoted as saying in past weeks, is now "fixed."

Of course, if France is totally bankrupt, there's nothing that a little diversionary war can't fix. Perhaps it is time to expand the Mali offensive a bit: there's a tempting little country in Asia called Vietnam...

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THX 1178's picture

I thought the word was "World" not "France."

camaro68ss's picture

raise taxes, that should fix it......o wait....

true brain's picture

An expansion of the war in Mali should solve this problem post haste.

Well at least for a while until, the people clamor for the return of the guillotine.

Sarkozy was wise to head to England before the SHTF.

ihedgemyhedges's picture

I wonder how long it will take for the Labor Minister to be involuntarily Depardieu'd????????

Mark Carney's picture

This is code for buy French OATS!!!!

trav777's picture

wait, you mean the strategy of importing millions of africans to help uphold the "social contract" didn't go smoothly?  Whocouldanode?

ParkAveFlasher's picture

It took only a few days for "currency war" to be an MSM meme, aaaand France surrenders.

Yes We Can. But Lets Not.'s picture

We live in an era of pretend, when the term 'inappropriate' is used to characterize a public official's having spoken a bit of truth.

AgAu_man's picture

Send them to help liberate Mali, a dozen other places in Africa. ;-/

Go Tribe's picture

Bankrupt, eh? Not until they sell all their national assets.  How much for a lovely French maiden and a bottle of vintage?

wee-weed up's picture

And they still have to come up with all the gold that they were holding for the Germans (that they spent!) that the Germans now want back.

Sacré Bleu!

Dugald's picture


Bankrupt, eh? Not until they sell all their national assets. How much for a lovely French maiden and a bottle of vintage?

Two bars of soap........!

Zap Powerz's picture

Bankrupt cheese eating surrender monkeys.

Just when you thought france could not suck any worse.

Anusocracy's picture

At least they don't live a life of lies like Americans.

CH1's picture

And it is not a life of lies to believe, "the magic state will deliver free shit, cradle to grave," forever?

AldousHuxley's picture

Ann Romney studied French, vacations in France, absolutely adores French everything......


US Elites love French high culture. Guess which country the Bankers take their mistresses....

Pure Evil's picture

France is not bankrupt, they just haven't managed to confiscate the remaining wealth of its citizens. Get back to me when all of your income and wealth has been transferred to the state.

fourchan's picture

must be bullish, a completly worthless country sounds undervalued to me. buy buy buy the fucking dips.

withnmeans's picture

I have been aware of this coming, great that some Official said it. Why else would Hollande try to get every Euro he could out of the people. Rich are fleeing, The Government is illegally going over to Switzerland collecting information. My friends that live in France say that things are getting very difficult, it is more like a depression.

Carry on...

NoDebt's picture

Whole thing reminds me of the old Sam Kinnison routine about the Betty Ford Clinic.  As he remarked "It costs $20,000 to go there.  But if you still have $20,000 you don't have a problem yet."

Like that.  But globally.

ParisianThinker's picture

It's a lot better in  France than where you are.

magpie's picture

Next up, plundering the Catholic church and Islamic endowments...

Things that go bump's picture

If they confiscate the Church property they could back their new curency with it.  

Things that go bump's picture

They tried that after the Revolution, you know, with disasterous results, as they couldn't rein in the urge to print more and more of it.  It was one of history's more gruesome hyperinflations.

natty light's picture

As I posted farther down:

Assignats, bitchez.

akak's picture

What IS the going market price for one altar boy, anyway?


Doña K's picture

Several years in prison and sex offender permanent listing

knukles's picture

And therein sir, rests the entire existential problem.
I am French therefore I am French.

Too fucking bad.

nmewn's picture

"US Elites love French high culture. Guess which country the Bankers take their mistresses...."

I have it on good authority (Harry Reid) that bankers take their wives & mistresses to the Caymans to count their cash.

So it has to be true.

TheFourthStooge-ing's picture

CH1 said:

And it is not a life of lies to believe, "the magic state will deliver free shit, cradle to grave," forever?

But of course it is. I think you simply misunderstood Anusocracy, which is all too easy to do in a text-based medium. When he said, "at least they don't live a life of lies like Americans," he was referring to the manner in which the life of lies is lived.

They don't live a life of lies like Americans, they live a life of lies like the French.

Freddie's picture

At least the French do not have Obama.

nmewn's picture

So, you're saying there is still Hope?

Harbanger's picture

I wonder if there is any correlation between a nations moral and financial bankruptsy?  I know the Weimar republic was a haven for hedonistic decadence and debauchery right before it collapsed.

Al Gorerhythm's picture

Sure there is. When theft of private property by an over-reaching government becomes all-pervasive, the immorality of it as an imposition outweighs the morality of saving, as a ratio. Everyone swims with the current; the mainstream (at least).

The Navigator's picture

"When theft of private property by an over-reaching government becomes all-pervasive"

And THAT is why the Founders thought of and wrote the 2nd Amendment.

ParisianThinker's picture

Just wait until Uncle Sam steals your 401(K) and IRA.

Al Gorerhythm's picture

Aren't they doing that already, right beneath your nose?

nmewn's picture

Yes, there certainly is...and we're livin it.

Enjoy the ride down ;-)

Harbanger's picture

The peak of our Washington Monument, unseen by the snakes and maggots below, still reads, Laus Deo.  I'm not concerned,  I know the snakes and maggots will be purged from this land.

Teamtc321's picture

We atleast they can Hope for a Change!!!

While we are stuck with Uncle peice prize doing a reach around, digging for our change.



OldTrooper's picture hope left.  But they do have a bit of change.

Parrotile's picture

>  At least the French do not have Obama.

Not yet. But the Ruling Family DO like to travel don't they, and Michelle DOES like fine dining, for which France seems to have quite a very good reputation.

Jake88's picture

NATO is Obama's bitch. Obama has France.

samcontrol's picture

you cheeseburger eating baboon , you've never been out of your fucking dump you call home.

redd_green's picture

"Your mother was a hamster and your father smelt of elderberries!",

Monty Python