Tag Archives: Brussels

‘Brexit’ . . . The Third Option

BREXIT photo

As the 24th June recedes into memory there is no doubt the establishment machinery has been working overtime to undermine the voice of the British majority decision to exit the EU, even suggesting many are having a change of heart.

The stock markets were beautifully manipulated to make small fortunes for those who already have large fortunes as they bounced back after the chaos of the vote. The IMF  reckon Britain will outstrip Germany, France and Italy’s growth forecasts and our own Bank of England report our economy has not slowed since the Brexit vote . . . So much for the end of the world!

Whilst the ‘presstitutes’ now focus on the triggering of Article 50, our new government is preparing for the supposed two years of negotiations to enable our extraction from Brussels influence.

The question nobody seems to be asking, in all of this hype and scaremongering, is the very real possibility that those negotiations won’t actually go the distance, because the EU has collapsed.

As time passes the problems for Brussels seem to be escalating, as the technocrats lurch from one regulated disaster to the next. With the benefit of hindsight, we should have read the warning signs of over regulation in the 70’s, with the famous beef and butter ‘mountains’ and wine ‘lakes’.

Then we saw the introduction of the disastrous single currency, designed to bring about financial control over the EU. Time has now shown that it is beyond possibility to try and manage the individual financial environments of many different countries in such a manner.

This one piece of mismanagement has led to building a toxic financial environment that is no longer sustainable without blatant subterfuge. Negative interest rates are not only killing the traditional business of banks but also crucifying pensions investment and the future incomes of hundreds of millions who have paid in with utmost good faith.

Moving from the financial to the political, we now have the political pantomime that has seen France, Germany and Italy declare a summit in Italy next month following the aftermath of the UK exit. We have G20 and G7, is this E3? I can only see it as another very expensive taxpayer funded ‘bun fight’, as I question the credibility that will give substance to these three getting together?

Let’s start with Germany, where Merkel is just about hanging on to power, with her country overrun with refugees she has invited in without reference to the other members and who are frightening off tourists as fast as the immigrants appear.

Her posturing and dictates also give no clue to the fact that her country is about to financially implode. Hers is the first Eurozone country to issue negative interest debt, something the ECB will not (currently) redeem in event of problems.

For over a year now the financial pundits have been saying the country’s largest bank by far, Deutsche Bank, is in serious trouble. Its share price has dropped 48% since last July, motivating finance minister Wolfgang Schauble to declare in February he has “no concerns about Deutsche Bank”, something finance ministers don’t say about ‘healthy’ banks!

The bank has been selling more of its shares and issuing ‘contingent convertible bonds’ to raise desperately needed capital, all of which have gone to further depressing it share price and credibility!

Such is global concern that Deutsche Bank will become the next Lehman Brothers that the IMF, no less, have publicly branded it the riskiest globally significant bank, at a time when its US businesses also failed a Federal Reserve stress test. If/when this bank collapses, the reverberations will make 2008 look like a walk in the park.

Then we have Italy, where the IMF have also declared the country’s banks, who have seen their share price plummet by more than 50% this year alone, pose a particular threat to the economic outlook. “Unless asset quality and profitability problems are addressed in a timely manner, lingering problems of weaker banks can eventually weigh on the rest of the system” came their warning.

Monte Dei Paschi is Italy’s third largest publicly traded bank and its particular distinction is that no bank in Europe has fallen so low so fast without completely crashing. Two years ago their shares were worth between €5 and €9 and today they are worth €0.33. What keeps it on life support is constant taxpayer bailouts, something a Merkel bullied Brussels has now pulled the carpet on.

Here lies the embarrassment for premier Renzi before his summit with France and Germany, rumour has it he is contemplating going head to head with Brussels and enacting a unilateral sovereign rescue of the Italian banking system.

How will he face Merkel, who insisted upon ‘bail ins’ over ‘bail outs’ and has gone on record as saying “We wrote the rules for the credit system, we cannot change them every two years”. If Merkel gives in it will make a mockery of her ‘bail in’ rules before they have been properly used, to say nothing of the political fallout if, once again, there is a raid upon taxpayer’s money to save a bankrupt financial system.

Whether she maintains her position or waivers, neither is an endorsement of her direction of EU policy, or the credibility of Brussels regulations.

What cannot also be overlooked is that Italy is the EU’s third largest economy, with €2.23 trillion of public debt, €400 billion of which is stagnating in Italian banks as bad loans, making them not only ‘too big to fail’ but also ‘too big to save’!

Finally, we have France’s contribution to the ‘toxic trio’ and their pompous little president, who is now traveling around the EU to secure unity in the face of these pending financial disasters, the Greek fiasco and Brexit and being publicly booed for his troubles. (Or perhaps it’s because of the $14,500 of taxpayer money he spends each month on haircuts!  Where is his credibility, when his popularity rating at home is now reported at below 10%?

As Philippe Le Corre noted in the Financial Times, opinion polls show that 61% of French people “hold unfavourable views of the EU”. Two-thirds feel that ”the EU has failed them economically”. By contrast to the UK, it’s the young who have been among the hardest hit, with massively high unemployment. “It is likely that they would vote for “Frexit” in a referendum”, says Le Corre.

This seems to be lost on Martin Schultz, President of the EU Parliament, who stated quite clearly: “It is not the EU philosophy that the crowd can decide its fate”. (So what is the point of the elected members of this parliament, or indeed this parliament?!!!) And this pearl of wisdom comes only weeks after the people of one of the EU’s largest contributors demanded a return of democracy following their Referendum on membership on 23rd June.

The European Commission’s attempts to drive through the trade deal with Canada (CETA) is pouring more petrol on the glowing embers of discontent, as it is now close to collapse after a German political party sued Brussels over its implementation. “it reveals once more the cavernous differences opening up between different member states which have effectively rendered the European project unworkable”, according to one recent report.

The only logic appears to be that this undemocratic move by Brussels creates a precedent for the equally undemocratic TTIP trade deal with the US, which is running in the face of huge public protest.

It will only take the effects of one of these trade deals, or the collapse of a bank, on top of the mounting problems of immigration, to trigger revolt in an already unstable union, which it is not that far off if Brussels pursues its present political stance.

Two years of exit negotiations . . . we shall see.

Until the next time.

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

‘Remain’ . . . ‘Leave’ . . . And?

Banking photo

As I survey the aftermath of our historic referendum I feel a huge sadness at the state of a country I love and have now lived in for the proverbial three score years and ten. Never before in my life have I felt I am in a helpless and rudderless ship as I do now.

Our political system is in total disarray, with back stabbing, political connivance and a complete lacking in any vision of the future by all concerned. As I see it the ‘Leave’ campaign made the right decision but for the wrong reasons and the ‘Remain’ campaign made the wrong decision for the right reasons.

After the vote, when I heard that Boris Johnson was working on his manifesto I was appalled but suspect all the other contestants were doing the same thing. That all concerned had taken us into a fight, arguing with lies and very dubious statistics, about something so critical to our future and with not the slightest vision of what that future might be, speaks of only of the agenda of debt and profit driven Neoliberalism.

We are bereft of serious leadership because our politicians no longer have any power to direct our Society. There has been much talk about the ‘1%’ and the ‘corporate masters of political power’ and now we are witnessing the stark reality of this abomination.

We hear of Theresa May making her play for the top power job, without any idea of her thinking as to a direction forward, other than the bog standard and vague rhetoric about “Strong Proven Leadership” “No reneging on Brexit” and “No activating Article 50 until the end of the year”.

OK, that’s the short term but what’s her vision of the future. Surely to God she must have one, or is she just ‘more of the same’ with austerity and democratic erosion, now that Cameron has been kicked out by the financiers for messing up their plans for a more controllable ‘one state Europe’.

If we look at her political style on surveillance, for example, she certainly supports it but in a rather worrying way, with an again vague Internet Spying Powers Bill that has left parliament very confused. To quote from a recent piece in the Spectator:

The new bill makes pitifully little effort to define when heavy surveillance powers may or may not be used. It merely stipulates that they can be used in the investigation of ‘serious crimes’, without attempting to define what that means. The bill specifically allows surveillance to be undertaken in order to safeguard the ‘economic wellbeing’ of the country — a power which could all too easily be interpreted by tax authorities as justifying the use of heavy-handed surveillance of people who pay their cleaner in cash or involve themselves in other trivial forms of tax-dodging.

Labour are in an even worse mess, as Blair’s ‘team disgrace’ are actually given media space to mount their attack on the only honest and decent political leader parliament has seen in years. That twice disgraced cabinet minister Mandelson is still given media space shows just how corrupt the establishment have now become:

“Peter Mandelson: Corbyn’s leadership could turn U.K. into a one-party state”

Wasn’t he part of the team that sought Murdoch’s support in 1997, at a cost of taking Labour so far to the centre that it became indistinguishable from the Tories. If ever there was a ‘one party state’ it was that which emerged under his strategic supervision and something Corbyn is now trying to repair.

Whether it is May or the Blairites, we are suffering the consequences of the takeover of our state by stealth from the Neoliberal forces that have crept up on all of us. The financiers have taken control and their threats are still ringing in our ears from their bullyboy tactics to protect dominant financial agendas during the referendum. They have become even more confident in exerting their will over political power and the democratic process by the strategic application of debt and monetary control.

The unrest in the world is because people sense their loss of power, of which the current Brussels run EU is very much a part. The President, Jean Paul Juncker, has said quite emphatically that “There can be no democratic choice against European Treaties”

It doesn’t get much clearer than that and in the end it leaves me in no uncertain terms I will have little or no say over how my life is run in future. Do the clowns in Brussels honestly believe that they, for the first time in our history as a species, can institute a framework of rules and regulations that meet the needs of 27 different countries and 500 million people without changes or adaptation?

Their arrogance suggests this is the case. I suspect however, that what is closer to the truth is that they are blindly implementing the dictates of their corporate lords and masters. That agenda includes not only political and financial control over Europe but also the introduction of military might that will then mirror the military/industrial complex money making machine that dominates America.

The Euro is a disaster, failing hopelessly to meet the needs of the differing financial requirements of those member states who opted in and is now crippling them one by one. Greece was the first victim of this incompetence and all the warning signs now point to Italy to bring the whole financial edifice to its knees.

‘Remain’ were right in their claims for closer ties with Europe but they cannot be achieved by trying to change Brussels. Renegotiation is not in their vocabulary. ‘Leave’ are wrong to distance themselves from Europe but the only way to change Brussels and its Neoliberal agenda, including TTIP, is to totally discredit the whole political establishment and rebuild a more democratic structure out of the ashes.

We must now re-empower Society by re-empowering political leaders who care about the people and will get their full support in bringing about meaningful change of the sort I outlined in my last piece, which sadly went down like a lead balloon but won’t shut me up!

Indira Ghandi best summed it up: “You can’t shake hands with a clenched fist.”

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes