The euro could could collapse by the weekend!!

Dear Reader, the European single currency could collapse by the weekend! Or maybe not that soon but maybe by the beginning of 2012. The game is up if the Chinese and Japanese don't want to lend ten year money at very low rates to Germany. In today's Daily Mail an article on the U.S by Max Hastings described German leader Angela Merkel as an adequate city mayor. I think that it is a bit harsh.

While a recent article in the Times by the so-called economics expert Anatole Kaletsky shows him to be a bit deranged. OK it looks like a German takeover of Europe but if national governments want their budgets to be approved first in Berlin (Ireland, Greece etc) then it is up to them. For instance, nobody asked the Irish banks to massively expand their balance sheets and go bust taking the country with it. I read once that a Irish bank took a big group of local property developers to Chicago on a jolly as a way of getting loan business.

Apparently, Ireland wants to review its bail-out package since the country looks stupid trying to pay back its debts with the Greeks getting debt relief (sovereign bond haircut) of at least 50 pct from the commercial banks. If Ireland leaves the euro, I don't think Royal Bank of Scotland and Lloyds Bank would be too impressed!

What can we do in the UK? Cutting personal and business taxes (perhaps slowly) would would help (the Laffer curve). Hope more companies follow the example of European aircraft manufacturer Airbus and Swiss food group Nestle in
announcing new jobs. Sack Chris Huhne and rethink the windpower programme.

To protect social cohesion/integration, if things get really nasty, one idea would be to reintroduce some kind of conscription focusing on green projects, looking after the elderly etc without the military angle. If you are paying benefits to the hoodies, you might as well get them doing something useful.

UK chancellor George Osborne might talk up infrastructure projects but we are where we are. The infrastructure projects are too smaill and they will take too long. Expecting rich sovereign wealth funds to invest in "Boris Island" is just pie in the sky!!

Columnist Peter Oborne opines that the collapse of the euro will completely discredit the European elites. As long as it shuts up that EC idiot Jose Manuel Barroso I would be happy. He has been European Commission president since November 2004, so it is time for a change.

David Cameron did not have to go begging to Berlin!!

Dear Readers, I thought the recent trip by British premier David Cameron was degrading. I do not see any point in begging the Germans for anything. If Angela Merkel wants to see the Euro collapse, then it is up to her. I can understand the German electorate not wanting to underwrite the crazy economics in countries such as Italy and Greece, where the local populations can retire a lot earlier than in Germany. However, expecting Greece, Italy and Spain to reform at breakneck speed is pointless.

For instance, Mariano Rajoy has won the general election in Spain for the centrist-right Partido Popular. He does not strike me as a Spanish Maggie Thatcher in the making prepared to reform the labour market (taking on the unions, ending collective bargaining etc), reducing the 17 regional governments to just two (the Catalans and Basques) or reforming the university sector, where lots of Spanish students spend years learning rubbish subjects.

However, I would be loath to give Sr Rajoy advice on these areas since the United Kingdom has exactly the same problems (politically motivated public sector unions),
the expensive Welsh and Scots and a non-performing university system. However, some British universities are the best in the world while Spanish business schools featured very strongly in a recent Economist survey. Spain has a great tourism sector
winning back business with the collapse of places like Tunisia and Egypt. What the country needs is time to get back on his feet after the mismanagement of Zapatero.

As for Italy, its banks did not buy many Greek government bonds, its citizens are wealthier than Germans and the country has some great companies and top managerial talent. However, Italy will never really pay off its debt mountain. One common problem for Italy and Spain is the level of corruption, especially siphoning off cash to fund political parties.

http://www.expatica.com/es/news/spanish-rss-news/spanish-corruption-probe-finds-millions-in-swiss-accounts---report_31311.html

I am sorry about the dilatory nature of posts!!

Dear Reader, I am sorry about the dilatory nature of posts. I used to like moaning a bit about former UK premier Gordon Brown but I could not get the same enthusiasm in complaining about David Cameron et al. However, I am getting a little irritated about
the incompetence of the Tory/Liberal administration. The main example of ths was the lack of protection for citizens during the summer riots. Given the amount of money we pay in tax and the amount of intrusion we face from the authorities, the UK population deserve a better deal.

So hopefully I will be back on the blog trail!!

Today, the press has been reporting George Osborne's negative comments about the French economy. I thought the British chancellor would have enough on his plate with
problems such as youth unemployment rather than worry about our neighbours. France has higher productivity per employee than us and some amazing world-class companies such as L'Oreal. The French also make pots of money from the design of the European Union (EU), which enable the country to survive its bonkers employment legislation, which restricts the hours people worked. This explains why you can be in France and not get a meal after 9pm.