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.