Two Views on Europe

A joint WSJ op-ed by a group of European officials here.

An FT op-ed by Tony Barber here.

47 replies on “Two Views on Europe”

The Wall Street Journal piece is worth a read – interesting but not informative. It is written on behalf of five members of the creditor nations (three of them German) it mentions unemployment once (though not its level), “staying the course” twice and variations on competitiveness no less than six times. The letter is part political manifesto, part psychiatric checklist (dishonesty: check, fantasy: check, absolute self belief: check) and at least 60% fallacy of composition.

It is a damn shame that the European Union has been so compromised by these awful, ignorant, selfish, fanatical neoliberal head cases.

There is a third article that might be mentioned today, the Guardian’s first look at the International Red Cross report on the effects of austerity on Europe since 2009:

Depressing reading. The German bloc is savagely punishing the Eurozone in an effort to save it from social democracy and Keynesianism.

These really are very bad people and we need to have a plan for escaping their influence.

In Ireland Mr Kenny did not just lose the referendum on the abolition of the Seanad,on Tuesday the first of October 2013 his government were defeated in the Seanad on the reform of legacy upward-only rent review commercial property leases. A majority of the Seanad wanted reform of these ruinous commercial property leases.
Ireland has the most anti-tenant commercial property lease law in the world i.e upward-only rent reviews tied to long leases, some as long as 65 years eg Carrisbrook House Ballsbridge Dublin 4, but usually 35 years.

The payment of rent is governed by the provisions of the lease. US leases are of varying lengths but rarely for longer than ten years and often for 3-year periods; Australian leases of grade A and premium office appear similar to the US. Leases in the Far East are often shorter still. The tendency in the UK is towards 5,10 or 15 year leases, but it is now not uncommon for industrial and office leases to include breaks,normally timed at 5-year review date. In continential Europe 3-10 year leases are very common.

The regularity with which rents may be increased also differs throughout the world. While in the US,Hong Kong and Singapore the 3-year lease is usually at a fixed rent and the Australian office and retail leases include annual fixed or consumer-price-index reviews, the continental European leases often have rents indexed annually. Longer North American leases may have rents tied to the rate of inflation or,more often, to tenants turnover; this is rare in the UK. Change to the UK commercial leasing regime has been one of the most important property market issues since the UK property crash of 1990.

No other government in the world,except the Irish government, would sign these ruinous leases, and waste billions of it’s citizens money.

All Mr Haughey’s bagmen and all the corrupt Irish politicians bagmen are sovereign landlords.

@shay as a proud ‘neowhateverthef..” my position on this is very clear,whats yours,blame the Germans and give everyone free housing?

no s*it sherlock so why go before the dail and deny it,tut,tut……Paddy finally seeing the light,give it up,this is not a job for an academic or a spoilt over paid underworked civil servant,you need a businessman sort out the mess.
“The scale to which the unresolved arrears situation has grown in Ireland reflects the absence of immediate consequences for non-payment. This lack of consequences has created a degree of moral hazard. ”

re: WSJ article;

On whose behalf is this letter written?
Are they speaking on behalf of their respective institutions: The Eurogroup, the EC, the ECB, the ESM and the EIB?

Or are these job applications for the board of the new Euro State, that is already in de facto existence.

” Our response to the crisis, which is based on an integrated approach by member states and European institutions, is beginning to deliver results.”

The integrated approach that leaves 25% unemployment in some countries and 5% in others.
The integrated approach that mandates payments to bondholders on threat of imploding a country’s banking the system, until all favoured bondholders are paid; and then confines the remaining losses to citizens of the countries that the banks nominally reside in.
The integrated approach that will ensure that all banking losses are shifted and fully allocated to ‘national’ citizens, before the final act, or piece of the jig-saw.

“In the meantime, work on the final piece of the banking-union puzzle—the Single Resolution Mechanism—will continue.

It is time that some people in the EZ woke up to the fact that they are indeed pieces on the jig-saw of right wing ideologues.

I comment on the WSJ Op-ed View of Europe written by a group of leading European officials.

Please consider that fiat money died Friday September 20, 2013, with World Stocks, VT, Major World Currencies, DBV, and Emerging Market Currencies, CEW, trading lower, as Jesus Christ operating in dispensation, as presented by the Apostle Paul in Ephesians 1:10, that is in administrative oversight of all things economic and political, pivoted the world out of liberalism and into authoritarianism, and as such the stock market has turned from bull to bear with the Too Big To Fail Banks, RWW, and Regional Banks, KRE, trading lower in value.

Competitive currency devaluation has commenced on the exhaustion of the world central banks’ monetary authority, as investors are coming to realize that the US Fed’s monetary policies have crossed the Rubicon of sound monetary policy, and have made “money good” investments bad.

The Great Bear Market of 2013 commenced when World Stocks, VT, traded lower on October 1, 2013. with confirmation coming from Dow Theory, as both the Transports, XTN, and the Industrials, FXR, XLI, PSCI, traded strongly lower in value.

The Fed plans for QETernity. David Malpass of the WSJ reports The Bigger Battle Behind the Shutdown. A staggering $250 billion per month, 80% of spending, runs on autopilot without congressional control. At its core, the shutdown is part of a much bigger battle to restrain the federal government. It is spending $3.6 trillion per year without a budget, and its expenditures are expected to increase rapidly in the years ahead. Meanwhile, the government has piled up $17 trillion in debt and $60 trillion more in unfunded spending promises. The Federal Reserve will borrow $1.1 trillion in 2013 alone to buy bonds and it reserves the right to borrow unlimited amounts for future bond purchases without congressional or presidential permission.

Through anticipation of ongoing monetary intervention by the US Fed, the see-saw destruction of fiat wealth that commenced October 1, 2013, and intensified October 7, 2013, will become more vigorous, as bond vigilantes call the Interest Rate on US Ten Year Note, ^TNX, higher from 2.65%, and as currency traders sell the EURJPY, the AUDJPY, and Major World Currencies such as the Canadian Dollar, FXC, the British Pound Sterling, FXB, the Swedish Krona, FXS, the Swiss Franc, FXF, and Emerging Market Currencies, CEW, such as the Indian Rupe, ICN, and the Brazilian Real, BZF.

Out of a soon coming Financial Apocalypse, that is a global credit bust and financial system breakdown, as foretold in Revelation 13:3-4, and more specifically out of sovereign insolvency and banking insolvency of the periphery and southern European periphery nations of Portugal, Italy, EWI, Ireland, EIRL, Greece, GREK, and Spain, EWP, that is the so called PIIGS, the Beast Regime of regional governance and totalitarian collectivism, presented in Revelation 13:1-4, will rise to rule, in all of the world’s ten regions, and occupy in all of mankind’s seven institutions.

It will be the officials, Jeroen Dijsselbloem, President of the Eurogroup meeting of euro-zone finance ministers, Olli Rehn, Vice President of the European Commission responsible for economic and monetary affairs, Klaus Regling, Managing Director of the European Stability Mechanism, Werner Hoyer, President of the European Investment Bank, Jorg Asmussen, Member of Executive Board of the ECB, as well as Michel Barnier, EU Commissioner responsible for internal market and services, and Viviane Reding, European Commissioner for Justice, Fundamental Rights and Citizenship, two not listed in the article, who will be the very leaders who will establish a new economic order, as they meet in summits and workgroups to waive national sovereignty and announce regional framework agreements, which pool sovereignty regionally, this for the purpose of regional integration, so as to provide regional security, stability and sustainability.

I saw somewhere this am that Iceland’s private sector is set to run out of foreign currency to pay debt…some of you I suppose have forgotten how the northern star had pointed the way to a promised land without austerity. The new PM is having some problems as well in meeting his promise to cut household debt.

Far away hills are green.

Tony Barber has it right: “the enemy may be not only the hydra itself. It may be complacency.”

There was a legitimate argument to be made on the extent of what has been termed austerity, but it appears the common reaction in Ireland was that the bubble standard of living should be maintained by Germany in particular, in the interest of solidarity.

It’s also interesting that at a domestic level, there was no evidence of solidarity when those with the power used it to protect their existing privileges.

“It’s also interesting that at a domestic level, there was no evidence of solidarity when those with the power used it to protect their existing privileges.”

Agree 100% with that,

But equally it should not be assumed that the EZers have the answer. It is clear that they don’t, but they have dressed up a self-serving creditor’s agenda into an economic dogma, that everybody must pay homage to.
In Ireland, those paying homage have been well rewarded, by being in a position to hold onto their privileged positions, while passing the ‘austerity’ onto others.

@ Shay and Joseph,

JEROEN DIJSSELBLOEM, Dutch finance minister, ruling labor party, the President of the Eurogroup

OLLI REHN, European Commissioner for Economic and Monetary Affairs and the Euro, Finnish Centre Party (presently left opposition)

JÖRG ASMUSSEN, executive board of the {European Central Bank}, German Social Democrat,

KLAUS REGLING, CEO of EFSF and Managing Director of the ESM (700 b Euro), German social democrat father, alleged sympathies for CDU,

WERNER HOYER, President of the European Investment Bank, kind of a european KfW, subscribed capital of the Bank was EUR 232 billion (313 b$) in 2012, more than half of the IMF 500 b$ I remember (or?, has anybody a good reference at hand?), German FDP

These 5 people are European key decision makers, representing the social democrat centre-left core European consensus

When I look in comparison to 2 Irish bloggers here, constantly edging at the racist hate mongering side, and a few English scribblers on the hard left side, constantly doing the bidding of speculators like Soros and Paulson, I say:

We have had it,

– of folks constantly throwing their tantrums, threatening national default over finally implementing universal health care, like all civilized nations, just 130 years later,

– or constantly disputing about balancing the budget and paying taxes and debt

Whom else do you need you , Schäuble in the FT before the elections, and the 5 now in the WSJ after them, to tell you:

This continental rock is not moving on its principles: social justice and hard money supporting this

European Central Bank and China strike currency swap deal

“These 5 people are European key decision makers, representing the social democrat centre-left core European consensus”
I must have missed their election. Or is Franceen suggesting we all need some technocratic rule?

@ john gallaher

Thanks A LOT for that link!
I had to reload 3 times, but now it looks like working.

@ Brian Lucey, sub prime friend
Did you forget the question about , what ONE single one publication of yours you are proud of ?

Hiya Francis. Im proud of all my publications. Every one. What about you? Oh, I forgot – if you told us one we would know who you are
Anyhow. Who died and made them Kings?

john g,

with all my respect for apprentices making their way up from modest starts,

the bank counter clerk Carsten Schneider has no say about what will be done

@francis oh i think there may be something in it,perhaps not as described but expect considerable pressure on Ireland to move its tax rates in line with most modern economies.

Carsten Schneider trying to force corporate tax rates on other nations, via german coalition negotiations,

sounds a little bit like lunatic Oskar Lafontaine in 1999, trying to “harmonize” income tax rates across Europe, to the tune of the 60%, we needed at that time for our reunification.

Would you like that ? Join David O’ Donnell and his Frankfurt School friends at nachdenken seiten de. They would really love to feel all the international love they so truly deserve : – )

stability culture, entrepreneur something,

and social justice only at 3rd place.

We ve got to work on his priorities.

Just saying : – )

‘24% — the frightening poll’
10 October 2013 Presseurop Le Nouvel Observateur

“For the first time,” the Front National (FN) has taken the lead in a survey of voting intentions in France, reports an Le Nouvel Observateur. According to a poll conducted for the weekly, the far right party led by Marine Le Pen is credited with 24 per cent of the vote, “two points ahead of the UMP [the opposition Union for a Popular Movement] five points above the PS [the ruling Socialist Party]”.

97% public debt euro average vs 107% US, 247% JP, these are not some loose numbers in such circumstances, from that kind of guys

infrastructure investment, education, energy security, demography

economies move in cycles, that is normal

“excessive” is the problem


careful about commenting about IMF recommendations for the US

“The IMF has the expertise ….”

…. well they were obviously proven wrong by the facts

the argument of “the IMF 10 yr vs european 30 year horizon”, I am getting familiar with that by now

jörg on the german supreme court … “this is what the markets need to know”

EIB (small) non-EU development lending as extremely helpful experience for intra-EU “non-development” lending, ROFL

Absinthe make the heart go fonder. Perhaps you have morphed into the Dork from Dresden,

@Ernie Ball,my cheap shot at public sector workers related to this dispute.
I think the gov is doing an absolute awful job,if he actually ran a ‘bank’ he would be fired by the shareholders/owners-you guys-,the mtg. mess has gotten worse under his watch.

yeah yeah its a ‘phoney’ concept indeed…denial is not just a river in Egypt.

Franky boy lay off the grog. …
I wish I could replicate the business model of ReedElsevier..

@john gallaher

My comment wasn’t directed at you. I don’t consider you a troll but do wish you’d make a little effort to tidy up your unreadable “prose.”

@Ernie Ball,hi Ernie in another life I want your writing skills,how’s the blog any more excellent articles,haven’t checked for a while.Luckily it’s the oul math that I make a few bob with,shur no one reads my posts anyway…
It was a rather smarmy stupid comment about PS workers,an Indo link too,jay…sus but I do think the NTMA is having a laugh,if they could only pay those fellas at NAMA a bit more you guys will lose less money 🙂

@francis myself and Brian L. agreed to disagree kinda,on say strategic default for example.But he has done significant reading and work on the topic,is fully entitled to his opinion and defends it well.But it does not result most times in a slagging match.
So please keep me out off some these back and forth’s btw you guys.
I enjoy our exchanges and am curious this morning if there has been any follow up on the link above regarding ireland and the formation off a new german govt…..

i made a rather stupid comment in trowing all PS workers under the bus and Ernie had every right to have a go at was a pretty obnoxious comment.
Ok have a good one please link anything you come across regarding ireland and taxes its a major topic back home.

John Gallaher,

Since you asked, I did a search just for “Irland”, to avoid any exclusions for various german spellings of “taxes” in bad search machines,

– in the most relevant german media (not “deutsche wirtschafts nachrichten : – ),

– strictly ranked by reach (“meedia” online clicks, print positions would be a little different),

– not sympathies, in order to avoid any potential bias : – ) (37%)
Ca 20 x football, some dog story,
Specifically for Ireland and taxes: This molestor from geneva caught in Poland, …..hääääh? wtf
Some august 2013 public TV story on the tax cheating (29%)
1x The google-bermudas story, 5x the football game against Ireland in a few minutes (8%)
Ca 10x football, one “drink and drive” story from a week ago (8%)
Football, Google mentioned first time at place 7, ryanair on 2nd of october (6%)
Your link at 2nd position !!!!! 6x football, a travel story for tomorrow reise/mitten-in-absurdistan-bitte-weiter-kuessen-1.1776447 “Frau Merkel will doch ihr ganzes Geld zurück.” (4%)
Google 1x on place 2, some , some adam Hochschild book 6th of octoberaround position 10, the rest football (5%)
1x The google Bermudas story

This tax thing interests only Carsten Schneider here around.

That matches also my own personal discussion experiences here around.

From my perspective Ernie Ball has made it perfectly clear “@john Gallaher, My comment wasn’t directed at you.”

And I do respect your relation to Brian. I have several times stopped after your pleas for him. But he keeps coming.

Some Irish “Leprechaun” fans holding their fist to the heart, during our “Einigkeit und Recht und Freiheit” national hymn,

mutual respect, that is as it should be.

And of course I want my boys to give them a 0:4 reason to sing “fields of athenry” : – )

@francis its not the forum to get ‘personal’ no offense but unless you are willing to reveal yourself its a losing battle,bit like inflation…
I enjoy our exchanges thanks for the search,its not really big news here in NY either.
Oh i have no particular ‘relationship’ with Brian L. never met the chap,no desire to either but he does use his real name and is a somewhat public figure so i admire that about him….
We also don’t agree on ‘open access’ but hey it would be a boring place if everyone agreed all the time,still we can keep the exchanges civil.
Most the Irish papers ran with it today….next meeting Tuesday i think whats the most likely outcome ?
If you have not already Niall Ferguson does a simply wonderful if a bit catty ‘job’ on your pal K-MAN over a H-Post-3 parts!

@ David O Donnell

Via your link, from the same outlet:

@ John G
thank for bringing Niall up. I had seen the first part, but then somehow lost track, I think my PC forced a reboot for making the loudspeakers work in unexpected ways, or …

Krugman got what he deserves, and Niall is the perfect guy to deliver it. I believe many people here in Germany think along similar lines.

What I noticed, when I looked up the inflation data, is how closely France and Germany are tracking, cumulatively less then 1% difference, from 1998 to now. The same holds for stocks, e.g EWM vs EWG, since 1996 a mere 3 % cumulative. Although we do a lot of things pretty differently. Irish yield spreads now down to 1.84%, could be 1.5 at years end.


Krugman got what he deserves, and Niall is the perfect guy to deliver it. I believe many people here in Germany think along similar lines.

Its not just you “Francis”, many people in the non-ordoliberal world think that Niall Fergusson is as perfect a representative as the German economic mainstream could ask for. Proud, foolish, willfully ignorant and dangerous.

Here is an old LRB piece on the rights current Colossus of Thought:

After reading it I suggest you give this very short Krugman piece a read: On Knowing What You Don’t Know.

Off topic but entertaining.

If anyone needs an amusing reminder of some of Niall Ferguson’s other great contributions to economics and the political science of gender and sexuality this post by Josh Barro is laugh out loud funny, or your money back.

A little taste:

Indeed, what credentials does The Atlantic’s Matt O’Brien have? In an accompanying video interview with Alyona Minkovski, Ferguson notes with horror that O’Brien has never even written a book. Why, he might as well be some vagrant!

@francis,hi francis keep in mind Niall is also currently promoting a new book,yes another one Shay!
Quite the shocker irish spreads,oh they may blow out any day now.There is a very highly paid group of civil servants there called the NTMA,that kinda run the place.Put their reputations on the line by stating that irl is ‘out’ off the markets until next year,but if they wrong or mistime the call no consequences at all.
Anyway was catching up on some stuff before heading out,enjoyed this makes a lot sense….
The cobra analogy is quite good too.
“Eurobonds are a case in point. Granted, eurobonds would offer temporary respite to heavily indebted member states of the euro area. But the introduction of eurobonds would throw the already lopsided balance between liability and control even further out of kilter. While spending decisions would essentially remain a national prerogative, liability would become European. Incentives to incur further debt would thus be strengthened, not weakened. This would strain rather than smooth the working of the system.”
here’s jens in fine form as always.

@ John

when I read Jens I see

” Between 2009 and the end of this year, the deficit-to-GDP ratio will have been reduced by well over 3 percentage points.” and
“without sound public finances, sustainable growth will not be possible.”

the rest as general blah. Do I miss something? But the important rest was also already said, by the appropriate people, the 5 in the wsj, and Draghi in Boston.

With respect to the Cobra story,
are you sure it is true? They would have released the cobras in their own neighborhood, and their neighbors would have also known it.
Otherwise Dombret just repeats that Eurobonds are asdead as Stalin, the ESM/OMT is the framework for all emergencies, which may come at some point, maybe.

With respect to Niall, I think my wording was precise. Krugman deserved it, and Niall was the right guy to deliver it. In order to throw back the dog poop, with a good swing to it, you must not be afraid to touch it : – ). Could you imagine Carmen Reinhart doing it?

That does in no way mean, that I support much else what Niall wrote somewhere else, or that he is not also self-promoting.

He exposed the shameless hyperbole of Krugman, in a way easy enough to read for many, and that sticks.

I remember that the

Noah piece Krugtron
“getting 14 out of 15 predictions right.” “his secret weapon is simple, elementary Keynesian economics – a rough-and-ready IS-LM view of the world, backed up by sophisticated “liquidity trap” models like {this one}”

was pretty much the last thing I read there. At that time, the
IMD multiplier
was through (the vicious attack of deLong etc. on anybody who pointed out that the rest of the world is laughing how that was produced e.g Gavyn Davis FT),

the Iceland miracle come and gone, the Latvia story had already broken. It was clear (May 2012) that Krugman had not the slightest clue, how IMF /EFSF loans work, his conservative colleague Henderson half to one year later also not.

The endless attempts to build strawmen, what others have allegedly said.

And it was clear that these people live in a parallel universe in which they believe to get away with this behavior, even the Bloomies got enough of it “Krugman buries himself”.

And the attacks on Rogoff was then just the total end of anything.

Where I live, to expose the falsehood of a public figure, the “attacker” does not have to be a white knight or fight with a name plate.

But from some comments here, I sense that many in Ireland see this somewhat differently?

@francis,the link was really a “dig” at Irish spreads..
“At present, sovereign bonds are treated by European regulators as risk-free – an assumption that stands in contradiction both to the no-bail-out clause and to recent history. An adequate risk weighting of sovereign bonds would make banks more resilient if the fiscal position of the respective sovereign were to deteriorate. And it would bring spreads more into line with the underlying risk, thus giving a disciplining signal to the sovereign.”


Wow, that the great thing with you.

I did focus less on dombret in an “emerging market” issue after cobras,

but somehow I felt more than I was really consciously thinking, there is something more, I am missing, and I have to ask.

But to this point, I think that has to be fixed by fixing the sovereigns, and not by assigning risk weights, defined by who?

@francis the fundamentals in Irl have not changed that much,throwing around the possibility/probability of using German savings to shore up the Euro that’s what changed….anything it takes and all that.
Looking forward to the OMT decision,there will be no retroactive recap nor should there be….Irl wanted go guarantee s**t they didn’t understand,it was like guaranteeing a student loan for a juvenile delinquent, go ahead here’s the bill.


your tonque is AT LEAST as sharp as mine : – ) compliment

1. Before I read the seminal paper of Philip Lane to the end, I stopped shortly to wonder for myself, what things and statistics he would tick off,
Most of it, but one thing is missing, household debt.

I think I had mentioned this before, there was a non-academic, Warren Brussee, “The second great depression, 2007 -2020”, who used this, in analogy to Japan, and when I look at this Japan, following K-mans vicious advice, I still get scared, look at OECD annex 58.

But it was fascinating to look at a picture, based on data until 2004, the first glances on a new world, just coming out of the mist, a little bit like in the movie “1492”, for dry data people like me : – )

And then go on, compare to data to 2008, to 2012, as we have them now. And wondering, who was really in charge, when.

Straying off topic:

2. At first I thought I do not respond to Shay “ordoliberal” and Mickey Hickey’s repeated swings at Merkel, liberals, and the FDP

But I came across Genscher, a great German liberal, FDP, who incorporated “Ostverträge” and “Entspannungspolitik”, “OSCE”, 23 year minister, social-liberal coalition,

for all people able to read precise german, a wonderful piece of journalism, every second sentence a nugget to enjoy.

More full, from somewhere else “ Die aus meiner Sicht doch in seinen Äußerungen vorhandene Unbestimmtheit über den Gegenstand, den er beschrieb, und die gleichzeitige Zufriedenheit der Journalisten, die hat bei mir, ehrlich gesagt, auf meinem politischen Lernweg eine nachhaltige Wirkung entfaltet.“

Some folks in Ireland knew since the elimination of the German risk manager in April 2007, at the local unicredit, I seem to remember, that things were running afoul, and 29th of September 2008 the fateful decision was signed into law.

And Merkel and Steinbrück had to put up this statement

Carefully devoid of any specifics

And FDP Wolfgang Kubicki [commenting] zur großen Koalition: “Man hatte wirklich das Gefühl, man kann abends beruhigt schlafen gehen, CDU und SPD haben das Problem im Griff.”

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