A Deeper Union?

The WSJ has a detailed report on the current state of negotiations – here.

11 replies on “A Deeper Union?”

The term “negotiation” presupposes that there is an issue or a clear topic on the table. The current state of “confusion” is probably more accurate.

@ seafoid

the common cure for people playing with dynamite in the wrong place is lots of bullets through her head.

“social cohesion.” as mentioned in the WSJ also needs people , at the national level, are solidaric, rise to the common defense, as against floods, and take substantial losses on their bank balance, stock prices, income and pension levels, as I have taken, and then rise to the challenge, in solidarity, to secure their nations full credibility and functionality.

I think that

Cyprus 3/2013, Berlusconi 9/2013, GOP 11/2013 have shown very convincingly, that those folks can push the suicide button as much as they want, and nothing happens. We have cut their wires, but it shows their lunacy for everybody to see.

Who wants to go next, trying that ?

@ francis

“the common cure for people playing with dynamite in the wrong place is lots of bullets through her head.”

That is a deeply unpleasant remark. And not true either.

“GOP 11/2013 have shown very convincingly, that those folks can push the suicide button as much as they want, and nothing happens. We have cut their wires”

Also unpleasant. Also, you understanding of who ‘we’ are is very odd. At the risk of actually getting an answer, how did your ‘we’ cut the wires of the GOP?

Government is facied with having to accept a credit line with strings attached that concretes over any green shoots with further austerity and/or another bank bailout, with the same result.

A wholly unexpected turn of events.

Re final par of that article “Guntram Wolff, director of Brussels think tank Bruegel, says that across a range of issues, “Germany thinks more and more that we should move back to a model where countries are responsible on their own.” Without a fiscal, political and banking union, he argues, “we will have a euro that just survives, but not one that functions well.”

I agree with Guntram. Further I suggest Germany having recalled its gold from the FED is likely planning for breakup of the EMU. It sees the imminent crash of the dollar braking against US debt ceiling and growing currency pressures for the euro currently at 1.38 to dollar as writing on the wall for euro. Its becoming more difficult to hide the sticking plasters on eg Irish /Greece/Spain/Portugal public debt.

Bertie led us to bailout. Enda is leading the charge to default. But look at Switzerland not a full member of the EU but instead does very well out of its membership of the European Free Trade Agreement.

A future for Europe abandoning the euro and having closer ties under EFTA could become a viable form of European union forcing countries to be individually responsible for their own destiny not ones like ours trying to fish in a perfect storm.

Off topic but I wonder could one of you guys explain to me how it comes about we are 13th with $91.8bn, a third more than Germany’s quota of investments in T-Bonds, or point me to resources for further info

http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt

@ Colm Brazel

Beyond some NTMA holdings, most of the Irish resident Treasuries are likely held by companies/funds based in the IFSC.

@ All

The WSJ story also suggests that France isn’t pushing for what it terms “un gouvernement économique.”

With the banking union project underway, against the backdrop of a fragile recovery, leaders need to pay attention to the economics rather than spend years of wrangling about new treaties.

It is true that an actual closer union would promote confidence but any significant move towards it would require treaty changes, national approvals and lots of uncertainty.

gavin,

I think the bullet comment is the appropriate answer to this loose “burning dynamite” rhetoric, even when it comes from the “right people”.

The “we” is for the other cases also not anything I am involved personally, but was written in a sense of “we, the reasonable people”.

From my perspective, and that of most others in markets, it was pretty obvious that the “all or nothing” approach of the tea party behind the GOP house will falter, in the last minute.

Colm,
Germany just brings back a little bit of our gold reserves

http://www.spiegel.de/wirtschaft/bundesbank-holt-700-tonnen-gold-aus-new-york-und-paris-nach-frankfurt-a-877931.html

At times, where russian tanks could have been in one hour frankfurt, storing it in US, Paris, London had advantages.

Now that is gone, and we still keep half of it in the US after 2020.

Nothing panicky about that.

@ Finfacts,

I kinda had the same idea that “NTMA holdings, most of the Irish resident Treasuries are likely held by companies/funds based in the IFSC.” But I was wondering re precise figures.

If, as appears likely possible, the Germans, Finns, Netherlanders and other EMU members enforce a bail in, if the message reiterated by Wolfgang Schauble is true and not what the Irish authorities would like to be true, there will not be a retro recap of Irish banks from the ESM. So, in the event of a devaluation exit of the euro or a bail in the T-bond credits are interesting?

Are t-bonds of either the NTMA or the IFSC safe from bail in? Plus I don’t get why the IFSC is used to invest in them rather than some bank buying them direct. Probably a long technical answer on this just looking for sources and I know lots of this is beneath the radar in the shadow banking industry.

@Francis

Der Spiegel is being a bit disengenuous though it agrees with me “http://nsnbc.me/2013/04/18/federal-reserve-refuses-to-submit-to-an-audit-of-germanys-gold-held-in-u-s-vaults-2/

“The central bank wants to retain the ability to quickly convert the gold in the event of a currency crisis in currencies such as the dollar.”

Sounds panicky to me. I’m curious how such holdings will be treated by the Bank for International Settlements in the event of a possible euro exit or bail in by ECB?

Also why not load the 800tons tomorrow onto a couple of planes? There are concerns it doesn’t exist? For example, http://nsnbc.me/2013/04/18/federal-reserve-refuses-to-submit-to-an-audit-of-germanys-gold-held-in-u-s-vaults-2/

Perhaps also its been over leveraged as collateral for borrowings or lent out as the article states.

Its not uncoincidental the metals markets and gold itself fell sharply in value against a backdrop of growing currency fears shortly after the German recall. Was this a drive to lower prices and allow the TBTF JP Morgan et GS Sacks Citigroup to repurchase gold at lower prices and return the gold to the FED?

That was a panicky drop in the price of gold given countries are asking for their gold to be returned?

Nothing panicky unless it doesn’t exist then?

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