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“Europe Will Not Be Europe”
“Europe Will Not Be Europe”
- In the United Kingdom, the Brexit Party victory at 31.6% of the vote was a remarkable achievement that showed the persistent willingness of millions of Britons to leave the European Union. The “populist” positions — the defense of national sovereignty and European civilization, refusal of uncontrolled immigration and diktats of Brussels technocrats — have gained ground.
- The parties that have ruled Europe for decades obtained weak results, but, with rare exceptions, did not collapse — and will continue to dominate the European Union.
- The Greens may gain more influence – along with its consequences. To anyone who read the Greens’ programs, it is evident that they are essentially leftists with an environmental green mask. They support unrestricted immigration and multiculturalism. They are…resolutely hostile to any defense of Western civilization, to free enterprise and free markets. They are often in favor of zero growth. Most of them support an apocalyptic vision of climate change and say that the survival of humanity will be at stake around the corner if Europe does not take drastic measures to “save the planet”. All of them are in favor of authoritarian decisions imposed from Brussels to all of Europe.
- A European parliament placed under the influence of the Greens will almost certainly accelerate the slide towards more power given to the unelected members of the European Commission, and a phasing out of nuclear energy and fossil fuels. Policies favorable to still more immigration already are in preparation.
On the evening of May 26, Italian Deputy Prime Minister and Minister of the Interior Matteo Salvini commented on the results of the European elections, “A new Europe is born.” The party he leads, the League, had just won with 34.3% of the vote. Other parties defined in Europe as “populist” also won: in Hungary, the Fidesz-KDNP alliance (Hungarian Civic Alliance and the Christian Democratic People’s Party) received 52.3% of the vote.
…click on the above link to read the rest of the article…
The Center Isn’t Holding in Europe
The Center Isn’t Holding in Europe
If there is one big takeaway from the recent European Parliamentary elections it is that centrist parties which stand for nothing in particular represent a lot fewer people. From both the ‘left’ and the ‘right’ the center lost ground across Europe.
The Euroskeptics got a lot of press in the run up to these elections and the final result was pretty much in line with expectations, with a couple of exceptions. The pro-EU left lost a lot more ground in Sweden than expected but the Dutch People’s Party were rejected thoroughly in the Netherlands.
Otherwise the polls were mostly in line with the results. And while the early spin tried to put a brave face on results in the U.K. and France Marine Le Pen outpolling sitting president Emmanuel Macron just two years after he beat her in the presidential election is notable.
The results in the U.K. were a microcosm of the trends we’re seeing across Europe. The major parties, both campaigning from the center, lost the confidence of the people on both sides of the divisive Brexit argument.
Those that want Brexit in no uncertain terms bolted to Nigel Farage’s Brexit Party while those fed up with Labour’s indecision on not only Brexit but a host of other issues bolted for the Liberal Democrats and the Greens.
And a lot of those seats that would have went to the Social Democrats via Labour in the European Parliament now belong to Guy Verhofstadt and ALDE.
But the U.K. isn’t alone in this splitting along ideological lines. Germany has seen the collapse of the Social Democrats give spark to the Greens there as well. The Greens outpolled Angela Merkel’s Grand Coalition partners by more than five points, coming in 2nd behind the CDU/CSU with 20.5%.
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Albert Edwards: “At This Point You Realize Something Has Gone Very Wrong”
Albert Edwards: “At This Point You Realize Something Has Gone Very Wrong”
In his latest note published last week, SocGen’s Albert Edwards – never at a loss subjects that inspire his outrage – rages on the topic of Brexit, and specifically the often repeated assertion (discussed here as well), that post-Brexit referendum UK has lost 2% of its GDP output, or about £800m a week.
We won’t dwell on that for a simple reason: as UBS’ chief economist Paul Donovan put is best last week, “A few things have happened in the EU-UK divorce. Does anyone care? No, they do not.”
Another reason why Brexit is largely meaningless despite resulting in countless, pound-moving newswire headlines each hour: the final outcome is clear – with Theresa May a remainer, and with both sides seeking to perpetuate the status quo by delaying and delaying and delaying some more until it appears that it’s the public’s desire to reverse the outcome of the 2016 referendum, it is just a matter of time before the entire idea of Brexit is scuttled.
Instead we will focus on an anecdote that Edwards brings up in relation to his now 30-year-old son, Newcome, who was 10 back in 1999, and was reportedly stealing Albert’s Financial Times “to look at Nasdaq share prices:”
It was at that point that I realised the tech bubble was really getting out of hand (I have reproduced part of this weekly explaining what happened, at the end of this note).
As Edwards further explains, “discovering my 10 year old son looking at Nasdaq share prices alerted me to the extent of the madness that had gripped the markets by end 1999. Similarly there are moments in this job when something you hadn’t been following particularly closely is highlighted to you and you stagger back in shock. At that point you realise that something has gone very wrong.”
…click on the above link to read the rest of the article…
Assange Arrested, Brexit Squashed — Just Another Day in the Empire
Assange Arrested, Brexit Squashed — Just Another Day in the Empire
And down goes Julian Assange, right beside Brexit. If there was ever any doubt that The Powers That Be are unrelenting in their cruelty just look at the 24 hours starting on Wednesday.
First Theresa “The Snake Oil Lady” May kicks 17.4 million voters into the weeds.
And then she oversees the arrest and judging of Wikileaks founder Julian Assange.
The timing of this is important beyond dovetailing it with her Brexit betrayal. They had to go after Assange now, because Theresa May’s time in office is ending.
A Jeremy Corbyn-led government would not grant the U.S. it’s prize.
Corbyn, for all of his faults, would be a breath of fresh air in the unraveling of the ‘special relationship’ between the U.S. and U.K. in foreign policy for as long as he lasted in office.
Still think Theresa works for anyone other than her owners?
Still think the opposition to Corbyn predicated on his “Socialism” isn’t anything other than a coordinated psy-op? It’s no different than the narratives spinning around Trump being a Nazi or a Russian stooge, except that Corbyn actually is a socialist.
But, he is also far more independent than anyone in the British political class wants running the country, that much is certain.
Trump is running for re-election opposing “Socialism” in the U.S., Venezuela and soon, Cuba.
The Leave campaign, thanks to May, was focused for the week leading to Assange’s arrest on her sitting down, “with an avowed Socialist.”
May and Trump are captured figures, dutifully doing their owners’ bidding.
This 12 hour period may be the most brazen abuse of a Western nation by its government that I’ve seen.
But nothing surprises me about the evil of Theresa May anymore.
…click on the above link to read the rest of the article…
Beneath the Surface of Brexit
Beneath the Surface of Brexit
Geography matters, the balance of power matters, and democracy–it’s not yet clear if democracy matters or not.
I’ve been asked to comment on Brexit. I’m happy to do so, but not by promoting a position yes or no, or by attempting to unravel the political machinations, as I have neither the knowledge nor the interest to do so.
What I can do is propose two beneath the surface contexts which might be useful in understanding what’s really going on. These are the impressions and opinions of a distant observer, someone who is neither an expert nor a resident of the United Kingdom / Great Britain.
It seems to me that geography is still salient. As an island sea power, England is close enough to the continental land-based powers of Europe to fear invasion or continental hegemony but independent enough to not rely too completely on continental European powers.
This is not just a consequence of its temperate weather (thanks to the Gulf Stream) or being an island; the historical reliance on sea power places it in the same general category as the other historic blue-water sea-power-based European nations: The Netherlands, Spain, Portugal, Denmark and Sweden.
These sea-power nations projected power and secured trading rights and colonies by controlling the seas and access points to interior lands, the so-called Rimlands.
Continental powers such as Russia, France and Germany have at various times made formidable attempts to create rival blue-water navies, but in each case the British or American fleets eventually limited these claims to dual power bases (both land and sea-based power).
…click on the above link to read the rest of the article…
Kondratiev – Riding the Economic Wave
Kondratiev – Riding the Economic Wave
LET’S escape Brexit and see what’s happening in the wider world. Most forecasters are gloomy about global economic prospects. According to Schroders, doyen of UK assets managers: “We forecast a more stagflationary environment in 2019 with global growth set to slow and inflation to rise”. The Davos World Economic Forum predicts a “sharp drop-off in world trade growth, which fell from over 5 per cent at the beginning of 2018 to nearly zero at the end”. Forbes business magazine warns: “The biggest problem for the global economy in 2019 will be massive business failures that could also lead to bank failures in emerging markets”.
Of course, the forecasters have been wrong before but it is clear that the main analysts of the global capitalist economy are pessimistic about current trends. They are right to be worried.
The international economy operates in pulses christened Kondratiev waves after Nicolai Kondratiev (1892-1938), the Russian economist and statistician who first identified them. These K-waves consist of an expansionary upswing lasting normally 15-20 years, followed by a downswing of similar length. We are now in such a downswing that could last till the 2030s.
What causes Kondratiev pulses? There is a rich literature trying to identify the cause, in particular the work of the Belgian economist, the late, great Ernest Mandel. Crudely, it works like this. Social and economic conditions mature to spark a runaway investment boom in the latest cluster of new technologies. After a period, excess investment and increased competition lower rates of profitability, curbing the boom.
At the same time – because this is as much a sociological as an economic process – growth expands the global workforce, both in numbers and geographically. The new, militant workforce launches social struggles to capture some of the wealth created in the boom. This, in turn, adds to the squeeze on profits. The peak and early down wave are characterised by violent social conflicts, whose outcome determines the length of the contraction.
…click on the above link to read the rest of the article…
View From The Brextanic
View From The Brextanic
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Longtime Automatic Earth friend Alexander Aston talks about finding himself at Oxford at a point in time when the British themselves appear overcome by a combo of utter confusion and deadly lethargy, and one can only imagine what it must be like for ‘foreigners’ residing in Albion, who face large potential changes to their lives and know there’s not a thing they can do about it, not even vote.
I like the observation that the entire British political system, the place where decisions are made, is the size of a small village. That’s a visual we can all relate to. It’s a physical limit as well as a mental one. I’m all for sovereignty and self-determination, but how’s that going to work if you can’t even see the boundaries of your own territory?
Guys, it’s 4 weeks to D-Day today. How about we call off the landing, get a few pints instead, and talk? First round’s on me.
Here’s Alexander:
Alexander Aston: I arrived in the UK in 2015 to undertake interdisciplinary research at the University of Oxford. I am a child of the Empire, a cultural product of Britannia’s oldest colonies in the British Isles, her most important colony now turned empire as well as one of her youngest, Zimbabwe. The UK is both an intimately familiar society and yet one that is also strangely alien for me, like a wealthy, often charming and deeply abusive parent that sparks both self-recognition and rejection.
The ‘leave’ referendum occurred close to a year after I arrived in the UK and is one of the few political events over the past few years that surprised me.
…click on the above link to read the rest of the article…
Blain: European Banks Are The Most Successful Ponzi Scheme Of All Time
Blain: European Banks Are The Most Successful Ponzi Scheme Of All Time
“Lenin was right. There is subtler, no surer means of overturning the existing basis of society than to debauch the currency.”
I must post this line from one of my favourite Financial sector commentaries – Duncan Farr of Jeffries who covers banks: “Here we are 5 weeks ahead of Brexit, and the top 2 performing banks in Europe are Lloyds followed by RBoS.” If you ever wanted a clearer hint the supposed Brexit crisis and imminent collapse of UK plc might just be a fictitious political construct, then there you are. Its fascinating just how sanguine the markets have become about the divorce. Sterling is up and who cares?
I have often been told I worry about all the wrong things. According to BAML, (reported on BBerg), the biggest fear of European investors currently is a Worldwide Economic Slump, with 30% of respondents citing it as their primary worry. Yep. I can see why that would be an issue. Only 2% of European investors surveyed by BAML rank Brexit as their primary fear. It’s not even in the top 5! (For the record, my primary fear is a Global Liquidity Storm – the sudden and catastrophic drying up of liquidity following a shock..)
Politics and markets are intertwined, but… maybe no longer in the case of Brexit? It’s just become background noise – meaning it; doesn’t matter, or we’re overly complacent. UK politics has never looked so dire. Markets appear increasingly disinterested. A new UK political party, and unstated threats a whole slew of ministers are set to resign if we get/don’t get a Brexit deal. Rumours are a deal is already inked with Brussels. Rumours are the Tory Brexiteers will reject it – whatever it says. It Theresa May is capable of getting together a deal in parliament – then this would probably be a good time..
…click on the above link to read the rest of the article…
The Great Discontent
The Great Discontent
Johannes Vermeer Woman holding a balance 1662-63
The problem is, of course, that not only is economics bankrupt but it has always been nothing more than politics in disguise.
-Hazel Henderson
It’s often hard to understand how people can be aware of something but then fail to link it to a perfectly logical next step, or even multiple steps, and see where it fits in a larger scheme. There really are people out there, believe it or not, who look at economic and political developments over the past decade in any particular western country and believe they are unique to that country.
In reality, while things may play out slightly differently from one place to the other, the core causes of what’s been unfolding are the exact same ones in every single location. The reactions of incumbent politicians and economics has been the same as well: massage the numbers and the media, keep the rich and powerful happy, and make sure you and yours are on the ‘right side’ of the line.
In France, the main complaint that the Yellow Vests movement has now taken into its 13th consecutive weekend is crystal clear: people can’t pay their bills anymore. In the UK, austerity has demolished wages, social care, the NHS and much else. In the US, many millions of Americans can’t afford a $400 emergency payment, have ever scarcer access to healthcare and live from paycheck to paycheck.
Rinse and repeat for every western nation. The storylines vary somewhat, but they all tell the same tale, they could be, they are, chapters in the same book. And it makes one think if people are not connecting them.
…click on the above link to read the rest of the article…
UK vegetable and fruit supplies at risk
UK vegetable and fruit supplies at risk
Potatoes on the wing – and thin pickings for all as UK crops wilt. Image: By Lucas Sankey on Unsplash
Britons’ familiar and well-loved fish and chips could become scarcer as politics and climate change imperil UK vegetable and fruit supplies.
LONDON, 5 February, 2019 − A combination of Brexit − Britain’s move to leave the European Union − and climate change is threatening UK vegetable and fruit supplies for its 66 million people.
Brexit-associated delays at ports could result in widespread shortages of a range of imported vegetables and fruit such as lettuces and tomatoes, particularly if the UK crashes out of Europe at the end of March this year with no deal in place.
Now there’s more bad news on the British food front; a just-released report says climate change and resulting abnormal weather conditions are causing significant decreases in the UK’s own vegetable and fruit harvests.
The study, produced by the Climate Coalition in association with the Priestley International Centre for Climate at the University of Leeds in the UK, says about 60% of food consumed in Britain is domestically produced.
The unusually warm summer in 2018 – the hottest ever in England since records began in 1910, according to the report – led to a drop in the onion harvest of 40% and a decline of between 25% and 30% in the carrot crop.
In 2017 the UK’s apple growers lost 25% of their produce due to unseasonably warm weather followed by an unusually late series of frosts.
“It’s really hard work growing fruit and vegetables, but erratic and extreme weather pushes you over the edge”
The study says climate change-related extreme and unpredictable weather is putting at risk future supplies of potatoes – a staple of the British diet.
“The UK could lose almost three-quarters of the area of land currently well-suited for potatoes by the 2050s under climate projections”, says the report.
…click on the above link to read the rest of the article…
Flash-Balls, Pitchforks And A Backstop
Flash-Balls, Pitchforks And A Backstop
It’s educational and even somewhat entertaining to observe the role of the western press in the ongoing erosion and demise of democracy in Europe. But while it’s entertaining, it also means their readers and viewers don’t get informed on what is actually happening. The media paints a picture that pleases the political world. And it it doesn’t please politicians to lift a veil here and there, too bad for the public.
The Shakespearian comedy that was performed last night in the UK House of Commons is a lovely case in point. Basically, MPs voted whether or not to allow PM Theresa May to change the Brexit deal she had told them about a hundred times couldn’t possibly be changed. Brexit has turned full-blown Groucho by now: “Those are my principles, and if you don’t like them… well, I have others.”
It was exactly two weeks ago last night that lawmakers voted by a historic 432 to 202 count to reject May’s Brexit deal. And now they voted to a) let her change it and b) go talk to the EU about changing it though Brussels has said as often as May herself that it cannot be changed. Remember: the UK is set to leave the EU 59 days from now, and counting.
It’s like in a game of chess that has long turned into a stalemate or threefold repetitionsituation: you stop playing. No such luck in British politics. The only way the parliament could find ‘unity’ (in a narrow vote) was to agree to ditch the Irish backstop that is an integral part of why the EU accepted May’s deal to begin with.
…click on the above link to read the rest of the article…
Project Fear Goes To ’11’: Brexit Could Lead To Thousands Of Deaths, Mass Hunger
Project Fear Goes To ’11’: Brexit Could Lead To Thousands Of Deaths, Mass Hunger
If you listen to the government tell it, a post-“hard” Brexit Britain will inevitably resemble the post-apocalyptic Australia from “Mad Max”: A post-apocalyptic hellscape where Britons will be forced to battle it out “Thunderdome”-style for access to scare essentials like food, medicine and “guzzoline”.
Sound outlandish? Well, that’s because it probably is. The notion that reverting to WTO rules on trade would cause anything beyond a transient disruption to supply chains is ridiculous on its face. Most of this blatant fearmongering can be attributed to a very effective propaganda campaign we’ve dubbed “Project Fear”. In recent weeks, May’s government has staged traffic jams near would-be border checkpoints and warned that the hit to economic growth will linger for years, if not decades.
Yet, out of naivety or shrewdness, Brexiteer MPs have largely ignored these warnings and continued to oppose May’s deal, despite her insistence that it is Britain’s “best and only” option. So far, the EU has refused to reopen negotiations on the Withdrawal Agreement, prompting May’s latest attempt to transform a wave of resistance into a surmountable obstacle by winning support for an amendment that she could then pitch to the EU27 as the only workable arrangement. But like her other plans, this too appears to be mired in conflict.
Fearful of the shortages that could lie just around the corner, both warehouses and UK citizens have begun hoarding food, medicine and other supplies. Perhaps realizing that they have pushed the country to the brink of hysteria, PM May’s government on Monday tried to walk back some of the more outrageous claims, assuring citizens that there will be enough to eat in the event of a hard Brexit, though prices on fresh foods could see a temporary spike. The walk back followed another warning from supermarket chains about possible supply shortages if ‘no deal’ goes through.
…click on the above link to read the rest of the article…
Three Concerns Hanging Over the Davos Elite
Three Concerns Hanging Over the Davos Elite
This week, the global elite descended private jets to their version of winter ski-camp – the lifestyles of the rich and powerful version. The World Economic Forum’s (WEF) five-day annual networking extravaganza kicked off in the upscale ski resort town of Davos, Switzerland.
Every year, the powers-that-be join the WEF, select a theme, uniting some 3000 participants ranging from public office holders to private company executives to the few organizations that truly do help fix the world that they mess up. This year’s theme is “Globalization 4.0”, or the digital revolution. The idea being, the potential tech take-over of jobs, and what wealthier countries are doing to lesser developed ones in the process.
While the topic might be focused on the future, the present is just as troubling, if not more so, than the future. Such is the disconnect between real people and corporations. That’s what the estimated 600,000 Swiss Franc membership to be a part of the WEF constellation gets you as a CEO at the Davos table.
Government leaders like German Chancellor Angela Merkel, Brazil’s president, Jair Bolsonaro and Chinese Vice President, Wang Qishan are in attendance this week. Business leaders like Microsoft co-founder Bill Gates and JPMorgan Chase CEO, Jamie Dimon will also take part in the festivities.
Yet, even though the various leaders will likely promote their achievements, what’s lurking behind the pristine snowcapped Alps, is a dark foreboding of a less secure world. Nearly every major forecast from around the world is projecting an economic slowdown. As one Bloomberg article reports, “companies are the most bearish since 2016 as economic data falls short of expectations and political risks mount amid an international trade war, U.S. government shutdown and Brexit.”
…click on the above link to read the rest of the article…
Gold Bullion Will Protect From Politicians, Brexit and Increasing Market Volatility In 2019
Gold Bullion Will Protect From Politicians, Brexit and Increasing Market Volatility In 2019
Historically, gold has proven to be a very safe investment – could it remain so in times of a massive global debt bubble, Brexit, trade wars and an uncertain world economy?
“You have to choose between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the government. And, with due respect for these gentlemen, I advise you, as long as the capitalist system lasts, to vote for gold.”
The words of the witty Irish playwright and philosopher George Bernard Shaw, will resonate with investors in Ireland , the UK and internationally today given the UK government’s handling of Brexit and the rise of Trump and other radical politicians on the left and right.
Populist politicians are creating increasing political, economic and financial risks for us all. This is clearly seen in the complete mess that is Brexit – for Ireland, the UK and indeed the EU.
Shaw was a keen student of history and saw the economic problems that monarchies and governments have created over the years. Only the most foolhardy investor would claim that the coming years will be any different than our past.
Gold’s safe-haven historical status
A massive global debt bubble, Brexit, the risk of Italy leaving the EU, an increasingly fractured EU, aggressive Trump foreign and economic policies and an increasingly polarised and uncertain world cast shadows over our economies and financial markets.
There are very real risks posed by the gigantic global debt bubble – the world is nearing $250 trillion in debt and the global debt to GDP ratio has risen to 320%.
Shaw was also alluding to gold’s safe-haven status throughout history. Paper currency devaluations and indeed stock, bond and property market crashes are much more common throughout history than many people realise.
…click on the above link to read the rest of the article…
Brexit, EU, Germany, China and Yellow Vests In 2019 – Something Wicked This Way Comes
Brexit, EU, Germany, China and Yellow Vests In 2019 – Something Wicked This Way Comes
– “Something wicked this way comes” warns John Mauldin
– Shaky China: Chinese landing could be harder than expected
– Brexit and EU Breakage: “I have long thought the EU will eventually fall apart”
– Helpless Europe: If Germany sneezes, their banks & the rest of continent catches cold
– We may see “yellow vests” spread globally: Economics is about to get interesting …
Source: TradingEconomics.com
For a couple of years now, the economic narrative has shown a comparatively strong US against weakness in Europe and some of Asia (NOT China). The US, we are told, will stay on top. I agree with that, as far as it goes… but I’m not convinced the “top” will be so great.
Americans like to think we are insulated from the world. We have big oceans on either side of us. Geopolitically, they serve as buffers. But economically they connect us to other important markets that are critical to many US businesses. Problems in those markets are ultimately problems for the US, too.
Last week I gave you my Year of Living Dangerously 2019 US forecast, but I didn’t discuss important events overseas. Summarizing last week quickly, I think the base case is that the United States economy slows down but avoids recession in 2019. That said, there are significant risks to that forecast, mostly to the downside.
Today we’ll make another literary metaphor to frame our discussion. “Something Wicked This Way Comes” is a 1962 Ray Bradbury novel about two boys and their horrifying encounter with a travelling circus. Later it was a movie.
In our case, something wicked most certainly is coming this way. Several somethings, in fact, approaching from all directions. The real question is how much damage this circus will do before it leaves town.
Shaky China
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