Another Helping of EuroFudge?


Merkel – First Reich Kanzler of the Forth Reich?

We are told that Germany is winning the argument to create a Forth Reich out of the ashes of the EuroZone. Then we are told France is winning the argument to create a new super bank to bail out the EU every time it runs out of money.


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Then again, tomorrow may see another helping of EuroFudge as EU leaders talk the talk but don’t walk the walk.

If that happens the markets are likely to be savage, having followed the roller coaster of EU announcements, followed by EU inaction. There are already signs that speculators are viewing Greece as just the start of a set of opportunities as EuroZone members approach debt default and leave the Euro. There would be rich pickings in the fire sale that would follow multiple defaults and destruction of the Euro.

The signs of abject failure have emerged as the debates amongst leaders have become personal and acrimonious.

Merkel has apparently suggested France’s vertically challenged President is too short to even reach the table. France’s Sarko has been equally rude, commenting on how Merkel’s idea of a diet is a second helping of cheese. He has also complained loudly about being lectured by his recently Best Friend Cameron and Chancellor Osborne. Once things come down to such a low level of insults, reaching a real agreement becomes that much more difficult.

Whatever “agreement” emerges tomorrow for the EuroZone is probably going to be too little too late, but with Germany having the final say because, of the EuroZone members, Germany has the biggest cheque book and is the only EuroZone member the markets are likely to believe in.

Cameron is actively promoting a new Treaty for the EU which may be even less to the benefit to Britain than the previous attempts towards a European Super State. By suggesting the EuroZone should move towards becoming a new state with its capital in Berlin new European tensions will be generated and the 17 EuroZone members could shrink to seven. That would leave 20 EU members outside the new State with Britain as the strongest member, which may be Cameron’s big idea. What is being missed is the opportunity to create a European Confederation that would allow members to retain sovereignty and a high level of self-determination, but create a fair and free internal market with the mechanism to come together co-operatively when required.

Times have just become more complex and challenging, not least because anti-EU feeling is rising across the EU, as citizens become more confident in expressing their anger at the unaccountable political elite that has been creating the largest potential economic crisis in history.


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