Post Tagged with: "Europe"

Not All Germans Love The Euro These Days

Not All Germans Love The Euro These Days

Bloomberg View had a good column today on the popularity of the European single currency. The article shows how the euro has gone from being unloved in Germany at introduction in 2002 to well accepted, while the opposite has happened in Italy and France. But behind the aggregates, deep fissures lie that tell a different story. Let me start the conversation on that story here.

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Europe’s delusional economic policies

Europe’s delusional economic policies

Yesterday three big things happened in three different eurozone economies that I think are interrelated. And I am going to tell you what I believe they mean for the European political economy by tying them together in this post under the somewhat provocative banner of “Europe’s delusional economic policies”. The reason for the title is that what I see happening is an anti-growth economic framework which is having political consequences by fomenting nationalism and anti-EU sentiment.

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Trump is dead wrong on Germany. It won’t matter though

Trump is dead wrong on Germany. It won’t matter though

The FT is reporting that US President Donald Trump sees Germany as a ‘currency manipulator’ of sorts, a view bound to have negative consequences on bilateral relations. What’s more, according to the Financial Times, Trump’s top trade advisor, Peter Navarro, has accused Germany of using a “grossly undervalued” euro to “exploit” the United States as well as Germany’s own EU monetary union partners. This makes three countries in Trump’s sights: China, Mexico and, now, Germany.

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Germany is the biggest loser in 2017

Germany is the biggest loser in 2017

As Donald Trump attempts to make wholesale shifts in American domestic and foreign policy, there are bound to be winners and losers economically and politically. Leading German government representatives from Sigmar Gabriel to Frank Walter Steinmeier to Angela Merkel have all taken a vocal stance against Trump’s policies. But the Trump administration appears to be moving in a direction that would weaken Germany’s hand. And so, Germany risks being one of the losers politically in 2017 – something that plays into Vladimir Putin’s hands.

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More on why Britain might not leave the EU and how a second referendum could happen

More on why Britain might not leave the EU and how a second referendum could happen

I have long suspected that an act of Parliament would be necessary to formally trigger Article 50. In an 8-3 verdict today, the UK Supreme Court affirmed this suspicion. Theresa May cannot invoke royal prerogative for the simple reason that leaving the EU is an act that has a tremendous impact on laws governing the UK. And the Supreme Court says these vast changes in UK law require an act of Parliament to decide. At the same time, the Court ruled that Wales, Scotland and Northern Ireland have no devolved powers here, They cannot veto the UK’s exit from the EU.

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Why Canada is the country to watch on Trump’s trade policy

Why Canada is the country to watch on Trump’s trade policy

If you want to know whwere Trump is headed on trade, don’t look at China or Mexico. Don’t even look at the UK. Canada is the country to watch for a number of reasons. First of all, Canada has an existing deal with the US and Mexico under NAFTA. That matters in terms of understanding where Trump is headed on trade. Moreover, Canada is also the 2nd largest trading partner for the US behind the European Union. Finally, the fact that Canada is finishing off its EU trade deal just as the UK is getting ready to exit puts it in a unique position in reconfiguring world trade alliances – wth an Anglo-American group involving Canada a potential outcome.

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A Q&A With Prime Economics’ Jeremy Smith on Brexit, Immigration and Democracy

A Q&A With Prime Economics’ Jeremy Smith on Brexit, Immigration and Democracy

On Monday, UK Prime Minister Theresa unveiled her vision for Britain’s exit from the European Union. The Prime Minister couched her outlook in positive terms, speaking of Britain leaving the EU but remaining in Europe. She spoke of EU member states as friends and partners. And she insisted that Britain would prosper after Brexit is achieved. I have written about what the key takeaways from her speech were. But to get a better sense of how realistic her vision is in political and economic terms, I also asked Prime Economics Co-Director Jeremy Smith for his take.

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Britain's Home Secretary Theresa May delivers her keynote address on the second day of the Conservative party annual conference in Manchester, northern England September 30, 2013.  REUTERS/Phil Noble (BRITAIN  - Tags: POLITICS SOCIETY) - RTR3FFSM

Theresa May: Britain will definitely leave the EU

British Prime Minister Theresa May set out details for her vision regarding the UK’s relationship with the EU In a speech today that will please those that campaigned to leave the EU. The Prime Minster, as expected, made clear that this will be a ‘hard Brexit’ because there will be not attempt by government to maintain Britain’s access to Europe’s single market. The biggest piece of new news in her speech was her acquiescence to a vote by Parliament on an EU deal, something that pre-empts a decision by the high court on the government’s ability to use Royal prerogative to bargain on the Queen’s behalf

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Hammond’s ‘whatever it takes’ strategy for a hard Brexit

On Friday, I wrote why, unlike Bank of England Governor Mark Carney, I believe the economic threat of Brexit to the British economy is now higher. The gist of my remarks was that an actual trigger of Article 50 under hard Brexit circumstances is when we should expect any economic impact from diminished consumption and investment. Some brief comments below

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No one talks about Eurobonds anymore. Here’s why

Eurobonds are one way of tying the fortunes of eurozone countries together by eliminating – or at least greatly reducing – default risk. The thinking is that if you have a common currency and free labour movement and you still don’t have economic convergence you need to go further in uniting Europe politically and economically. No one is talking about eurobonds though. That’s because they won’t happen.

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Black Swan Investing and the breakup of Europe

This isn’t going to be a thematic post on how to profit from Europe’s breakup, despite the sinister title. Instead, it’s a potpourri post – a mashup of different ideas I have right now and want to run by you to organize my thinking about them. I used to do this a lot more in the past – and I found it useful; I hope you did too. So for lack of a coherent theme, I chose the title above. Here goes.

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The EU as a larger Germany post-Brexit and Hugh Hendry’s Eclectica Fund commentary

The EU as a larger Germany post-Brexit and Hugh Hendry’s Eclectica Fund commentary

Stocks have mostly recovered since Brexit and the strong dollar and Yen have reversed much of their overvaluation in recent days. The question remains as to what the fallout from the UK’s departure from the EU will be. I continue to believe the near-term economic impact will be muted, and that Brexit will come to be seen as mostly a political event. But it is a political event with wide-reaching potential ramifications.

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