Sorry mate, was very busy this morning. Tax deadlines approaching. Needed to get my f11’s etc sorted.
Italian bond yield climbed again this morning, before retreating slightly and are now trading at just shy of 6.6% not far off the notional tipping point of 7%.
A lot will depend on how the vote in the Italian Parliament goes this morning. If Berlesconi wins the vote then except yields to rise again and push italian closer to IMF country. If he is defeated then yields could come down slightly.
And what impact will it have on Ireland if they reach the 7% tipping point?
It’s frightening the way the bond market are overruling the democratically expressed wishes of sophisticated European democracies.
Fintan agrees with you
[size=4][font=times new roman]Triumph of the spivs as democracy is sidelined[/font][/size]
[left]
FINTAN O’TOOLE
EVER WISHED, in a dull moment, that you could have lived through some of the big moments of European history? Well, be careful what you wish for. We’re living through one of them now and it’s not much fun.
Historical moments aren’t sudden changes. They’re the points at which something that has been long in the making finally emerges, when something murky crystallises into clarity. That happened last week, and Ireland was a significant part of it.
What happened was that two of the big shaping forces of western Europe, forces that have been working broadly in tandem for 300 years, clearly fell apart. One force is capitalism; the other democracy. From the Enlightenment onwards, it has been an accepted truth that democracy and capitalism were at the very least compatible with each other. The things that were needed in order for capitalism to develop – the breaking of aristocratic power, the free movement of labour, an open market in ideas, functioning parliaments, independent legal systems, states that could command popular consent and thus underpin stability, taxation to fund mass education and infrastructure – were also conditions for political democracy. They may not have been sufficient conditions, but they were necessary ones.
This is not to say that there have not been huge tensions in the relationship between capitalism and democracy, or that there have not been periods when the holders of capital preferred authoritarian or fascist regimes. Nor is it to deny that the large-scale inequalities inherent in most forms of capitalism have tended to limit the practice of democracy, through private control of media, the funding of political parties and the ability of the very rich to threaten and intimidate elected governments. The point is simply that the two forces were generally compatible. The trump card of capitalism against communism was clear and simple: we hold free elections and you don’t.
What became so dramatically clear last week was that this compatibility has ended. The leading form of capitalism – the finance capitalism that has expanded so monstrously over the last 30 years – is no longer compatible with democracy in Europe.
And by democracy in this context I mean just the limited, basic form: universal suffrage and sovereign governments. This is a pretty big deal.
Consider the three things that happened in Greece and Ireland last week. Firstly, it was made explicit that the most reckless, irresponsible and ultimately impermissible thing a government could do was to seek the consent of its own people to decisions that would shape their lives. And, indeed, even if it had gone ahead, the Greek referendum would have been largely meaningless. As one Greek MP put it, the question would have been: do you want to take your own life or to be killed? Secondly, there was open and shameless intervention by European leaders (Angela Merkel and Nicolas Sarkozy) in the internal affairs of another state. Sarkozy hailed the “courageous and responsible” stance of the main Greek opposition party – in effect a call for the replacement of the elected Greek government.
The third part of this moment of clarity was what happened in Ireland: the payment of a billion dollars to unsecured Anglo Irish Bank bondholders. Apart from its obvious obscenity, the most striking aspect of this was that, for the first time, we had a government performing an action it openly declared to be wrong. Michael Noonan wasn’t handing over these vast sums of cash from a bankrupt nation to vulture capitalist gamblers because he thought it was a good idea. He was doing it because there was a gun to his head. The threat came from the European Central Bank and it was as crude as it was brutal: give the spivs your taxpayers’ money or we’ll bring down your banking system.
Again, as in Greece, even the basic forms of democracy were incompatible with this process. There could not be a Greek referendum because there is no acceptable question that can be answered by a democratic vote. And there could not be a debate in the Irish parliament about the extortion of a billion dollars because there is nothing to be debated. Referendums and parliamentary votes are rituals of public consent. But the question of consent is now not just irrelevant. It is reckless, outrageous, downright scandalous.
And this isn’t just a simple matter of the Merkozy monster lording it over us little PIGS. For at this historic moment, even the German chancellor is little more than a cipher. She’s caught in the democratic crisis too. Remember this time last year when Angela Merkel started to make noises about bondholders sharing the pain of rescuing the banking system? She had to back down very quickly and make it clear that she didn’t mean present bondholders – heaven forbid. Even the German chancellor isn’t allowed to say certain things.
Europe, and the rest of the western world, is thus at a parting of the ways. We can have the form of rapacious finance capitalism that has become the dominant force in our economies and societies.
Or we can have democracy. But we can’t have both.[/left]
Irish bonds have not seen any increase yet today, “trading” at a steady 8.16% (that’s down from over 15% in July).
Some analysts feel that a default/write down for Italy may not be a bad thing for Ireland, as it would give us more leverage to angle for a write down of our own. The thoughts of Italy defaulting though would be unimaginable for the Eurozone.
Why is that Runt?
I’m very pro-Eurozone, mainly due to the Ryder Cup.
Because their debt is over a trillion dollars. The phrase “too big to bailout” is being bandied about.
They reckoned on Vincent Browne last night that the Italian Government isn’t actually running at that much of a deficit and a couple of years of reasonably tough cuts would have them back on an even keel fairly quickly. The problem seems to be that Berlusconi has been promising these cuts and reforms for years without actually implementing them and the markets have lost patience with him.
It’s frightening to think where it all might lead. Depression in the core European economies has turned out pretty badly in the past.
Fintan knows the score.
1-0 to the bond traders with a likelihood of them making it 2-0 any minute. [quote=“Watch The Break, post: 519975”]
Fintan agrees with you
[size=4][font=times new roman]Triumph of the spivs as democracy is sidelined[/font][/size]
[left]
FINTAN O’TOOLE
EVER WISHED, in a dull moment, that you could have lived through some of the big moments of European history? Well, be careful what you wish for. We’re living through one of them now and it’s not much fun.
Historical moments aren’t sudden changes. They’re the points at which something that has been long in the making finally emerges, when something murky crystallises into clarity. That happened last week, and Ireland was a significant part of it.
What happened was that two of the big shaping forces of western Europe, forces that have been working broadly in tandem for 300 years, clearly fell apart. One force is capitalism; the other democracy. From the Enlightenment onwards, it has been an accepted truth that democracy and capitalism were at the very least compatible with each other. The things that were needed in order for capitalism to develop – the breaking of aristocratic power, the free movement of labour, an open market in ideas, functioning parliaments, independent legal systems, states that could command popular consent and thus underpin stability, taxation to fund mass education and infrastructure – were also conditions for political democracy. They may not have been sufficient conditions, but they were necessary ones.
This is not to say that there have not been huge tensions in the relationship between capitalism and democracy, or that there have not been periods when the holders of capital preferred authoritarian or fascist regimes. Nor is it to deny that the large-scale inequalities inherent in most forms of capitalism have tended to limit the practice of democracy, through private control of media, the funding of political parties and the ability of the very rich to threaten and intimidate elected governments. The point is simply that the two forces were generally compatible. The trump card of capitalism against communism was clear and simple: we hold free elections and you don’t.
What became so dramatically clear last week was that this compatibility has ended. The leading form of capitalism – the finance capitalism that has expanded so monstrously over the last 30 years – is no longer compatible with democracy in Europe.
And by democracy in this context I mean just the limited, basic form: universal suffrage and sovereign governments. This is a pretty big deal.
Consider the three things that happened in Greece and Ireland last week. Firstly, it was made explicit that the most reckless, irresponsible and ultimately impermissible thing a government could do was to seek the consent of its own people to decisions that would shape their lives. And, indeed, even if it had gone ahead, the Greek referendum would have been largely meaningless. As one Greek MP put it, the question would have been: do you want to take your own life or to be killed? Secondly, there was open and shameless intervention by European leaders (Angela Merkel and Nicolas Sarkozy) in the internal affairs of another state. Sarkozy hailed the “courageous and responsible” stance of the main Greek opposition party – in effect a call for the replacement of the elected Greek government.
The third part of this moment of clarity was what happened in Ireland: the payment of a billion dollars to unsecured Anglo Irish Bank bondholders. Apart from its obvious obscenity, the most striking aspect of this was that, for the first time, we had a government performing an action it openly declared to be wrong. Michael Noonan wasn’t handing over these vast sums of cash from a bankrupt nation to vulture capitalist gamblers because he thought it was a good idea. He was doing it because there was a gun to his head. The threat came from the European Central Bank and it was as crude as it was brutal: give the spivs your taxpayers’ money or we’ll bring down your banking system.
Again, as in Greece, even the basic forms of democracy were incompatible with this process. There could not be a Greek referendum because there is no acceptable question that can be answered by a democratic vote. And there could not be a debate in the Irish parliament about the extortion of a billion dollars because there is nothing to be debated. Referendums and parliamentary votes are rituals of public consent. But the question of consent is now not just irrelevant. It is reckless, outrageous, downright scandalous.
And this isn’t just a simple matter of the Merkozy monster lording it over us little PIGS. For at this historic moment, even the German chancellor is little more than a cipher. She’s caught in the democratic crisis too. Remember this time last year when Angela Merkel started to make noises about bondholders sharing the pain of rescuing the banking system? She had to back down very quickly and make it clear that she didn’t mean present bondholders – heaven forbid. Even the German chancellor isn’t allowed to say certain things.
Europe, and the rest of the western world, is thus at a parting of the ways. We can have the form of rapacious finance capitalism that has become the dominant force in our economies and societies.
Or we can have democracy. But we can’t have both.[/left]
[/quote]
Could this end up with a big, mad, fuck off pan European war?
Runt?
Once the pasta and pizza stock piles start to run out then yes, yes it could.
Hordes of panicky people seem to be evacuating the town for some unknown reason. Professor, without knowing precisely what the danger is, would you say it’s time for our viewers to crack each other’s heads open and feast on the goo inside?
Yes I would Kent.
It is somewhat inevitable though. The whole idea of democracy is fairly significantly undermined by massive concentration of resources. Regardless of whether a politician as an individual is a cunt or not, the interests of the guy who can pull the plug on your campaign funding are going to take precedence over the interests of the guy who’s only participation is to show up and put an X on a piece of paper every 4/5 years. And the reality is the first guy is generally a lot more tuned into his interests, whereas the second guy can probably be won over by a few righteous sounding sentiments around polling time. Unless you have a shitload of checks and balances, any notion of democracy is pretty illusory in that setup.
The consequences of this are obvious. Any time there is the possibility of a left wing government being elected you’ll hear all this shit about how this will send the bond markets into a tailspin and the markets ate very nervous until they frighten the shit out of voters and make them change their minds. [quote=“Watch The Break, post: 519985”]
It is somewhat inevitable though. The whole idea of democracy is fairly significantly undermined by massive concentration of resources. Regardless of whether a politician as an individual is a cunt or not, the interests of the guy who can pull the plug on your campaign funding are going to take precedence over the interests of the guy who’s only participation is to show up and put an X on a piece of paper every 4/5 years. And the reality is the first guy is generally a lot more tuned into his interests, whereas the second guy can probably be won over by a few righteous sounding sentiments around polling time. Unless you have a shitload of checks and balances, any notion of democracy is pretty illusory in that setup.
[/quote]
Interesting move by Bossi today. I hope as a firm Eurosceptic he is using this to secure at least more powers for Padania. This is the Lega Nord/Northern League’s time. I hope they use it wisely and get rid of some of their more ridiculous policies. Tiocfaidh ár lá. Roma Iadrona.
The Bunga Bunga Party King has agreed to step once key austerity measures are passed in the Italian Parliament (likely to be passed by the end of the month).
Markets 2 - 0 Democracy
Democracy voted to allow kenny & noonan to make the decision to repay the bond holders on our behalf if that’s what they thought was best. Fintan wasn’t over happy about that either. Can’t have it every way!
It’s morbidly fascinating what is going on. Really don’t have a bloody clue what’s going to happen
I don’t think that that is what Kenny and Noonan said they’d do before the election. Not that it matters. [quote=“dancarter, post: 519989”]
Democracy voted to allow kenny & noonan to make the decision to repay the bond holders on our behalf if that’s what they thought was best. Fintan wasn’t over happy about that either. Can’t have it every way!
It’s morbidly fascinating what is going on. Really don’t have a bloody clue what’s going to happen
[/quote]