European Tribune - Community, Politics & Progress.

Europe.Is.Doomed. (2)

by Jerome a Paris
Sat May 3rd, 2008 at 11:51:59 AM EST

Euro shows signs of end to bull run
Speculation that the euro’s seven-year bull run was coming to an end intensified on Thursday as the single currency fell to five-week lows against the dollar and the pound.

Remember: when the euro goes up, it's bad for the eurozone, and when it goes down, it is a sign that things are going badly for the eurozone.

Euro nears milestone, but faces north-south divide
By most yardsticks, Europe's common currency has been a success, emerging as an alternative to the fading dollar for bond dealers, central bankers, Chinese exporters, even Jay-Z, the American rapper, who put a pop-cultural imprimatur on the currency by flashing a wad of 500-euro notes in a music video.
Yet fissures are forming in the European monetary union that threaten to widen in coming months.

Europe.Is.Doomed. They keep on telling us so, so it must be true.

Series numbering corrected; see link-list of whole series.

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Europe.Is.Doomed. (2) | 20 comments (20 topical, 0 editorial, 0 hidden)

The last paragraphs put things in pespective (4.00 / 8)

..; a bit

Given the deepening distress in these countries, experts said they were surprised that there had not already been more complaints. (...)
Part of the reason for the quiescence may be that Europe has remained steady despite the recent financial upheavals in the United States. Few countries, it seems, can contemplate trading the discomfort of a robust euro for the vagaries of their old currencies.
(...)
Europe's monetary union may be lasting, but it is not widely loved.

So it's either doomed or undemocratic. As usual

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (jeromeguillet@yahoo.fr) on Sat May 3rd, 2008 at 11:55:35 AM EST

Re: Lasting or Loved? (none / 1)

Jerome a Paris:

Europe's monetary union may be lasting, but it is not widely loved.

The US Federal monetary union's dollar, on the other hand, appears to be loved (by these guys anyway) but it's maybe not going to be lasting....

by ChrisCook (cojockathotmaildotcom) on Sat May 3rd, 2008 at 12:43:12 PM EST
[ Parent ]

Re: The last paragraphs put things in pespective (4.00 / 3)

"when the euro goes up, it's bad for the eurozone, and when it goes down, it is a sign that things are going badly for the eurozone."

In Spanish we say:

"Si da el cántaro en la piedra o la piedra en el cántaro, mal para el cántaro"

"If you give the pitcher on the stone or stone in the pitcher, bad for the pitcher"

So? A good pension in euros and march to live in Buenos Aires, for example? Is there somewhere very cheap in Europe, instead of Buenos Aires?

When Procrustes looks after you, you're sure to fit in.

by PerCLupi on Sat May 3rd, 2008 at 03:30:02 PM EST
[ Parent ]

Re: The last paragraphs put things in pespective (none / 1)

I do not know anything about economics.
What is the stone?
Because another possibility is to remove stones from the eurozone.
I am happy to devote remove stones. I worked in Paris as a mason. But What are the stones?

When Procrustes looks after you, you're sure to fit in.

by PerCLupi on Sat May 3rd, 2008 at 04:36:44 PM EST
[ Parent ]

Re: Europe.Is.Doomed (4.00 / 6)

There are a lot of economists and commentators who predicted the Euro would be a failure, right from the word go. They are particularly shrill because the eventual success of the Euro will prove that you cannot consider economics in isolation from politics. That's not a happy thought for them.

by Metatone (metatone [a|t] gmail (dot) com) on Sat May 3rd, 2008 at 12:06:29 PM EST

spin's wonderful (4.00 / 4)

Given that whichever way the Euro moves there's always going to be a downside then the job of a spinner is easy, as long as they're willing to throw consistency out the window.

by MarekNYC on Sat May 3rd, 2008 at 12:18:24 PM EST

Re: spin's wonderful (4.00 / 4)

The consistency is that [Europe.Is.Doomed™ Alert]

They're really quite consistent about trying to get that across.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Sat May 3rd, 2008 at 03:30:57 PM EST
[ Parent ]

Re: Europe.Is.Doomed (none / 0)

I think you misunderstand the dynamics going on here. Nobody wants to read good news, so all pundits are trained to always find the cloud behind the silver lining.

Disasters and fear sell papers, thus it has been and thus it will ever be.

Of course, this doesn't absolve economic and political pundits when they show off their ignorance and ideological biases...

Policies not Politics
---- Daily Landscape

by rdf (robert.feinman@gmail.com) on Sat May 3rd, 2008 at 01:10:39 PM EST

Re: Europe.Is.Doomed (4.00 / 2)

I think you misunderstand the dynamics going on here

OK, let's see.

Disasters and fear sell papers

The papers are the FT and the IHT aka the NYT.

In what way is the doomedness of the euro disaster or fear for these Anglo media?

Tell us they're selling disaster and fear when they're talking about the slide of the dollar and sterling. Then I think we'll agree about the dynamics.

When locusts move on, they leave nothing behind

by afew (afew(a in a circle)eurotrib_dot_com) on Sat May 3rd, 2008 at 03:50:58 PM EST
[ Parent ]

Re: Europe.Is.Doomed (none / 1)

Correct analysis. The world no longer revolves around the Anglo-American Pole. It might have in times past, but those eras are over.

Share. Share resources, share delight, share burdens, share the healing. If we only could realize that sharing will bring us back from mass suicide.

by Isis on Sat May 3rd, 2008 at 11:27:36 PM EST
[ Parent ]

I think you missed my point (none / 0)

I agree about your more general point, but there are still nuances in that the US/UK business/mainstream press is happier to talk about bad news applying to specific groups or countries, and to spin some news as bad for these targets.

News about Europe (in particular France and Germany) is almost always negative unless the evidence is overwhelming, and makes it possible to draw systemic conclusions (and the need to "reform") News about the UK or US economies, when bad, can be explained away as "cyclical" and in any case do NOT put in question the economic paradigm which underlies them.

Thus the spin that the USD/EUR rate (between the eurozone and the US economy) is bad for the eurozone when the euro goes up, and bad for the eurozone when the euro goes down.

Don't you notice the assymetry in the bad news there?

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (jeromeguillet@yahoo.fr) on Sun May 4th, 2008 at 05:44:52 AM EST
[ Parent ]

Re: Europe.Is.Doomed (4.00 / 3)

Of course, the pundits could even be wrong that the dollar's fall is over. Here's a strong analysis from a site J pointed to during the week:

Jesse's Café Américain

So far the dollar rally looks like a technical bounce similar to ones we have had in the past when the dollar sets a lower trendline, bounces off it, and then falls back and tests it after a three or four week rally.

I don't believe they can manipulate past the horrible fundamentals.

Skennah Kowa

by Crazy Horse on Sat May 3rd, 2008 at 01:33:28 PM EST

Re: Europe.Is.Doomed (4.00 / 5)

Correct. The US Property ATM has been switched off.

The next phase is a collapse of corporate profits as the recession hits, and a wave of defaults on corporate buyout debt.

Plus a new wave of mortgage defaults this time by people with "prime" mortgages, where the incidence of defaults is already way up in the US.

by ChrisCook (cojockathotmaildotcom) on Sat May 3rd, 2008 at 02:13:11 PM EST
[ Parent ]

Re: Europe.Is.Doomed (none / 1)

Well, bad news and doom & gloom sell papers and air time. Every once in a while, someone will start a "good news" paper or magazine, with much positive fanfare, only to see it fail dismally within a short time. Good news lacks the conflict interest of bad news. Conflict is the moving force in drama. Even the best comedy plays and movies have plenty of dark moments.

Admittedly, the talking heads of recent times seem to have taken the gloom part to ridiculous lengths. A more reasoned approach would be preferable, but then many of the talking hairdos of US (and probably European) TV would be unemployed.

by Mnemosyne on Sat May 3rd, 2008 at 05:20:30 PM EST

The problem is not bad news (none / 0)

It's asymetric bad news - whatever the euro/dollar rate, it means that something's wrong, or about to go wrong, with the eurozone countries.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (jeromeguillet@yahoo.fr) on Sun May 4th, 2008 at 05:46:13 AM EST
[ Parent ]

Re: The problem is not bad news (none / 1)

if it's raining things are bad, and if there's blue skies it's going to rain.

Life should consist in at least fifty percent pure waste of time, and the rest doing what you please.

by ceebs (bunchofwankers (at) gmail (dot) com) on Sun May 4th, 2008 at 05:56:32 AM EST
[ Parent ]

Re: Europe.Is.Doomed (4.00 / 3)

It's interesting this point should be made twice in this thread.

The newspapers concerned here are not from eurozone countries. Preaching the demise of the euro is not bad news, doom and gloom from their point of view and that of their reading public. If they were trying to sell their publications on the doom and gloom ticket, they'd be talking about the decline of the US dollar and dollar-based GBP.

When locusts move on, they leave nothing behind

by afew (afew(a in a circle)eurotrib_dot_com) on Sun May 4th, 2008 at 06:08:22 AM EST
[ Parent ]

Re: Europe.Is.Doomed (none / 0)

To supplement the others; what I notice in the same papers when writing about the British or US economy is the discovery of silver lining in bad news (say a big loss of a bank is not the news, but that it is less than predicted) and the boosterist now-the-crisis-is-over commentary of every uptick.

*Traitor*, n.
A benighted individual who perceives an illusory distinction between serving his nation and abetting the criminals who govern it.

by DoDo on Tue May 6th, 2008 at 03:37:00 AM EST
[ Parent ]

Re: Europe.Is.Doomed (4.00 / 2)

It's the NYT. You were expecting journalism?

Where's your motherf*%&ing flag pin?

by Drew J Jones (blahblahblah@blahblahblah.com) on Sat May 3rd, 2008 at 05:57:07 PM EST

Re: Europe.Is.Doomed (4.00 / 5)

All national media are to a degree chauvinistic. The difference here is that English is the world language and the anglo-americans assume their sphere to be the world system as well - with some deviant regional aberrations such as the Euro, Yen, renminbi etc. which are "unfairly" managed or manipulated to exploit the natural world order generously provided by America/English/Dollar. The greater this world hegemony is challenged, the more shrill its protagonists, and never mind the evidence. How ungrateful of the French/Japanese/Chinese - they have been beneficiaries of Pax Americana and now they are reneging on their royalties to their lords and masters.

This IS politics. It has little to do with economics - or the real world, for that matter.

"It's a mystery to me - the game commences, For the usual fee - plus expenses, Confidential information - it's in my diary..."

by Frank Schnittger (mail Frankschnittger at hot dotty communists) on Sun May 4th, 2008 at 06:26:54 AM EST

Europe.Is.Doomed. (2) | 20 comments (20 topical, 0 editorial, 0 hidden)

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