And my para in there about how the fact that the euro is a political rather than an economic project is what will keep it alive rather than kill it is probably the key bit of the piece. You will doubtless have recognized Bernard here and in other places within. It was an extraordinary privilege to have worked with him and to have learned so much from him. I wonder about the extent to which my subsequent evolution is really nothing more than Oedipal Revolt. If you are in touch with him (I have not since my 2010 conversion), please do convey my deepest regards.
Hi John, Great to hear from you! Been more than 20 years I think. I certainly don't believe it's 2011 again with France in Greece's place. Greece was a sui-generis mess back then with high debt to GDP (like Italy but unlike Spain), high negative NIIP (unlike Italy but like Portugal), and a generalized perception of low state capacity (like Italy but unlike Spain and Portugal). France has a current deficit issue that's a problem for EU institutions and it drives Lindner crazy, but I cannot see r/g dynamics on the scale of what threatened Italy in 2011 let alone Greece. Couple of reasons for that--France is indisputably heart of the geopolitical core of the EU/EZ and Germany knows that. It has a P5 veto, nukes, and the most functional military establishment after the UK left. It also has productive structure that's essential to any European ambitions whatsoever(Airbus, Dassault, Total e.g.). Moreover, le Pen knows this as well (Melenchon I'm not that sure about), but I also think someone has already told her (or will) that a France that is no longer in the EU/EZ will not get to run Anglo-American style fiscal and current account deficits even as reserve managers scoop up OATs (because the Germans refuse to produce enough Bunds). This can turn into a game of chicken but one where I expect both sides Commission/Germany/ECB and France will I expect come to their senses. Even more so because Trump; and not just Trump but Bannon/Grenell even more so REALLY dislike the EU. The EDP itself is highly choreographed as I understand it, so I expect there will be kerfuffles and bright red headlines along the way, but I expect the Franklin Moment (we must hang together lest we hang separately to prevail.
Any change in your point of view after the French elections? How will the EC/ECB deal with the “caretaker” government and the likely absence of a French budget in September? Is this 2011, except with France rather than Greece? And if not, why not? As a beneficiary of the French health care system (and public order here) I certainly hope there are good answers to these questions, but I am not certain there are. Best John Dizard
And my para in there about how the fact that the euro is a political rather than an economic project is what will keep it alive rather than kill it is probably the key bit of the piece. You will doubtless have recognized Bernard here and in other places within. It was an extraordinary privilege to have worked with him and to have learned so much from him. I wonder about the extent to which my subsequent evolution is really nothing more than Oedipal Revolt. If you are in touch with him (I have not since my 2010 conversion), please do convey my deepest regards.
Hi John, Great to hear from you! Been more than 20 years I think. I certainly don't believe it's 2011 again with France in Greece's place. Greece was a sui-generis mess back then with high debt to GDP (like Italy but unlike Spain), high negative NIIP (unlike Italy but like Portugal), and a generalized perception of low state capacity (like Italy but unlike Spain and Portugal). France has a current deficit issue that's a problem for EU institutions and it drives Lindner crazy, but I cannot see r/g dynamics on the scale of what threatened Italy in 2011 let alone Greece. Couple of reasons for that--France is indisputably heart of the geopolitical core of the EU/EZ and Germany knows that. It has a P5 veto, nukes, and the most functional military establishment after the UK left. It also has productive structure that's essential to any European ambitions whatsoever(Airbus, Dassault, Total e.g.). Moreover, le Pen knows this as well (Melenchon I'm not that sure about), but I also think someone has already told her (or will) that a France that is no longer in the EU/EZ will not get to run Anglo-American style fiscal and current account deficits even as reserve managers scoop up OATs (because the Germans refuse to produce enough Bunds). This can turn into a game of chicken but one where I expect both sides Commission/Germany/ECB and France will I expect come to their senses. Even more so because Trump; and not just Trump but Bannon/Grenell even more so REALLY dislike the EU. The EDP itself is highly choreographed as I understand it, so I expect there will be kerfuffles and bright red headlines along the way, but I expect the Franklin Moment (we must hang together lest we hang separately to prevail.
Any change in your point of view after the French elections? How will the EC/ECB deal with the “caretaker” government and the likely absence of a French budget in September? Is this 2011, except with France rather than Greece? And if not, why not? As a beneficiary of the French health care system (and public order here) I certainly hope there are good answers to these questions, but I am not certain there are. Best John Dizard