Re: Meanwhile in the Eurozone ...
Originally Posted by Bruce
It is happening all over the world, nothing specially to do with Europe or the EU. It is caused by the USA v China trade war, everybody else is collateral damage, the big boys are playing hard.
You are kidding yourself if you think it is to do with Brexit (though Brexit won't help).
The excuse is that it's always happening all over the world
Ofcourse the trade war with China has a huge impact on the Eurozone but the bigger picture here is how after 10 years the Eurozone are still pumping 20 billion a month into the economy from borrowing just to keep it afloat. It's an epic failure of biblical proportions.
Another problem for the Eurozone (and the EU) is that Germany is going into recession (which is another reason why the ECB are panicking and throwing 20 billion a month at the problem to try and cover it up). People have lost trust in the German car manufacturers because of the emissions scandal, they are primarily big diesels that nobody wants to buy because of uncertainty on tax laws and lastly, they do not have a hybrid/battery alternative which have lately been super popular because of government funding schemes and incentives to help people buy them (although these have mostly ended now). The Japanese and Americans are way out in front with their technology, leaving Germany to desperately look for solutions (although VW are touted at buying Tesla - which has other issues of exploding cars, deaths and spontaneous fires).
I digress ..
I never said it was to do with Brexit although the UK contributions would help to shore up the QE from the ECB thats for sure, and considering up to 100 billion net trade is going to walkout the door on 31st October guess what's going to happen to the 20 billion a month QE from the ECB .... ? Up Up Up it goes !
The ECB QE is an absolute catastrophe its failed since 2009 and continues to fail year in year out. Put your money in a Eurozone bank and they will take 0.5% just for putting it there - ouch ! Doesn't look like the Eurozone banking industry is a good investment does it
Draghi left a legacy of QE4EVA (QE For Ever) to Lagarde - its the death spiral of the Euro and their brilliant idea is to give the problem to ex-convict Christine La Garde to fix (who, incidentally, is a lawyer not an economist).
How is all this paid back ? Well, thats another question ... and the only method available to the Eurozone is with austerity measures. They cannot devalue their currency, they cannot control inflation, they can only punish their tax payers for their miserable failure of implementing a centralised currency with no centralised treasury.
I'll give it 2 years maximum.