Euro establishment isn’t learning any lessons from the crisis June 11, 2012 IT seems that €100bn no longer buys very much these days. Yesterday’s post-bailout rally fizzled out almost as soon as the markets opened, as traders’ innate over-exuberance soon turned into jaded realism. Spain and the Eurozone are still in deep trouble; these days, you can only fool the markets for a few hours. There are [...]
It’s time governments stopped bailing out bankrupt banks June 10, 2012 IF you are tempted to celebrate Spain’s bailout, or if you agree with its football-mad PM that it was a “triumph”, a great European “victory”, I would urge you to reconsider. Sure, chucking at least €100bn at insolvent, incompetently managed second-tier Spanish banks will pour oil on stormy Eurozone waters. It will reduce the immediate [...]
Our fatally conceited elites are being confronted with reality June 7, 2012 IT was FA Hayek, an economics Nobel prize winner of immeasurably greater distinction than Paul Krugman, who put it best. In his book the Fatal Conceit, he launched a devastating attack on those who believe that elites can mould and control humanity’s destiny. Central direction is impossible, a limitation those in authority never accept. Past [...]
Five lessons to be learnt from the accelerating Eurogeddon June 6, 2012 HERE are a few observations on the latest developments in the Eurozone crisis. 1) The markets are desperate, short-termist bailout junkies. Their bounce yesterday was all to do with the hope of more QE or taxpayers’ cash to bail out Spanish banks. The fact that this would mean well-managed countries picking up bills incurred by [...]
A spectacular triumph for the British monarchy June 6, 2012 JUST in case there was any doubt as to the Queen’s popularity, the amazing, heart-felt and spontaneous outpouring of the past few days serves as categorical proof that republicans have been routed. Support for the Royal Family from the Great British public – in all of its modern diversity – is increasing, and is even [...]
George Osborne’s latest tax U-turn is a great Jubilee present May 31, 2012 FOR charities and their donors, including many in the City, George Osborne’s latest and most spectacular u-turn comes as a perfect Jubilee weekend present. The Chancellor had announced in the Budget a limit of £50,000 or 25 per cent of income, whichever was higher, on the amount individuals could donate in a tax-deductible fashion; the [...]
Eurozone optimists are suffering from cognitive dissonance May 30, 2012 MY abiding memory of the credit crisis was the delusion that continued to grip the City and Wall Street long after it became apparent to objective observers that a terrible recession was about to begin. Most people kept their heads firmly in the sand when HSBC’s US sub-prime unit reported losses, for example, or when [...]
Surging labour costs are keeping UK unemployment high May 29, 2012 THERE is a straightforward reason why unemployment remains so high in Britain. Unit labour costs are rising – hiring someone to produce a set amount of output is becoming more expensive. And higher prices mean reduced demand – in the jobs market as in everything else. This may come as a bit of a surprise: [...]
Osborne’s U-turn comes as UK celebrates tax freedom day May 28, 2012 CONGRATULATIONS: you’ve just started to work for yourself. Today is tax freedom day, the day when Britons stop working for the chancellor and start working for themselves. The Adam Smith Institute has calculated that for the first 149 days of the year, every penny earned by the average UK resident will be taken by the [...]
Eurozone crisis could unleash an epidemic of protectionism May 27, 2012 WHEN Lehman Brothers went bankrupt in 2008, precipitating a global recession and the unwinding of a massive credit bubble, many feared a terrified world would succumb to the siren songs of protectionism. History usually repeats itself because younger generations forget the past or believe that they are better than their forebears; and one of the [...]