Britannia Radio

26 July 2011 5:47 PM

Analysts: 'Eurozone crisis deepens as slowdown spreads to the core'

This note has just dropped into my email, from Capital Economics, the London macroeconomic consultants who provide serious analysis to institutional and corporate clients around the world. The managing director is the famous Roger Bootle.

So here their take on the eurozone after the latest so-called 'bailout', and I'd say it is spot-on:

"The latest rescue package for Greece has reduced the threat of a near-term catastrophe in the eurozone. But it does not address the fundamental problems facing Greece itself and is unlikely to bring an end to the recent signs of contagion to bigger economies like Italy and Spain."

"Meanwhile, the economic data has brought growing evidence that the weakness of activity in the peripheral economies is starting to spread to the core, with even Germany – the powerhouse of the recovery – losing steam."

"With growth likely to slow further over the coming quarters and the fiscal crisis set to continue, doubts over the future of the currency union are likely to grow."

Though I'd say "doubts" is an understatement.

What Norway must do now, no matter how the stomach heaves: stand by the rule of law

This is a bad development in already appalling situation: there are moves reported this morning that some pressure groups outside Norway are trying to have Breivik charged with 'crimes against humanity.'

The point would be to have his trial shifted out of Norway, out of the justice system of Norway, away from the democratically-framed laws of Norway and into the international court at The Hague.

This would be to ensure Breivik gets locked up for life, a sentence available to the court at The Hague, but which is not available to any Norwegian judge: by some reports the maximum sentence which Norwegian law would allow is no more than 25 years.

Yes, the thought of Breivik free again before he is 50 years old is revolting. But I'd add that the thought of him -- assuming the courts find him sane -- being left to live out the course of his natural life in prison is revolting, too. If people outside Norway have the right to interfere -- which on democratic principle they do not -- some of us would rather ensure that the interference leads to Breivik being executed. But I would resist such interference, even if it resulted in the justice of the execution of the killer.

The rule of law has to stand, and the rule of law is established by the democraticallyelected members of a national parliament. The Norwegian people themselves had their representatives do away with the death penalty; a foolish decision, yes, but they took it.

And they elected parliamentary representatives who legislated for what, to many people abroad, seems an extraordinarily light sentencing policy for any murder, much less murders by the dozen. But it was the choice of the Norwegians as to how their law and order should be structured, and it must remain their choice alone.

The Norwegians also seem to have encouraged a society in which more than 500 people could be on an island and not one of them, not even the so-called security guard, was carrying a gun: an unbelievably reckless policy. Worse, reports are now emerging that even Norwegian policemen must gain authorisation from the chief before they can get their hands on a gun. That policy is beyond reckless.

What that means is that the Norwegians must live with what such democratically-decided policies produce: a murderer who may walk from prison in early middle age, and a population and police force unready to deal with a determined killer.

One can understand the desire to tear down the law to secure a tougher sentence for Breivik, now that he has admitted the shootings. But if international political manipulation makes it so that the law does not apply to him as it has to other Norwegian murderers, imagine this. Imagine you are the parent of a young girl who was murdered in Oslo 15 years ago and you already have to endure the endless pain of her killer walking free and living back in his own home.

Yet another parent whose daughter was shot by Breivik would know her killer would be locked-up forever.

Where would be the justice in that? Where would be the rule of law?

The rich Tory and the African escort girl: I quite understand

I know we're supposed to be shocked at the story in today's Mail on Sunday that a married Tory donor fathered two children by an African escort girl. It seems he used to fly her around the world to meet him at exotic locations. But if that African escort girl is anything like the African escort girl I once came across in Nigeria, all I can say is: nobody could blame you, mate.

In the 1980s I was in Lagos with a television film crew, working on a package about the Nigerian economy. While there, we got to know a group of big time Asian businessmen who were doing deals with the oil-money upper crust. They invited us to the top nightclub in town -- $200 a skull for dinner, on their tab, not our expenses -- and as we were about to leave the hotel an utterly lovely African girl appeared by the side of one of the businessmen. One of his colleagues explained to us that she was an escort he flew in from Abidjan in the Cote d'Ivoire whenever he was in Lagos, and she would be joining us for dinner.

Mesmerising us for dinner more like it. In a city with a climate like a steam bath built on a volcano, Miss Abidjan was cool, and in every sense. The dress was elegant, the legs were sensational, and the hair was plaited to her shoulders in those braids finished with beads. The voice was low and sexy with the accented drawl of French-speaking Africa. And as she purred to her man and pushed back the tumble of braids back from her face, the crew member on my left looked on in awe: 'I love it when they do their hair in those braids. It looks just like real hair.' Not a 'culturally sensitive' comment, but I know what he meant.

And she danced with her man. But then she came back to our table and pointed to our assistant camera man and in the closest I've hear to a female growl since Eartha Kitt said: 'Now you will dance with me.' And back again, through our sound man and on down the table. At the end was my boss, who clutched my arm in the kind of terror only an Englishman can feel in such a situation. 'What's French for, "I'm sorry, I have a wooden leg?"'

Though perhaps that rich Tory should have tried that line when he met his own African escort girl. It could have kept him out of trouble.

How the EU has infiltrated the IMF

The Alien euro-creature: or as Ripley said, 'How do we kill it, Ash? There's gotta be a way of killing it. How?'

Yesterday the Washington-based International Monetary Fund released an official statement from Antonio Borges, the director of its European department, about the rolling crisis in the eurozone.

Now, background: given the purpose and methods of the IMF, it was a surprise when it became entangled last year with the EU and its bail-outs. The Brussels-directed 'rescues' excluded the possibility of debt-crushed eurozone countries such as Greece being allowed to default. Yet the IMF's way of operating usually includes as a first step a default on the struggling country's sovereign debt. But the EU sucked the IMF into the eurozone problems as a junior partner anyway.

You can reckon the IMF only agreed to this because at the time Dominic Strauss-Kahn was running the fund and he wanted to paint himself as the saviour of the eurozone -- that would be his selling pitch for the French presidential election.

Terrifric, he's gone, but now unfortunately Christine Lagarde, another French euro-cult technocrat is in charge. Despite her appointment, some of us had hopes that the most powerful of the IMF's 187 members would insist the fund pull back on involvement in the eurozone: they have realised by now that what is supposed to be liquidity provided by 187 different nationalities of taxpayer, all to be repaid, is in fact billions poured down a deep, deep hole, little of which will ever be recovered.

So yesterday's announcement from Director Borges of the IMF's European department was a surprise. Instead of saying --as one would expect any IMF expert to say -- that it's time for the weak eurozone countries to get out of the poisonous currency union and default on their debts, the director said: 'To put the crisis behind, we need more Europe not less.' He went on about expanding the bail-out fund into a vehicle for buying government bonds and to recapitalise banks.

What?

That is not Washington straight talk, 'more Europe' is Brussels code for 'we need to take more power away from member states and their parliaments, and give it to the EU and its eurocrats.'

I couldn't understand how that perfect European Commission propaganda line come out of the IMF headquarters in Washington. So I checked out what path Borges took to the IMF: the 2010 annual report of European Corporate Governance Forum -- a creature of and advisor to the European Commission -- lists the Portuguese Borges as a member. He also worked on the whole economic and monetary union project.

Ridley Scott covered this situation in a 1979 film: there is an Alien forming in the host...