Eurocrash: the Wackelkandidaten shall inherit the earth
Thursday 30 August 2012
"I have to tell you I resent having to find out about the fate of this country by reading German newspapers", writes Mary Ellen Synon, in the Wail's clog. One knows how she feels.
The fact of the matter, though, as we had begun to realise as early as June, is that is where the debate is happening, with the English press standing on the sidelines, obsessed with other matters.
Even today (or especially today) it continues, with the latest instalment of the Weidmann versus Draghi spat making the weather in Handelsblatt. And it's not looking good for Weidmann, the paper says.
One begins to get a sense of German phraseology here – even if I readily admit I'm too often out of my depth when it comes to deciphering that new language … Googlese. All Weidmann's warnings "are beaten into the wind" by Draghi, says the paper. One can guess that it is telling us Draghi has played a blinder.
But if Mary Ellen looks askance at the use of the word Schicksalsgemeinschaft ("destiny community"), what are we supposed to make of Wackelkandidaten, from whom Draghi wants to buy bonds? Are we to assume that the Schicksalsgemeinschaft is now committed to bailing out the Wackelkandidaten, and that there is nothing Weidmann can do to stop it?
Handelsblatt, like so many others, focuses on Draghi's assertions that the ECB "will remain independent" and "will always act within its mandate", failing entirely to challenge the claims when, manifestly, the ECB is not independent and has clearly exceeded it mandate.
But, if you allow these false claims to stand, for Draghi then to say, "When markets are fragmented or influenced by irrational fears … this may at times require exceptional measures", seems eminently reasonable. He fails to say, though, that his "exceptional measures" are driving a cart and horse through the EU treaties.
For Weidmann and his co-conspirator Jürgen Stark, this is particularly galling because Germany is isolated in the ECB governing council. The Googlese thus tells us: "As an advocate of a consistent stable exchange German tradition Weidmann is not tired, put his finger in the wound".
When you've worked that one out, drop me a line and tell me what it means. You can also add Weidmann's comments: "Whether it's of interest or any special measures - in the end it always works out that the central bank clamped for goals of fiscal policy should be", he says. If I knew what he was saying, doubtless I would agree.
You can get the drift of it though, and it is entertaining to read a quote from the employee magazine of the Bundesbank: "We will continue to work with all means and at all levels … so that the monetary union will continue to live as a stability union".
But there no now doubt that Weidmann can hold the line. Without a proper and full backing from German politicians, he is no longer secure. Recent statements from Merkel, especially those in Canada, did not help as they apparently support Draghi.
Merkel, it seems, is playing a double game, happy to rely on the ECB to keep a lid on the markets, with all the other "euro-weary governments" piggybacking on the ECB as well. If it wasn't for the ECB, the chancellor would find herself under pressure to rescue Italy and Spain sometime before the election. And that would be politically difficult.
Thus, we are told that the German chancellor is de facto a euro Inflationierungspolitik. So there we have it. The Schicksalsgemeinschaft, led by an Inflationierungspolitik is committed to bailing out the Wackelkandidaten, all – you will be pleased to know – under the fig leaf of "conditionality".
But reforms take time and the only thing left to keep the markets in check is the ECB "Bazooka" – so that is how it is going to be. The Wackelkandidaten shall inherit the earth, and poor old Weidmann is out in the rain.
Even today (or especially today) it continues, with the latest instalment of the Weidmann versus Draghi spat making the weather in Handelsblatt. And it's not looking good for Weidmann, the paper says.
One begins to get a sense of German phraseology here – even if I readily admit I'm too often out of my depth when it comes to deciphering that new language … Googlese. All Weidmann's warnings "are beaten into the wind" by Draghi, says the paper. One can guess that it is telling us Draghi has played a blinder.
But if Mary Ellen looks askance at the use of the word Schicksalsgemeinschaft ("destiny community"), what are we supposed to make of Wackelkandidaten, from whom Draghi wants to buy bonds? Are we to assume that the Schicksalsgemeinschaft is now committed to bailing out the Wackelkandidaten, and that there is nothing Weidmann can do to stop it?
Handelsblatt, like so many others, focuses on Draghi's assertions that the ECB "will remain independent" and "will always act within its mandate", failing entirely to challenge the claims when, manifestly, the ECB is not independent and has clearly exceeded it mandate.
But, if you allow these false claims to stand, for Draghi then to say, "When markets are fragmented or influenced by irrational fears … this may at times require exceptional measures", seems eminently reasonable. He fails to say, though, that his "exceptional measures" are driving a cart and horse through the EU treaties.
For Weidmann and his co-conspirator Jürgen Stark, this is particularly galling because Germany is isolated in the ECB governing council. The Googlese thus tells us: "As an advocate of a consistent stable exchange German tradition Weidmann is not tired, put his finger in the wound".
When you've worked that one out, drop me a line and tell me what it means. You can also add Weidmann's comments: "Whether it's of interest or any special measures - in the end it always works out that the central bank clamped for goals of fiscal policy should be", he says. If I knew what he was saying, doubtless I would agree.
You can get the drift of it though, and it is entertaining to read a quote from the employee magazine of the Bundesbank: "We will continue to work with all means and at all levels … so that the monetary union will continue to live as a stability union".
But there no now doubt that Weidmann can hold the line. Without a proper and full backing from German politicians, he is no longer secure. Recent statements from Merkel, especially those in Canada, did not help as they apparently support Draghi.
Merkel, it seems, is playing a double game, happy to rely on the ECB to keep a lid on the markets, with all the other "euro-weary governments" piggybacking on the ECB as well. If it wasn't for the ECB, the chancellor would find herself under pressure to rescue Italy and Spain sometime before the election. And that would be politically difficult.
Thus, we are told that the German chancellor is de facto a euro Inflationierungspolitik. So there we have it. The Schicksalsgemeinschaft, led by an Inflationierungspolitik is committed to bailing out the Wackelkandidaten, all – you will be pleased to know – under the fig leaf of "conditionality".
But reforms take time and the only thing left to keep the markets in check is the ECB "Bazooka" – so that is how it is going to be. The Wackelkandidaten shall inherit the earth, and poor old Weidmann is out in the rain.
Richard North 30/08/2012
Posts
