EU – The devided Union

New self-confidence of small EU states

The strongest european country Germany shows weakness as we discussed before. Mrs. Merkel prefers beeing in countries far away because she is still adored there. Not so in Germany. 43% of the germans want her to step down (german: Focus)

France and Germany used to lead the EU and the other member states followed. Money always helped, if a country rebelled. But times change and young leaders like Sebastian Kurz from Austria and the italian secretary of the interiour Matteo Salvini want to get involved in the decisions. The latest example for this is the rejection of Merkels and Macrons plan of a new european budget. 12 EU countries signed a letter against the plan. Their simple but entitled question is: “What problem does this new budget solve? – We see no sense in it.” (german Focus)

Greece.

Greece was officially released from the rescue program on Friday. The Euro almost had crashed and the country has been broke but over 270 billion euro saved her. (german: Badische Zeitung)

That sounds good as long as you don’t look behind the facade. Economic data have been forged over many years and no one believes them now. Unemployment is still over 20%. High taxes make it difficult for start-ups to establish. Since the European Central Bank will stop buying state bonds, new money will get more expensive. Greece is a risky financial investment and so they will have to pay higher interest rates. I hope that Greece will make it but chances are that the next crisis is aroud the corner.

Global trade war will test EU unity

What is the final answer to the US tariffs? Will they promote a new EU, that builds a wall against immigrants and protects itself by own protective tariffs? Or will the globalists win? There are different opinions within the EU that could split the continent even more.

Dangers and possibilities

It seems to me that many countries got strong leaders in the last years: Putin, Trump, Kim Jong Un, Kurz, Netanyahu, Macron and Erdogan for example.  No matter what will happen with Germany’s chancellor in the near future, Germany will be without a strong leader. No party is strong enough to form a strong government. The EU as a whole is estranged. This is like a vacuum that longs for fulfillment. It could be that people say: “We need a strong leader whatever it takes.” So let us watch mindfully at the political developments.

 

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German Government Crisis

Government parties CSU and CDU give press conference – in different places!

Merkel in Berlin and Seehofer in Munich received the press at 2 pm. Merkel didn’t answer the question that everybody wants to know: Would she fire Seehofer if he implements his full aslym masterplan? That would mean the end of the current government.

None of the government parties (CDU, CSU and SPD) desires new elections, because all 3 lost tremendously in the last months and had not the majority in the parliament in the case of new elections. (Forsa)

The whole theater could also be a trick to convince the SPD to agree to a stricter immigration policy. The SPD is extremly immigrant-friendly and would never accept tougher politics. But to avoid that the whole government flies apart, she might be willing.

Even chancellor Merkel now supports tougher immigration politics (62 of 63 of Seehofers masterplan points). But she still insists on a european solution and rejects a solo action of Germany. Her goal is “to reduce, control and arrange (note from me: arrange not stop!) illegal immigration” (19:18 in Live Stream Die Welt).

This isn’t enough for the home secretary Seehofer (Press conference youtube). In 2 weeks, when Angela Merkel will be back from the EU summit they will talk with each other and Merkel will have to report her EU achievements.  If they don’t match the masterplan of Seehofer, he will act and send the police to the border. In the press conference this sounds pretty clear. Seehofer also sais that his masterplan – he didn’t publish it yet – contains a lot of explosive material. This is the point where Merkel strictly disagrees and she will use her power as chancellor to correct him. (she said this indirectly when she insists that she still has the power to do so).

Back to Weimar Republic?

The fronts between the two are hardened. What would be the best scenario? The best thing would be if Merkel rethinks her immigration policy. Another option is that Seehofer rows back from his position as he did many times before.

A political earthquake however would be this:

  • Merkel can not convince our european partners of a common immigration solution (very likely to happen since she didn’t achieve it during the last 3 years)
  • Seehofer sends german police to the border and implements his full masterplan
  • Merkel uses her power to instruct him not to do so
  • Seehofer does it anyway
  • Merkel fires her minister
  • government parties CDU and CSU split their union
  • Merkel steps down
  • new elections in Germany
  • result: 7 parties in the parliament (CSU, CDU, SPD, AfD, Grüne, FDP, Linke), none of them has a majority or can easily form one
  • lack of political stability, similar to the weimar republic (10 parties)

 

 

What you need to know today

Will the global crash start in Germany soon?

There are signs that the financial system in Germany could crash in the next few months and cause another global crisis. This time could be much worse than the last time.

Disturbing news today

The ugly face of an emergency fusion of Deutsche Bank and Commerzbank occurs today again in german news (german: Die Welt). Both banks are totter candidates, both share prices declined since 2007: Commerzbank from 245.18 Euro to 9.32 Euro and Deutsche Bank from 79.84 Euro to 9.55 Euro. Deutsche Bank faces also expensive complaints in the USA and Australia. What would a fusion of those banks bring us? Nothing good, because zero plus zero stays zero. The german state is the biggest shareholder of the Commerzbank which is the forth-largest bank in our country and present in more than 50 nations (Wikipedia). If those two banks fail it would affect Germany first and hard and then spread around the world.

100.000 Euro savings deposit garanteed – REALLY?

We germans believe that Angela Merkel said the truth when she promised that our savings will be safe. But the bank fond that has to back 0.8% of the savings of their customers is half empty.  That means that in the case of another bank crisis savings could be lost (german: Der Spiegel).

Shocking drop in orders 

The german industrie notes it’s longest drop in orders since the global financial crises in 2008.  Originally the orders were expected to grow for 0.8% but the political and economic uncertainty pressed the order numbers down. (german: Handelsblatt) One of the main reasons are the fears of an international tradewar. The G7 summit is already called a G6+1 summit: on the one side US president Donald Trump and on the other hand Canada, Japan and the EU countries. They have their deepest conflict since WW2.

USA vulnerable and isolated – german policy influences german press

The press in Germany never liked Donald Trump. The background seems to be clear. People don’t trust the newspapers anymore and get their informations in the internet. But that also means that the media needs different ways to finance themselves. Mass media is therefore grateful that the german party SPD is financially deeply involved in their affairs (german: Presserecht) It is clear that the mass media that is partly financed by the left party SPD shares and prints her opinion.

The crazy fact is that the SPD herself is in deep trouble. Her politics are polluted with economic interests and the workers don’t see what the party is doing for them. Once the SPD was strongly represented in our Bundestag with 45.8% in 1972. Now they are only one among others with 20.5%.

Hit dogs bark and the SPD bites in panic every political enemy. This hits Donald Trump in the USA and the AfD in Germany that received a lot of votes from former SPD people. Long before the tradewar started the german press denigrated Mr. Trump. Now they are happy to have a real topic: the (quote Merkel:) illegal tariffs on steel and aluminum. The international mood is heated up because of Mr. Trumps withdrawal from the iran deal, from the climate agreement and his Israel politics.

You already can hear voices from the EU that they don’t need the USA any more. Agreements with other states would make them just as strong and stronger than the USA. Now what will happen if the USA really needs help and her current allies have turned away? This could be a real threat to the USA – because even the strongest nation on earth needs friends in a case of emergency.

Be prepared for a storm ahead and be careful if they say “Peace and prosperity everywhere”.