Other than the occasional politician going off script, there has been very little discussion of Europe's bail-ins and debt spirals and debilitating unemployment while the German politicians squabbled over the reins of the country. But now that Merkel has been returned to power as German chancellor, we can expect to be hearing more about the Eurozone in the coming weeks.
If you've been following the financial media for the last two weeks, chances are you've heard about the Fed's non-taper decision and its ongoing ramifications (market euphoria wearing off, S&P heading down to 10-month trendline support, money pouring back into treasuries as yields continue falling) enough to make you pull your hair out. But there's this little systemic crisis in Europe that might have slipped everyone's mind...
As it turns out, there's a reason why the Eurozone debt crisis has fallen off the radar in recent months: the German elections. Just as Germany remains the undisputed economic workhorse of the faltering Eurozone, so too do European politics increasingly revolve around German politics. And during this election season, it was to the benefit of the German political establishment that the Eurocalypse be kept off the table. Other than the occasional politician going off script (Schauble, we're looking at you), that was largely accomplished; there has been very little discussion of Europe's bail-ins and debt spirals and debilitating unemployment while the German politicians squabbled over the reins of the country. But now that Merkel has been returned to power as German chancellor in a convincing win at the ballot box (albeit without a majority, but such is the German political system), we can expect to be hearing more about the Eurozone in the coming weeks.
Like this from The Times of London: “Germany Leads the Eurozone's Rebound.” Or this from Reuters: “Eurozone Business Activity Growing Faster Than Thought in September: PMI.” In other words, propaganda as usual from the usual bankster mouthpieces. This time excitement over Markit's Flash Composite PMI figures for the Eurozone indicating a jump to 52.1, higher than market projections. The German contribution to this, according to the Times, included a service sector reading of 54.4, indicating that it was domestic consumption as much as exports that were driving this uptick in activity. What a nice little present just in time for Merkel's re-coronation.
Of course, it didn't take long for the dire nature of the ongoing Euro disintegration to pierce the bubble of unreality created by those PMI figures. Less than 24 hours after the PMI headlines, the German IFO Business Climate report was released and it was dismal. Everything came in under expectations, once again reminding the markets that the ECB is still in a currency war with the Fed, and the Fed's latest non-taper antics has just given the dollar the upper (lower?) hand. Queue the European answer to Chairman Ben, aka ECB President Mario Draghi, who came out with currency guns blazing, promising to provide more cheap long-term loans to keep money market rates from increasing. And just like that, the Euro slipped a notch on Tuesday, which, if you'll remember, is a good thing in bizarro world economics.
And so it is that the OECD came out yesterday to warn that the Eurozone still poses a threat to global recovery (just in case anyone forgot). So apparently a regional economy that has just come out of its longest recession in 40 years, that still has depression-level unemployment rates, that is still talking about austerity and bail-outs and write-downs, is a “threat to global recovery”? Well who woulda thunk it? Unfortunately, we're due for a lot more of this talk as the Eurozone limps into an anemic fourth quarter.
Meanwhile, the long term agenda continues to play out exactly as we always said it would: with the banksters using the crisis they themselves created to argue for more money and power. In the latest development, Draghi is now calling on the European parliament to establish a credit line for the ECB's bank resolution fund, itself set up in preparation for the region-wide stress tests that it is due to start conducting in the coming months. And with each fresh turn in the Eurozone crisis, the globalists move that much closer to regional government...