Brexit: Germany Gains Power From Merkel’s Disastrous Policy

As we predicted, Cameron resigns after the British have cast “a leave vote” but Germany’s Chancellor Merkel is to blame for the disastrous result of the referendum.

Last year she mishandled three problems:

In 2015, under Angela Merkel’s leadership, the problems in Greece span out of control and Yanis Varoufakis, the finance minister of Greece, was able to jeopardize the whole euro project;
When in 2015 millions of refugees were heading for Europe, it was Angela Merkel that single-handedly, without consulting her political counterparts in Warsaw, London or Rome, decided how Europe had to deal with it ;
Chancellor Merkel held talks with Erdoğan: Turkey was being considered as a member-state of the European Union, which lacked any support in Europe whatsoever .

No wonder the British voters came to doubt the democratic legitimacy of Brussels as they saw Berlin mishandle the European project. Continue reading →

Brexit: Market Sell-Off Is Irrational!

Markets tumble amid global selloff now British decide to choose for a Brexit. ECB announced it would pledge to backstop. The economy in the UK is far from healthy but, that said, our team sees no reason for fundamental changes now the UK decides to leave the European Union. George Soros warned, “If Britain leaves, it could unleash a general exodus, and the disintegration of the European Union will become practically unavoidable.” Leaving the EU is a completely different story to leaving the Eurozone. For signs of Eurozone disintegration it is better to have a close look at events in France. Now a Brexit happens there is panic and this is an opportunities to earn some easy money. Soros’ remark makes us think about the legend of Nathan Rothschild after the British won the battle of Waterloo: “But this was Nathan Rothschild. He leaned against “his” pillar. He did not invest. He sold. He dumped consols.(British government bonds) […] Consols dropped still more. “Rothschild knows,” the whisper rippled through the Change. “Waterloo is lost.” Nathan kept on selling, […] consols plummeted – until, a split second before it was too late, Nathan suddenly bought a giant parcel for a song. Moments afterwards the great news broke, to send consols soaring. We cannot guess the number of hopes and savings wiped out by this engineered panic.” The legend turned out not to be true, but it learns us a good lesson. Now there is a Brexit and markets are in panic, we expect Soros picks up the pieces for fire-sale prices.

Kazakhstan: the next victim of chaos and global games

The time of Kazakhstan’s stability and prosperity is just passing away. And this conclusion does not come from recent protests and shootings in the city of Aktobe, but from the panicky reaction of President Nursultan Nazarbayev. According to the 75-year old declared Leader of the Nation and his officials, latest developments are a “color revolution” aiming at a “coup” made by “pseudo-religious extremists” financed by detained pro-Russian businessmen; the President voices this opinion despite the fact that previously he claimed it was the “fifth column” of undefined third (western) powers that attempted to interfere with Kazakhstan’s internal policy. Madness. As if it were not the sharp decline in oil revenues has nothing to do with that in a country which produces 1.7 million barrels per day.

Making things even worse, it is questionable if the Aktobe event was prepared by Wahhabis or other Islam terrorists. Religious extremists usually do not attack gun shops and military units, but prefer bombings and random mass killings. Moreover, they usually wear beards, whereas most of Aktobe assailants were clean-shaven. Radio Liberty attributes the responsibility for the attack to the “Army for the Liberation of Kazakhstan,” which, according to officials and some other experts, does not even exist. The level of misinformation is enormous. Continue reading →

After the Brexit Referendum, a Fiscal Union Will be Brussels’ Surprise

The process of drawing up a joint EU budget has just commenced: it is the first step to a fiscal union. The idea of having a joint budget has long been pushed forward by the proponents of a more tight integration, just as it has been opposed by the European population at large. The term budgetary or fiscal capacity should be properly understood: it is a joint budget for the eurozone that will be governed by a real treasury in Brussels. To create a collective treasury, Europe’s social and economical model has to be brought in line. For this, Brussels wants all minimum wages to be equal. Martin Schulz, the President of the European Parliament, announced drastic reforms after the Brexit referendum. Following 23 June the aforementioned process of integration will gain momentum and it is likely to encounter upheavals because there is widespread aversion to federalization. Continue reading →

Poland Prepares to Import Own Gas From the North Sea

Polish President Andrzej Duda has visited Norway to attend the Polish-Norwegian Economic Forum in Oslo. As a result, the political approval for gas supply to Poland from Norway has been made. Also Denmark has offered its support for the construction of the Baltic Pipe (a gas link that would connect Poland and Norwegian gas fields through the Danish infrastructure as part of the route). The state-run Polish gas company PGNiG bought in 2014 shares in four fields on the Norwegian Continental Shelf. The gas supply from Norway as well as the LNG supplies to the Świnoujście terminal are part of Poland’s plan to reduce its reliance on gas supplies from Russia. The Baltic Pipe would also secure gas supply to Poland, Ukraine, Slovakia and the Baltic states or even Finland.
Continue reading →

French Manufacturing PMI Resembles that of Greece Rather than Germany

The monthly €80 billion ECB’s quantitative easing, harmful internal reforms and high public deficit have not helped the French manufacturing sector which has contracted for the third straight month in May, even if the reading was insignificantly higher than expected. The Markit Eurozone Manufacturing PMI posted a three-month low in May. The euro area has stuck in stagnation and France has joined Greece as a main concern.

Mario Draghi’s policy did not prevent the widening of the economic gap between Germany and France. PMI data shows that both the imbalance between the two countries and Germany’s power within the monetary block have increased. From the latest PMI data one can conclude that the cheap euro improves German economy while it cannot prevent France from falling further behind. While Germany’s ruling elite are voicing a vehement opposition to the ECB’s policies, it is absolutely clear that the Paris Establishment are not amused by the result. Continue reading →

Belarus: between international recognition and a Maidan scenario

Belarus the last pariah of Europe? Its leader, referred to as dictator, shunned by polite society? Its image tarnished in the media? No longer so. Alexander Lukashenko’s fortress has been laid siege to, has been bombarded and… emerged victorious. With flying colors. Minsk has hosted talks on Ukraine’s future, the sanctions have been lifted, and President Lukashenko has been readmitted both to the lay (Rome) and spiritual (the Vatican) European salons. Continue reading →