Joined: 03 Jun 2005
|Posted: Fri Oct 28, 2011 3:19 pm Post subject: MORE CRAP FROM THE EU AND WE WANT OUT NOW
|The EU referendum can wait no longer in the face of this terrifying economic crisis
By Daily Mail Comment
Last updated at 11:20 AM on 28th October 2011
For the 14th time in just over 18 months Europe’s leaders emerged from a grandiose summit yesterday, and proclaimed a great victory in the battle to save the euro.
Unfortunately – as on so many previous occasions – their proposed solution to this terrifying economic crisis raises more questions than it answers.
On the surface, President Sarkozy’s description of the rescue plan as ‘credible and ambitious’ seems plausible.
An injection of more than £500billion into the bailout fund and a £100billion scheme to shore up Europe¿s tottering banks may still not be enough to save the Euro
An injection of more than £500billion into the bailout fund, a £100billion scheme to shore up Europe’s tottering banks, and an agreement that creditors will accept a 50 per cent write-down on Greek debt could provide some temporary respite for the beleaguered currency.
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But where is this mountain of new money coming from?
The European Central Bank will not stump up, none of the eurozone nations has so far pledged to contribute more to the bailout fund, and private holders of Greek bonds are already resisting taking such an enormous loss.
Even the £100billion recapitalisation of the banks, a relatively modest slice of the total needed, is fraught with difficulty. It is envisaged that existing bank shareholders will provide most of the money by buying more stock to protect their investments.
More from Daily Mail Comment... Who has the vision to repair the euro? 26/10/11 Why there MUST be a referendum 25/10/11 MAIL COMMENT: This was a shabby night for British democracy 24/10/11 MAIL COMMENT: Crisis offers an ideal chance for EU reform 23/10/11 MAIL COMMENT: What’s wrong with an open debate on EU? 21/10/11 MAIL COMMENT: Brutal end for tyrant who exported terror 20/10/11 MAIL COMMENT: The facts behind the Dale Farm hysteria 19/10/11 MAIL COMMENT: Inflation means rethinking benefits 18/10/11 VIEW FULL ARCHIVE But given the precarious position of some of these institutions, isn’t there a real chance many will fear they might be throwing good money after bad?
To plug the anticipated hole in the bailout fund, Mr Sarkozy and his partners are pursuing two other revenue streams. Both have worrying implications.
The first is to take the begging bowl to China and plead for a handout. The Chinese already hold untold billions – probably hundreds of billions – in euros and eurozone sovereign debt, so they might be willing to invest more to save the currency from collapse.
China has a colossal cash surplus and is rapidly buying assets in the West. If it became guarantor to the euro, its economic expansion could go into overdrive, with European companies struggling to compete and the EU unable to intervene on their behalf.
To plug the anticipated hole in the bailout fund, Mr Sarkozy and his partners are pursuing two other revenue streams. Both have worrying implications
The second option is scarcely less worrying. If they can’t raise enough capital to swell the bailout fund to the required 1trillion euros, Mr Sarkozy said it would be raised by ‘leveraging’.
In plain English, this means the eurozone would seek to pay off its debts by borrowing even more money.
Wasn’t this exactly the type of madhouse economics that created the debt crisis?
Enlarge Even more significant than the financial package announced at the summit, was the confirmation that the eurozone nations are moving towards fiscal union, with more integrated tax, spending and budgetary policies.
The Mail has grave doubts that any union which tries to unite such diverse economies as Greece and Germany is sustainable. But the implication is clear. The 17 eurozone countries want to take control of the EU, reducing the status of the ten other member countries.
In the face of such fundamental changes, Chancellor George Osborne vowed yesterday to ‘rebalance’ Britain’s relationship with Europe.
For this pledge to be more than the empty rhetoric we suspect it is, he must immediately persuade the Prime Minister to hold a referendum asking one simple question – should Britain use this opportunity to reclaim powers from Brussels, yes or no.
We believe the country would answer with a resounding yes, giving Mr Cameron the moral and political authority to go to Brussels and simply demand a new deal.
For Britain’s return to prosperity and growth, nothing could be more urgent
Any referendum need only ask the In/Out question - the resounding answer to that would be "Out"! Once out of the EU nightmare we would regain control of our own destiny, be free to trade with whoever we want and negotiate a new trade agreement with the EU - on OUR terms.