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Nothing. He won’t. It will be continued, managed decline until he leaves office at the end of this parliament
Appears that some people on here disagree. Either way, most people seem to agree that the status quo is unsustainable but there is no consensus on what to do about it.
I don;t know about Brexit's costs looking trivial, but if the Eurozone goes belly up, presumably, we'd catch a lot of economic crap from that too.
Re Brexit though, I wonder if the Germans in particular wish they'd done more to keep us on side? They could do with another payee country if nothing else. We'd also have been a useful moderating voice politically, given how so much of Europe looks like it's heading far-right. Hey ho - they dug their heals in as was their right.
We wouldn’t be involved in any bailout as we sat outside the Eurozone.
Also there’s a lot of catastrphising about the end of Europe, driven by those on the far left and far right who want it to happen. But France isn’t going to break the Eurozone or EU, in fact the average Eurozone debt to gdp is far lower, sustainable, and some economies even run at a fiscal surplus.
France is paying for its own incompetence and incompetent politicians. They’ll agree a bailout deal with spending covenants (to save Macron), riot a bit more, and then suck it up. The alternative is they default on some of their debt, crash out of the Euro, and descend into utter chaos and poverty. The idea that the rest of Europe who’ve been far more prudently run suddenly see France crash and burn and think ‘I want some of that’ is hilarious.
We wouldn’t be involved in any bailout as we sat outside the Eurozone.
Also there’s a lot of catastrphising about the end of Europe, driven by those on the far left and far right who want it to happen. But France isn’t going to break the Eurozone or EU, in fact the average Eurozone debt to gdp is far lower, sustainable, and some economies even run at a fiscal surplus.
France is paying for its own incompetence and incompetent politicians. They’ll agree a bailout deal with spending covenants (to save Macron), riot a bit more, and then suck it up. The alternative is they default on some of their debt, crash out of the Euro, and descend into utter chaos and poverty. The idea that the rest of Europe who’ve been far more prudently run suddenly see France crash and burn and think ‘I want some of that’ is hilarious.
Macron doesn’t need saving. He has 6 months to go. This is about what comes next. It will be Le Pen or Mélonchon, both of whom are strongly opposed to EU inference.
The EU can’t afford a bailout and the terms on the French will be very hard to set. This isn’t Greece.
The weighted average of debt to GDP is entirely skewed by Germany
The only other major economy is Italy, on a similar trajectory.
Macron doesn’t need saving. He has 6 months to go. This is about what comes next. It will be Le Pen or Mélonchon, both of whom are strongly opposed to EU inference.
The EU can’t afford a bailout and the terms on the French will be very hard to set. This isn’t Greece.
The weighted average of debt to GDP is entirely skewed by Germany
The only other major economy is Italy, on a similar trajectory.
Of course they can, the ECB would only need to buy any bonds which France were unable to IMMINENTLY service to keep them solvent - there’s no suggestion from the Central Bank in France of a risk of total default. It would of course come with stringent rules around spending cuts.
The Greek bailout deal also involved the IMF which could also be the case here if the ECB didn’t step in to at least some extent (which wouldn’t happen). In the case of Greece their debt was far more severe, and also included hidden liabilities.
The Eurozone is huge now, even the small to medium economies are large enough that with France and Italy, the Eurozone most recently recorded a fiscal surplus. Exactly the kind of OTT outlook I was referring to!
It's a well used moniker on the right. Coined by Stephen Barrett I think.
Fair point, but there’s a difference between managing a city council and running a G7 nation. Obviously, a speech from Number 10 isn't going to magically stop a riot in Paris. But when our closest neighbor and second-largest economic partner is facing a massive fiscal and security collapse, the silence from our Prime Minister is telling.
He is actively trying to tie our long-term economic and regulatory destiny back to the EU. If he wants us closer to Europe, he needs to have the backbone to address the reality of what is actually happening over there, rather than hiding behind micro-policies like parking fines to look busy.
Hiding?! Or just getting stuff done that our country needs, in our country?
You seem a little desperate to apportion blame to Burnham. I'd put money on if he were talking about the French riots you'd be saying "Why is he getting involved in the Frech riots when there's stuff at home to be fixed?!"
Hiding?! Or just getting stuff done that our country needs, in our country?
You seem a little desperate to apportion blame to Burnham. I'd put money on if he were talking about the French riots you'd be saying "Why is he getting involved in the Frech riots when there's stuff at home to be fixed?!"
Agreed. I’ll probably keep criticising him until he’s gone.
You’d do the same with Kemi. It’s almost like politics is tribal….
We wouldn’t be involved in any bailout as we sat outside the Eurozone.
Also there’s a lot of catastrphising about the end of Europe, driven by those on the far left and far right who want it to happen. But France isn’t going to break the Eurozone or EU, in fact the average Eurozone debt to gdp is far lower, sustainable, and some economies even run at a fiscal surplus.
France is paying for its own incompetence and incompetent politicians. They’ll agree a bailout deal with spending covenants (to save Macron), riot a bit more, and then suck it up. The alternative is they default on some of their debt, crash out of the Euro, and descend into utter chaos and poverty. The idea that the rest of Europe who’ve been far more prudently run suddenly see France crash and burn and think ‘I want some of that’ is hilarious.
"We wouldn’t be involved in any bailout as we sat outside the Eurozone."
Oops! Apologies!
Has anyone ever looked at their own postings for last day or so? Oh my... so sorry. Was Ullaa
Agreed. I’ll probably keep criticising him until he’s gone.
You’d do the same with Kemi. It’s almost like politics is tribal….
Well I'm glad you admit it at least!
A little unfair to say what I'd do. I'm quite happy to criticise the Tories when they deserve it, not sure I've ever tried quite this hard though!
Don't think you were on here at the time, but I got dogs abuse on for suggesting Boris Johnson might be a good PM (based on him being known for getting other people to do the actual work).
A little unfair to say what I'd do. I'm quite happy to criticise the Tories when they deserve it, not sure I've ever tried quite this hard though!
Don't think you were on here at the time, but I got dogs abuse on for suggesting Boris Johnson might be a good PM (based on him being known for getting other people to do the actual work).
Having an objective debate about how good/bad each PM has been will always be difficult.
Of course they can, the ECB would only need to buy any bonds which France were unable to IMMINENTLY service to keep them solvent - there’s no suggestion from the Central Bank in France of a risk of total default. It would of course come with stringent rules around spending cuts.
The Greek bailout deal also involved the IMF which could also be the case here if the ECB didn’t step in to at least some extent (which wouldn’t happen). In the case of Greece their debt was far more severe, and also included hidden liabilities.
The Eurozone is huge now, even the small to medium economies are large enough that with France and Italy, the Eurozone most recently recorded a fiscal surplus. Exactly the kind of OTT outlook I was referring to!
The Eurozone hasn't posted a fiscal surplus. (must admit I had to look that up).
France is around 12 times bigger than Greece economically and Greece didn't totally default either, but yes the crisis was terrible.
France, Germany and Italy make up about 2/3rds of the bloc.
The Eurozone hasn't posted a fiscal surplus. (must admit I had to look that up).
France is around 12 times bigger than Greece economically and Greece didn't totally default either, but yes the crisis was terrible.
France, Germany and Italy make up about 2/3rds of the bloc.
Sorry typo - current account surplus, the area has typically run a trade surplus which helps with liquidity.
You said the ECB couldn’t bail France out, that’s not even what they have said, so you’d have to show some evidence. All they said is they won’t assist unconditionally, it’s certainly less than ideal but not the catastrophe to Europe some are making it out to be.
The French issue is less about its ability to service current debt but rising borrowing costs, ie becoming prohibitively expensive. That’s a different issue to what happened to Greece, which suddenly lost access to markets through revealing concealed debt - triggering a liquidity crisis.
A long read, but here are some of the possible ECB route to interventions:-
“What Tools Does the ECB Have?
Analysts say that while the ECB has tools to counter disorderly markets that obstruct monetary policy, supporting individual governments whose fiscal choices have undermined investor confidence is harder to justify.
The ECB is unlikely to step in at this point. But if spreads continue to widen and the pressure spreads further, its language could start to change. Mitch Reznick, head of cross-border credit at Federated Hermes. Jörg Krämer, chief economist at Commerzbank, outlines four possible stages in the ECB’s response, moving from softer rate guidance to bond purchases if market conditions deteriorate.
Step 1: Strike a Less-Restrictive Tone Krämer sees recent comments from ECB President Christine Lagarde as signalling less urgency to raise interest rates further in the near term. Lagarde told European lawmakers that sharply rising bond yields would dampen economic growth and limit the pass-through of higher energy costs to consumers. Higher borrowing costs weaken demand, making it harder for businesses to pass rising energy bills on to customers through higher prices. By dampening expectations for further rate hikes, such comments could ease pressure on government bonds without committing the central bank to intervention, Krämer says.
Step 2: Step Up Verbal Intervention and Stress Readiness to Deploy TPI If selling of French debt continues to intensify, the ECB could go further by explicitly signalling its readiness to deploy instruments such as the Transmission Protection Instrument. The TPI was introduced in 2022. It allows the ECB to buy bonds in secondary markets when unwarranted, disorderly movements threaten the transmission of monetary policy across the eurozone. Purchases would focus on public-sector securities with remaining maturities of one to ten years, with no predetermined size limit.
Step 3: Restart PEPP Reinvestments If verbal intervention proved insufficient, the next step could be to pause the reduction of the ECB’s bond holdings and resume reinvestments under its pandemic emergency purchase program PEPP, says Krämer. Launched in March 2020 to stabilize markets and support the economy during the covid crisis, the program is now being wound down as bonds mature without the proceeds being reinvested. This gradual reduction of the ECB’s bond holdings is known as quantitative tightening. Krämer argues that renewed purchases could focus on French government bonds, using PEPP’s flexibility to depart temporarily from the allocation based on national central banks’ capital shares. Reinvestments ended in December 2024, so restarting them would require a new policy decision. Carsten Brzeski, global head of macro for ING Research, also sees halting quantitative tightening and resuming reinvestments as an option before activating TPI: “The ECB could first stop QT and reinvest maturing bonds at its discretion (read: all into France).”
Step 4: Activating TPI The ECB assesses fiscal compliance, debt sustainability and economic policies when considering TPI. France is subject to an EU procedure for breaching fiscal deficit rules, but this does not automatically rule out TPI support, Krämer says. He nevertheless expects the ECB to reserve TPI as a last resort, rather than use it pre-emptively to shelter France from market pressure. “After all, the ECB is unlikely to want to relieve French policymakers—who are ultimately responsible for the fiscal problems—of pressure too early.” “But at face value, widening spreads without clear fiscal consolidation efforts will not trigger TPI,” says ING’s Brzeski. He sees contagion as a stronger argument for intervention than widening French spreads alone. “A more convincing case for TPI would be spread widening that shows contagion across several eurozone countries.”
One of the greatest political interviewers of his time. And he never lets his own political leanings influence his grillings. Hence the reason Johnson ran away from him.
Regarding the French riots, what a shame that the far left, Islamists and antisemites have hijacked what were genuine grievances.
This clip sums it up perfectly.
A bit like the anti-poll tax demonstrations. in Britain in March 1990. Many people had a genuine grievance, but the demonstration turned into senseless mass vandalism.
Sorry typo - current account surplus, the area has typically run a trade surplus which helps with liquidity.
You said the ECB couldn’t bail France out, that’s not even what they have said, so you’d have to show some evidence. All they said is they won’t assist unconditionally, it’s certainly less than ideal but not the catastrophe to Europe some are making it out to be.
The French issue is less about its ability to service current debt but rising borrowing costs, ie becoming prohibitively expensive. That’s a different issue to what happened to Greece, which suddenly lost access to markets through revealing concealed debt - triggering a liquidity crisis.
A long read, but here are some of the possible ECB route to interventions:-
“What Tools Does the ECB Have?
Analysts say that while the ECB has tools to counter disorderly markets that obstruct monetary policy, supporting individual governments whose fiscal choices have undermined investor confidence is harder to justify.
The ECB is unlikely to step in at this point. But if spreads continue to widen and the pressure spreads further, its language could start to change. Mitch Reznick, head of cross-border credit at Federated Hermes. Jörg Krämer, chief economist at Commerzbank, outlines four possible stages in the ECB’s response, moving from softer rate guidance to bond purchases if market conditions deteriorate.
Step 1: Strike a Less-Restrictive Tone Krämer sees recent comments from ECB President Christine Lagarde as signalling less urgency to raise interest rates further in the near term. Lagarde told European lawmakers that sharply rising bond yields would dampen economic growth and limit the pass-through of higher energy costs to consumers. Higher borrowing costs weaken demand, making it harder for businesses to pass rising energy bills on to customers through higher prices. By dampening expectations for further rate hikes, such comments could ease pressure on government bonds without committing the central bank to intervention, Krämer says.
Step 2: Step Up Verbal Intervention and Stress Readiness to Deploy TPI If selling of French debt continues to intensify, the ECB could go further by explicitly signalling its readiness to deploy instruments such as the Transmission Protection Instrument. The TPI was introduced in 2022. It allows the ECB to buy bonds in secondary markets when unwarranted, disorderly movements threaten the transmission of monetary policy across the eurozone. Purchases would focus on public-sector securities with remaining maturities of one to ten years, with no predetermined size limit.
Step 3: Restart PEPP Reinvestments If verbal intervention proved insufficient, the next step could be to pause the reduction of the ECB’s bond holdings and resume reinvestments under its pandemic emergency purchase program PEPP, says Krämer. Launched in March 2020 to stabilize markets and support the economy during the covid crisis, the program is now being wound down as bonds mature without the proceeds being reinvested. This gradual reduction of the ECB’s bond holdings is known as quantitative tightening. Krämer argues that renewed purchases could focus on French government bonds, using PEPP’s flexibility to depart temporarily from the allocation based on national central banks’ capital shares. Reinvestments ended in December 2024, so restarting them would require a new policy decision. Carsten Brzeski, global head of macro for ING Research, also sees halting quantitative tightening and resuming reinvestments as an option before activating TPI: “The ECB could first stop QT and reinvest maturing bonds at its discretion (read: all into France).”
Step 4: Activating TPI The ECB assesses fiscal compliance, debt sustainability and economic policies when considering TPI. France is subject to an EU procedure for breaching fiscal deficit rules, but this does not automatically rule out TPI support, Krämer says. He nevertheless expects the ECB to reserve TPI as a last resort, rather than use it pre-emptively to shelter France from market pressure. “After all, the ECB is unlikely to want to relieve French policymakers—who are ultimately responsible for the fiscal problems—of pressure too early.” “But at face value, widening spreads without clear fiscal consolidation efforts will not trigger TPI,” says ING’s Brzeski. He sees contagion as a stronger argument for intervention than widening French spreads alone. “A more convincing case for TPI would be spread widening that shows contagion across several eurozone countries.”
Thanks for posting, interesting reading through.
You are dead right that the ECB won’t be bailing out, more intervening in the money markets to manage the cost of borrowing.
The political gridlock in France is a huge issue though. This is the blocker to the resolution I was describing. Macron doesn’t have the support and L’assemble national are there to thwart him anyway.
1. I was in Paris on the night that its mayor, Jacque Chirac, became President in 1995. I therefore followed the election more than I might otherwise have done, and came to the conclusion that there was little difference in policy terms between the two parties in relation to things like public spending and the role of the state.
2. The French tendency to protest, sometimes violently, seems to me to make it difficult to make unpopular decisions.
3. The political impasse in the Parliament makes it difficult at present to agree a budget and has led to the pause of the proposed increase in the pension age from 62 to 64.
4. Macron is much more popular outside France than inside, and was probably foolish to hold Parliamentary elections a couple of years ago.
Having an objective debate about how good/bad each PM has been will always be difficult.
Not sure Boris was that bad.
The Boris Johnson that wanted Covid to “rip through the population”
There were more than 43,000 recorded deaths involving Covid in care homes between March 2020 and July 2022.
"Today's report is a devastating account of one of the darkest episodes in our country's history. "It shows that the government knew the care sector was extremely vulnerable to a pandemic and yet did nothing. Failing to act until it was too late."
Official records reveal Boris Johnson took four days off in February 2020, a critical period before the UK's Covid-19 lockdown, contradicting his sworn testimony to the inquiry.
During this time, described as a "lost month" for pandemic preparation, Johnson reportedly engaged in personal activities at Chevening, rather than official government business.
The Covid inquiry's report concluded that Johnson's delay in implementing lockdown measures resulted in an estimated 23,000 additional deaths.
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