The Guardian reports today:

European markets hit by politics

European stock markets fell sharply in early trading as the prospect of the US government shutting down and the Italian coalition collapsing this week sends shivers through trading floors.

Making it sound as though something terrible has happened! The Markets, with a Capital M, hit by politics??? What is the world coming to?

Yet isn’t it about time politics started hitting back at markets? For the past thirty years at least, through deregulation, graft, “the best politicians money can buy” and a demented  headlong rush into a thoroughly dogmatic worship of markets, politics have been abolished. One need go no further than the EU to see this in practice.

So instead of shaking at the thought that markets have been hit by politics, perhaps we should start rejoicing.

Can we hope that this may signify the return of some sense to the politics and economics of the 21st Century?

After being bashed over the head for years over how imperative deregulation is for the proper functioning of the Economy, how imperative it is we leave everything up to the market that knows best, after the idiocy of the supposed “trickle down effect” of supply side economics, we have at last heard the hint of some reason coming back.

Ed Milliband said he would freeze energy prices, whereupon out come the guns of the terror squad the neoliberal aficionados employ, not unlike neo nazi hit squads, and start screaming No! That is impossible! It would be a disaster! It would lead to energy black outs! The country will be plunged into darkness if any kind of regulation returns! We must be free to hike up prices whenever we chose  to keep our profits rising to keep share holders happy! There Is No Alternative! As shrill and piercing in our ears as ever.

Milliband comes back and states the obvious, what no party leader has dared even mutter over the last thirty years. Certainly not Tony Blair who turned citizens into consumers when it came to schooling and health care. Milliband just came out and said, “the King has no clothes.” He said this is the same kind of terrorisation we heard from the banks, the same scare mongering tactics to preserve high profits at the expense of citizens. It is not acceptable and we need to bring back regulation.

Hear hear! The whole financial sector is in dire need of REregulation, so are the huge energy monopolies and most other big businesses for that matter. Regulated capitalism worked very well, and the whole thing started breaking down with the hysterical, dogmatic deregulation mania of the zealots.

The gap between rich and poor has grown out of all proportion, the middle classes are being wiped out, the standard of living for the 99% of citizens has plummeted. So just what has all this deregulation achieved? Well just that. It has accumulated wealth into very few hands at the expense of civilization as a whole.

However, if the energy industry continues to threaten black outs if they are not allowed to hike up prices on citizens whose income is steadily and surely decreasing, I would say they themselves are providing the perfect argument foe Nationalisation!

There! I’ve dared say it!

The Frau’s Great Victory is due entirely to her own image and nothing else. The election campaign was squarely centred around her and her alone. A lot of silly comments in the international press about her remarkable achievement in that she is the only leader in Europe not to have been ousted during the crisis. In all other Eurozone elections so far all the incumbents have been ceremoniously ousted by a kick in the rear from their electorates.

But the Great Mutti not only held onto power but increased her share of the vote spectacularly! Well, yes… But why is this considered such a great achievement? If anything it was to be expected. All the other ousted leaders were following the policies She imposed on them. But then the citizens (or vassals) of the other Euro states do not vote in German Elections. On the other hand, The Frau not only has not imposed any debilitating stringent austerity programmess on her own electorate, but has designed a policy which benefits Germany alone. If only for the short term.

In other words the southern states are being forced into penury to keep the Euro going so that German exports remain competitive. Furthermore Germany has imposed a nice little earner in that all these bail out funds, though not bailing out any of the recipients, are generating billions in inflows to Germany from interest. While, at the same time causing the debt of the debt stricken states to balloon. So what was the object of the exercise? To benefit Germany! Alone, you dumbkopf!

Well, after the election results that is quite obvious. Merkel has very successfully imposed a policy of Heads I win Tails you lose on the rest of Europe. So for God’s sake stop expressing surprise on how well she did compared to other incumbents! There is no comparison.

Now the composition of the Bundestag. Well, since Germany does have a fair proportional representation electoral system, the seating result is interesting. In the triumph of her will The Frau is about 5 seats short of an overall majority. Since the ignoble Free Democrats were booted out (at least!) and since the Alternative for Germany party just didn’t get into the Bundestag for a few thousand votes it appears, the Bundestag is made up as follows: Merkel (and it IS Merkel and not the CDU judging by the winning campaign) is 5 seats short and the opposition parties are in the majority. The Opposition Parties are the SPD, the Greens and De Linke.

All three parties in opposition are supposedly from left leaning to left wing parties. In any other democracy, since they have a majority in votes and seats, they should be the ones to form a governing coalition. However this is not going to happen. Firstly because of all the hype over Merkel’s triumph, second, perhaps above all, because the SPD, Social Democratic party is just another of these misnomers like Tony Blair’s version of a “Labour” party, or Papandreou’s so called “socialist” or even Francois Hollande’s lukewarm version of “socialism.”

Nevertheless, the SPD does not seem too keen. NOT mind you because it objects to Merkel’s policies, since they did vote in every one of the Greek “bail out” packages with all the catastrophic conditions attached, but because last time around the Grand Coalition with Merkel cost them a large percentage of votes. This time around Merkel’s coalition partners were decimated, so simple cynical political survival politics warn against participating in such a coalition.

So what could happen? Well a coalition of the left, the only sensible and democratic solution is out, because the Germans do not want to rock the boat of The Frau’s triumph. Next, of course the Grand Coalition with the SPD, or even a small coalition with the Greens. It appears, however, that the Greens have ruled this out. And it is reported that the SPD is split over whether to go ahead with the coalition, for the above stated reasons.

So a good solution could be a minority CDU government (in any case the SPD just about always votes with Merkel on most things), or else there could be defections from the SPD or even a formal split of the SPD. The most likely outcome appears at this stage to be the Grand Coalition, because somehow the Germans, despite the way they actually voted, are polled as wanting this solution. Ingrained conservatism after all? Lack of imagination? A false sense of security?

It makes you wonder why Marx had always believed the Revolution would start in Germany!

There have been some rather shallow articles trying to explain why Greece today is not like the Weimar Republic. One even had the audacity or ignorance to say that the difference was that Greece has the democratic EZ supporting it, because otherwise it would have collapsed.

This preposterous statement fails to realise that Greece would be neither over indebted nor so uncompetitive if it had never entered the Euro. Furthermore it choses to ignore the fact that the very stringent austerity imposed by Europe together with a German ban on any funds to help growth is what have ruined Greece, not saved it from catastrophe.

A blogger in the Guardian reminded us of a very perceptive article on the BBC by Paul Mason dating 11 months ago.

He says and I quote: “Faced with a recession, [Heinrich] Bruning followed a policy of austerity, while keeping Germany’s currency pegged to the Gold Standard (much as Greece has follows a policy of austerity dictated by euro membership). This made the recession worse.”

The situation today is even worse than it was when the article was written. But I think the main aspect of it is truer than ever. He described the “hopeless inertia” we have succumbed to, how people have stopped protesting and reacting and withdrawn into themelves, into drug and drink and the purely personal, and quotes from Kurt Weill’s Opera, the Silver Lake:

“You escape from the horror,” Fennimore sings; “that may destroy all we know. Yet the germ of creation will struggle to grow.”

“All this can be a beginning

“And though time turns our day back to night

“Yet the hours of dark will lead onwards

To the dawning of glorious light.”

And this is what expresses the mood in Greece today. Not fight as Mason says, but flight. Flight either abroad, for those younger, or into the personal, substances or even, perhaps above all, flights of fancy. One day we will be reborn again. Perhaps…

At least the Marx brothers were funny. This lot just make you cry and cry and cry.

But “Marx Brothers” is the closest they will ever get to even the remotest understanding of Economics.

But perhaps I am being too harsh. They do have a sense of humour. Both of them maintain that they have done an excellent job! (And they can actually pull off these gags of theirs about a success story and having saved Europe with a straight face!)

The Economist published a ridiculous article on Frau Merkel, very much endorsing her to win the German Chancellorship for a third time. It starts off by saying how much they have criticised her for her policies and in so many ways that she had done a very poor job, with which the Economist objected. BUT!

BUT they say, what if instead of the Frau there were to be a left wing coalition, including de Linke!!! Quiver, quiver, shake shake! Such horror! No! We can’t have that so we must have this miserable, bigoted, small minded failure yet again, or else? What will the world come to?

It is a miserable article ending with the hope that The Frau will wish to be remembered as “a decider and not a ditherer”, clean forgetting that she is a proven ditherer and unlikely to change now, especially if she has won a third time on her record of dithering and fudging and kicking the can down the road.

But even more destructive austerity, inhuman Merkel is better than, oh my God! Dare I even say it! A mildly pink coalition, far removed from anything remotely resembling red!

What the Economist fails to appreciate, however, is that all these Merkel shenanigans masquerading as ‘policy’ are precisely what has pushed Europe so much nearer the edge of some kind of red revolution. Even a pink one. So if the Economist is really so terrified of a Red Revolution in Europe, it should be rooting for a mildly pink coalition in Germany that would put an end to this idiotic, catastrophic, economically disastrous policy, pushing people to the brink of revolution, that the Merkel Chancellorship has imposed on Europe.

But that, I suppose, would be too imaginative for them. Never mind. I would like to dedicate the following ditty to them and all those who think like the Economist. (I am sure Walter Bagehot is turning in his grave).

The word “reform” like the word “flexibility” has been reduced to a euphemism that means “stick it to the workers, stick it to them hard. Make sure they are underpaid, underfed, with no rights and absolutely no security or healthcare or welfare or any thing else ‘wet’ like that!”

However before we are all pushed kicking and screaming into this neoliberal dream (nightmare rather) of Utopia, lets consider this dirty little word, reform.

Indeed, the world is in great need of reforms. But like charity, reform should begin at home. At home being the seats of power and the institutions they exploit.

First of all the IMF. It has turned into Frankenstein’s monster and does not even remotely resemble what it had originally been designed for. Wherever it has gone it has spread catastrophe, pain, disaster and ruined economies and people’s lives. If it can’t be restored to health and sense then it should be completely scrapped. Now a lot of taxpayers’ money would be saved there, now wouldn’t it?

Then the UN, particularly the Security Council. In case you hadn’t noticed ladies and gentlemen wielding power, it has become completely irrelevant, a waste of time and good money, and has in any case already been scrapped de facto by the powers that be.

As for NATO… well what was it originally designed for? The west’s protection against the Communist threat fro Eastern Europe. The only threat from Eastern Europe currently terrorising the European continent is Frau Angela Merkel. And the rest of Europe can do very well without her overbearing arrogant “fixes” designed exclusively to keep kicking the can down the road to preserve herself in power.

That is where reform should start. And if or perhaps when it does (in one way or another) everything else will fall into place.

Remember, the US Founding Fathers knew what they were talking about when they said “Government for the people, by the people, of the people”, remember that one? Perhaps we should. And as soon as possible, otherwise people tend to react in ways these overbearing elites find rather unpleasant.

With anything from Guillotines to firing squads or even the more recent more humane helicopter rescues from government building roofs. Somehow, if real reform is not taken seriously, I fear the humane manner of dealing with these criminals will not be resorted to this time around.

Everyone is very up beat about how the Eurozone economy is out of recession (0.3% growth… hmmm), how things have stabilised and the yields on Euro sovereign debt have fallen and remained low (solely owing to Draghi’s as yet untested OMT) and above all that the Cassandra’s prophecying exits from the Euro (Grexit above all) and even worse a collapse of the Euro have been proved wrong!

They always forget, however, that the thing about the hapless Cassandra was that she always got it right but was never believed till the disaster actually did strike. So watch it when it comes to premature triumphalism.

The Greek disaster is being tarted up and covered with make up and rouge on the cheeks to conceal the fact that this lady is in fact already dead. But that may stop after the German elections. It would be inhuman not to stop, though the Eurogeeks are so terrified that the Euro will unravel if even a little country with hardly any GDP left exits, that they’ll do anything to present this corpse at least as a zombie.

They are also so arrogant as to keep stating that Greek debt is sustainable and will in fact be paid back to them. How? How can a country in chronic decline with unemployment levels expected to reach and exceed 30% if, or rather as, current policy remains in force? And more and more nonsense piles up as they cling to the illusion, the German led illusion, that everything will sort itself out if we stick to the rules!

No one even dares suggest that.. rules? what rules? That bunch of punitive counter productive measures concocted in a blind panic with the sole object of saving the banks of Germany and France from a Greek default? And how are they going to save their taxpayers now from a Greek default on the much greater debt level owed them now?

Simple! We shall merely keep lending them more and more so that they can keep paying us back, provided of course they continue sucking their own economy dry in order to … stick to the rules. All that will achieve is a greater bust when Greece can no longer keep up the pretence. After all, just how much tax can you garner from a moribund economy? Not to mention what happens when people no longer have anything to lose?

Still. There you go. That is the current Euro line everyone must stick to because so says Germany, or else!

Nigel Farage is often considered a bit of a clown by some (and a dangerous threat by others). Nevertheless today he spoke the simple truth by shouting out in the European Parliament at Strasbourg, on the occasion of Barroso’s Nonsense State of Europe speech, that the King really has no clothes. He said,

“The euro will die a very slow and painful death, but you’re all in denial about that.”

And that’s absolutely that.

At the G20 summit today, we are told:

‘The Chinese deputy finance minister, Zhu Guangyao, told a pre-G20 briefing: “Military action would have a negative impact on the global economy, especially on oil prices ? it will cause a hike in the oil price.”‘

It doesn’t matter that little children are being gassed to death, it doesn’t matter that this horrible civil war had been dragging on for so long with so many casualties. Quite regardless of the rights or wrongs of any kind of intervention. The issue is not the legality or otherwise of a military strike. The issue is not how far such a strike even if legal will have any effect of reining in the bloody violence and the carnage. The death of civilians or anything like that.

No!

There is one argument and one argument only. It would be bad for business!

This is the face of today’s world. Human suffering means nothing. Values no longer exist. All that matters is what the markets want and that nothing that is bad for business must ever be undertaken. No matter what.

The Duc de la Rochefoucaild once said that hypocrisy is the tribute which vice pays to virtue.

It is a sorry sign of the times then when vice no longer even feels the need for hypocrisy any more.

One of the reasons why my blog entries are dwindling is precisely because all recent economic data proves that the Eurocrisis is over. Overall the Eurozone has returned to growth and production figures as well as services figures are up just about everywhere. So the crisis is over, right? So we don’t need to keep grumbling and prophesying doom, right?

And then again perhaps not. How many times have we been told that this wretched crisis is over? Ah, but the figures haven’t been so good before, have they? But are the figures really good? Okay, some mild drop in unemployment, yes. Apart from Greece where it is rising, but the great end of the recession being trumpeted is due solely to German growth.

Southern Europe remains in the doldrums. Even the north is not doing so well. Look at The Netherlands. Greece will no doubt explode probably sooner rather than later, if not with a bang with a whimper. France, though appearing to pick up will never be competitive vis a vis Germany owing to the Euro and that holds for Italy and Spain too. So what more can we say without rehashing the same arguments the dogmatists now holding sway refuse to even consider?

Well we could say that the crisis is not over because this is not just another economic crisis. Greece in particular demonstrates that this is not a crisis but a complete and violent exercise in social engineering and a revolution (as in overturn) of social cohesion, values and the final nail in the coffin for its whole production base and very way of life.

How will this play out? What will come in the place of this catastrophe? Will Greece remain a debt colony as appears to be Germany’s choice, in that it wants to keep recycling Greek debt through more and more loans with more and more catastrophic conditions attached?

You see we have now got beyond the realm of economic analysis. We are now well in the realm of prophecy and omens. At the moment the omens for Greece are not good at all. We are in a complete impasse of failure while continuing to beat that wretched dead horse, and the Greek population does not react. It has been beaten to a pulp and is lying moribund in the gutter.

As Professor Varoufakis rightly points out, in an Economic Depression, the people become depressed too and therefore do not react. How long can this last? Will there even be a Greece at all at the end of the line? Another take is that people are just taking it like this because they feel that they can do nothing to change it. The attitude being, well what have we to gain by protest and so on, since we are powerless to change anything?

However, this ‘what have we to gain?’ may well change into “what have we got to lose?’ Nothing but our chains? You see, this is beyond economic analysis, beyond a crisis, this is part of a sea change in history. A landmark in the fortunes of mankind. And for all the talk that Greek recession and unemployment will last another twenty years, nobody has a clue what will happen. For better or for worse. Why twenty years and not ad infinitum, for instance?

So next time you read a forecast, either by the IMF or Central Banks or Labour Organisations or whoever, just take it with a pinch of salt. Nobody knows and nobody has a clue. Just as nobody (at least not one of the Very Serious People as Krugman calls them) saw the great sub prime crash coming either. Nobody had a clue. And that holds true now. It is, after all, a continuing process.

So brace yourselves.