Election provides more questions than answers
Just as the EU were basking in the glow of political stability following the elections in The Netherlands and France, the German election has brought the return of concerns over Nationalism.
The “rise of the right” has brought concern not just to Germany, where there have been protests and demonstrations but across the entire region as elections in Italy, due to be held by next May, are also facing a disruptive influence as the main opposition parties each favour the issue of a parallel currency which will be used for domestic payments only. The idea is gaining traction much to the chagrin of Brussels and Frankfurt.
Before Italy votes, Angela Merkel who won a fourth term in office but little else to be pleased about must cobble together the Jamaica coalition with the Greens and pro-business FDP.
The ECB has been steadfast that it is the economic and political stability demonstrated by the individual members of the bloc that will determine future monetary policy decisions.
The common currency reacted in a muted fashion to the German result and it is unlikely to be able to make further headway despite the problems facing the U.S. as the Fed appears to want to be far more proactive than the ECB, having launched itself onto a tightening bias.
Brexit becomes a matter of politics
When he launched the referendum into Britain’s membership of the EU (which seems a lifetime ago) then Prime Minister David Cameron was clear that he expected MP’s to campaign with their consciences rather than political allegiances. That sentiment had been tenuous in the post-referendum debates as an essentially remain Prime Minister grappled with creating a Brexit strategy.
The most recent vote in the House of Commons drew a three-line whip and the entire process became politicized.
The Party Conference season is upon us and Labour have been meeting this week. The main opposition party have managed to avoid a damaging debate on Brexit as the national executive managed to find the required eight topics to vote upon leaving Brexit ninth. This was clearly a tactical decision since Jeremy Corbyn faced either being put on the spot or losing a vote to change Labour Party policy to have a remain manifesto.
The ruling Conservative party meet this weekend and Theresa May will be under pressure to unite the Party behind her “vision for Europe”. It is however Boris Johnson’s “Blueprint for Brexit” that is giving most concern and it seems a matter of time rather than conjecture as to when a leadership challenge will come,
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Kim and Trump now inextricably linked
When Donald Trump mused over his legacy as President while dropping off to sleep during his successful campaign it is doubtful in the extreme whether Kim Jong-un featured anywhere near the top. He will have considered proving global warming to be nonsense, a reconciliation with Russia and stronger ties with China or even an economic miracle at home but a war of words with no winner with Kim? Not likely.
Xi Jinping, China’s President, is orchestrating his “Puppet in Pyongyang” perfectly keeping Trump nicely both off balance and occupied. If he can keep this up for Trump’s entire Presidency then his work will be done.
So far as Trumps first year as President comes to an end, his achievements have been meagre in the extreme. His approval rating is the lowest ever for a President in his first year but it is incredible to think that around 39% of Americans think he is doing a decent job. His economic record is non-existent since he has not even proposed a stimulus package. The destruction of Paris Accord on Global Warming was a foreign policy disaster and still Kim Jong-un manages to “tweak his tail” at will.
He has managed to weaken the dollar but that is clearly more by luck than judgement.
