Angela Merkel

Standard & Poor’s Warns on Germany as Anti-Euro Political Party Soars in Popularity

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Screen Shot 2014-09-25 at 3.44.03 PMThe German political party known as the AfD, or “Alternative for Germany,” first came to my attention a year ago. Upon reading about it, I became so interested in this new party (it has only been around since early 2013) that I composed a post titled: Anti-Euro Party in Germany Makes Significant Headway into Parliamentary Elections. Here’s an excerpt:

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It’s Official – German Gold is Staying in New York at The Federal Reserve

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*Update: A couple of people have made a stink about this post claiming that it is misleading because the prior agreed upon repatriation schedule has not actually changed. That said, anyone who reads the Bloomberg piece will quickly conclude that the article clearly implies something had changed, which is why I made this assumption. In fact, the source article was so misleading that Peter Boehringer, co-founder of “Repatriate Our Gold,” posted the following in the comment section:

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What Mr. Boehringer makes clear, is that there is nothing “new” in the Bloomberg article. That of course is not to say that the repatriation schedule as it stands is not preposterous. It is, and he agrees with that wholeheartedly. So the reason for this update is clarify this one key misunderstanding. That doesn’t change many of the key points of the post. Those are:

1) The interesting observation that German officials and politicians continue to put so much faith in the Federal Reserve just as “End the Fed” protests spread through the nation.

2) The ridiculous notion that it is in any nation’s interest to liquidate gold for Central Banker created fiat, which can be conjured into existence in infinite amounts, at zero costs in no time.

3) That the politics on the ground of the ruling party seem to be shifting against repatriating the gold (that is clearly Bloomberg News’ take).

With that out of the way, below is the original post, unchanged, because as I said, the main points are still completely relevant:
 

Screen Shot 2014-06-23 at 10.54.04 AMJust last week, I published a post titled, Video of the Day – “End the Fed” Rallies are Exploding Throughout Germany, which subsequently went viral. Interestingly, only a few days later we find out that Germany’s very own criminal political class has decided it will continue to store the nation’s gold in New York rather than bring it back home as had been the intention. It’s quite ironic that just as protests against the fascist Federal Reserve are spreading throughout the land, the political class officially decides to keep Germany’s treasure across the Atlantic, in care of none other than The Fed itself.

To be fair, this merely seems like a way for Angela Merkel and the rest of her German cronies to save face. After all, it was very clear that the Federal Reserve had already told them “no” when they asked for the gold back in the first place. Why else would it take almost a decade to transport the gold from the U.S. to Germany, which was the latest repatriation schedule. We learn from Bloomberg that:

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Anti-Euro Party in Germany Makes Significant Headway into Parliamentary Elections

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I haven’t been paying all that much attention to Germany as of late considering the incredible amount of scandals that have been emanating from the Obama administration, in addition to its ridiculous and dangerous attempts to catalyze World War III. However, with parliamentary elections set for September 22, it appears there are some interesting things afoot.

In case you haven’t heard of it, a new party was formed in Germany on February 6, 2013. The party is known as the AfD, or the “Alternative for Germany.” It is strongly anti-Euro and has gained surprising strength in the polls despite its very brief history.

On a related note, reading this article made me think of a comment made by Angela Merkel the other day when she said:

This is my approach and you can say that I’m doing all these things because I’m really a European at heart.

I found this odd, because while I do not live on the continent, I have spent some time there and in all my travels I never once met a European. I’m wondering, does this species actually exist outside of the catering halls of Brussels? Where do they live?

Now for more on the Afd from Business Week:

German parliamentary elections are coming up on Sept. 22, and Chancellor Angela Merkel has a problem on her hands. A euro-skeptical political party known as AfD is rising in the polls and could deny her Christian Democratic Union and its coalition partners the majority they need to continue governing.

AfD, or Alternative for Germany, currently holds no seats in the Bundestag, and until recently it barely registered in public-opinion polls. But a survey released on Sept. 4 by the Forsa polling group showed it with 4 per cent support—just shy of the 5 per cent needed to win Bundestag representation. Peter Matuschek, Forsa’s chief political analyst, says the poll may have underestimated the party’s strength. Many supporters, he told Spiegel, “are too embarrassed to admit that they are planning to vote for the AfD,” which wants Greece, Spain, and other crisis-hit countries to leave the euro zone, and possibly break up the existing monetary union itself.

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German Backlash to NSA Spying Begins: “National Security is at Stake”

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You’d think that in a country in which a great deal of the population is young enough to remember the East German secret police colloquially known as the Stasi, there would be considerable backlash to the Anglo-American global spy grid. Well it appears that there is.  I want to highlight a scathing critique published a couple of days ago in Der Spiegel, one of the most popular weekly magazines in Europe, with a circulation of more than one million.  In it, Jakob Augstein wrote an article titled: Anglo-Saxon Spies: German National Security Is at Stake.  Here are my favorite excerpts:

American and British intelligence agencies are monitoring all communication data. And what does our chancellor do? She says: “The Internet is uncharted territory for us all.”

That’s not enough. In the coming weeks, the German government needs to show that it is bound to its citizens and not to an intelligence-industrial complex that abuses our entire lives as some kind of data mine. Justice Minister Sabine Leutheusser-Schnarrenberger hit the right note when she said she was shocked by this “Hollywood-style nightmare.”

It may be up to the Americans and the British to decide how they handle questions of freedom and the protection of their citizens from government intrusion. But they have no right to subject the citizens of other countries to their control. The shoulder-shrugging explanation by Washington and London that they have operated within the law is absurd. They are not our laws. We didn’t make them. We shouldn’t be subject to them.

The totalitarianism of the security mindset protects itself with a sentence: If you have nothing to hide, you have nothing to fear. But firstly, that contains a presumption: We have not asked the NSA and GCHQ to “protect” us. And secondly, the sentence is a stupid one: Because we all have something to hide, whether it pertains to our private lives or to our business secrets.

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Inaugural Thought of the Day – The Farce

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The Farce
A couple of months ago one of my closest friends in the business spontaneously described the financial markets as “The Farce.”  I took to it immediately and from that day on pretty much every morning our first conversation over Bloomberg begins with “so how’s the farce today?”

Long time readers know that I am under no illusions that the markets were ever “free” in our investment lifetimes.  Let’s be real.  A small group of 12 Central Planners determine the most important price signal in the economy, ie interest rates.  They admittedly use this tool to manipulate behavior and markets.  So in some ways the financial markets as long as we have had fiat money and the Federal Reserve has always been a farce in the near-term.

That said, the prior farce is very distinct from the current farce.  At least in those days interest rates would manipulate behavior but beyond that basic macro backdrop the Central Planners allowed markets to generally do whatever they wanted until in their infinite wisdom they decided to pull the plug.  Ever since the banksters blew up the world in 2008, our Central Planners clearly made a decision that a new playbook was needed.  They needed to manage markets much more aggressively in order to “save the system” and restore confidence to the ponzi scheme that is the global financial system.  This increased manipulation was obvious to anyone paying attention in the markets, but investment managers were so terrified they justified it and largely continue to do so.

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