The election of France’s first Socialist President in nearly two decades has been completely overshadowed by the election of nobody in Greece. The failure of the Greek vote to form a government has left a chasm of uncertainty in its wake. Since then investors have been treating the Euro with about as much confidence as a blind man feels when trying to navigate the Spaghetti Junction. With a plenitude of possible options but an ineptitude in terms of guidance, both the blind man and the single currency are finding it hard to cope under these testing conditions.
Political leaders engage in conversations about: growth; stability; and commitments, whilst civilians discuss: empty rhetoric; corruption; and hypocrisy. Talk of Greece existing as a state with any resemblance to the developed world, in its hypothetical post-apocalypse – post-default – days is treated with supreme condescendence. Perpetrators of such talk are thrown to the river to sink or swim, without the luxury of the ducking-stool.
David Cameron, George Osborne, and Mervyn King stand in tandem popping out of a small wooden box with a cuckoo painted on its roof. They exclaim that they have been made cuckold by the Eurozone; its ‘irresponsible’ leaders, and their ‘self-defeating’ policies. As they pump money into the banking system in volumes that seem unreal the price to send a letter or snack on a pasty rises in time to a ticking time bomb.
If a Greek exit were to be looked at through the delicate prism of a nail-bomb, the volatile Mediterranean states of Portugal, Italy and Spain would be the primary victims, suffering crippling-to-mortal wounds of contagion, bankruptcy, and abandonment. Whereas Deutschland and the Great British Isles would be passers-by; maybe a splintering bullet would graze the German economy’s knee or some dust from the rubble could muddy the UK financial market’s view temporarily, but ultimately we will muck on through.
The USA, befitted with its impermeable cloak of independence would be comparatively unscathed. However, rich psychopaths in Wall Street will be unable to see into the future through the frenzy of confusion and President Obama may be ejected from office as global stocks decline and trade balances retreat.
In the forex markets this year Sterling reached 1.63 against the US Dollar, but quicker than you can turn around touch the floor and shout ‘premature appreciation’, the Pound had given up its gains and is now slumping towards 1.56.
It could be worse, we could be the answer to all of Europe’s needs… a single currency. The Euro has fallen from 1.33 to 1.25 against the US Dollar in less time than it takes Usain Bolt to get to the supermarket to stock up on chicken nuggets.