October 29, 2003

So Sophisticated

Some are more equal than others in the EU:

The economic fundamentals that underpin the eurozone looked shaky last night after the European commission warned that its two biggest economies - Germany and France - are on course to flout EU budget deficit limits for four years running.

Looks like a lot of little European countries are going to get another opportunity to keep their mouths shut.

Mr Solbes noted that three countries have broken the rules of the EU's stability and growth pact in the past (Germany, France and Portugal) and warned that the Netherlands, Italy and Greece were looking like they would follow suit.

I think now might be a good time to short the euro (1.167 today).

He said the UK, which is outside the eurozone, was also at risk. The commission estimated that the UK deficit would swell to 2.8% this year from 1.5% in 2002. Although the commission could not fine the UK if it broke the 3% limit it might rebuke it for sloppy handling of public finances.

Ya gotta love the EU approach of, "do as we say, not as we do," when it comes to managing a countries finances. Are these people really going to try and put an army together? At least the UK has some excuse for running a deficit as they are actively fighting a war, but planning for that vote on jettisoning the pound for the euro has got to be getting tougher for Tony Blair right now.

Posted by Charles Austin at October 29, 2003 10:39 PM