Baltic Dry Index. 1150 -23
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
In central banking as in diplomacy,
style, conservative tailoring, and an easy association with the affluent count
greatly and results far much less.
J.
K. Galbraith.
More on Vote-Day Minus One, (or Vengeance-Day as it’s
known north of the border,) in tiny
Scotland later, first today’s “good” news. China’s PBOC is rumoured to have
blinked again and is adding liquidity over the next 3 months. Rumoured because
it hasn’t been officially announced, just leaked to Sina.com, much as the Fed
now routinely leaks news to its on message favourite hack at the Wall Street
Journal.
PBOC Said to Add Liquidity With $81 Billion Injection
Sep 17, 2014 4:54 AM GMT
China is
injecting 500 billion yuan ($81 billion) into the
nation’s largest banks, according to a government official familiar with the
matter, signaling the deepest concern yet with the country’s economic slowdown.
The People’s Bank of China will funnel 100 billion yuan each to the five biggest banks for a three-month period, said the official, who asked not to be identified because the measure hasn’t been formally announced.
The credit expansion builds on targeted measures to shore up growth while stopping short of broad-based monetary and fiscal stimulus that increases dangers from bad loans. China joins the European Central Bank in adding liquidity, while the U.S. prepares to scale back stimulus.
“It shows China’s monetary policy is leaning toward easing, and the easing stance may last throughout next year,” said Hua Changchun, a China economist at Nomura Holdings Inc. in Hong Kong. The lack of an official announcement shows that the PBOC “doesn’t want to send a strong signal” of policy easing, Hua said.
The Sina.com website earlier reported the injection and the PBOC didn’t respond to faxed questions.
More
The bad news is that
heading off next quarter’s Property Trust debt defaults is probably
as much of
the reason as stimulating the Chinese economy.
Property Trusts Pull Support as Mounting Debt Due: China Credit
Sep 17, 2014 4:21 AM GMT
Property trusts are funneling the least amount of money into Chinese
developers in almost five years as maturing debt balloons, escalating default
concerns. Issuance of trusts for real-estate projects, which target wealthy individuals, slid to 30 billion yuan ($4.9 billion) this quarter from 67.8 billion yuan in the three months to June 30, the least since the start of 2010, data from research firm Use Trust show. Borrowing costs are rising as developers face $9.1 billion in bonds and loans maturing by year-end. Hubei Fuxin Science & Technology Co. sold AA rated securities with a 9.2 percent coupon Aug. 26, above the 6.38 percent average yield for similar-rated notes.
Cash from operations are also facing a squeeze as home sales fell 10.9 percent in the first eight months of the year in the world’s second-largest economy, which is forecast by the government to expand at the slowest pace in 24 years. Standard & Poor’s sees a risk that a developer may default in the coming 12 months, highlighting weak earnings at Renhe Commercial Holdings Co. and Glorious Property Holdings Ltd.
“Given the bad housing sales, fewer trust companies are willing to help property companies raise money,” said Li Ning, a bond analyst in Shanghai at Haitong Securities Co., the nation’s second-biggest brokerage. “Default risks are rising rapidly before so much debt is due next quarter.”
More
In the not so good news category, as in what could
possibly go wrong, PIMCO cashes in US Treasuries to go all in in the casino of
leveraged derivatives betting, on emerging and distressed Club Med debt. With
Scotland one day away from voting the UK as we know/knew it up or down, and
with it Club Med and much of continental future stability, PIMCO has picked an “interesting
time” to gear up at 10 to one to up to 100 to one, to use that long past, once famous British understatement. Derivatives
betting is a zero sum game. Assuming no counter party default, where it becomes
a lose-lose game, in a zero sum game there’s a loser for every winner. It’s
very much a game of hero or zero gambling.
At a miserly 10 to one leverage, PIMCO has just made a
450 billion dollar bet. Scotland better vote no and by a wide margin, while
China better start buying Brazilian iron ore like a drunken sailor, at current
to higher prices. The talking chair Fed
needs to collapse the dollar to save Brazil’s debt.
There can be few
fields of human endeavour in which history counts for so little as in the world
of finance. Past experience, to the extent that it is part of memory at all, is
dismissed as the primitive refuge of those who do not have the insight to
appreciate the incredible wonders of the present.
J. K. Galbraith.
Bill Gross Used $45 Billion Derivatives to Lift Fund Gain
Sep 17,
2014 5:00 AM GMT
Bill Gross
is relying on derivatives rather than Janet
Yellen to raise his returns on government bonds. The co-founder of Pacific Investment Management Co. sold most of the $48 billion of U.S. Treasuries held by his $221.6 billion Pimco Total Return Fund (PTTRX) in the second quarter, replacing them with about $45 billion of futures, according to an August filing. The contracts require small up-front payments, freeing up money for Gross to invest in higher-yielding securities including Brazilian, Spanish and Italian debt.
“They are taking the cash and buying all these peripheral bonds that have a lot of spread on them relative to Treasuries,” said Erik Schiller, a Newark, New Jersey-based senior money manager at Prudential Fixed Income, referring to bonds issued by European countries other than France and Germany. “It is levering their fund.”
Pimco in May said that interest rates in the U.S. will remain lower than they had been before the financial crisis, as the economy enters a “new neutral” characterized by global growth converging toward lower, more stable speeds. The Newport Beach, California-based firm is recommending that clients consider strategies implemented with futures, options and swaps to lift subpar returns.
Agnes Crane, a spokeswoman for Newport Beach, California-based Pimco, had no immediate comment on the fund changes.
More
In the acrimonious war between heroic, but always a
victim Bonnie Scotland, and dastardly, if always a winner England, in the latest
poll dastardly England is four percentage points ahead, with one final day to
play. Sadly a 52 to 48 percent win settles very little, a new Flodden Field it
aint, the English have already bribed Scotland with Independence Lite, and the
Barnet Formula subsidy forever. Europe and the world’s wealth envy nationalists
everywhere, will view such a close outcome as an independence TKO, and be
greatly encouraged. In an upset, Belgium, France, Italy, Spain, parts of
eastern Europe, Quebec, and the Ukraine, among others, all come into long term
play. Who needs violent Bolshevik revolution and war, if Independence or
Independence Lite is available by other means. Pounds or Euros anyone?
“No one
believes more firmly than Comrade Salmond that all Scots are equal. He would be
only too happy to let you make your decisions for yourselves after independence.
But sometimes you might make the wrong decisions, comrades, and then where
should we be?
Comrade Chairman
Salmond.
Scottish independence: Ed Miliband forced to abandon walkabout in Edinburgh
Labour leader cuts short chaotic visit to shopping centre where he is heckled by Yes supporters
Ed Miliband claimed the
independence debate had an “ugly side” as he was forced to cut short a chaotic
walkabout in the centre of Edinburgh.
The Labour leader’s visit to the
St James Shopping Centre in the Scottish capital quickly descended into farce
as he was surrounded by the media and rival Yes and No supporters.
He struggled to make himself
heard, or to find voters to talk to as he was followed by hundreds of journalists,
members of the public and nationalist hecklers shouting “liar” and “master of
the universe” at him.
Mr Miliband also
made an ill-judged stop in front of a hair salon called Supercuts, which
prompted a cry of: “Supercuts, that’s what you get from the Westminster
government.
His first bid to speak to an
undecided voter was equally unsuccessful when the surprised young man said he
was “only visiting Scotland”, while another told him he was backing
independence.
Labour had attempted to keep the
visit quiet but the crowd forced Mr Miliband to cut the visit short after less
than five minutes in the centre.
More
Betfair pays out early on Scottish independence 'No' vote
Online bookie hands those who have backed loss for Alex Salmond on Thursday a 'multi-million' pound pay-out.
Betfair is so confident of a
"No" vote in Thursday's Scottish independence referendum that it is
already paying out to those who have staked money on it.
The online bookmaker says it is
paying out a "six-figure sum".
Despite polls ahead of the vote
continuing to be close, betting markets have been overwhelmingly in favour of
the Better Together camp winning on Thursday.
Betfair said this morning that
gambling patterns indicate a 79pc likelihood of a "No" vote.
Despite the odds on
"Yes" shortening last week, they have rebounded significantly in the
last few days
Financial markets have appeared to mirror betting patterns in recent days, with both suggesting that the chances of a "Yes" vote are far slimmer than polls suggest.
Betfair's pay-out applies to its
sportsbook operation, not the online exchange in which punters bet against each
other.
Odds on a "Yes" vote
have drifted from 4 (or 3/1) at the end of last week to 4.5 (or 7/2) on the
exchange.
This would mean a £100 bet would return £450 if Scotland votes for independence. Backing "No" would return £127.
http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/leisure/11098848/Betfair-pays-out-early-on-Scottish-independence-No-vote.html
But below, the English finally stir in revolt. Can Westminster’s Three Stooges actually deliver the hapless English into Independence Lite?
“How
can you govern a country which has 246 varieties of Scotch, and tastes all of
them before noon?”
David
Cameron, with apologies to Charles de Gaulle.
The English want Scotland to remain part of the Union. But not at any price
Dan Hodges Politics Last updated: September 16th, 2014And finally, the bribe. If the emotional appeals and thinly-veiled threats don’t work, then the time has come to cross their palms with silver.
This morning’s Scottish Daily Record splashes on the “No” campaign’s final throw of the dice. Under the headline “The Vow”, David Cameron, Nick Clegg and Ed Miliband all pledge to honour the “principles and values” underpinned by 300 centuries of union if the people of Scotland reject independence on Thursday. And, just to be on the safe side, they have underwritten that commitment with a blank cheque from the people of England.
According to the three leaders – who appear to be following another edict issued by the recently self-appointed president of the United States of Britain, Gordon Brown – the Barnett formula, which allocates tax revenues across the UK, is to be retained in perpetuity.
The Barnett formula – like the West Lothian question – is one of those quirky constitutional anomalies that exists for the sole reason that no one really knows that they exist. Established in the 1970s, it regulates how the centralised tax take of the government should be apportioned to Scotland, Wales and Northern Ireland, relative to public spending in England
Now, if you or I were setting up
a system such as this, we would, I suspect, do so on the basis of equity. Each
person in each region getting the same per-capita level of expenditure. Or
perhaps by some more progressive means of calculating social need.
Instead, Joel Barnett thought to
himself: “Bugger that. The English account for 85 per cent of the Union, the
Scotts 10 per cent. What’s 10 divided by 85 as a percentage? 11.76. That’ll do.
They can have that.”
And so, over the last 50 years
the people of Scotland – amid regular complaints about the raw deal they’ve
been getting from Westminster – have actually been in receipt of ever greater
financial support than their cousins in the rest of the Union. And we know this
because as the independence vote has neared, our government has been shouting
it from the rooftops.
In November the Treasury
published figures that showed the gap between public spending in Scotland and
England had widened to 20 per cent – in Scotland’s favour. The average Scot now
receives £1,623 more in state spending than their English neighbours. £10,152
was spent per head on public services in Scotland in the 2012/13 financial
year, compared to £8,529 in England. “These figures demonstrate that the people
of Scotland continue to see a real financial benefit of over £1,300 per person
compared to the UK average”, boasted Danny Alexander, chief secretary to the
treasury.
----In 2007 the Scottish Parliament established the Calman Commission to review the success of Scottish devolution, and recommend possible future changes. One of the things they looked at was the potential for additional devolved tax-raising powers, and their implications for Barnett.
It concluded that the people of
Scotland should be able to vary their income tax rates by 10p in the pound, as
is currently being proposed by President Brown and his junior ministers
Cameron, Clegg and Miliband. But it also said that this would have to be done
in conjunction with a commensurate cut in the block grant provided via the
Barnett Formula. Calman then went on to conclude that the current way of
calculating Barnett was itself no longer fit for purpose, and said, “in our
view need is the only basis on which grant funding can be properly justified,
and it should be need for the common welfare services that comprise the social
union”.
Let’s remind ourselves who came
to that conclusion. It wasn’t St-George’s-cross-waving Little Englanders. It
was the Scottish Parliament’s own commission on its own ongoing process of
devolution.
But now Calman has hastily been
consigned to the dustbin. Scotland is going to have its cake and eat it. And
then it’s going to have England’s cake and eat that as well.
According to this morning’s
“Vow”, the Scots are to be given their tax-raising powers. On top of that they
will continue to receive 20 per cent more funding than their neighbours in
England. The Barnett Formula will be locked in stone. Or rather, it will be
locked in by a totally outdated 1970s population census. And the idea of
allocating the resources of the Union on the basis of need will be permanently
ditched.
And why? Because, as we’ve seen during the corporate insanity of the last week, the people of Scotland cannot be trusted to vote the right way. Actually, no one can be trusted. That’s why decisions involving the future of every man, woman and child on this island are instead being unilaterally taken by Gordon Brown, rubber stamped by the leaders of the three main parties, and then presented to the voters as a fait accompli.
Well I’m sorry, that just isn’t
going to stand. It’s very nice of our politicians to vow to the people of
Scotland that people in England will help them pay for improvements in their
health services. It’s nice of them to give a commitment that we will happily
continue to hand over our extra 20 per cent to Scotland, even after the Scots
vote for what has been described as “home rule”. But it isn’t their money for
the politicians to bargain away. And if they want to make a vow with my money,
they need to ask me first.
Morehttp://blogs.telegraph.co.uk/news/danhodges/100286555/the-english-want-scotland-to-remain-part-of-the-union-but-not-at-any-price/
My funding formula for Scotland is a 'terrible mistake', Lord Barnett admits
Lord Barnett says his formula, which gives Scotland higher levels of funding has become a 'national embarrassment', should be scrapped
The architect of a controversial
funding formula for Scotland has described his own policy as a "terrible
mistake" after David Cameron pledged to keep it despite a revolt from Tory
MPs.
The leaders of all three main
political parties have pledged to continue using the formula, which sees
Scotland receive £1,623 per head more than the rest of the UK, if Scotland
votes to stay in the Union.
However Tory MPs warned the move
could be voted down in the Commons, where Mr Cameron faces a potential
"bloodbath" at the hands of his own party.
Lord Barnett, the former Labour
minister who devised the formula, said that the pledge to continue using it was
a "terrible mistake".
More
http://www.telegraph.co.uk/news/uknews/scottish-independence/11100400/My-funding-formula-for-Scotland-is-a-terrible-mistake-Lord-Barnett-admits.html
We end for the day with the return of the Icelandic problem. A portent for Independent Bonnie Scotland 2024? And the bribe of Independence Lite in the Ukraine. As goes Scotland so goes the (civilised) world? Say it aint so!
Icelandic Retirement Savings Threatened as Bubble Risk Grows
Sep 16, 2014 12:34 PM GMT
Iceland’s 2.7 trillion kronur ($22.7 billion) of pensions are under threat
by capital controls
that risk generating bubbles in both equity and bond markets, the second-largest manager of
retirement money said. “We’re seriously concerned” that controls on the krona, imposed in 2008 to prevent a flight of capital, are risking Iceland’s entire pensions system, Asta Rut Jonasdottir, chairman of the Pension Fund of Commerce, said in an interview in Reykjavik on Sept. 11. “We’re worried about bubble formation and the work related to the removal needs to be done swiftly. We’ve waited much, much too long.”
Iceland imposed restrictions on its currency after the crash of its three largest banks plunged the nation into the worst recession since World War II. The controls are preventing pension funds from investing abroad and have led to a doubling of the main stock index and pushed the GAMMA index of Icelandic government bonds up almost 70 percent since the end of 2008.
“There’s a risk of a bubble, whether or not you’re a pension fund or something else, when you’re locked inside some sort of a system,” said Jonasdottir. “There’s a much, much greater risk of a bubble than if the system is open and free. Of course one is considerably worried about this and the limited investment opportunities.”
More
Ukraine Approves Special Status for East as Truce Strains
Sep 16, 2014 1:03 PM GMT
Ukraine’s parliament
approved a law giving special status to the country’s two easternmost regions
while a cease-fire, now in its 11th day, came under threat as some separatists
called for a resumption of fighting. The parliament in Kiev approved the special status bill and an amnesty law envisaged in the cease-fire agreement, Deputy Speaker Ruslan Koshulynskiy said by phone today. Under the measure, certain areas controlled by pro-Russian separatists will hold early local elections on Dec. 7, enjoy a special economic and investment regime and have the right to use Russian as a second official language.
The
situation in Donetsk remains “tense” after one civilian was killed today and
the city council reported intensive military operations in two of its
districts. The clashes are throwing the Sept. 5 cease-fire into further doubt.
The U.S. and other NATO allies began military exercises yesterday in Ukraine,
which says Russia has about 25,000 troops along the border and more than 3,000
soldiers inside the country. The government in Moscow denies involvement in the
conflict.
The
drills have “the potential to lead to a destabilization of the situation,” Dmitry Peskov, a spokesman
for Russian President Vladimir Putin, said in a
phone interview. “The truce is very fragile. It is just the start of the
settlement. Russia consistently continues to do all it can to help promote the
resolution of Ukraine’s internal crisis.”
----The
parliament also today ratified the European Union-Ukraine association accord,
which takes effect on Nov. 1, and should deepen ties between the conflict-torn
country and the 28-member bloc. President Petro Poroshenko said his nation has
“paid the highest price for its EU choice.” The measure was also ratified by
the European Parliament in Strasbourg, France today.
Implementation of the free-trade agreement was delayed until Dec. 2015, with Poroshenko saying it gives the country extra time to boost its competitiveness.
The adoption of the regional status and amnesty laws “doesn’t guarantee a peaceful resolution of the conflict but they give good prospects for the cease-fire’s extension,” Yuriy Yakymenko, the head of the political department at the Kiev-based Razumkov Center, said by phone today.
Ukrainian government bonds tumbled for a third day and the hryvnia slumped 7.5 percent to 14 per dollar, making it the worst performer today among all currencies tracked by Bloomberg. The ruble slid 0.4 percent to all-time low 38.5175 per dollar.
More
If
all else fails, immortality can always be assured by spectacular error.
J. K.
Galbraith.
At the Comex silver depositories Tuesday final figures were: Registered 63.72 Moz,
Eligible 119.31 Moz, Total 183.03 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
“All Scots are
equal, but some Scots are more equal than others.”
Chairman Salmond.
The Origins and Implications of the Scottish Referendum
The idea of Scottish independence has moved from the implausible to the very possible. Whether or not it actually happens, the idea that the union of England and Scotland, which has existed for more than 300 years, could be dissolved has enormous implications in its own right, and significant implications for Europe and even for global stability.The United Kingdom was the center of gravity of the international system from the end of the Napoleonic Wars until World War II. It crafted an imperial structure that shaped not only the international system but also the internal political order of countries as diverse as the United States and India. The United Kingdom devised and drove the Industrial Revolution. In many ways, this union was a pivot of world history. To realize it might be dissolved is startling and reveals important things about the direction of the world.
Scotland and England are historical enemies. Their sense of competing nationhoods stretches back centuries, and their occupation of the same island has caused them to fight many wars. Historically they have distrusted each other, and each has given the other good reason for the distrust. The national question was intertwined with dynastic struggles and attempts at union imposed either through conquest or dynastic intrigue. The British were deeply concerned that foreign powers, particularly France, would use Scotland as a base for attacking England. The Scots were afraid that the English desire to prevent this would result in the exploitation of Scotland by England, and perhaps the extinction of the Scottish nation.
The Union of 1707 was the result of acts of parliaments on both sides and led to the creation of the Parliament of Great Britain. England's motive was its old geopolitical fears. Scotland was driven more by financial problems it was unable to solve by itself. What was created was a united island, acting as a single nation. From an outsider's perspective, Scotland and England were charming variations on a single national theme -- the British -- and it was not necessary to consider them as two nations. If there was ever a national distinction that one would have expected to be extinguished in other than cultural terms, it was this one. Now we learn that it is intact. We need a deeper intellectual framework for understanding why Scottish nationalism has persisted.
----The doctrine of the right
to national self-determination drove the first wave of revolts against European
imperialism in the Western Hemisphere, creating republics in the Americas. The
second wave of colonial rising and European withdrawal occurred after World War
II. In some cases, nations became self-determining. In other cases,
nation-states simply were invented without corresponding to any nation and
actually dividing many. In other cases, there were nations, but republican
democracy was never instituted except by pretense. A French thinker, Francois
de La Rochefoucauld, said, "Hypocrisy is the tribute that vice pays to
virtue." Even while betraying its principles, the entire world could not
resist the compulsion to embrace the principles of national self-determination
through republican democracy. This effectively was codified as the global gold
standard of national morality in the charters of the League of Nations and then
the United Nations.
Europe in particular tore itself apart in wars between 1914 and 1945 over issues related to the rights of nation-states, with the idea of the nation-state being taken to its reductio ad absurdum -- by the Germans as a prime example. After the war, a principle emerged in Europe that the borders as they stood, however imperfect, were not to be challenged. The goal was to abolish one of the primary causes of war in Europe.
The doctrine was imperfectly applied. The collapse of the Soviet Union abolished one set of borders, turning internal frontiers into external borders. The Yugoslavian civil war turned into an international war once Yugoslavia ceased to exist, and into civil wars within nation-states such as Bosnia, Serbia and Croatia. At the same time, the borders in the Caucasus were redrawn when newly independent Armenia seized what had been part of Azerbaijan. And in an act that flew in the face of the principle, NATO countries divided Serbia into two parts: an Albanian part called Kosovo and the rest of Serbia.
The point of all this is to understand that the right to national self-determination comes from deep within European principles and that it has been pursued with an intensity and even viciousness that has torn Europe apart and redrawn its borders. One of the reasons that the European Union exists is to formally abolish these wars of national self-determination by attempting to create a framework that both protects and trivializes the nation-state.
Scotland's Case
The possibility of Scottish independence must be understood in this context. Nationalism, the remembrance and love of history and culture, is not a trivial thing. It has driven Europe and even the world for more than two centuries in ever-increasing waves. The upcoming Scottish election, whichever way it goes, demonstrates the enormous power of the desire for national self-determination. If it can corrode the British union, it can corrode anything.
----This is something that
must be considered carefully in a continent that is prone to extreme conflicts
and still full of borders that do not map to nations as they are understood
historically. Catalonia, whose capital is Barcelona, the second-largest and
most vibrant city in Spain, has a significant
independence movement. The Treaty of Trianon divided Hungary so that some
Hungarians live in Romania, while others live in Slovakia. Belgium consists of
French and Dutch groups (Walloons and Fleming), and it is not too extreme to
say they detest each other. The eastern half of Poland was seized by the Soviet
Union and is now part of Ukraine and Belarus. Many Chechens and Dagestanis want
to secede from Russia, as do Karelians, who see themselves as Finns. There is a
movement in northern Italy to separate its wealthy cities from the rest of
Italy. The war between Azerbaijan and Armenia is far from settled. Myriad other
examples
can be found in Europe alone.
----Scottish independence
would transform British history. All of the attempts at minimizing its
significance miss the point. It would mean that the British island would be
divided into two nation-states, and however warm the feelings now, they were
not warm in the past nor can we be sure that they will be warm in the future.
England will be vulnerable in ways that it hasn't been for three centuries. And
Scotland will have to determine its future. The tough part of national
self-determination is the need to make decisions and live with them.
----More important, perhaps, is that although Yugoslavia and the Soviet collapse were not seen as precedents for the rest of Europe, Scotland would be seen that way. No one can deny that Britain is an entity of singular importance. If that can melt away, what is certain? At a time when the European Union's economic crisis is intense, challenging European institutions and principles, the dissolution of the British union would legitimize national claims that have been buried for decades.
But then we have to remember that Scotland was buried in Britain for centuries and has resurrected itself. This raises the question of how confident any of us can be that national claims buried for only decades are settled. I have no idea how the Scottish will vote. What strikes me as overwhelmingly important is that the future of Britain is now on the table, and there is a serious possibility that it will cease to be in the way it was.
Nationalism has a tendency to move to its logical conclusion, so I put little stock in the moderate assurances of the Scottish nationalists. Nor do I find the arguments against secession based on tax receipts or banks' movements compelling. For centuries, nationalism has trumped economic issues. The model of economic man may be an ideal to some, but it is empirically false. People are interested in economic well-being, but not at the exclusion of all else. In this case, it does not clearly outweigh the right of the Scottish nation to national-self determination.
I think that however the vote goes, unless the nationalists are surprised by an overwhelming defeat, the genie is out of the bottle, and not merely in Britain. The referendum will re-legitimize questions that have caused much strife throughout the European continent for centuries, including the 31-year war of the 20th century that left 80 million dead.
Read
more: The Origins and Implications of the Scottish Referendum |
Stratfor
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Sir Humphrey: Minister, Britain has had the same foreign policy
objective for at least the last five hundred years: to create a disunited
Europe. In that cause we have fought with the Dutch against the Spanish with the Germans against the French, with the
French and Italians against the German, and with the French against the
Germans and Italians. Divide and rule, you see. Why should we change
now, when it's worked so well?
Hacker: That's all ancient history, surely?
Sir Humphrey: Yes, and current policy. We 'had' to break the
whole thing [the EEC]
up, so we had to get inside. We tried to break it up from the outside, but that
wouldn't work. Now that we're inside we can make a complete pig's breakfast of
the whole thing: set the Germans against the French, the French against the
Italians, the Italians against the Dutch. The Foreign Office is terribly
pleased; it's just like old times.
Hacker: But surely we're all committed to the European
ideal?
Sir Humphrey: [chuckles] Really, Minister.
Hacker: If not, why are we pushing for an increase in the
membership?
Sir Humphrey: Well, for the same reason. It's just like the United Nations, in fact;
the more members it has, the more arguments it can stir up, the more futile and
impotent it becomes.
Hacker: What about the Scots..
Sir Humphrey: Arrrgh! Don.t ever bring up the Scots, Minister!!!
With
apologies.
The monthly Coppock Indicators
finished Aug.
DJIA: +152 Down. NASDAQ: +312 Down. SP500: +231 Down.
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