EU madness is no longer a laughing matter

Trichet….very small gap between ears

Irish bailout grows, cost to members grows, resistance to Brussels grows

This is the latest statement (made earlier this month) by European Central Bank boss Jean-Claude-Trichet on the subject of the euro:

‘There is no crisis of the euro as a currency. The currency has delivered price stability over the last 12 years with average inflation, as you know, of 1.97%. The credibility of the currency, namely that it will continue over the next ten years to keep its value and to deliver price stability in line with the definition of less than but close to two per cent, is remarkable. This is the solid anchoring of inflation expectations that I have already mentioned. We have a solid central bank and a solid Governing Council. We consider ourselves to be an anchor of confidence in the euro area.’

Crisis, what crisis?

What Trichet refused to do three times during the press conference concerned was comment on the likely outcome of an election where the victor Fianna Gael says it will renegotiate the ERM/IMF bailout terms. All he would say is that there is a plan, and things are going according to plan.

Well, they aren’t. New stats released by the ECB show its lending to Irish banks went back up to levels seen at the height of the bailout crisis in the latest December period.

What happened was this: corporate and personal bank withdrawals totalled 1.2 billion euros, so the ECB (NOT the IMF) had to pile in with 1.9 billion. The IMF has lent Ireland lots of money, and the ECB is pumping in what the population takes out. Trust me, this was not the plan.

And now, of course, the puppets bludgeoned by Brussels into a deal are nothing but a rump; Fianna Gael is indeed in power, and something of  bad mood.

We would all heed Trichet’s remonstrations about ‘getting real’ if (a) he did so himself (b) Berlin lost the illusion that this is 1940 all over again and (c) The Eurocrats would stop passing idiotic laws to stifle economic growth.

Only last year they screwed up Ireland’s Guinness exports with new rules that were beyond parody. Now for the EU as a whole, they are to make it illegal to assess insurance premiums and pension payouts on the basis of a policyholder’s sex. Experts are conservatively estimating this will make car insurance much more costly for young women, and cut retirement annuities for men by around 8%.

We are watching an anarchy in which mad pc and even madder banking denial is about to collide with events both inside and outside Ireland. We should all wish the Irish good luck – but expect none on a broader future-front.