READERAMA: Homing in on Boris’s badness, closing in on Co-Op silliness, bashing the eurozone’s banking disunion, deconstructing the dodgy trade data, and new cracks in the fracking front.

ScreenHunter_09 Apr. 10 08.40Welcome to a new Slog feature, wherein the democratisation of journalistic feedback is celebrated. There follow some of the thoughts, theories, rumours and dramas that have been floating into Slogger’s Roost over the last 48 hours.

 

First up, an email from Boris Johnson’s office:

ScreenHunter_08 Apr. 10 06.41Cutting to the chase here, we get two bollocks in a banded-pack offer for the price of one: ‘Ebbsfleet is outside London so the Mayor does not have a direct role in determining what would be appropriate forms of development for the area. I would however say that the Ebbsfleet area is defended to a high standard from flood risk from the sea/Thames Estuary’.

One wonders in this case why the Mayor threw his very considerable weight (and millions in taxpayers’ money) at the personal proposal for an airport which (if I recall correctly) was going to be in the Thames Estuary. And while Ebbsfleet does indeed have huge 50″ bore anti-flood guns to the West, they are I’m afraid pointing in the wrong direction: the threat to Robsone Waterworld is from the sea (slight) and fenland seepage (huge).

Monitoring the casual corruption of Mayor Johnson is a fulltime occupation, so I’m more than delighted to give a plug to anyone dedicated (and mad) enough to undertake this leviathan task. Long-time BoJo prodder Dave Davies has just launched the www.cappi.org.uk website to try and expose what he calls “some of the improper conduct ref air pollution , including Bozo and Yeo’s little scam (under transport tab)”. Yes indeed Dave, most of Bo’s dealings are under the table. And not always involving merely money: the flesh is equally weak.

Moving along from those who whistle loudly the better not to hear, a Coop whistleblower with his lughole pinned very close to the ground alleges that Euan Sutherland didn’t resign over the governance issues as he made out. He was having an affair with his head of HR. She joined the Co-op around a year ago, and then left with a £1m pay-off all of a sudden. It was said her relationship with Sutherland had broken down. We ask ourselves if the esteemed members of the Treasury Select Committee will ask him about the role of indoor sports in the latter stages of his career. But more of us would be pleased by them pointing out how, as a chap playing the role of Clean Skin, he managed to be an Independent Non-Exec for two years on the Co-op Group Board whilst alsobeing the, um, Chief Executive of Kingfisher. Which is not a very independent role at a close competitor. Details, details. Get on with it.

Oh alright. Len Wardle, you will all recall, was the man at the top of the steaming heap when the Group took on Somerfield (the value of which has been written down to zero) and then after some Cabinet Ministerial arm-twisting, the Black Hole formerly known as  Britannia building society. Those with still longer memories remember the heady days of the  Brighton Co-op, when it too had to be rescued from insolvency. The man in charge on that occasion was, er, one Leonard Wardle, later to reemerge as the purveyor of bountiful cheques to Shadow Chancellor Mr Teddy Testicles.
But we mustn’t be too parochial. Abroad – that wonderful place so despised by Left and Right for so many years – has in the end become the darling of both major British Parties….despite the fact that it now realises every thinking citizen’s worst nightmares conceived in that distant past. Brussels has been – since late March – basking in the deceptively cool Spring sunshine of its “successfully” managed banking union. But I now hear it is a success only in the sense of having been signed by all those concerned. Its chances of success as an institution are homoaeopathic.
First, not all euro members are created equal: Germany can well afford to bail out its banks…if what the banks say about themselves is true, ho-ho. Italy couldn’t afford to bale out a piss-pot, and Spain is that country still sitting on the kaka of the cajas. So it is a tad strange that Germany’s banks have managed to exclude almost all their assets from Banking Union assessment. A source (backed to the hilt by the reader in question) opines in this context that small countries will be singled out for ritual bashing, while the failures of larger founders like France will be printed away. One still strongly suspects that this was Hollande’s price for abandoning any semblance of mutuality between State and citizen in his country.
Second, huge numbers of smaller banks in the eurozone will remain unassessed. Once again – spookily – all the German Landesbanks lie outside the regime; but as a whole, just 130 banks are in the tent. This is not so much a Union, more a schism.
But we must not leave the EU, because if we do, aaaarrrg, thunderstorms of burning hail will devastate such UK landscape is left once Hanna’s mates get fracking. Having myself spotted yesterday that a tiny reduction in Britain’s trade deficit was due to nothing more than imports falling even faster than exports (an observation also noted in the FT) a reader better informed than me wrote ironically of “celebrating the IMF upgrade”, while pointing out that the industrial numbers coming out of the system bring us back to mid 2012 (a time when the Chancellor was still blaming our “poor”output on Labour) and some 15% below what we were doing in 2000 – when Moral Tone was in charge of The New Paradigm. The Slogger succinctly concludes, “The 1.4% increase in services exports just isn’t enough”. Correct: and it’s also the same old, same old: we still don’t make enough of things people Abroad want.
But let’s get back to fracking, because you see if only we could dig up all the bits of Britain not already tarmaced and and ticky-tackied, then the industry would benefit from all that cheap energy. In recent statements, the White House seems to be backing that idea….as indeed it would. Referring to the recent boom in unconventional US shale gas, Obama and Kerry have both stated the US could more than replace all Russian gas to the EU.
Not so, says another Slogger: it’s “an outright lie based on physical realities”.
At his Brussels meeting, Obama told EU leaders they should import shale gas from the US to replace Russian. There is a huge problem with that, it seems: as noted here months ago, the “dramatic rise” in US natural gas production from fracking is being dumped by the oil majors. Put simply, they can’t make money out of it.
Shell has just announced a huge reduction of its exposure to US shale gas development. It’s selling its leases on some 700,000 acres of shale gas lands in Texas, Pennsylvania, Colorado and Kansas. Those States, my friends, represent an area far bigger then the UK.

Over to you on that one, Dan. Let’s, maybe not, get fracking.

Yesterday at The Slog: The invisible robot armies of Ukraine’s Kharkov

(Stay tuned for an update on distraction from weapons in Ukraine).

EU rules on national bank resolution will not yet be in force, while the eurozone’s single resolution mechanism will be initiated only in 2015. So banks in northern Europe that are still backed by creditworthy governments would be treated differently than those in cash-strapped southern Europe: Germany can afford to bail out its banks; Italy cannot.

CommentsView/Create comment on this paragraphMore likely, the ECB will fudge the exercise, owing to fear of reigniting the financial crisis and pressure from national governments. Small countries will be singled out to make the exercise look tough, while bigger problems will be swept under the carpet: German banks have already succeeded in excluding many of their assets from the assessment.

CommentsView/Create comment on this paragraphOne argument for making the ECB the watchdog for eurozone banks was that it was less captured by the banks than national supervisors were. But its behavior throughout the crisis suggests otherwise. It has repeatedly prioritized the interests of banks in “core” countries and proved more pliable to political pressure from Berlin and Paris than from Madrid or Rome, let alone Dublin or Athens.

CommentsView/Create comment on this paragraphEven after the new banking union framework is fully in place, it will be full of holes. At Germany’s insistence, the ECB will supervise only the eurozone’s 130 or so biggest banks. That will leave the smaller Ländesbanks (state-owned regional banks), many of which made spectacularly bad lending decisions in the bubble years, and Sparkassen (smaller savings banks) in the hands of local politicians and Germany’s pliable financial supervisor.

CommentsView/Create comment on this paragraphThe argument that smaller lenders are not a systemic threat is spurious: consider Spain’s cajas. In any case, there will not be a level playing field.

Read more at http://www.project-syndicate.org/commentary/philippe-legrain-shows-how-far-the-new-framework-for-supervision-and-resolution-falls-short#w80Qp72lGIUlfedx.99

EU rules on national bank resolution will not yet be in force, while the eurozone’s single resolution mechanism will be initiated only in 2015. So banks in northern Europe that are still backed by creditworthy governments would be treated differently than those in cash-strapped southern Europe: Germany can afford to bail out its banks; Italy cannot.

CommentsView/Create comment on this paragraphMore likely, the ECB will fudge the exercise, owing to fear of reigniting the financial crisis and pressure from national governments. Small countries will be singled out to make the exercise look tough, while bigger problems will be swept under the carpet: German banks have already succeeded in excluding many of their assets from the assessment.

CommentsView/Create comment on this paragraphOne argument for making the ECB the watchdog for eurozone banks was that it was less captured by the banks than national supervisors were. But its behavior throughout the crisis suggests otherwise. It has repeatedly prioritized the interests of banks in “core” countries and proved more pliable to political pressure from Berlin and Paris than from Madrid or Rome, let alone Dublin or Athens.

CommentsView/Create comment on this paragraphEven after the new banking union framework is fully in place, it will be full of holes. At Germany’s insistence, the ECB will supervise only the eurozone’s 130 or so biggest banks. That will leave the smaller Ländesbanks (state-owned regional banks), many of which made spectacularly bad lending decisions in the bubble years, and Sparkassen (smaller savings banks) in the hands of local politicians and Germany’s pliable financial supervisor.

CommentsView/Create comment on this paragraphThe argument that smaller lenders are not a systemic threat is spurious: consider Spain’s cajas. In any case, there will not be a level playing field.

Read more at http://www.project-syndicate.org/commentary/philippe-legrain-shows-how-far-the-new-framework-for-supervision-and-resolution-falls-short#w80Qp72lGIUlfedx.99

View/Create comment on this paragraphBut EU rules on national bank resolution will not yet be in force, while the eurozone’s single resolution mechanism will be initiated only in 2015. So banks in northern Europe that are still backed by creditworthy governments would be treated differently than those in cash-strapped southern Europe: Germany can afford to bail out its banks; Italy cannot.

CommentsView/Create comment on this paragraphMore likely, the ECB will fudge the exercise, owing to fear of reigniting the financial crisis and pressure from national governments. Small countries will be singled out to make the exercise look tough, while bigger problems will be swept under the carpet: German banks have already succeeded in excluding many of their assets from the assessment.

CommentsView/Create comment on this paragraphOne argument for making the ECB the watchdog for eurozone banks was that it was less captured by the banks than national supervisors were. But its behavior throughout the crisis suggests otherwise. It has repeatedly prioritized the interests of banks in “core” countries and proved more pliable to political pressure from Berlin and Paris than from Madrid or Rome, let alone Dublin or Athens.

Read more at http://www.project-syndicate.org/commentary/philippe-legrain-shows-how-far-the-new-framework-for-supervision-and-resolution-falls-short#w80Qp72lGIUlfedx.99

View/Create comment on this paragraphBut EU rules on national bank resolution will not yet be in force, while the eurozone’s single resolution mechanism will be initiated only in 2015. So banks in northern Europe that are still backed by creditworthy governments would be treated differently than those in cash-strapped southern Europe: Germany can afford to bail out its banks; Italy cannot.

CommentsView/Create comment on this paragraphMore likely, the ECB will fudge the exercise, owing to fear of reigniting the financial crisis and pressure from national governments. Small countries will be singled out to make the exercise look tough, while bigger problems will be swept under the carpet: German banks have already succeeded in excluding many of their assets from the assessment.

CommentsView/Create comment on this paragraphOne argument for making the ECB the watchdog for eurozone banks was that it was less captured by the banks than national supervisors were. But its behavior throughout the crisis suggests otherwise. It has repeatedly prioritized the interests of banks in “core” countries and proved more pliable to political pressure from Berlin and Paris than from Madrid or Rome, let alone Dublin or Athens.

Read more at http://www.project-syndicate.org/commentary/philippe-legrain-shows-how-far-the-new-framework-for-supervision-and-resolution-falls-short#w80Qp72lGIUlfedx.99