Wednesday, 30 November 2016

JAPAN TIMES Brexit Headlines: 1 Nov - 30 Nov 2016

The Japan Times
Brexit Headlines

Britain's Brexit firebrand Farage meets Trump in New YorkWORLD / POLITICSNOV 13, 2016

Leading Brexit campaigner and U.K. Independence Party leader Nigel Farage visited U.S. President-elect Donald Trump at his home in New York City on Saturday and a Trump aide said the pair had a "very productive" meeting. "We're just tourists!" Farage joked with reporters after he ...


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Sunday, 27 November 2016

It isn't Britain that's confused about Brexit, it's the EU

For those who are not in denial about Brexit, Britain's broad aims are pretty clear. The real issue is what the remaining EU 27 want from us. It's Europe that's in chaos about Brexit, not Britain, and Europe that has the real questions to answer

Eu_flag_union_jack
Brussels doesn't know how to wave its flag
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John Redwood MP
On 27 November 2016 16:48

So many commentators and broadcasters, and most Opposition politicians, keep on and on about what are the UK’s negotiating aims. Often they misrepresent the UK’s position, both seeking to weaken it by false report and by pretending our aims are unclear or unstated.
If they wanted to be helpful and do something useful they should turn their attention to the rest of the EU and their aims and positions.
The UK’s position is very easy to grasp for anyone who read the referendum ballot paper or has listened to the Prime Minister. The UK is going to leave the EU.
There is no such thing as a single market we can remain in on leaving, and no-one on the Vote Leave campaign suggested there was. As the UK wishes outside the EU to negotiate trade agreements with non EU countries we clearly will not be in the Customs union.
The PM has ruled out EEA membership. This means there is not a lot to negotiate. We will not negotiate our independence with the rest of the EU -- that is an absurd contradiction. We will offer them no new barriers to their trade with us, and I expect, after a lot of huffing and puffing, they will want to accept that offer.
If they don’t we will trade with them as most favoured nation under WTO rules, and they will be the big losers on tariffs as a result.
So what do they want? They haven’t yet even confirmed that all UK residents legally living in the rest of the EU can carry on doing so, though the UK has made clear we are happy for all EU legally resident people in the UK to stay if they wish, assuming there are no forced evictions from the continent.
Isn’t it time the rest of the EU moved to reassure all those citizens? Surely, civilised countries who accept international law could bring themselves to reassure people living in their counties? Why are they so unpleasant to their residents?
Some of them have said they want the UK to continue with freedom of movement. The answer to that is clearly No. They cannot make us do that. Some have then said they wish to damage their trade with us, so they can damage our trade with them, as a punishment for daring to leave. What a ghastly club if it needs to punish members who want their freedom!.
The bad joke is of course on those who make these threats. It will be their trade that suffers more, as it is their trade which will attract more of  the tariffs that can be placed on agriculture, wine, and cars whilst most of our trade will be tariff free or very low tariffs under WTO rules.
I don’ t  think in the end, with such high unemployment in the Euro area, they will want to hurt their trade. If they do, it will certainly confirm how wise we were to leave.
Why would you want to stay in a club with other members who so want to harm you that they will harm themselves more to do so?
Why would you wish to stay with former partners who say such disobliging things and cannot even tell their residents they are of course free to stay where they are living. Time for our journalists to ask some  questions of the 27.
Mr. Redwood's writing is re-posted here by his kind permission. This and other articles are available at  johnredwoodsdiary.com
Read more on: European Union, european union budget, break up of the European Union, and brexit
http://www.thecommentator.com/article/6451/it_isn_t_britain_that_s_confused_about_brexit_it_s_the_eu
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Friday, 25 November 2016

Europe's Year of Elections



Euro-area countries with elections over the next 12 months


http://www.bloomberg.com/news/articles/2016-11-24/ecb-warns-of-market-correction-as-political-instability-spreads
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Editor's notes: Still in shock over Brexit? Get a grip

Some corners of our national life are finding it harder to adapt to the new post-referendum reality than others.

 Friday 25 November 2016 2:11am

 The United Kingdom Goes To The Polls In The EU Referendum
Britons voted to leave the European Union back in June (Source: Getty)
Earlier this week I joined the cream of the British commentariat at the annual Comment Awards, celebrating the best columns and comment pieces of 2016. As you know, we have a stable of excellent columnists here at City A.M. but since I never got around to entering them into this year’s awards I sat at the back of the room without a dog in the fight. And it was fascinating.
One after another various media figures took to the stage either to present or collect an award, and almost all of them were in a state of post-referendum mourning. The height of this came when an actor appeared at the lectern to read solemnly from Jonathan Freedland’s post-referendum cry of anguish, published in The Guardian. It was delivered like a Rupert Brooke poem on remembrance Sunday. A fine piece of writing, to be sure, but the mini-performance served to highlight how wide the gulf has become between the pundits and the public. Or at least, large swathes of the public. There was little understanding on show as to the reasons why people voted to Leave, let alone any consideration of a potential upside.
Plenty of people in the City exhibited similarly shell-shocked reactions to the vote. Anthony Browne of the British Bankers’ Association let rip in The Observer last month, warning that banks were gearing up for a mass exodus and that the end was nigh. But earlier this week he appeared to have changed his tune, telling the BBA annual dinner that the City has weathered storms in the past and that now was the time to “stop looking back...to roll up our sleeves and look to the future.” Some say he was leant on by senior bankers and urged to find a more helpful tone, but whatever lies behind the change of approach, members of the media’s comment class should follow his lead. As Browne said, “the time for grieving is over.”
Brexit bonus for George Osborne
Former chancellor George Osborne looked relaxed on the backbenches this week as his successor delivered the Autumn Statement. Now we know why. Osborne bagged more than £320,000 from giving speeches in the US in the months after he was sacked as chancellor, including £80,000 for a single speech last month. He may be out of office but he certainly isn’t out of pocket. He’s not as pricey as Cameron, though, who is charging £120K for a talk.
​One import we could all live without
With exports high on the political agenda post-referendum, it’s time to consider one of the most offensive imports of recent times: Black Friday. Retailers jumped on the American idea for a pre-Xmas discount day, and now the phrase invades press releases for weeks in the buildup. Yesterday a PR firm tried to tell me that Black Friday had caused a spike in private jet journeys to the UK - as if oligarchs are determined to take advantage of discount TVs at Asda. Spare me.
Labour's City man embraces the role
One doesn’t associate the Corbyn regime with black-tie dress codes and lavish City dinners. But Labour’s new shadow City minister, Jonathan Reynolds, is not your typical Corbynista. He’s popular in the Square Mile and at home in the brief. He turned a few heads at Monday night’s meeting of Labour MPs by arriving in black-tie, ahead of joining the British Bankers’ Association annual dinner at Mansion House, where he was clearly more relaxed than his boss, John McDonnell.
Get involved in the City's democracy
The new Lord Mayor, Andrew Parmley, had to dip out of a dinner earlier this week to officiate at a City by-election. Returning to his guests he apologised for having been called away to “a rare outbreak of democracy in the City.” It was a joke, of course, but one based on the idea that while the City of London Corporation may be the world’s oldest democracy, it isn’t always seen as the most open one. More should be done to encourage participation.
http://www.cityam.com/254410/editors-notes-still-shock-over-brexit-get-grip
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Thursday, 24 November 2016

ECB Says It Can Shield Euro Area From Global Finance Instability

The European Central Bank is confident it will be able to continue shielding the euro area from the risk of a sudden correction in asset prices, after political events such as the election of Donald Trump threaten to increase volatility in coming months.

Updated on 

“We are certainly seeing a correction coming from the U.S.,” ECB Vice President Vitor Constancio said on Thursday in an interview with Bloomberg TV’s Matt Miller. “The ECB will continue to exert its stabilizing role, so I don’t think there will be significant contagion to Europe.” Constancio spoke on the occasion of the publication of the ECB’s twice-yearly Financial Stability Review.
The report warns that the risk of an abrupt global market correction has intensified on the back of widespread political uncertainty, posing a threat to banks, stability and economic growth. While the policies of incoming President Trump may lead to higher spending and faster inflation in the U.S., their effect on the euro area is difficult to gauge given the possibility of protectionist tit-for-tats and higher chances of populist victories in votes across the continent.
Constancio: Will Keep Expansion Stance on Monetary Policy
 
Bloomberg
“More volatility in the near future is likely and the potential for an abrupt reversal remains significant,” according to the Frankfurt-based central bank. “Elevated geopolitical tensions and heightened political uncertainty amid busy electoral calendars in major advanced economies have the potential to reignite global risk aversion and to trigger a major confidence shock.”
For Constancio, U.S. expansionary policies may be accompanied by “some protectionist measures which would then reduce the impact on other parts of the world.” He said the recent rally in asset prices will only become sustained in Europe if inflation and growth in the region pick up, while a recent appreciation of the dollar won’t have a major effect on the continent as it did for emerging markets.
The U.S. elections capped a period of unexpected political results that started with the U.K.’s vote to leave the European Union, and that could continue as the region’s main economies face elections in coming months where populist and nationalist movements are slated to make inroads. Compared to its previous report six months ago, the central bank increased its concern over a “global risk repricing leading to financial contagion, triggered by heightened political uncertainty in advanced economies and continued fragilities in emerging markets.”

Euro-area countries with elections over the next 12 months
Euro-area countries with elections over the next 12 months
While the currency bloc’s economy and financial system have remained resilient so far, more political instability in coming months may put pressure on weak banks and countries with high sovereign debt. The central bank flagged the risk of a return of market pressure on the region’s weakest countries as the spread of populism hinders reforms.
“Higher political uncertainty may lead to more domestically focused, growth-hindering policy agendas,” the report said. “This, in turn, could delay much needed fiscal and structural reforms and could in a worst-case scenario reignite pressures on more vulnerable sovereigns.”

Vulnerable Banks

“We are in a new phase of weaker world trade” Constancio said in a press conference. “If, on top of that, there would be a wave of protectionist measures, world trade, and world growth would suffer.”
The ECB vice president confirmed that the despite the risk build-up, the ECB still sees euro-area growth around 1.6 percent in 2017, with inflation rising to about 1.25 percent in the spring. Even so, he stressed that some of the region’s lenders remain weak and need to continue addressing excessive costs and a high burden of non-performing loans.
“Vulnerabilities remain significant for euro-area banks,” the central bank said in its report. “Profitability prospects overall remain low across the euro area in a subdued economic growth environment.”
Even so, the U.S. election results spurred a pick-up in bank stocks as investors saw the risk of ever tighter regulation recede. If sustained, this would “provide some support for euro area banks’ profitability prospects,” according to the ECB.

http://www.bloomberg.com/news/articles/2016-11-24/ecb-warns-of-market-correction-as-political-instability-spreads

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German growth halves on weak trade, uncertainty clouds euro zone outlook

Growth in leading euro zone economies slowed over the summer months and an expected German-led rebound at the end of the year may prove too short-lived for the European Central Bank to unwind its monetary stimulus.

 BUSINESS NEWS | Thu Nov 24, 2016 | 9:50pm GMT
By Michael Nienaber | BERLIN
Germany's quarterly growth rate halved to 0.2 percent in the three months to September even though private consumption and state spending rose, as weak foreign trade slowed overall activity in Europe's biggest economy.
Confirming a preliminary reading, the Federal Statistics Office said on Thursday that net foreign trade subtracted 0.3 percentage points from GDP growth as exports fell 0.4 percent on the quarter and imports rose 0.2 percent.
State spending increased by 1.0 percent in July-September, contributing 0.2 percentage points to growth. German authorities are spending billions of euros on accommodating and integrating more than one million migrants who have arrived since the start of 2015, many from war zones in Syria and Iraq.
Household spending rose by 0.4 percent, also adding 0.2 percentage points to growth, as consumers benefited from high employment, rising real wages and low borrowing costs.
"Many in Germany like to complain about Mario Draghi's policy of low interest rates, but actually Germany in particular is benefiting from it," VP Bank economist Thomas Gitzel said, adding that cheap loans were giving construction a push.
"Also thanks to Draghi, Finance Minister (Wolfgang) Schaeuble is managing the balancing act of increasing investment in public infrastructure without net new debt."
Investment in construction edged up 0.3 percent in the third quarter while investment in plant and equipment fell by 0.6 percent, a sign that German firms are holding off investment.
In an unusually downbeat report, the ECB said on Thursday that political upheaval on both sides of the Atlantic is raising financial stability risk in the euro zone, which could increase concern about some countries' ability to finance their debt.
Elections and referendums could fundamentally shift the political landscape, triggering sudden capital flows and market volatility, it warned.
STRONG SPAIN
Data for other euro zone countries pointed to a modest and fragile recovery in the 19-member currency bloc, driven mainly by domestic demand.
In Spain, the euro zone's fourth biggest economy, growth slowed slightly to 0.7 percent in the third quarter from 0.8 percent in the April-June.
In France, the bloc's No.2 economy, the central bank predicts growth to double to 0.4 percent in the final quarter from just 0.2 percent in the third. Industrial morale there held steady in November for the third consecutive month.
German business confidence also held steady at a high level in November, suggesting executives remain upbeat following Donald Trump's victory in the U.S. presidential election.
The United States is Germany's most important trading partner and Trump's protectionist rhetoric has unnerved many euro zone exporters - in addition to the uncertainty created by Britain's June vote to leave the European Union.
The Munich-based Ifo economic institute's business climate index was unchanged from 110.4 last month.
"The German economy seems to be unfazed by the election of Donald Trump as U.S. president," Ifo chief Clemens Fuest said. "Confidence in the German economy continues to be good."
German companies were again more satisfied with their current business situation, but somewhat less optimistic regarding the coming months, the monthly survey showed.
"If there is a 'Trump effect', it could show up later though - that's what we saw after the Brexit vote," Ifo economist Klaus Wohlrabe told Reuters.
Q4 REBOUND
Wohlrabe said Ifo's business climate index suggested the German economy would expand by 0.5 percent in the fourth quarter, bringing full-year growth to 1.9 percent.
Another survey suggested German consumers are ready to splash out over the Christmas season and support growth in the final quarter.
Most economists see the third-quarter cooling as temporary, pointing to other sentiment surveys such as Markit's purchasing manager index (PMI) that suggest a rebound in the final quarter.
Germany's central bank said on Monday it expected manufacturing to drive a pick-up in growth in October-December.
"Since the first Brexit shock, the Ifo index has staged an impressive comeback, suggesting that the summer slowdown of the entire economy was only a blip and not a new trend," ING-Diba economist Carsten Brzeski said.
But Brzeski warned that growth was "artificially" inflated by the ECB's record-low interest rates and Berlin's migration-related hike in state spending.
Capital Economics analyst Jack Allen said the Ifo index suggested the German economy was performing well in the fourth quarter, although "we expect growth to slow next year, putting pressure on the ECB to loosen policy further".
The German government expects growth to slow to 1.4 percent in 2017, an election year, mainly due to sluggish foreign trade.
For the euro zone as a whole, economists polled by Reuters expect growth to hum along at a modest pace, helped by the ECB which is expected to announce that its asset purchase stimulus programme will be extended beyond March 2017.

http://uk.reuters.com/article/uk-eurozone-economy-idUKKBN13J1BN
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