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By Christian Takushi, Macro Economist – Zurich & Geneva on 14 March 2017: Elections in the Netherlands, France and Germany (text adapted for public release on 15 Mar 2017)
Voter Revolt in the EU is likely to fail – the EU could shift further to a liberal- left course in 2018
“Continental Europe is not the USA“
Tomorrow Dutch voters elect the new parliament and this will subsequently form the government. The similarities to the UK and US shocks are there indeed: the experts and the polls predict the outsider has no chance. But then, Western Europeans are not as risk-friendly as Americans. There could be a surprise tomorrow with the Freedom Party of Mr. Wilders winning the elections. But barring a landslide, he will be unable to form a government. Putting emotions aside, we feel the Dutch vote is not critical for the survival of the EU. It is elections in France and Germany that really matter. The Dutch vote is simply not a foretaste of the French nor German votes; despite the wave of discontent against the liberal pro-immigration & pro-globalization establishment of left, center and right parties, all of these nations are distinctly different cases.
I stick to my assessment from earlier this year: The Voter Revolt we saw in Britain and the USA in 2016 is unlikely to be repeated in the EU in 2017. I am expecting either the SPD or CDU to form the new German coalition government. To some extent a missed opportunity to set Europe on a better course. The European Union actually needs to rethink the policies it has been using for 4 decades – it is time for a reflection and pause of strategic dimensions. The EU is flawed at its core. A future European Federation should have a more democratic and efficient foundation to compete and thrive. But the power of the state & state media and the reliance of EU citizens on the state are simply too big, at least for now.
Based on our current analysis, I expect the remainder of the EU to become even more left-leaning and liberal from Q4 2017 onwards. Without the U.K. the EU will veer further left into deficit spending, without reducing regulation and state controls. With consensus currently obsessed with the political risks, EU markets and the EURO could experience a temporary upward move in 2017. One that will not last for too long, though.
After promoting millions of immigrants to move countries, removing borders, weakening the Rule of Law and allowing big firms to become gigantic Oligopolies, the EU now can make the case that individual nation states can no longer cope with today’s challenges. And they have a point. Thus, overwhelmed nation states have to come together into Super States, of which the EU (or its successor, the European Federation) is the first one. In a not too distant future, individual nation states may exist only on paper.
It would be wise for the West to look at the example of Japan in this context. Not every modern economy has to sacrifice its identity, culture and religion to simply be able to grow GDP a little bit more and at any cost. Over the past decade the EU took millions of immigrants, while Japan only a few – Japan has the strictest immigration policy of any major industrialised nation. Did the EU do so much better than Japan since the Financial Crisis? With so much immigration by the EU and Japan’s traumatic triple catastrophe of 2011, one would expect that it did, but the growth happened only at the surface. Japan’s GDP per capita grew actually marginally faster than the EU – currency moves included. That is astonishing, because the EU did not only take in millions of migrants, it also aggressively devalued her currency (EURO) against other major currencies to support her export industries. During the same time Japan had to face a sharp appreciation of the currency, followed by a correction.
The mayor of London recently implied that radical Islamic terror was a ‘normality’ in every major city of an advanced society: but he erred, the biggest city in the world, Tokyo, doesn’t have that problem. I am sure there can be an open-minded but controlled “middle way” between the two opposite extremes of the EU and Japan of recent decades.
Christian Takushi MA UZH,Macro Economist & Strategist, 14 Mar 2017, Zurich-Geneva, Switzerland. Text adapted for the public on 15 Mar 2017.
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Global Geopolitical Macroeconomic Outlook:
Released to the public on 19 Oct 2016
Focus on how the BREXIT aftermath is weighing on US elections, German-Turkish relations and the fight for the US Supreme Court. Ironically, under a Clinton administration our independent research sees a higher likelihood for large scale wars.
Martial Law is coming to the West:
16 July 2016 – Switzerland
As some of you may be aware, we have been forewarning of Martial Law to be imposed in many nations, also in the West, in the future. The unprecedented confluence of political, economic, military, religious and geophysical crises & threats is likely to overwhelm many nation states. Many Western democracies are particularly vulnerable. I reiterate my analysis from 2015 that Martial law and even the postponement of Elections cannot be ruled out.
After decades of fostering a system in which (1) the law is no longer enforced for certain groups of people, (2) hypersensitivity & “entitlement thinking” have shaped culture, and (3) activist movements have taken over media and news channels to shape public opinion, Civil Unrest is only waiting to be ignited.
The recent highly organised violent paid-for demonstrations, racial/religious tensions, and planned killing of police officers may be only the foreshadows of what lies ahead.
by Christian Takushi MA UZH, Macro Economist & Strategist, Switzerland, 16 Jul 2016
Turkey moves closer to Schengen & EU:
In our GGMO from 7 April 2016 we shared our independent analysis of the US Elections 2016 and Turkey’s Rise; how it would impact the EU – it also contains an update of our Global Risk and Business Alertness models
The fruits of 12 years of assertive Turkish Security & Foreign Policy are bearing fruit. Ankara faces complex security threats, but has forced its way into the EU. Turkey is projecting influence and impacting Europe way beyond its weight of 4.3% of EU’s GDP. The attacks in Brussels are not just a sign of EU’s lack of strategic foresight and the proliferation of radical Islam, but Turkey’s destabilisation.
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