ObamaCare and Congressional Democrats

The Hill: Reports that Democrats in Congress are worried that ObamaCare will be thrown out by the US Supreme Court. In many respects this would help the Oval, at least the hated mandate, by which US Citizens would be forced to buy medical cover would not be an issue in November 2012. The real worry for the Chicago Obama re-elect committee would be if the US Supreme Court decided it was legal, thus would make the tea party movement come out in droves in November. The Republican candidates would have a field day if the Court gave the green light to ObamaCare, even Romney has argued that RomneyCare is not a template for the rest of the US. Thus the Republicans could make ObamaCare their major issue in till November. Thus the tea party supporters and independent voters it can be argued could push the Republican Nominee over the wining line.

Is Germany BREAKING ? - ECB

Guardian Live: Reports that Peter Bofinger an economic adviser to German Chancellor Merkel has stated the following, “ .. has broken ranks and conceded that the European Central Bank should become the "lender of last resort" ”. Is this a trial balloon folks by the Germans, to see how the markets and the German people, react, one can postulate that that a adviser would not have stated the above without a green light from the Chancellor. But as stated it’s a trial balloon, the Germans are VERY wary of this kind of printing money policy by the EBC, brings back the memory of hyper inflation of Weimar Germany and the raise of Hitler, the idea would have to get through the German Parliament and the German Supreme Court, the German Parliament has made it clear it wants to okay any EU polices of the Chancellor. If the ECB did print money it would help Italy and Greece, save the Euro, but it would mean in essence that Germany would have to bailout the EU all the time, lets see if this balloon goes up or gets shot down in Berlin.

Italian Bonds = 7%

BBC News: Reports that the cost of 10 year Italian Bonds has gone over the 7% mark again, even with the formation of a new Italian Government. Lets face it folks, the Markets on the whole are not fools, they know that when the tough austerity package starts to hit Italians this new Government of technocrats has no base, no backup, thus it will fall, also should the 60 billion package of tax hikes and cuts work the political parties will not allow the new Government to take credit, they will call snap elections, they have the votes. Thus if your betting a long term Italian Government you are miss reading the public mood folks, this new Government will be short and brutal, better bet would be on the lottery folks.
　

US Supreme Court and ObamaCare

The New York Times: Reports that the US Supreme Court will decide on the legality of ObamaCare next year. In many respects its in Obama’s interest for the Court to strike down the law, at least then it wont be an issue in November, the worse outcome for POTUS but great for the Republicans would be if the US Supreme Court decided that ObamaCare was legal, this would give an issue for Republicans to run on till the November election. Lets be honest ObamaCare is hated folks, also its promise that health care costs would go down has not happened, they have gone up, thus to lose would be to win for the Oval.

Italian Bonds - Eurozone Crisis

Guardian Live: Reports that Italian 10 year bonds have started to raise again after falling due to the resignation of PM Berlusconi, they have gone up to 6.82%. As noted in this blog folks the idea that you can place technocrats in charge of Democracies in a time of economic danger and this will solve the problem is a mistake, these technocrats will be at the mercy of the political parties, these parties if they think they will lose out in VOTES will remove any such threat by a vote of no confidence, does not matter what Berlin or Paris think. In a modern Democracy, and the last time this blog looked that was the case with Italy and Greece you need the support of the people through them voting for political parties, a technocrat has no power, no base, he has to pander to the political groups just to get minor things passed, these technocrats will not last long folks, they will be ousted, politicians hate to give up power, what they hate most is to give power to someone who has not got elected dog catcher before becoming in to a leadership role. Politics is a brutal business folks, its called Democracy.

Spain Next ? Part Two

Telegraph Live: Reports that Spanish 10 year bonds have reach the 6% cost for the Spanish Government. This could be the double hit folks, short term Italian bonds at around 6% for a long economic period, to be joined by Spain. There is a General Election in Spain soon folks, the right wing Party of Spain is expected to win, thus a reduction in Government, problem folks, the level of Spanish Unemployment is at 22%, think how bad it seen to the US at 9%, also like the US, Spain has heavy personal and government debts. This could be the perfect hurricane folks, what if Italy and Spain ask for a bailout, the EU/IMF/ECB, does not have the money, this could be the start of the end of the Euro folks, yes its that bad, the UK might reap the whirlwind of that disaster folks.

Italian Bonds - Eurozone Crisis

BBC News: Reports that even with the resignation of former Prime Minister Silvio Berlusconi, Italian five year bonds reached a Eurozone high at 6.29%. At over 6% for a long term period Italians will not be able to go to the bond market, the cost would be just to much for the Italian taxpayer, thus down the road folks Italy will need a EU/IMF/ECB bailout, but for this happen the Germans have to move on their objection that the ECB should not print money. Modern Germany will have to get over Weimar Germany, there is no threat of another Hitler coming to power in Germany. Thus in this specific case the Germans will have to forget about their past and save the Euro, they wanted it well they will have to pay for it, the Greeks will need another bailout in the future, the Greek people will revolt when they face their tough austerity package, in many respects it is a 4th German Economic Reich, an informal empire, didn’t do the British Empire any harm in its informal period, time for Germans to go beyond their history.