Skip to comments.EU: Markets braced for shift away from austerity as Francois Hollande wins French election
Posted on 05/06/2012 4:54:11 PM PDT by bruinbirdman
Financial markets are braced for a radical shift in economic policy and fresh question marks over a eurozone break-up, as Francois Hollande moves into the Elysee Palace on Monday as the first Socialist president of France for 30 years.
Mr Hollande's 'farewell to austerity' programme combines taxing the rich, raising
public spending and lowering the retirement age.
A confrontation between the new president and Angela Merkel, Germany's chancellor, is also high on the markets' worry list.
However leading economists believe Mr Hollande will attempt a damage limitation exercise to avoid increasing turmoil in a eurozone facing further upheavals, with result of this weekend's Greek election increasing speculation about an eventual break-up of the fragile currency bloc.
Mr Hollande's 'farewell to austerity' programme, which combines taxing the rich, raising public spending and lowering the retirement age, has raised the expectations of the French electorate about the end of the 'Merkozy' era.
But Ms Merkel is unlikely to cede ground in the face of Mr Hollande's demand for a re-writing of the eurozone fiscal pact.
Christian Jimenez, a fund manager at Diamant Bleu Gestion in Paris, said: "Hollande's victory has already been priced in by markets, however his promises made during the campaign have not been priced in, so there is risk on the downside if he stands his ground when he announces a first set of measures.
"There's a clear need to boost economic growth across Europe, no question, but the debate is on how to achieve that without spooking investors. All in all, Hollande won't be able to convince Merkel to soften her position on the need for austerity."
Chancellor George Osborne appeared diplomatically relaxed at Mr Hollande's victory. "I don't think it's a problem. He's not anti-austerity. He's made it very clear
(Excerpt) Read more at telegraph.co.uk ...
This is not a good omen for France’s wellbeing.
If they repudiate their debt, they won’t be able to borrow more- and what will the French masses do then. And if they repudiate their debt to a foreign power that is willing to employ “self help” in collecting what they lent France in good faith, this could easily lead to another war.
A lot of bad stuff can happen when you try to stiff someone for billions.
I don’t think that France is going to be able to tax themselves out of this mess, regardless of how much they soak the wealthy.
“Germans still want to save and they want a strong currency. This appears impossible now with Greece, Italy, Spain, Portugal, and now La France.”
This is why I believe Germany will be the first to leave the Euro. If they don’t, they will end up with a pile of worthless debt from the other Euro countries.
Yeah. I reckon so. The Marxist is counting on the same happening here.
You betcha. Lock, load and reload.
Reellion is ON!
I lost that “B”.
“Mr Hollande’s ‘farewell to austerity’ programme, which combines taxing the rich, raising public spending and lowering the retirement age, has raised the expectations of the French electorate about the end of the ‘Merkozy’ era.”
At least this is going to be entertaining to watch.
And a cautionary tale for others wanting to follow suit...
I think Germany will take the Netherlands, the Flanders region of Belgium, Austria, Finland and several eastern European countries with them if Germnay decides to leave Eurozone. And Norway, Sweden and Denmark may join them, too.
I just hope the convention is wild and we have a candidate who is has conservative principles and a fighting spirit.
Can they even do that? are they a hybrid system or Euro only?
“From 1 January 1999, the value exchange rate of the French franc against the euro was set at a fixed parity of 1 EUR=6.55957 FRF. Euro coins and notes replaced the franc entirely between 1 January and 17 February 2002.”
They can’t print more unless they convince the EU to print more..
expect wide spread inflation in Europe with all the rich flocking towards Switzerland, gold/silver to protect their wealth
this is why fake right wingers annoy me, like Romney. There will no austerity under his admin as the economy continue to slide downhill, but the media will call it that
“How in the heck in this day and age of ecomonic devastation do idiots elect socialists, if not for their own stupidity and greed?”
It’s rather simple....
“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship. The average age of the world’s greatest civilizations has been 200 years.”
- Alexis de Tocqueville
Did anyone on earth think the Europeans were going to give up the goverment teat?
These “austerity” requirements to get more funding were jokes. Bad ones.
Yep. France sees the answer to failed socialism as even more socialism. I think there will be downside to financial markets but this will drag on for a long time. I have moved quite a bit to bonds lately.
Romney has NEVER claimed that he is a right winger....he is what he is and what he is is NOT obamey ( still won’t capitalize his dang name)
Down against the greenback, too. Under $1.30.
Watch as the exodus of productive people out of France begins.
Early retirement from 30 hr work weeks and 40 week years. Yeah, that should work.
Pray for America
Hollande has lots of comrades on his side outside Kermitville.
The EU ain't dead yet. They haven't even begun to print money.
And there is still plenty of private property to confiscate.
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