A big question is whether or not the ‘ political will ‘ exists to enact institution reform in the EU. I believe the general crisis is likely to be managed if the following happens. … Stay with me on this … The USA must pass BASIC financial reform by the fall of this year; which it will. This will be just in time for the mid-term congressional elections in Washington, with both major parties having relatively low approval ratings from their constituents. Most everyone realizes it is a mid-term election year and that the US economy is likely to get stronger and more stable towards the end of the calendar year. The US equity markets historically take into consideration the future 6 months of domestic economic conditions.
Managed debt restructuring of Greece is needed immediately, regardless of the other related issues. There must also be institutional changes in regards to the EU and / or ECB in the future as well. We will shortly find out more about growth in the EU, with 1 st quarter EU growth data released this Wednesday ( May 12th . )
Historically speaking, it is important to remember that a country’s ( or a region like the EU or Europe ) geography has been important in shaping geopolitical, strategic military, as well as economic potential and opportunity. If the sovereign debt in the EU can be restructured, it could allow the EU and ECB between 2-3 years of time, in which to implement institutional reform. The EU needs to take a page out of the USA’s ‘ play book ‘ in regards to BASIC financial reform.
From a geopolitical, strategic military and economic point of view, the emergence of Poland ( a relatively recent EU member ) and Turkey ( a potential EU member ) could provide short and medium term opportunities for the EU. Who knows what may happen in the longer term. Both of these countries have positive current and projected GDP forecasts and increasing political stability, which are both beneficial for the region and the EU. From a strategic military point of view, the current and near future of both Poland and Turkey benefit not only the region and the EU, but the USA as well. Let us not forget that although the USA is facing increased competition in terms of the global economic balance of power; it still wields the most powerful military in history. This is no exaggeration regarding US military power, although it’s relative standing may well change, but not in the short term.
In general, ‘ hybrid ‘ forms of capitalism are continuing to spread around the world; although not always in conjunction with democratic politics ( although usually with at least a somewhat stable political system of some sort. ) So far most of these countries’ track records look pretty good and include increases in the following areas : national wealth (especially the ‘middle class’ ), current and forecasted GDP as well as more stable national economic systems. According to many statistics, we, as a planet, have less war now than we have had for a long time ( see statistics in regards to soldier and non-combatants killed and wounded as well as statistics in many other areas regarding war). Poland and Turkey are growing not only in the 2 political and economic areas mentioned previously, but also in a strategic military role in the region, in regards to the EU, Europe and as whole and in regards to the USA. This growing emergence is gradually being revealed in several areas in regards specifically to Poland and Turkey, but also including other ‘ hybrid ‘ capitalistic economies. This will aid the global financial markets in emerging from the depths our recent global meltdown with less market volatility and more potential for opportunity, growth, domestic and international equity, earnings and cooperation among countries. The global financial markets generally respond positively to and peace, political stability and growing economic prosperity around the world.
* Editor’s note: My apologies to everyone for posting PART 2 of this post late. *
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