Yesterday S&P lower the credit rating on Spanish government bonds from AAA to AA+, a significant downgrade reflected in the jump in Spanish bond spreads to 1.15% over comparable German bonds. Greece, already down at A- trades at an eye watering 2.5% over bunds. Credit default swaps, the cost of insuring Spanish bonds against default, also rose to record levels. Both Greece and Spain have high, say 18%+ and rising unemployment. Civil unrest will increase in these countries and when it hits the political elite then policy, even Euro membership, will change! Politicians do not like being assaulted by the populace. Monetary policy is boring and arcane but it is its failure that led to the closure of high street names like Woolies. By this summer I expect High Street, UK to be littered with to let signs. This is not academic as many pension funds own many of these retail units so pensions are now in danger.
Doug and Ian have put another two clips from my take on the EU on Youtube. One deals with the possibility the UK government will run out of money and have to resort to the Mugabe solution and the other on why vote UKIP. I strongly support UKIP policies but I cannot support the despicable treatment that has been meted out to long serving UKIP activists like John West by the NEC’s ruling cabal and the imposition of dubious non-UK nationals on to UKIP slates.
Click on the links below to see further clips from my unscripted talk at Lexdrum last month.
Why you should vote UKIP
The Government is running out of money