I returned from ski-ing in France on Saturday. The Snow conditions were the best I have seen in 30 years but the mountain cafes were virtually empty. The prices are too high and even those from the Eurozone are feeling the pinch. Unemployment in France will rise and indeed they had a public sector transport strike last Friday. As I predicted civil unrest will spread as we can see in the Total refinery and its associated sympathy strikes in the UK in the last week. Politicians who ignore this grass roots feeling do so at their peril. The seeds of these problems in the UK were sown over the last 15 years when our government handed over control of much of our country to the EU bureaucrats. It as Warren Buffet says, "When the tide goes out you can see who has been swimming naked". The economic tide has certainly gone out and the pigeons have come home to roost. For Noah this was good news but for Gordon its very bad news indeed.
Italian bond spreads have come in a bit to 1.4% over bunds. Greek spreads are still at an eye watering 2.5%. Most worrying from Gordon's viewpoint the UK spreads have widened to 0.4 % from 0.2% two weeks ago indicating as I noted in my pre-ski blog, Johnny Foreigner may be thinking twice about buying more of Gordon's gilt edged toilet paper.