Outside the Box

The Futility of European Elections

John Mauldin

June 28, 2012

After I sent out this week's OTB on Germany, I remembered this very intriguingly titled piece by my friend George Friedman, founder of a geopolitical analysis company called Stratfor.

The piece was written a few days ago, but when it comes to someone as ahead of the pack as George, who managed to write a book called The Next 100 Years, well, let's just say what he writes is pretty timeless.

The content of this report is as bold and thought-provoking as the title. Some nuggets:

• Greece disappointed Europe not because of the choice it made but because it was crippled with indecision.

• Germany has become the problem in the eurozone where once it was the solution.

• France is not yet leading a coalition against Germany, but it is difficult to imagine a different scenario.

If you like the piece below, consider subscribing to Stratfor. <<OTB readers can click here to access a pretty significant discount on a Stratfor subscription>>. Their coverage of Europe (and the rest of the world) provides a unique geopolitical perspective. I also know that a very in-depth report on the geopolitics of Germany is coming up in the next couple of weeks, so you may want to subscribe to access it.

Your wishing this Italy trip was also timeless analyst,

John Mauldin, Editor
Outside the Box

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The Futility of European Elections

By George Friedman

Europe and the financial markets watched intently June 17 as Greece held general elections. German Chancellor Angela Merkel, French President Francois Hollande and Italian Prime Minister Mario Monti all delayed their flights to the June 18 G-20 summit in Mexico to await the results.

The two leading contenders in the elections were the center-right New Democracy Party (ND), which pledged to uphold Greece's commitments to austerity…

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Frank Cava

June 29, 2012, 6:55 a.m.

The timing will be unexpected and abrupt, but it will be Germany that elects to leave the Euro first. It will occurr in a month where the month ends over a weekend, so best guess for 2012 would be September or November, as I cannot see it dragging out into 2013.  Germany needs to move while their economy is relatively strong, since extraction in a recession would compound the problems that will follow.  Once Germany has left, the remaining countries will flounder around, desparately trying to maintain the unity of the remaining countries. France will be the one-eyed man in the land of the blind for a while, but by the end of 2013, the Euro experiment will be extinguished.

William Maddaford

June 28, 2012, 7:14 p.m.

I lived in Hong Kong from 1990 to 2002. I ran into German tourists there who were very unhappy about losing the Deutschmark and being saddled with the Euro as its replacement. That is the crux of the problem. The German public do not like the Euro. They never have and they never will. That will not change so there is no hope of the Germans ever agreeing to what Hollande wants. Either Europe agrees to play by German rules or the whole thing will fall apart. Whether Germany is shooting itself in the foot is absolutely irrelevant.

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