Gordon Couger wrote in message
...

as far as I can tell the only security they are interested in is
their
own job security. The general working assumption is that the current
government wants to join the euro and get further into the EU. At
the
moment it is beginning to look that the Germans effectively have
deflation. Deflation and no central bank is a bad combination. In
the UK
the only thing that seems to be keeping us from deflation is the
rise in
house prices which is not really sustainable. (At one time it was
considered ridiculous and unsustainable that a couple borrowed three
and
a half times joint income to get a mortgage. Recently I have heard
of
single people borrowing seven times their income, in mortgages to be
paid back over forty or fifty years. I am not sure I believe these
stories but they could be true.)
When the euro was introduced the Germans insisted on the a stability
pact, governments were not allowed to borrow more than 3% of
spending.
This was an attempt to keep the currency strong. Now the French have
announced they are ignoring this, the Germans will not keep to it
either
and senior Commissioners have announced the rule is silly and should
be
scrapped. The Euro is going to be a weak currency and if the Irish
vote
Yes to the Nice treaty it is going to be a larger, less well
developed
area with a weak currency.
It may be that having a weak currency is actually a policy decision.
It
would mean that Europeans could not afford to buy much in the way of
imports from outside the EU and would give them a more secure home
market. The obvious problem is that we buy a lot of raw materials
from
outside the EU and we buy them in Dollars because that is what world
trading is done in. So we will have a situation where manufacturers
are
1) buying in Dollars which will be a strong currency relative to the
euro
2) selling in Euros which is a weak currency
3) having to bear steadily increasing social costs.

We have had this in agriculture in the UK for the last three or four
years and it hurts.

Hopefully better prices will hold up a while. I talked to a local gain
merchant and he says the higher wheat goes the less is for sale. He
hasn't
started moving his stocks yet and wheat is 5.24 a bushel for export
and corn
is $5 a bushel at the feed lot. He is 50 cents away from both in
freight.

certainly makes UK price look a bit sick. That is probably why we can
export wheat to North Carolina :-((

Hard money and expanding the EU into eastern Europe appear to me to be
mutually exclusive. Particularly at the outrageous tax rates and low
productivity rates in the EU. You can't have high wages, high living
standards, high taxes, high suicidal services, low cost products, lots
of
free time and hard money in one package. Only farming, mining,
manufacturing, computer programming and similar industries create or
enhance
wealth. Governments, health care, social services, and service
industries
are leaches, ticks and fleas on the productive sector. We have to have
some
of those services but we all need dipped.

I don't know about the off the books income in the EU. In the US it is
estimated to be 50 to 100% the size of the known income. The street
price of
dope is high. Travelers tell me that cash does speak its own language
in
Europe as it does most places so I expect it is a simulate situation.

The US government doesn't like small business becase so much of the
money
misses the tax man. Governments would like a cashless society so they
could
trace every dollar. Even then barter will beat the tax man. The
government
really likes people that work for wages. They have them with no way
out.
.

certainly the civil service in the UK always used to tilt everything
against the self employed. In many agreements with other countries the
self employed weren't covered. Actually the EU has been better to the
self employed than the UK would be, indeed the EU has been better for
farming than the UK. In the EU there are still people in power who
regard farming as important. This state of affairs no longer exists in
the UK


--
Jim Webster

"The pasture of stupidity is unwholesome to mankind"

'Abd-ar-Rahman b. Muhammad b. Khaldun al-Hadrami'