There's the old story about the FX trader who believed he was always right...it's just that his timing was occasionally wrong. That's me. I was right in saying that Greece would default. They did but it having not been called a default, they didn't. I said they would probably leave the EU by the end of the year. They didn't. I had forgotten the old credit mantra, "nobody can go broke if there's someone stupid enough to lend him money." Oh well, I'll have more to write about next year. I scoffed at political integration...got that one right...and continue to scoff at financial integration beyond mindless chatter in the face of continuing cries for the same; result yet unknown.
I was bang-on Italy (with a bit of help from amico Massimo...he'd kill me if I didn't give him a plug), pretty much spot on with France who is rapidly trying to become the sick man of Europe once again...actors thinking about living in Putin's Russia, dear God! Kept saying all this was about getting to the German elections intact--although no one should take credit for that--and even in the end predicted that Russia would extend an offer to aid Cyprus; after all all the money the oligarchs and politic ions have stolen is there for God's sakes. All in all, I think I did OK sorting out the Euros but as I have said the one big thing that I missed entirely is the growing (from a strong base to be sure) enmity between the Brits and the Boys Across the Channel. This could be the story of the year in 2013 and a goodly part of it will be how the new Obama administration plays it. The present mob was clueless, which might have been a good thing, but this little set-to will have a BIG effect on banking as we know it and The Leader better get someone in there who's knows what he is doing (I am deliberately eliminating any female on the horizon...none are qualified). Almost as important find someone the Euros trust and like. Believe it or not there are people like that around. Names upon request.
Anyway, as a final act to this ongoing drama Sr. Monti had his budget approved today and is expected to promptly resign; whether he runs for office is another question. The "Italy needs you" crowd is in full throat and they are probably right. But ah, there sits Silvio, master pol that he is being coy with all and surveying the veld like a lioness in search of a meal. No matter what Sr. Monti decides I'm afraid Berlusconi runs again and this could turn out very badly indeed. More fodder for next year.
The cliff is looming. The Speaker couldn't deliver his party last night and everybody went home for Christmas which has come early for the main stream media who have convinced themselves and are trying to convince others that this is the final victory for The Leader and that the Republican Party is no more. Perhaps they are correct. But with George Bush fading quickly in the rear view mirror and the demise of the Republicans, The Leader is on his own in 2013 and where that brings us is altogether unclear. As we move forward the effect of past legislative "accomplishments," not yet enacted into law after two years in some case will, I believe, weigh heavily on the country moving forward robustly and I still fear that unknown event or events that might test the Krugman theory that there will always be funding if you have a printing press...and a Federal Reserve to buy it.
My thanks for all of you for sticking with me and I am delighted that the Mayans, like myself, had the right prediction but appeared to be off in their timing, so now we can do all this again next year.
My warm wishes for a most Merry Christmas and a Happy and Prosperous New Year. We'll be back on January 8--barring some major event--right after the conclusion of the most important football game of the year in Miami, the night before. See you then.
CHARLIE
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