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Will we soon see a spend spend spend experiment for real?
IronWolf
Posts: 6,445 Forumite
http://www.bbc.co.uk/news/business-17687759
Leading in the polls for the French Presidential election is Francois Hollande, who has come out with radical policies such as a top 75% income tax rate, higher corporate taxes and a tough approach to 'the markets'. Businesses all over France are already considering their options of moving abroad accordingly to the Economist.
So if Hollande gets elected, we may actually see whether a spend spend spend, tax tax tax policy by a government actually leads to deficit reduction and growth, or just higher interest rates and a crippling public debt.
Leading in the polls for the French Presidential election is Francois Hollande, who has come out with radical policies such as a top 75% income tax rate, higher corporate taxes and a tough approach to 'the markets'. Businesses all over France are already considering their options of moving abroad accordingly to the Economist.
Mr Hollande has advocated increasing government spending to stimulate growth.
However, Mr Sarkozy argues that austerity is the best way to bring debt levels down.
"If we start hiring civil servants, if we start spending again... it's not a risk that interest rates will rise, it's a certainty," Mr Sarkozy said on Wednesday.
So if Hollande gets elected, we may actually see whether a spend spend spend, tax tax tax policy by a government actually leads to deficit reduction and growth, or just higher interest rates and a crippling public debt.
Faith, hope, charity, these three; but the greatest of these is charity.
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Perhaps we will find out if the European level playing field is indeed level !
The cynics amongst us have long harboured suspicions that the French and Spanish can buy our banks and energy companies freely, but are less than willing to open up their infrastructure markets.
Surely now they will allow French businesses to freely move to a more open less regulated UK ?
..I'll believe it when I see it !0 -
So if Hollande gets elected, we may actually see whether a spend spend spend, tax tax tax policy by a government actually leads to deficit reduction and growth, or just higher interest rates and a crippling public debt.
The problem is it's takes an awful long time before things settle enough to make a judgement0 -
I can't think of anything much more enjoyable on the political front than watching the French commit economic suicide.
If nothing else, it might remind some of our socialists what happens when the lunatics take over the asylum. If we thought Brown was bad (and he was), Hollande being in power would would merit a very large bag of popcorn!0 -
Either way, the bank will win.
You can be certain of that."The problem with quotes on the internet is that you never know whether they are genuine or not" -
Albert Einstein0 -
Sarkozy appears to be gaining in the polls....
I admire and despise the French in equal measure. As much as I would like to see the result of a Sarkozy loss, I feel they will probably pull back from the aforementioned collective suicide of a Hollande presidency.
If he does get in however, ALL bets are off as regards both La Republic and the Eurozone. 75% top rate? Retire at 60? Greater taxes on business, enterprise and financial institutions?
The Markets will gut France like a fish.Go round the green binbags. Turn right at the mouldy George Elliot, forward, forward, and turn left....at the dead badger0 -
Even if Sarkozy does get in, it only buys them time, and probably less than you might think. France is a country with real problems (denial according to the economist) and an extreme aversion to any sort of austerity whatsoever. They should simply not be in a currency union with Germany. Period.
The pace at which bond markets have turned on dubious debtors has been quite incredibly fast. If Hollande wins, chances France will fall within weeks.
The only (rather unlikely) possible upside is that they, together with the PIIGS outvote Germany and give the ECB mandate to engage in massive QE leading to Germany leaving the Euro.0 -
A French government is less dependent on foreign investors buying its debt, because the French banks and institutions are big enough. And a Hollande government would presumably ignore the EU rule book and use protectionist measures to reduce the trade deficit. France can take care of itself.The Markets will gut France like a fish."It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis0 -
A French government is less dependent on foreign investors buying its debt, because the French banks and institutions are big enough. And a Hollande government would presumably ignore the EU rule book and use protectionist measures to reduce the trade deficit. France can take care of itself.
Yes but when even Sarkozy is threatening them with 50% corporation tax, and Hollande said he'll split them all and take no cr*p from the finance industry, you got to wonder if they're making too many enemies and are going to be punished in the bond markets by fobbed off bankers.Faith, hope, charity, these three; but the greatest of these is charity.0 -
They're fighting an election campaign. They don't mean it.Yes but when even Sarkozy is threatening them with 50% corporation tax, and Hollande said he'll split them all and take no cr*p from the finance industry"It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis0 -
Hmm - if my* EUR were in a French bank I would certainly be thinking about moving them to a German or Dutch one for the time being.
*My EUR (all 23) are actually sitting in the back of a drawer somewhere from my last holiday.A French government is less dependent on foreign investors buying its debt, because the French banks and institutions are big enough. And a Hollande government would presumably ignore the EU rule book and use protectionist measures to reduce the trade deficit. France can take care of itself.I think....0
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