Obama's effect on the Euro

11-06-2008 19:50

This week the world markets have to evaluate the implications of the regime change in Washington. The change itself isn't simple and this time isn't trivial either. A normal change has to basic stages, the latter one is the eventual replacement of presidency, and the first is the intermediate period, in which the incoming president shadows the outgoing president and affects his decisions, concerning subjects, contents and schedule.

The Federal Court [1] decided that Obama still needs to present his birth certificates, in order to prove compliance with the requirements set in the first chapter of the constitution of the USA concerning parentage and land of birth. If Obama fails to do that, like he failed last month to stand to the similar requirement by the honorable judge Barcley Surrick [2], then the prospect of his presidency shall be a de-facto constitutional crisis, which may require to have Joe Baiden appointed instead.

Obama's mother Ann Dunham was a communist and an internationalist, who changed countries and husbands and who was related to people whose consumption and street habits where a far cry from those of Church goers [3].

Obama himself declares he wishes to utilize the USA taxpayers money in order to provide health care to the many millions illegal resident in the USA and to hundreds of millions around the world. This shouldn't be dismissed as a fantasy, given the the year 1974 'Eurabia' agreement between the EC, the European Community, the predecessor of the EU, and between the Arab league, to admit dozens of millions of Arabs and other Africans, Asians and Muslims from around the world, like Obama's birth place Kenya or childhood nativity of Indonesia, of which he still is a citizen.

The USA lead by a second Mandela - helping to rebound Europe

Obama is being considered by some a similar phenomenon to Nelson Mandela [4] of South Africa, who tore apart the socio-economical fabric of South Africa, prompting a large proportions of the educated population to emigrate to Australia, New-Zealand, the UK, Canada, and the USA.

The demise of the traditional regime of SA followed the demise of the Warsaw pact and the S.A. migrants who wanted to go to German speaking countries, found that the absorption of the central European socio-economy left not much space and funding there, till the economy there rebounded about 3 years ago. This rebounding wasn't a simple reflection of the USA/UK rebounding which was based on oil money from Iraq and Natural Gas and Opium form Afghanistan, but also was the symptom of the restructuring of the central European economy, where modules produced in central Europe e.g. in Poland, Check, Slovak and Hungarian factories, on demand by the German Consortiums owning them, went through final assembly in Germany and won the made-in-Germany sticker accordingly. This capacity still offers many lucrative jobs to USA and SA mechanical, chemical and electrical engineers who would like to avert the prospect of the USA turning in to a slump the style of Chicago where Obama spent some of his youth and where his basin of support is located.

The USA not being the critical market it used to be, with its post war share of global GDP dropping from 50% of the Globe's to about 20% and keeping on dropping, because it is now like a concoction of on the one hand a reflection of the UK and Spain and on the other hand a reflection of Brazil. Perhaps Californian high-tech and affluence is that still tips the Balance in favor of the USA in that theoretical comparison. China serving the growth of the Eurozone instead of Anglo-America which conceived it. That's due to 3 main factors:

(1) Eurozone wide deployment of heavy industry production facilities.
(2) Markets for high-end Eurozone products
(3) Piling up Euro currency for reserves and trade
(4) Objection to USA policies around the pacific rim.

During that same period of the 1990's, many people abandoned Los-Angeles in favor of less crowded states like Oregon. This was named the 'white flight'.
It is expected that a similar effect would be given rise now that the Eastern shores of the Atlantic, offer standard of living and opportunities that compete with those of the USA for the first time since the outbreak of the first world war.

A massive migration of skilled workers from the USA [5] to the Eurozone may solve the demographic crisis in the EU, increasing consumer demand and the pool of skilled work force, especially for the engineering sector. - Now that's a strategic long on the Euro!

Putin's Russia

This empire of geography, natural resources, brains, knowledge. knowhow and military poses a set of impediments of the USA to heat up the global situation again, in a possible attempts to win more oil wells by means of warfare.
There seems to exist a quite partnership of existential interests between Russia and Germany i.e. of the CIS and EU. which suggests that Putin's standing wouldn't put Europe at risk.

If Russia integrates with the EU, perhaps in the form of a confederation, for a start, then it shall turn the stretch of Geography between Iceland to the west and the western Bering straights to the east a contiguous domain of Geo-political and socio-economical existence and functionality.
Eventually it may catalyze the crystallization of the pan European union, the PAU.
Once the PAU is stabilized then the Forex game would hang between the PAU and between the regional economical blocks directly bordering it to the south i.e. North-America, Japan, China, India and the central Muslim block, the CMB, comprising of Iran, Afghanistan, Pakistan and the Arab countries.

The UK – coming in to the Eurozone?

Given that one of the two legs of the UK economy, the (financial) city of London is experiencing a down-cycle, and with the other leg of the UK economy, the Petroleum and Natural Gas Production at record earnings, though due to past oil prices and the rates of the short-term future contracts they induced, which are not likely to be experienced again, unless all havoc is rendered in the Persian Gulf, then the down sliding of the GBP, to be emphasized quite soon with the de-facto abolition of interest rates in the UK, may bring the GBP to the long expected parity vs. the Euro, leading to a possible merger between the two entities and furthering the prospects of a genuinely united Europe.
When that happens, salvaging the dwindling UK economy from an Argentina-style crisis, the prominence of the US would be lost, perhaps for ever.
Back in to the USA and where Obama can make a direct positive impact on the economy.

Ron Paul vs. the FRB

Republican Ron Paul has brought to the house of Congress a legislation initiative to abolish the institute named “The Federal Reserve Bank” in order to undo the official indebtedness of the public, via the Federation, to the Banking cartel. This is possible because the money the “Federal” “Reserve” “Bank” provides to the treasury is made out of thin air, by means of the partial-reserve “system”. A casual visitor to the USA would expect the Democrat's presidency to oppose the Federal Reserve Bank, though it happens that it was the Democrat presidency of Woodrow Wilson who arranged it through congress and several states.

Property tax for Infrastructure

Assuming Obama isn't the Bankers man, which is quite implausible in the USA, an annual 10% property tax on Billionaire's, every year the recession lingers, would admit the funding of the hundreds of critically needed renovated and newly constructed bridges across the USA.. That would make a great contribution to the economy of the USA. But dare he.