Germany really has not been aggressive on the leadership front, as
many would like it to be, mostly because of the history of Germany in
Europe. In many cases, like the situation in Greece over the past couple
of years, Europeans still bring up Germany’s Nazi past whenever they
don’t like whatever it is that Germany is advocating.
Angela Merkel over the three terms that she has served as Chancellor
has tried to walk a narrow line, taking a strong position here and
there, but doing so in a way that will produce as little in the way of
controversy as possible. Given Germany’s position within the EU, not
just politically, but also because it is the largest economy in the EU,
playing such a moderate role leaves the community without the guidance
that it really needs.
Should she be re-elected and because of the changing relationship between the United States and Europe, Ms. Merkel appears to be taking a stronger stance in several areas that are important for the future of the Eurozone. This stronger leadership role also seems to be contributing to the strength of the Euro.
Next-door France is also contributing to the strength of the Euro. The election of Emmanuel Macron as the President of France has been a positive, and Mr. Macron, who “got to work” right from the start of his term, went to Ms. Merkel, seeking a partnership in the affairs of Europe and the European community. This was a very good start.
However, Mr. Macron has been suffering in the polls ever since he was elected President. In fact, his decline in the polls has been the most rapid of any new French president in their first 100 days on the job. His approval rating dropped to 36% from about 63% in a recent to Ifop poll.
The main reason for this is that Mr. Macron’s party did not exist 18 months ago. Furthermore, in the first round of voting, only 24 percent of the voters supported Mr. Macron. In the final runoff election against Marine Le Pen, the far-right populist candidate, he received a resounding 66 percent of the vote, although many voters, voted against Ms. Le Pen rather than voting for him.
He still has very strong support amongst his base and the Economist magazine had an article this week that discussed the reasons for Mr. Macron’s decline in the polls. The strongest argument for his decline in the polls is, he is a very brash, young, newcomer to politics, and is doing some very unpopular things.
A short time ago, Mr. Macron was an investment banker and focused on economics and markets, much to the dislike of many of the French. But, the point is that someone had to provide this kind of leadership for the French people if the French were ever to move in the right direction for the economic reforms needed.
Many of the reforms that he is suggesting besides spending cuts, is an effort to bring France into conformity with the deficit guidelines of the European Union. He is trying to build an economic program that will spur on growth and stimulate job creation. Furthermore, he has added a much-needed anti-corruption law that the public has given him very little credit for.
Furthermore, all these changes take time to work themselves through the economy. Coming up is a tough month for Mr. Macron who will present to the nation, labor reforms in September and these will be accompanied by strikes scheduled for September 12th.
The important thing here is that investors are in Mr. Macron’s camp even if the French polls are not.
The changes that Mr. Macron is bringing to France are the changes that are needed to make the country more productive and more competitive.
Analysts and investors know this and are encouraged by the efforts that Mr. Macron is making. Not to mention that he is working with a stronger and more assertive Angela Merkel, which should provide for a stronger, more complete European Union.
The last piece of this puzzle is Italy and the possibility that Mr. Matteo Renzi, the young former Prime Minister, will get re-elected in the spring of 2018 and provide a third partner to the team to build a new EU. The investment community too, we believe, would see this as positive and this would be good for the Euro.
Should she be re-elected and because of the changing relationship between the United States and Europe, Ms. Merkel appears to be taking a stronger stance in several areas that are important for the future of the Eurozone. This stronger leadership role also seems to be contributing to the strength of the Euro.
Next-door France is also contributing to the strength of the Euro. The election of Emmanuel Macron as the President of France has been a positive, and Mr. Macron, who “got to work” right from the start of his term, went to Ms. Merkel, seeking a partnership in the affairs of Europe and the European community. This was a very good start.
However, Mr. Macron has been suffering in the polls ever since he was elected President. In fact, his decline in the polls has been the most rapid of any new French president in their first 100 days on the job. His approval rating dropped to 36% from about 63% in a recent to Ifop poll.
The main reason for this is that Mr. Macron’s party did not exist 18 months ago. Furthermore, in the first round of voting, only 24 percent of the voters supported Mr. Macron. In the final runoff election against Marine Le Pen, the far-right populist candidate, he received a resounding 66 percent of the vote, although many voters, voted against Ms. Le Pen rather than voting for him.
He still has very strong support amongst his base and the Economist magazine had an article this week that discussed the reasons for Mr. Macron’s decline in the polls. The strongest argument for his decline in the polls is, he is a very brash, young, newcomer to politics, and is doing some very unpopular things.
A short time ago, Mr. Macron was an investment banker and focused on economics and markets, much to the dislike of many of the French. But, the point is that someone had to provide this kind of leadership for the French people if the French were ever to move in the right direction for the economic reforms needed.
Many of the reforms that he is suggesting besides spending cuts, is an effort to bring France into conformity with the deficit guidelines of the European Union. He is trying to build an economic program that will spur on growth and stimulate job creation. Furthermore, he has added a much-needed anti-corruption law that the public has given him very little credit for.
Furthermore, all these changes take time to work themselves through the economy. Coming up is a tough month for Mr. Macron who will present to the nation, labor reforms in September and these will be accompanied by strikes scheduled for September 12th.
The important thing here is that investors are in Mr. Macron’s camp even if the French polls are not.
The changes that Mr. Macron is bringing to France are the changes that are needed to make the country more productive and more competitive.
Analysts and investors know this and are encouraged by the efforts that Mr. Macron is making. Not to mention that he is working with a stronger and more assertive Angela Merkel, which should provide for a stronger, more complete European Union.
The last piece of this puzzle is Italy and the possibility that Mr. Matteo Renzi, the young former Prime Minister, will get re-elected in the spring of 2018 and provide a third partner to the team to build a new EU. The investment community too, we believe, would see this as positive and this would be good for the Euro.
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