"You can't change history - unless you're a historian." So said Mario Draghi yday in his final @ecb press conference. Except some (not him) have been attempting to re-write history recently, suggesting that the handling of the euro crisis was a triumph, not a disaster
For some, the fact that the eurozone made it through the crisis should be viewed as proof of the single currency's invincibility. It was tested and for all the scepticism, it survived. But this isn't right. The euro really did come dangerously close to collapse
I remember on the very day, at the very conference where Draghi pledged to do "whatever it takes" to save the €, being told by another v v senior European policymaker that some of the bigger € members were facing financial chaos that might force them out of the currency
The reality is the euro was saved through a combination of economic pain (Greece et al) and monetary anaesthetics, delivered by Draghi. Not fundamental reforms that addressed the deeper problems with the currency area. Those are still IN NO WAY resolved
The absence of a fiscal union, the lack of a properly funded banking union with joint deposit insurance, the inability to issue eurobonds. These were and still are the issues that mean in practice the euro is not irreversible
Why, you might ask, is even lifelong eurosceptic Matteo Salvini now saying the euro is irreversible? In large part because of charts like this. Since Brexit € popularity has soared to all time highs. One product of #EUref was to unite the rest of Europe as never before
Political and popular support is important, but it won't prevent another crisis. And the evidence is far from narrowing the economic and cultural divergences within the EU and eurozone are widening rather than narrowing. Eg see brookings.edu/wp-content/upl…
None of this means euro will inevitably collapse in the next crisis. But unless it introduces some form of fiscal transfers to share the burden and redistribute from rich to poor areas, it won't be safe. One chink of light: German enthusiasm for tight fiscal policy is diminishing
Brexit may change things. Macron hopes once UK leaves balance of power shifts and door opens to deeper integration. But while Europeans love the euro it's not clear they love sharing national wealth with poorer members. More in today's @thetimes column thetimes.co.uk/article/the-eu…
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If you're even half interested in energy, I bet you've seen this chart. I call it The Most Hopeful Chart in the World.
The point? We're embracing renewable power MUCH faster than expected.
Hurrah!
Only problem is, this chart has an evil twin. A chart we really need to discuss
🧵
The Most Hopeful Chart in the World shows how each year the @IEA predicted that the amount of solar output around the world would plateau or rise v slowly in the following years. But instead solar output defied all expectations, rising exponentially.
That's great news.
But making solar panels is an energy-intensive exercise.
You need a lot of coal to smelt down the silicon and a lot of power to turn metallurgical silicon into polysilicon, let alone the monocrystalline boules you really need for a decent solar module (read my book for more 📖)
🚜FARMAGEDDON🌾
The story of what's REALLY going on in farming. A story far more complex than the conventional wisdom.
This isn't just (or even mainly) about inheritance tax. It's about a cascade of challenges & crises that may ultimately threaten food security.
📽️5 min primer👇
Let's begin with that big, overarching issue: food security.
For most of the past century, farmers have been encouraged to grow as much food as possible. The story here goes back to WWII and its aftermath, when the conventional wisdom was the UK needed to be more self sufficient
Encouraged by the govt, the UK's domestic food production, which before WWII had dropped to just 35% of what we ate, rose rapidly to over 60%.
Some economists say self sufficiency is overrated. But it's one of those post-war principles that stuck.
By accident as much as design.
🚗What's happening to Europe's car industry is one of the biggest stories in the world right now, & prob the biggest story of next year too.
A slow motion implosion driven by multiple factors (esp Chinese competition).
Watch my primer on what's going on👇
What makes this moment so dangerous, so destructive for legacy carmakers, is that this is a perfect storm. Three main issues: 1. The shift from conventional engines to batteries is a DISRUPTIVE innovation. The kind of thing Clay Christensen wrote about.
This is a MASSIVE deal...
Think about a combustion engine.
An assembly of HUNDREDS of pieces of metal, all perfectly honed to turn fuel into motion.
Making these things is REALLY hard. Which is why:
a) that's where most of the value/jobs are
b) other countries have struggled to compete making them
Today we learnt the no of people flowing into the UK hit an all-time high last yr: an influx we've NEVER seen before either as a total or as a share of the population.
So... why is the @ONS (and some news organisations) reporting this as a FALL in migration?!
Let's dig deeper
🧵
The ONS publishes immigration figures every six months. There's a lot of data, with plenty of provisos all over it.
But as is often the case the story gets simplified in the telling.
Consider the story the last time the data came out. This is how the chart looked 👇
And here's how most people reported the numbers: immigration was going down. Yes, from unprecedented highs - but even so. Down by 10%. A success story, as far as the then govt was concerned.
🧵SALT🧵
It's been snowing in the UK and the road gritters are out in force, begging the question:
Have you ever wondered where that grit actually COMES from?
The answer is more magical, beautiful and fascinating than you probably realised.
1/14
Because that dirty-looking salt being spread by trucks on our roads is actually the remains of an ancient ocean (actually two ancient oceans), buried deep beneath our feet.
Most of the stuff being spread in London comes from a single mine in Cheshire - at Winsford.
2/14
Here, about 20 to 40m beneath the meadows of Cheshire, is an enormous slab of halite, rock salt, the remains of an ancient inland sea a couple of hundred million years ago.
This is where most of our salt comes from.
3/14
🧵How worried should we (and @RachelReevesMP) be about the slightly nervy reaction from financial markets towards her first Budget?
Short answer: certainly a bit worried.
But perhaps not for the reasons you might expect...
Worth saying at the outset: these markets are volatile.
Trying to interpret movements in govt bonds is v tricky.
They're moved by all sorts of factors - fiscal, monetary, economic and structural - from all over the world.
So yesterday's Budget is only one of many factors here...
Even so, there has been a marked rise in UK bond yields following the Budget which is greater than what we're seeing in other markets.
This morning the UK 10 year bond yield hit the highest level in nearly a year. It's up 1.7% since yday - far more than US or German equivalents