£39bn? Actually, the EU’s bill could be 10 times larger — Shock report
Without a quick & clean Brexit, UK is on the hook for up to £394bn of EU’s debts, it's all to do with the Eurozone.
The failing Eurozone could plunge the UK into 10+ years of austerity unless it leaves now. Its the hidden menace of failing to leave on 31 October 2019.
Mention money markets and global finance and most people’s eyes glaze over. We ask readers to stay with us for a couple of minutes while we summarise in layman’s language the very real risk of a long period of austerity, caused by the EU’s out-of-control financial system.
A new 40-page study published by Global Britain makes the EU’s claim for a £39bn divorce payout from the UK seem like small change. It could be 10 times that amount.
What’s the problem and why haven’t you heard about it?
Firstly, readers will know that the UK is not in the Eurozone, despite all the ‘experts’ telling us we had to join in 1999 or become an economic basket case.
Unfortunately, thanks to successive UK Government decisions, being out of the Euro has not meant that the UK is exempt from financial liabilities for the EU’s attempt to create one currency for the whole of the European Union.
Let's all take a good look
- Many Eurozone countries have excessive public debt and their banks have huge non-performing loans
2. The Euro was a political project, not underpinned by sound principles required for a currency to work
3. 20 years of the Euro have resulted in a black hole of €1 trillion
4. Under Theresa May’s ‘deal’, we do not cease to be a shareholder in the European Central Bank and the European Investment Bank for at least 20 years
5. With a new Euro crisis pending, the UK could be called on to bail out all the countries who can’t pay
6. The ‘transition period’ could cause the UK’s liability to rise from the current figure of £185bn to £394bn
7. Only a quick and clean Brexit on 31 October would prevent the UK’s liability rising by £209bn
Some highlights from the Global Britain study
- “The Eurozone financial system is drinking in the last chance saloon, a saloon that is a hall of mirrors”
2. “Behind the public façade lies a black hole of €1 trillion — the financial hangover built up over 20 years from banks and investors acquiring assets in the ‘Club Med’ countries and Ireland for far more than they are worth now”
3. The apparent recovery of the Eurozone since the crash of 2008 “is an illusion, kept intact by the ECB and the other Eurozone National Central Banks buying up government bonds in € trillions, as well as flooding financial markets with cheap money”
4. “In turn, this enables bankrupt borrowers — ‘zombies’ — to remain alive, and for lenders into these ‘zombies’ to rank their loans as ‘Performing’ when the borrower cannot repay the capital or sustain a rise in interest rates”
5. “The lenders are zombies themselves, kept animate by ECB money and creative accounting”
6. “A Eurozone meltdown could be triggered by 2020/2021 when it becomes obvious that it is economically and politically impossible to achieve compliance with the EU Fiscal Stability Treaty by 2030”
7. “Greece, Italy, Portugal, Cyprus, Spain, France and Belgium have Debt-to-GDP ratios over 90%” — the EU limit is 60%
8 “The UK needs urgently to distance itself from involvement and the way to do that is to leave the EU as soon as possible and without a ‘deal’, and certainly nothing based on the Withdrawal Agreement and Political Declaration”
The Brexit Coalition writes to Conservative Party constituency chairmen about the risks
Yesterday evening the Daily Telegraph published a piece about this, adding that Conservative Party constituency chairmen and senior Tory officials will be receiving a letter urging members to support a new Prime Minister who is “committed unequivocally” to backing a clean WTO-based Brexit.
This clean Brexit would avoid having to pay the massive contingent liabilities to the EU, as described above.
The letter comes from the Brexit Coalition, a loose grouping of 29 pro-Brexit organisations
Daniel Hodson, former head of the London International Financial Futures and Options Exchange (LIFFE) and current Chairman of The City for Britain, explains that
“The Brexit Coalition is uniquely broad, deep and non-partisan as well as being united. Every day now seems to bring a good reason for our leaving the EU.
“Our defence and our fishing are both iconic and under threat.
“And why should we bail out the Euro project, which seems increasingly doomed?”
You can download the full, 40-page report here. It is an impressive piece of work.
The study’s author is Bob Lyddon who has written extensively on the Eurozone financial system and the UK’s risks under it.
He has acted as an expert witness in international payments-related cases and has been retained by trade associations and industry bodies to advise on access to banking facilities and payment systems. From 2003 to 2016 he was general secretary of the IBOS international banking alliance. With PwC he managed several programmes at the time of the initial introduction of the Euro and has consulted for Bank Boston, Chemical Bank/Manufacturers Hanover and for Lloyds Bank International.
For most readers, leaving the European Union is about issues of sovereignty and democracy. That said, the economic arguments are powerful and should be aired.
One thing is abundantly clear. Simply removing the Northern Ireland ‘backstop’ from Theresa May’s surrender treaty is not nearly enough. The entire draft treaty needs to be rejected forthwith.
A new start is required under a new PM who will genuinely take us out of the EU on 31 October. The report by Global Britain is just another nail in the coffin of the Withdrawal Agreement, but an important one.
No-one — whether a Leaver or Remainer — wants the return of austerity for the next 10–20 years.