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The Bruges Group spearheaded the intellectual battle to win a vote to leave the European Union and, above all, against the emergence of a centralised EU state.
The Bruges Group spearheaded the intellectual battle to win a vote to leave the European Union and, above all, against the emergence of a centralised EU state.
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Bruges Group Blog

Spearheading the intellectual battle against the EU. And for new thinking in international affairs.
EU financial risk and liabilities

EU financial risk and liabilities

Michael Wood

Danegeld and Cult Crash

celebrating-1297377_1920 Thanks for the € Subsidy!
The chief executive of Deutsche Bank Christian Sewing told a meeting in Frankfurt "We are not the sick man of Europe. But, it is also true that there are structural weaknesses that hold back our economy and prevent it from developing its great potential. And we will become the sick man of Europe if we do not address these structural issues now." Ac...
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Reset Tory Politics Danegeld EU Colony German Economic Failure
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Bob Lyddon

Britain's debt pile is NOT higher than the EU's

euro-714947_1920 Euro - An Unhealthy Currency
Contrary to the Daily Telegraph's story today claiming that Britain's debt pile does not outstrip the EU's, Britain's is far lower, because the EU's is masked by creative accounting. The full extent of the EU's debts and other financial liabilities is detailed in my book recent book 'The shadow liabilities of EU Member States, and the threat they p...
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Eurostat EU Debt economy ECB Economic Harm
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Bob Lyddon

Eurozone’s ‘shadow debts’ start to become real ones, and threaten the Bundesbank with bankruptcy

Piggy-Bank Breaking the Bank
The German Federal Audit Office ('Bundesrechnungshof') has warned that the Bundesbank may need a bailout due to losses on the EUR650 billion of bonds it bought as part of the Eurozone's equivalent of Quantitative Easing. The Daily Telegraph reported on this on 26 June. Of course the risk is not for the entire EUR650 billion but for the fraction by ...
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Eurozone Economic Harm ECB EU Debt
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Bob Lyddon

Totality of on- and off-balance sheet liabilities of the EU public sector is cloaked in obscurity

cloaked-liabilities Hidden Debts
The totality of the public sector liabilities of EU and Eurozone member states is clouded in obscurity. The key measure tracked by Eurostat - 'General government gross debt' – is circumvented to such an extent that, based on year-end 2021 figures, debts of around €6.4 trillion failed to be registered, and contingent liabilities of around €3.8 trill...
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ECB EU Debt Eurozone Eurostat Economic Harm
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Bob Lyddon

The archipelago of EU public sector entities with borrowing powers has created a behemoth of liabilities

eu-liabilities-behemoth Hidden EU Debts
The EU member states contain numerous public sector entities with borrowing powers, and whose debts fall outside the definition of member state debt as reported by Eurostat. The responsibility for the debts tracks back, one way or another, to the member state but the amounts involved are opaque. All that can be said with complete certainty is that ...
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Economic Harm Eurostat Eurozone EU Debt ECB
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Bob Lyddon

The EU banking system has falsified the amount of its cushion against losses

eu-banking-sysyem-falsification EU Banking System Smoke and Mirrors
EU authorities have permitted commercial banks to implement a particularly aggressive form of risk-evaluation methodology, the result of which is the ability to claim a thick loss-absorption cushion and to attest that the EU banking system is stable and resilient. It isn't: cushions are as thin as before the Eurozone financial crisis. This is laid ...
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Economic Harm EU Debt EU Eurostat ECB
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Bob Lyddon

The Eurosystem has become a commercial bank, except one without a credit assessment department or loss-absorption cushion

eurosystem-commercial-bank Eurosystem is an unregulated Commercial Bank
The Eurosystem has expanded its operations well beyond what a central bank would have traditionally undertaken. It now owns assets that are not 'central bank money' definitionally. Assets have credit ratings as low as BB in the Standard and Poor's system, which means they are 'Speculative Grade' and involve 'Substantial credit risk'. It does not ev...
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Economic Harm ECB EU EU Debt Eurostat
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Bob Lyddon

TARGET2 harbours risks even greater than the enormous ones acknowledged by the European Central Bank

target-2-risks Target 2 - Enormous Hidden Risk
There has been long and ongoing debate about the nature of the sizable loans and deposits that the Eurozone national central banks (NCBs) run with one another within the TARGET2 payment system. The debate has overlooked that the balances are nearly double what the European Central Bank (ECB) reports, and that the report only shows the amounts at th...
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Bob Lyddon

The European Central Bank's programmes have created a major funding risk for Eurozone member states

ecb-major-funding-risk Major funding risk for Eurozone member states
The programmes of the European Central Bank (ECB) are extensive, and involve greater risks than the ECB can bear, it being very thinly capitalised. Even modest losses on its programmes would require it to be recapitalised by its Eurozone shareholders – the national central banks (NCBs) of the Eurozone member states. This is laid out in the newly-re...
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Eurozone Eurostat EU Debt Economic Harm ECB
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Bob Lyddon

Net Zero is the Rationale for the European Investment Bank to Help Manufacture Enormous Public Sector Liabilities

netzero-eib-liabilities Net Zero Liabilities
Net Zero is proving to be a good cover story for the European Investment Bank Group to create huge financial liabilities for the EU taxpayer. The amount looks set to exceed €1.2 trillion by the end of the current EU budget period in 2027. This is laid out in the newly-released book 'The shadow liabilities of EU Member States, and the threat they po...
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Eurozone EU Debt Eurostat Economic Harm ECB
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Bob Lyddon

Misleading Accounting Lends Undeserved Credibility to the European Stability Mechanism

misleading-accounting It is all smoke-and-mirrors.
The European Stability Mechanism is the main bailout mechanism behind the Euro. Croatia recently joined it upon adopting the Euro. The ESM uses two accounting tricks to make it appear larger and more robust than it actually is, disguising that it lacks the firepower to deal with a major incident. This is laid out in the newly-released book 'The sha...
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ECB Economic Harm EU EU Debt Eurostat
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Bob Lyddon

EU supranational entities harbour major unacknowledged liabilities for member states

eu-supranational-liabilities EU Debts
The structures of the EU and Eurozone have allowed the creation of a series of supranational entities that have taken on debts whilst having little financial strength of their own: their creditworthiness depends on guarantees or capital calls from member states, without the extent of the member states' liabilities being transparent and being added ...
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Bob Lyddon

Public credit rating agencies discriminate against the UK and in favour of EU/Eurozone member states

creditrating-discrimination Discrimination against UK
Public credit rating agencies have not been even-handed in their treatment of the UK compared to EU member states, given the large shadow debts and contingent liabilities that weigh on the latter. This is explained in the newly-released book 'The shadow liabilities of EU Member States, and the threat they pose to global financial stability', writte...
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ECB Economics EU Debt Eurostat EU
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Bob Lyddon

Scope of EU and Eurozone Debts is Unrecognised by Public Credit Rating Agencies

unrecognised-debt EU and EZ Debts ignored
The public credit ratings of EU/Eurozone member states are inflated, because the credit rating agencies have not factored in the significant shadow debts and other financial liabilities bearing down on the respective member state's debt service capacity. Total financial liabilities are much higher than these agencies appear to recognise. This is th...
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Eurostat Eurozone EU Debt Economic Harm ECB
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Bob Lyddon

Germany Cannot Pay Totality of EU/Eurozone Debts

germany-cannot-pay False assumptions of global debt markets.
Global debt markets appear comfortable to absorb all of the bonds issued by the European Union for its €750 billion Coronavirus Recovery Fund on the basis that 'it all tracks back onto Germany'. This is true: the guarantee structure behind the EU's debts makes each member state liable for the entirety of them. The same debt markets do not seem to h...
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Bob Lyddon

EU and Eurozone break both spirit and letter of global debt rules

breaking-debt-rules_1 EZ break Spirit and Letter of Global Debt Rules
The EU and its member states position themselves as a cornerstone of the rules-based international order, but they break its financial rules in both letter and spirit by failing to fully report their financial liabilities. The key measure tracked by Eurostat - 'General government gross debt' – is circumvented to such an extent that, based on year-e...
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ECB Eurozone EU Debt Economic Harm Eurostat
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Bob Lyddon

EU and Eurozone are massively over-indebted - but official figures obscure it

obscuring-over-indebtedness EU Obscure over indebtedness
EU and Eurozone member states fail to fully report their financial liabilities. The key measure tracked by Eurostat - 'General government gross debt' – is circumvented to such an extent that, based on year-end 2021 figures, debts of around €6.4 trillion failed to be registered, and contingent liabilities of around €3.8 trillion. This discrepancy is...
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Hiding debt EU Debt European Union Eurozone Eurostat
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Bob Lyddon

EU and Eurozone are Massively Over-Indebted - but official figures obscure it

Burn The Euro Zone is a Threat to Financial Stability
 EU and Eurozone member states fail to fully report their financial liabilities. The key measure tracked by Eurostat - 'General government gross debt' – is circumvented to such an extent that, based on year-end 2021 figures, debts of around €6.4 trillion failed to be registered, and contingent liabilities of around €3.8 trillion. This discrepa...
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Gross Debt Liabilities Rules Eurostat Eurozone
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Bob Lyddon

The Shadow Liabilities Of EU Member States And The Threat They Pose To Global Financial Stability

Shadow The Shadow Liabilities Of EU Member States
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Robert Oulds

The EU's Shadow Liabilities: Risky Business

euro-g652509f29_1920
 The EU likes to sell itself as the high priests of the 'rules-based' system, as the bedrock of financial stability worldwide. So much so that 'stability' was one of the main arguments of the remain side back in 2016 - and remains a prominent argument for rejoining today. In this Bruges Group publication, "The shadow liabilities of EU member s...
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