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Political Tremors In Germany And Spain
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Political Tremors In Germany And Spain

by The MoleSeptember 25, 2017

The datacenter hosting my VPS’ decided to hand me and a bunch of its client a crate of lemons when moving all its servers to a new location without previously advising its sub vendors. Well at least that is what mine is claiming and if you search for quickpacket on twitter you do indeed find a bunch of angry complaints on how the migration was handled. Now for me that means most of my VPS’ have been down since Sundays, leaving me hanging high and dry. Fortunately the Zero’s VPS is hosted somewhere else, so at least all you Zero subs will not be deprived of the signals today.

Now you probably know the old saying: if life hands you a bunch of lemons, make lemonade! While I unfortunately won’t be able to properly post my usual charts and campaign updates I believe the political crisis currently unfolding here here in Spain as well as in Germany may be worth summarizing as there appear to circulate a lot of myths and misinformation on both ends. And as a born German come American now living in Spain I do feel that I am somewhat qualified to offer my perspective on what is going on and where I believe things are heading here in Europe.

Germany

angela-merkel-headshot

So let’s start with Germany, a subject pretty dear to my heart as I was born there and spent about 12 years of my life living in various parts of the country. Apologies for the picture but that is literally the friendliest snapshot of Chancellor Angela Merkel I was able to find. She’s not exactly a people person and the sweeping changes to Germany she spearheaded over her past three administrations do to some extent reflect the fact that she grew up under the East German regime in which she was a low level player in her early youth. She’s an extremely smart woman who holds a degree in quantum chemistry and was awarded prizes for her proficiency in Russian and Mathematics.

After the unification of Germany in 1989 the Democratic Awakening party Merkel had previously joined merged with West Germany’s CDU. Then Chancellor Helmut Kohl took her under his wings as sort of a protégé and the rest is history as the saying goes. After 12 years in power she is now embarking on her fourth term as German chancellor, but due to various controversial policies during her reign, mass immigration and a shift in energy policy being the most salient, a new nationalist party called the Alternative Für Deutschland (AfD) managed to more than double its percentage from under 5% to slightly over 12% during yesterday’s federal elections. Plus several of her allies and previous coalition partner SPD are now starting to distance themselves from Mrs. Merkel, not surprisingly so as their own election results yesterday took a major hit as well.

It is difficult to project forward from here as, just with the Federal Reserve, one should never under estimate the political skill of Angela Merkel. She has repeatedly run circles around her opponents and I am pretty confident that she will once again find a way to form a coalition and determine the course of Germany over the next four years to come. However that said, the easy days are over for Mrs. Merkel as she now will face not only the conservative AfD but also a strengthened FDP as well as both an embattled CDU and CSU (the Bavarian version of the CDU) which are now realizing that they are facing a fight for political relevancy.

Now I do have a pretty unique perspective on the situation as I left Germany in 1991, just after the reunification. The way I still remember Germany is what some people today may call antiquated and backward as much of the political shift toward the left happened after I was long gone. I suspect that previous chancellors like Helmut Kohl or Willy Brandt would be considered political extremists in this day and age but if one peruses the election program of the CDU or SPD from about 25  years ago then you’ll find that there’s a lot of overlap between them and what the AfD stands for today. You may disagree on that front but there simply is no way that Germany will be taken over by Neonazi right wing extremists. The German people have learned from history and they would never ever let this happen again.

I actually think that this may turn out to be a blessing in disguise, not so much for Mrs. Merkel and her CDU, but for Germany, as it once again gives the political center a chance to reassert itself. The last thing the liberals want to do is to continue ignoring or outright ostracizing a large percentage of its own population for political opinions that were considered mainstream just two or three decades ago. Because that is exactly what has happened over the past few years and once the center disappears completely what you may get is polarization on both fronts, which puts you on the fast track to civil war. And Germany in chaos always means Europe in chaos. I hope the Germans will continue to remember their lesson and use the coming four years as an opportunity to engage in mutual dialog and to prevent the rise of political extremism on both sides, the right and the left.

Spain

Spain_manifestacion

When it comes to Spain I am somewhat stunned by the overwhelming international support that Catalonia seems to be receiving in its struggle for independence. I wonder if California or Texas attempting to secede from the United States would receive a similar response. Be this as it may, this has been a train wreck in the making for a good part of the past decade now and the independista movement is just now receiving global recognition. Which always surprised me a little as a break off from Spain may send shockwaves through the entire European Union.

As I am a guest here I will not post my personal opinion on the subject as I believe this is something that Spain and Cataluña will have to sort out amongst each other. You will probably come across a lot of opinion pieces on the subject with both sides presenting very compelling arguments. All I would like to offer however is this: Although I do believe that secession would be terrible for both Spain and Cataluña as well as the rest of Europe, I also believe that all people have the right to self determination and to decide their own future. If a large part of a region wants to establish independence then it should be allowed to at least pursue that course.

It’s a bit like owning a dog and keeping it on a leash at all times. The more you try to exert control, the more eager it will be to run off at the first opportunity. The more space and love you give it the more it wants to stick around. Clearly a lot of political mistakes have been made and instead of demonizing Cataluña Madrid should take a good look at itself and ask why the Catalans are so eager to separate themselves from Spain in the first place. On the other side the Catalans of course need to carefully evaluate the pros and cons of secession, especially on a long term basis. A decision made as a result of regional pride and frustration about unfavorable policies coming out of Madrid may in the long term lead to unintended consequences.

But the die is cast now and increasing exchanges between pro-independence groups and Spanish loyalists will only accomplish exactly what I have warned about in my chapter on Germany – increasing polarization on both sides. Whether this in the end devolves into another regional civil war remains to be seen but I do believe that the potential for violent conflict exists as the Catalans are very proud and politically engaged people, and are not expected to simply stand by idly if they feel treated unfairly.

It’s important to remember that the Catalans always have considered themselves to be Catalans first and then perhaps Spaniards. Unlike down here in Valencia where Valenciano is used actively alongside with Spanish the Catalans insist on speaking mainly Catalan and will often refuse to engage you in Spanish. This shows a lot about their passion and the importance they put on their own regional language, culture, and of course their political future.

In closing, I wouldn’t worry too much about Germany at the current time and instead look at Spain for future signs of trouble. While Merkel will continue to dominate the international headlines it is Spain that is sitting on a proverbial powder keg that could go off at a moment’s notice.


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • Grant

    ES is trying to form and OPD after last Wednesdays OPU-Hammer. Could be a nice consolidation move until the next move up.

  • Grant

    We have our own issues over here as well… Our largest sports league is trying to bankrupt itself.

  • Brishort

    Zero key to watch at this juncture…. NDX at key juncture as well. Time to see where the football gets fumbled!

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Brishort
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    now “there’s the luv”.
    without the Renko,
    my signal (just one of many) is saying ‘neutral’.

    http://stockcharts.com/h-sc/ui?s=%24BPSPX&p=D&yr=0&mn=6&dy=0&id=p02855803153

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • HD

    The NFL drama is full of irony on many levels. 869 players have been arrested for felony charges, a small few protest injustice, entire league gets called out for patriotism by an individual who dodged the draft 5 times.

  • HD

    was just about to comment on $VZ. Has been a good run. +$4. $HD too, has rallied Sept 5 out of last 6 years as I remember. Hurricane trade. Just one good trade. On to the next.

  • ridingwaves

    Mole, Costa Rica might be calling you, great bandwidth, great weather and nature…..

    OPEX for metals tomorrow…

  • StockTalker

    First target is /NQ 5750 will try a long. MCHammer

  • Grant

    Boom

  • Brishort

    Zero is the most puzzling for the moment. Assuming functioning is OK, should pay close attention to its signal for false alarm….Technical indicators clearly going off on many charts, but without any zero confirmation, remaining suspicious of what is exactly going on…Furthermore, this week is end of Q3…. another reason for suspicions. Therefore gameplan: let the trend roll but keep the stops trailing from the opening prices.

  • HD

    Did any body notice that little VIX thing they did again? VIX up 8% at the open, crushed it, and then a 10 handle hit SPX. Seen it twice now.

  • ridingwaves

    The NFL pretty much sucks now days to begin with, watching college ball is like 10X the fun without the BS….the players are just a bunch of overpaid whiners….
    they are losing fans by the second…

  • ridingwaves

    watching XLF for follow thru…

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    the index isn’t going to move as fast as BAC.
    same kind of chart. different volatility!!

    EDIT: IMHO, if you want to kill the weak baby deer, go for WFC!
    Muwahaha

    http://stockcharts.com/h-sc/ui?s=WFC&p=D&yr=0&mn=6&dy=0&id=p95495213686

  • ridingwaves

    BAC is one trick pony, why not get a taste of all FIRE….

  • ridingwaves

    GC catching bid here day before opex, October is strong delivery month for the precious….

  • Brishort

    Looking at a comparison of what happened this morning VIX vs. SPX right now on 5 minutes… indeed. Interesting to monitor to see if an edge is possible to extract.

    Now just look at the zero, slightly down on up candles while staying put on long down 5 min candles…. The nature of the bots seems to be adapting or switching algos!

    If that is the case, finding the new pattern may indeed lead to an edge (whereby a known pattern for bots used to be so far, whatever the direction of the market, gap the market at the open, then close the gap for the next roughly 100 minutes and then move before any continuation).

  • HD

    Agree, college is so fun to watch. NFL is a Sunday tradition though. I’m a fan. This too shall pass.

  • HD

    /VX 12.80 level is Big R IMHO

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Brishort

    Retracement to VWAP done. Slate is clean for next move.

  • ridingwaves

    there are some critters there, scorpions and the bird catching spider along with the Fer De Lance snake are things you want to avoid….

  • HD

    I spent some time in Costa Rica. Some of the friendliest people you will ever meet. Pura Vida!

  • HD

    I did a gap study once and had different results. There are a lot of open gaps on SPX chart. Volatility has been something new and enjoyable for me though. Great product. .25 is a good trade.

  • ridingwaves

    yes, beware of Hotel Del Rey though :) …but if Mole re-locates I’m in for ES trip

  • StockTalker

    Interesting to see both the dollar and gold up today.

  • Mark Shinnick

    pass….and so goes the mush of the brains of the the guys who play the game.

  • Yoda

    One of them should not be trusted

  • Mark Shinnick

    https://uploads.disquscdn.com/images/0d554826b6e52ca65a095715a8143c7aacefa29a564dee076b667b922f39a1d4.jpg

    This man a total hero: Pretty fucking sick to even think about supporting NFL again.

  • StockTalker

    Did I just read that Trump declared war by tweeting, wtf

  • StockTalker

    Looking for safehaven’s

  • BobbyLow

    He keeps poking at an insane tyrant calling him “Little Rocket Man”. I agree. WTF!

  • Mark Shinnick

    In-ground testings can be poo-pooed, but stuff like atmospheric detonations is a snubbing of the entire planet.

  • http://evilspeculator.com Sir Mole III
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    anyone notice the Verizon behind his head?
    I thought NOT.
    😉

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • BobbyLow

    Villanueva served 3 tours in Afganistan so I certainly respect what he’s done and I absolutely respect him as a man.

    OTOH, while campaining in Alabama our Obsessive Compulsive POTUS fed “Red Meat” to the people of Alabama and started yet another shit storm. Instead of having 2 or 3 NFL players on each team as outliers protesting, we’ll now have half the NFL players, owners and coaches doing it.

    Mole hit the nail on the head when he intimated that if the center is lost we are in for mayhem. DT has done absolutelty nothing to unite our country but he certainly has united his base of support. I didn’t think we could be anymore divided than we already are. But it’s only getting worse.

    BTW, I am a proud Viet Nam era Veteran and and when I got out of the military in 1967, I despised what we called at the time “long haired hippie freaks” who were burning flags and their draft cards protesting the war. By the time the early 70’s came along and we were still in Nam, I began to rethink my position. When I think about it now, 58,000 soldiers lost their life for the main reason that there were 3 US Presidents who didn’t want to be the first President to lose a war. They also wanted to have a chance to be relected. So fuck them and fuck that Draft Dodger Donald Trump who said his “personal Viet Nam was hoping to not to catch a sexually transmitted disease while the Viet Nam War was being fought”.

    I think you’ll find many veterans who believe that they fought in wars so that we as Americans will always have the right to protest and BTW, kneeling is not flag burning.

  • http://evilspeculator.com Sir Mole III
  • http://evilspeculator.com Sir Mole III

    To all subs: My hosting firm has screwed up a datacenter migration and I’m actually working on going to a different provider. I hope it’s fixed tomorrow but as of now I am still waiting for an update from them. Very frustrating and I apologize for any inconvenience.

  • Brishort

    No problem, thanks for the heads-up. At least the Zero is working fine, thank you for that! Very useful compass today!! :-)

  • BobbyLow

    Don’t know GG. This is one of those times when you have both the Dollar and Gold up at the same time.

    FBOW, I chased Long Gold after the NK guy spoke this morning. I jumped on UGLD right away but dragged my feet a little picking up some /MGC Futures. Both are up and we’ll see if this move has any legs.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Thank You for your service.
    I hope you have long made your peace with whatever you had to endure.

    https://www.youtube.com/watch?v=8ZH9ebAZouk

    Our preacher says everyone has their Lt. Dan moment in Life.
    And ‘that’s ok’. God can handle it.
    -GG

  • Mark Shinnick

    They’ve been fucking with you (and us) for too long Mole, glad you are moving away. What’s their name again???

  • Mark Shinnick

    Well, the DT election is only effect, not cause of a much longer trend. The rot is so very generationally deep, a primary reason being we are in too much collective denial of our taking shortcuts and scapegoating responsibility onto others. The 3pers long ago recognized what this writing on the wall portends.

  • Mark Shinnick

    So many amazing poignancies in that film.

  • StockTalker

    All indications of a downtrend day, let r rip

  • Mark Shinnick

    Don’t you wonder? Is is the finger in the dike with growing cracks, or pushing on another phoney dot?

  • StockTalker

    Real move here

  • BobbyLow

    Sorry, but I’ll have to respectfully disagree with a 3pers view but I do agree that DT could very well be an “effect”.

    However, I still have a some hope that we’ll survive this current situation. I actually think that what we have going on now is an over correction of “political correctness”. I also believe that political views with strong ideological beliefs are on a giant pendulum and have swung from an amplitude where everyone is a victim and let’s not offend anyone to a fuck you attitude and there is nothing too sacred or anyone above insulting for a powerful minority. Those with less strong views get sucked up in the swing of the pendulum in both directions until over time the most current strongest views begin to choke the masses and then the pendulum begins to swing the other way. JMNSHO :)

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • ridingwaves

    Protesting via not standing for the national anthem is just plain dumb, which definitely equates to many of the players. They are rich but not rocket scientists. If this protest is about black lives matter than it would be better to focus on their respective cities. The whole bullshit about racism is just news fodder, there are still only about 10K at most Klan members. No one cares what they do, they are just trash on the street that you don’t pick up. That is the take of 99.8% of white people.

    The news is distorting everything. The division has been growing for the last 30 years and it has to do with income inequality. The race stuff is what the news makes up….

  • Mark Shinnick

    If you don’t mind looking at hatred, and supposing that the mouthpieces of the most polarized groups reflect words and acts of hatred, where do you see the most hatred based on the news items we can see?

  • HD

    3:3 today at 12.80! beer me!

  • Brishort

    StockTalker, generally in agreement, but looking at the immediate close, with SPX triangulating just at VWAP, one need to be careful with shorts here. Let them rip, unless VWAP is retaken, then shorts may just pee in their pants again and run for cover into the close. VIX is currently supportive of the down move, but not by much. Zero is clearly suspicious of the entire thing…..

  • BobbyLow

    Back at ya Mark. About the only answer I can give you is that I am a left leaning moderate who has crossed over party lines many times. However, being somewhat established in the center, people such as blow em up types like Steve Bannon and phony hyprocrites like Newt Gingrich make me want to vommit. However there are many on the left that piss me off too. This is why being in the center right now really sucks. I know I’m in a minority here so everytime I say something that’s against Trump I expect to get verbally whacked.

    I don’t think we are ever going to be able to agree on this Mark. And that’s OK. It’s just when I see something that I feel is one sided, I feel compelled to say something.

    Oh and a few weeks ago we were talking about political news and the person I was talking to mentioned that he got all his news from a non biased source. I said I wanted some of that so I asked him to tell me where. I received no answer. So if the MSM is fake news and almost every thing that DT says is a lie or extraudinary exaggeration, then where do we get non-biased news from and please don’t say Breitbart.

    So I believe it’s all biased Mark and up to the reader or viewer to make a judgement based on each individual’s background, personal experience and makeup.

  • BobbyLow

    Maybe so RW, but if Trump didn’t shoot is big mouth off to appease Alabama voters there would have been no news. He’s crazy like a fox. The more outrageous he becomes the less we get to talk about what a failed presidency he has. He just tweets away everyday. He’s a fucking embarrasment.

  • Mark Shinnick

    That’s the thing, iI you see and mention the struggle of that centrism within you it makes your thoughts rather interesting.

  • http://evilspeculator.com Sir Mole III

    I don’t want to post it publicly but if you email me directly I’ll share it with you.

  • http://evilspeculator.com Sir Mole III

    Seriously, that one down would have really smashed me today.

  • ridingwaves

    I don’t get the whole protest to begin with to be honest…8 years they had a black president to work hard at the issues at hand….instead nothing was done and race inequality got worse….Trump hasn’t changed, he’s not a politician, rough on every edge and a twitterholic….

    Trump is probably here by design…He is here to provoke the little turd in NK to shooting first….Clinton would have been walked over by all leaders and then hand the little shooter over nukes like her husband did in 94….

  • ridingwaves

    sell Rosh is still in play….

  • BobbyLow

    OK one last thing about centrism. If our forefathers who wrote our constitution had the same attitudes of “my way or the highway” that is prevalent today, we probably would not have had a constitution. There’s no way of telling how things would have turned out.

    But in any event, I think that historically one party rule has been its own demise. This time around will probably not be any different.

  • Mark Shinnick
  • http://evilspeculator.com Sir Mole III

    So nobody picked up on the ‘evil lair’ on the map above? Tisk tisk…

  • Grant

    “Read meat” to the people of Alabama, Neil Young is that you? Seriously, if you don’t like southerners then go back to where you came from… The land of the high taxed and not free. We don’t care for yer votin kind.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    I did shortly before market close. but nobody likes a teacher’s pet.

    TSLA PnF weekly, high pole warning!
    the end is NEAR.

  • BobbyLow

    Hey now there’s a “Trumponian attitude” Good for you. LMAO!

    BTW, I live in the south and I’ll say what the fuck I want to and vote for whoever I want to. We still have these rights or are the secret police the next thing on your far right wing nut case agenda?

    Thank God not all southerners think like you do.

  • Mark Shinnick

    Where’s the Gerbil for the flashback…unless you deleted that comment too ??

  • https://scottphillipstrading.com/trade-setup Scott Phillips

    When I visited you in 2013 I saw people burning the Spanish flag in Valencia while a crowd cheered on. Catalan flags were hanging from a lot of windows. Looked like people who weren’t happy.

  • https://scottphillipstrading.com/trade-setup Scott Phillips

    I’ve seen protests over dumber things. Isn’t that what conservatives are always harping on about, the right to free speech? Seems just like the antifa fucktards, the right to free speech ends with your own opinions.

    If I was a black man in America, I wouldn’t be happy, thats for damn sure.

  • Mark Shinnick

    Has it not happened, too, that the CB free money to the best connected in the EU has alienated most people, especially those without a job?

  • https://scottphillipstrading.com/trade-setup Scott Phillips

    Arguably, but that’s drawing a pretty long bow. And without that CB free money they would have endured (and most likely been long finished with) a very painful period of recession.

    People didn’t want to take the pain, kicked the can down the road. Now the bill becomes due. Same as it ever was.

  • Mark Shinnick
  • http://evilspeculator.com Sir Mole III

    No shit – you never told me that! Yeah, we do have a lot of comunistas here in VLC as well. I think there is a lot of underlying problems in Spain that are being ignored. Since then the economy has rebounded a little which may serve to reduce tension. I do however sense a lot of passive aggressiveness and unhappiness among the people here. Which is strange as it’s such a beautiful and comparatively rich country.

  • http://www.captainboom.com/ captainboom

    @ridingwaves:disqus Agree on the income inequality issue. I don’t have a good solution, but would like to see well reasoned discussion of this at a national level. I read an interesting article on this yesterday, and may have to buy the book.
    https://qz.com/957711/everything-including-the-growing-income-disparity-can-be-explained-by-physics/

    @BobbyLow:disqus may want to read this article too.

  • http://evilspeculator.com Sir Mole III