Courtesy of Mish.
The ECB has enough on its hands already: Collapsing Italian banks, a Deutsche Bank derivatives mess, massive Target2 imbalances, and the rise of eurosceptics like Beppe Grillo in Italy and Marine le Pen in France.
Nonetheless, ECB president Mario Draghi decided there was room on his plate for yet another problem: trade politics.
Please consider Draghi Urges EU to Take Tough Line with UK in Brexit Talks.
Mario Draghi has become the latest European official to push for the EU to take a tough line in negotiations with the UK over Brexit, saying Britain should be refused access to the single market unless it sticks to rules on free movement of labour.
“Regardless of the type of relationship that emerges between the European Union and the United Kingdom, it is of utmost importance that the integrity of the single market is respected,” Mr Draghi said, speaking at the European Parliament on Monday. “Any outcome should ensure that all participants are subject to the same rules.”
Referring to rules on the free movement of labour, capital, goods and services, the ECB president said: “The four freedoms go all together. That’s clear.”
Mr Draghi added: “How we come out of this position will impinge on the stability of the union in future.” Allowing the UK to skirt the rules would weaken the EU’s strength in years to come, he said.
Counterproductive Stance
It might feel good to rattle sabers, but nothing good can possibly come of it. The risk of a hard Brexit is very real, and it’s a two-way street.
If the UK loses access to the “single market”, the EU will find itself losing exports to the UK.
No one wins these kinds of trade wars, but the EU will lose far more.
Cherry Picking Math
