The market related European crisis seems to be faded away (not the real crisis affecting real people).
What is happening? As I wrote long time ago (Europe, Dead on Arrival 2011) this is the third phase of the crisis -first was Market, then Economy and the, last one, Political.
Europe, on a political level, is divided as much as it ever been. They cannot even agree on a response to Ukraine.
Nationalistic Party are rising everywhere (the latest Le Pen rise in France) and they will keep on rising and allying with other European Nationalistic Party. A worry, but, for now, without a critical mass. But the “normal” politician know that they have limited time before this mass becomes critical.
The most interesting part for Europe is that some political bodies (EG German Constitutional Court) will try to limit Europe power and in the second part there will be fiscal reforms in Italy, France and Spain – plus the end of the bailout programs in Greece and Portugal.
This is where the Hungary example become interesting.
Hungarian right wing PM Viktor Orban did something different – he did not buckle under the European Union and went his own way (and now enjoys a great political support, even if in not a much democratic way). It looks like he got disillusioned with the concept of democracy (well, in my view it is always an oligarchy. In the information I have I really see very few democracy anywhere).
Practically he aligned himself with Russia. Most of Hungarian loans were in Euro and other currencies. When the Forint (Hungarian Forint) fell against the hard currency – Hungary practically told the banks to sort their own issues (you will be paid back in Forint and a percentage of what you are owed to). It also cut utilities price and announced a raft of unorthodox and controversial tax moves. And the UE said nothing.
For sure there are a lot of the South European countries that look carefully at what is happening there. Specially the Nationalistic Parties.
investorpolitico 