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interestrateripoff

France's Sarkozy Spells Out Loan Plans

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http://business.timesonline.co.uk/tol/busi...icle6811419.ece

Plans for a national loan to rebuild and redesign French industry were outlined yesterday by President Sarkozy of France.

He then charged a panel of scientists, economists and politicians, including former prime ministers, with the task of deciding how to spend the money.

The amount of the national loan, similar to a “war bondâ€, has not been set, but the French media speculated that the bond could raise between €80 billion and €100 billion (£70 billion and £87.6 billion).

The proposed loan, which will add to €1.3 trillion of government borrowings, underlines Mr Sarkozy’s support for an interventionist industrial strategy.

The task of the loan commission, which includes Alain Juppé and the socialist Michel Rocard, both former premiers, will be to meet “three challenges†facing France, the President said.

These were the “knowledge economyâ€, competitiveness and industrial innovation. Mr Sarkozy criticised the country’s lack of success among small and medium-sized exporters.

“How, in just a few years, did we allow our share of European exports to fall by a quarter?†he asked.

Mr Sarkozy declined to give the commission a budget to consider and the President’s enthusiasm for more intervention in the economy and support for an industrial strategy is creating anxiety among right-wing French politicians. Two former prime ministers — Dominique de Villepin and Jean-Pierre Raffarin — were openly critical of the proposal when it was mooted in June.

The funds from the national loan will be in addition to the stimulus package of €45 billion raised to combat the recession and the President made clear that the money would be used to set France’s industrial focus in a high-tech direction, such as “nanotechnology, biotechnology and energy storageâ€.

He said that the national loan would send out a message “to show people that the crisis is not cutting our capacity to take initiativesâ€. [/b]

And people doubt that debt is wealth.

Yet more borrowing to create the illusive growth, clearly we haven't borrowed enough the small amounts already borrowed has improved GDP. Clearly if we borrow even more we'll have the desired effect and generate huge growth in the short term.

This is the new economic paradigm.

Please don't ask awkward questions like where is all this money going to come.

Edit to alter thread title as I may have misread it.

Edited by interestrateripoff

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Am I reading that wrong, or does it say adding €80-€100 bn to an existing €1.3tr debt? If so, you might change the thread title.

I've altered it, on first reading I assumed he was going to pump an additional 1.3tr euro into the economy.

Oops.

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I've altered it, on first reading I assumed he was going to pump an additional 1.3tr euro into the economy.

Oops.

Whats interesting is that that wouldn't have been beyond the realms of possibility to read of on a Thursday morning.

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Whats interesting is that that wouldn't have been beyond the realms of possibility to read of on a Thursday morning.

Which is why I misread the article, it sound completely plausible that France would announce do it.

It's amazing how I didn't really give it a second thought that I could possible have got it wrong, even though it was such a huge amount of money.

Trillions have fast become meaningless.

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The only sensible thing I can see France doing is building another 25GW or so of nuclear power and feeding it to other European countries.

The UK would gladly accept 5GW, potentially 10GW

And the other 20GW they can feed to other European nations.

That would create about 75,000 direct jobs and then some 75,000 indirect jobs in France and would pay for itself.

Potentially they could become the Europes aluminium smelters too. French nuclear power could provide electricity at 2p a kWh with some hidden subsidies to its smelters and create more jobs in that way. This may require a few back handers from the state though.

Other than nuclear I don’t see what France is good at that it can increase and export.

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