Opinion: The Ukraine war may ultimately be decided through Europe's balance sheet, according to economic and geopolitical analyst Tom Luongo.
"What Trump is doing is taking the collateral away from Europe to force them to end the war? Yeah, and in fact, again, you have to continue to degrade their ability to continue funding Ukraine, because the United States isn't really funding Ukraine anymore. We have a Congress that wants the parts of Congress that want to fund Ukraine, but clearly Trump doesn't, right? But you definitely have that from the European side, from NATO. They're pledging another $170 billion or whatever it is that they're going to dump into Ukraine. There's a couple of reasons they have to do that, not the least of which is they need the war to continue, because they pledged all these loans, and the future cash flows over getting control of Russia to pay these loans back, and they're not getting them. So they have a real problem from that perspective. The Europeans do, and so now the big question is, on everybody's mind, is what happens when we can all do the macroeconomics of Europe? They're terrible. Germany's deindustrializing, France is a mess, the UK is nothing but City of London's forex and insurance industry at this point. All of it is bad, right? So at some point, global investors, the only thing keeping Europe afloat from a global investor perspective is the perceived chaos politically in the United States. So the minute Trump puts any real solid geopolitical wins on the board, which get him over the line in the midterms and everything else, forget it. All the capital is going to flow out of Europe, and they're not going to be able to continue funding their operations at 3% to 4%, or more appropriately, at lower interest rates than the United States is currently borrowing at."
💬 Discussion
Opinion: The Ukraine war may ultimately be decided through Europe's balance sheet, according to economic and geopolitical analyst Tom Luongo.
