Il Congress of Vienna it lasted from September 1814 to June 1815. It was the first European council of heads of state. He formulated the general strategy for the reorganization of the continent after three decades of upheavals of the millenary feudal structure due to the French Revolution and the Napoleonic wars. He calculated and divided the territorial compensations among the victors, instituted new states from scratch, restored dynasties and meticulously regulated the structure of powers and spheres of influence of kingdoms, principalities, duchies, states, statelets and their colonies on the five continents. All in nine months and without planes, videoconferences and smartphones. The Paris Peace Conference lasted from January 1919 to January 1920. Having only a telephone and telegraph, trains and ships but no planes, it reorganized the world after the Great War.
His 52 working commissions dissolved three empires, created a dozen new states, from Palestine to Armenia to Czechoslovakia, settled the Pacific, verified and modified the entire global colonial order, redrew the geographical map of Europe, laid the foundations for the League of Nations and also found the time to indulge Greece by realizing its Megali Idea (the great idea) of territorial expansion towards Thrace, Northern Epirus and Asia Minor. All in 12 months. There Tehran Conference of 1943 it lasted five days. Seven days were necessary for that of Yalta in February 1945 and five were enough for that of Potsdam in July of the same year. In a total of 17 days, the three conferences agreed on war strategy, prepared for the post-war period, redrew the world atlas again, divided Europe in two, examined and rejected the British proposal to transform Germany into a country of agriculture and pastoralism, moved Poland westward a few hundred kilometers, obliterated the Baltic states, created Mongolia, re-established Korea, abolished the Manchu state, adjusted the Chinese borders, verified the colonial settlement and prepared the guidelines for the establishment of the United Nations.
Stalin and Churchill, who according to some historians were no less tough negotiators than Tsipras and Juncker, managed to quarrel only over Greece but quickly reached an agreement whereby the Soviet Union kept 10 per cent of influence over the country and Great Britain 90 per cent. remaining. Had it been the other way around, Greece would perhaps today be a liberal country with low welfare and low debt and fiscally prudent, as are all the countries that have left the Soviet orbit. The Brussels conference on raising the retirement age in Greece, which started in February 2015, has already reached its fifth month. It is a global conference because it involves not only the 19 heads of state and the 19 finance ministers of the Eurozone, the ECB and the Commission but also the United States which, as it turned out, intercepts all telephone calls between the negotiators and then they call immediately after to have their say. The conference takes place day and night and the poor negotiators, who are forced to backbreaking pace, transmit growing weariness and irritation. Distant and faded are the images of Stalin, Roosevelt and Churchill negotiating relaxed under the palm trees and breezes of the hotel gardens in Yalta, overlooking the Black Sea, or those of Truman, Stalin and Churchill smiling under the linden trees of Potsdam Castle in the bright July sun. Those were simple times.
Be that as it may, we will soon know whether Greece begins its path of exit from the eurozone on Monday or whether, alternatively, it will be flooded with substantial new aid. The world, which in January had not even noticed Lithuania's silent entry into the euro, is ready to follow Greece's possible exit with bated breath. Which almost certainly will not exist but which, if there were, would confirm the reversibility of the single currency. Scandal. There is an old saying that a banker who, in times of financial crisis, feels the need to declare that his bank is solid is already out of time, because he shows weakness. The euro is the only currency in the world whose irreversibility is periodically felt to be proclaimed, a clear sign of weakness. For this reason, while sincerely hoping that the euro will have a long life and while having a reasonable faith in the fact that it will, we have been suggesting for years to increase the solidity and stability of portfolios by holding a fair share of dollars, in the same spirit with which one used to always keep a little gold, without paying too much attention to price fluctuations. The euro is stressful, it is a continuous near-death experience followed by resurrection. In a portfolio built on Mars it would be perfect as a satellite element, to enter and exit, of a hard core made up of dollars and renminbi.
Il Five Presidents Plan released in recent days (interesting coincidence) goes in the direction of irreversibility through the creation of a single federal treasury and the launch of elements of a common fiscal policy, but it takes a very long time. In any case, nothing will be touched before the French elections of 2017. In fact, the volatility, more than on the euro itself, is unloaded on the continental stock exchanges. It's already a big step forward from three years ago, when even the bonds of the periphery were traveling between near-death and resurrection. If Greece is still with us on Monday, as we hope and believe probable, the continental stock markets will allow themselves a summer of rises that could take them close to, but not beyond, the recent highs of April. Cyclicals and banks will be preferred. Quality bonds, on the other hand, will have to suffer a bit but not much, because they have already given a lot in the sharp fall in price in recent weeks. Periphery spreads will, of course, tighten. Once the Greek question has been filed away and soon forgotten, sooner or later we will return to discussing the rate hike. The advance of the stock exchanges will make the problem topical again. Europe will not touch policy rates until 2017, but a certain tension will still be felt on long maturities. We will return to this matter soon.
