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Is the European Union (EU) on the brink of splitting apart? When the British voted to leave the EU (Brexit), I was surprised when I compared promises versus the real results.

This EU website outlines their grandiose plans:

“From resistance fighters to lawyers and parliamentarians, the EU pioneers were a diverse group of people who held the same ideals: a peaceful, united and prosperous Europe.”

The Brits described the results in this manner:

• It’s like heaven for the political bureaucrat because it is power without accountability.
• It was devised to make sure that the great mass of the people could not control government ever again.
• The vote is to take back the right to govern ourselves.

Good intentions be damned, the Brits saw an untenable bureaucracy stifling peace and prosperity. Urs Vrijhof-Droese echoed those feelings in our recent interview:

“The EU consists of many countries with different cultures and economic needs, yet it tries to regulate them all under a one-size-fits-all approach.

…. The EU is at a critical crossroads—either it gets its act together or risks falling apart. …. If the EU can successfully combine stimulus spending with reduced bureaucracy and meaningful deregulation, it could unlock its former economic strength.

…. For the EU to get back on track and fulfill its promise of peace and prosperity, its leaders must return more power to individual member states—centralization has proven to be a roadblock, not a solution.”

I feel Trump’s tariff proclamation is to renegotiate trade deals. The European Trade summary reports, “The U.S. goods trade deficit with the European Union was $235.6 billion in 2024, a 12.9 percent increase ($26.9 billion) over 2023.”

New trade deals or tariffs won’t help the EU economy. It’s time for expert Chuck Butler to weigh in on the situation.

DENNIS: Chuck, welcome back! A lot of readers were concerned about your recent bout with pneumonia.

This entire US/EU situation appears complicated. When the banks were bailed out in 2008, the US cut interest rates and much of the world followed. By doing so, they maintained some relative parity among currencies. It’s still all paper money.

EU governments borrowed cheap money and spent at record-breaking levels. Like the US, lax immigration policies have outraged many citizens.

Chuck, my question is this. While Urs discussed the EU getting their act together, isn’t this more of a political issue than economic?

CHUCK: Yes, I do believe it is… The politics of the European Union (EU) have been steadfast in allowing immigration much like the Biden administration did, although in the EU, the numbers get skewed.

We expect immigrants to assimilate into our culture. Much of the EU immigration appears designed to bring about change to the countries involved. Certainly, the EU leaders are aware of this; their citizens are upset, and they must deal with it soon. So maybe – just maybe – the EU can be saved…

DENNIS: As a “conspiracy theorist.” I feel there is much truth in the David Rockefeller quote, “The supranational sovereignty of an intellectual elite and world bankers is surely preferable to the national auto-determination practiced in past centuries.”

The EU structure, with an unelected hierarchy, is an obstacle for them to “get their act together.” Do you see the EU just blowing up, or perhaps a realignment?

CHUCK: I see realignment; giving more power to the people, recognizing the ethnic votes and individual country culture. By doing so, the EU should return to what they were formed for, peace, prosperity, and freedom to easily move about the countries of the EU. Economic growth helps return Germany to the powerhouse manufacturer it once was…

Rose colored glasses? Perhaps, but it’s what I see!

DENNIS: When the Brits bolted, the EU made it very difficult, intending to make sure no other member tries to secede. There are a lot of members heavily in debt, making no attempts to remedy the situation. While we’re guessing, how do you see this process playing out?

CHUCK: When I was at EverBank, I mentioned to my good friend and Big Boss Frank Trotter, that countries might leave the EU because of debt and immigration problems. He handed me a multi-page document outlining the parameters countries had to meet to leave the EU.

It was quite extensive and I felt no country would ever leave, but I was wrong and the U.K. left a few years later…

However, if this new realignment of the leadership of the EU comes about, smaller countries that can’t get their debt within the EU parameters, will be asked to leave…

DENNIS: As a currency expert, who will be winners and losers?

CHUCK: I think Switzerland is the leader of that pack of winners; they never took the bait of joining the EU, and now stand head and shoulders above the rest of the EU Counties. Germany should expect a rebirth of manufacturing if a realignment comes about. Denmark, and the Netherlands, historically very closely tied to Germany, should also be good to go.

Spain, Greece, Italy, Portugal, what I call Club Med countries, all have a mountain of debt that they’ll have to deal with. The more prosperous members are tired of guaranteeing their debt. I doubt they will meet the debt limit requirements of the EU; they’ll be asked to leave – becoming the losers.

DENNIS: Tariffs, leading to a trade war, can send the entire world into a Great Depression, hurting everyone. The world thrives when all economies are booming; trade deals must be fair. Politicos must put their egos aside and renegotiate in good faith. What do you anticipate?

CHUCK: I’ve warned my readers in my newsletter: A Pfennig for your thoughts (shameless plug) that they need to associate themselves with the effects of the Smoot-Hawley tariffs. While they weren’t the only reason the Great Depression started, they sure didn’t help.

I do believe that IF the trade tariffs announced by the POTUS on April 2^nd are not intended to result in negotiation for better trade deals, then a global trade war will result – and everybody loses.

The POTUS has been quoted as saying that he will bomb any country that retaliates tariffs, but in my view this a negotiating tool. It’s one that should never have been used, but it was, and that’s that!

You’re right that the global economy (particularly the US) would be much better off with fair trade deals. Remember when the great President Ronald Reagan introduced global trading? Things sure were simpler then, eh?

DENNIS: One final question. You’ve warned us about the Smoot-Hawley experience leading to a worldwide trade war; certainly not helping to bring us out of the Great Depression.

A couple days after the tariffs went into effect, the stock market tanked; I experienced the biggest one-day drop in my life.

Trump’s opponents call the tariffs bone headed economics, dangerous and more. The conservative media shows these same liberal leaders supporting tariffs when their party was in power. Politicos and the media support those same policies when they are in power, and scream how terrible they are when the other party is in power.

God, I hate politics and the associated media! Personally, I give no respect or credence to those who have a history of talking out of both sides of their mouth.

In the past I’ve written that liberals want another depression so they can call Trump another Herbert Hoover, vote him out and then they can control DC for 20+ years like the last time around. A good example of political power being more important than what’s right for the people!

Panic, stay cool? What would you like to say to our readers?

CHUCK: Dennis, to me, this is similar to election night right after the polls closed; much too soon to make a call.

Let’s start at the beginning…. Tariffs are similar to a value-added tax being added to imports. They are called “protectionist” because they are designed to help the workers in the home country.

Several news shows pointed out that almost 50% of the goods on the shelves of Walmart and Costco are made in China. While that may lower prices, losing millions of good-paying American jobs to other countries is the result. It’s the extremes that become the issue, and Trump is branding them as “unfair.”

Tariffs are not the problem; it only becomes a problem if leaders allow their egos to get involved and start playing one-upmanship, which can lead to a trade war hurting everyone.

I read that Trump is getting many calls from foreign governments willing to renegotiate; that’s a good sign.

As to the stock market, check this out:

The market dropped to where it was last August. I urge readers to keep things in perspective. We need not panic; let’s see how things play out…

Dennis, thanks again for inviting me.

DENNIS: My pleasure, Chuck.

Dennis here. I appreciate Chuck’s cool head, helping us maintain our bearings.

The highly politicized media makes it difficult to sort things out. Personally, because of my gold, silver and metal stocks, even with the sudden drop, I’m well up for the year. While a bit unnerving, I’m not panic-selling and will wait to see how things shake out before I begin to buy.
 

On The Lighter Side…

Congratulations to the Florida Gators on winning the college basketball championship. March Madness, with bracket pools, etc. captures the attention of much of America.

Next up are the NBA and hockey playoffs – and major league baseball is in full swing. Jo and I are pulling for the Tampa Bay Lightning in the hockey playoffs. It’s a sign of spring and nice summer days to follow.

I love summer baseball; it’s still #1 in my heart. As a child, I have fond memories of the radio broadcasting the game in the background every day.

I saw my first Cub game at Wrigley Field in 1944, and I’ve been afflicted with Cub Fever ever since. They have won the World Series exactly once in my lifetime, and I would love the thrill of seeing them do it again. Unfortunately, this year’s team doesn’t appear to be a championship roster.

Friend Chuck Butler, a die-hard St. Louis Cardinal fan, reminds me they have won 11 championships, five in his lifetime. It must be nice!
 

Quote Of The Week…

“It’s spring again.

The earth is like a child just finding its feet and toddling toward a new future.” (unknown)
 

And Finally…

We’ll share some Jimmy Buffet wisdom to close out the week:

• “Take naps like they’re happy hour.” Don’t let anyone shame you for nodding off. Naps are nature’s way of giving you a little slice of paradise.
• “Remember: sand in your shoes is better than snow in your driveway.” If retirement hasn’t taught you to be a snowbird yet, well, what’re you waitin’ for?
• “Drink your margaritas frozen and your coffee lukewarm.” Hot coffee’s for people with somewhere to be, sip yours slow and take it easy.
• Let the adventures continue, keep the laughter loud, and remember Parrotheads, paradise is wherever you decide to sit down with a smile.
• “Smile lines are just proof you’ve lived right.” Wear those wrinkles with pride, they’re a souvenir from the ride.
• “Always carry two things: reading glasses and a sense of humor.” Life’s clearer with both.
• “Go barefoot whenever you can.” Life’s more fun with sand between your toes and grass under your feet.
• “Tell your kids you’re off to chase the sunset.” They may think you’re joking, but there’s magic in those last golden rays. Chase ’em, catch ’em, soak it all in.
• “Forget the beach body. Just make sure your hat has a good brim.” Cover up, sunscreen up, and enjoy the beach—life’s better with a good tan and no sunburn.

And my favorite, in line with this week’s thoughts….

• “Splurge on the good guacamole, your kids can fight over the will.” Why save all the fun for later? Enjoy it now. Life’s short, guac is extra, so live a little.

Until next time…

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