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Shahin Vallée

Things Shahin Says on Podcasts

Senior Fellow at @dgapev and Catalyse Europe

Where to Find Them

Shahin Vallée writes Notes on Europe . They have also been a guest on Odd Lots and Independent Thinking . They also write for Agape.s on Substack.

Recently: “The French Political Crisis That's Turning Into a Debt Crisis” on Odd Lots (October 2026); “Notes on Europe” on Notes on Europe (October 2026); “Notes on Europe” on Notes on Europe (October 2026); “Notes on Europe” on Notes on Europe (September 2026); “Notes on Europe” on Notes on Europe (September 2026); “Notes on Europe” on Notes on Europe (September 2026).

What They Said

“The days where the Chinese can produce the equivalent of an Airbus A320 are going to be dark days for Europe and for France.” — Shahin Vallée, Odd Lots

Asked how exposed France is to a second China shock, Vallée says much of France's deindustrialization has already happened, so it is less exposed than Germany. Aerospace is the exception: an industry where China doesn't compete yet but might.

Odd Lots · 2026-10-16 Permalink → Listen →
Odd Lots Around 29:06 into the episode
Shahin Vallée

…inevitable part of the adjustment process, as well as I think pension reform is an inevitable part of the adjustment process on the spending side. And so I think we have these two sacred cows that we'll probably have to sacrifice in order to deliver any meaningful adjustment over the coming years.

Joe Weisenthal

…of China trade question in the context of Germany, and that's huge there. What is the version of that in France these days? And how much similar anxiety is there about, I guess, French Political giants, et cetera, and their own exposure to surging Chinese exports of higher value, added value goods?

Shahin Vallée

…occurred in France already. It is occurring now in Germany. And so to some extent, this is a fight that France has already lost. France is a lot more than Germany, fundamentally a service-based economy. The one worry I think that France rightly has is is in the aeronautical business, which remains a very important French Political, and one where China is not yet competing, but where it might. The days where the Chinese can produce the equivalent of an Airbus A320 are going to be dark days for Europe and for France. And so I think the worry, even though for the auto sector, which is at the heart now of the fight, you know, there's not a, you know, a central concern for France, the worry is that, you know, that, you know, moves an entire industrial landscape in Europe that could end up, you know, being pretty detrimental to France too.

Tracy Alloway

So in classic debt crises, you often need some sort of circuit breaker to put a stop to the dynamics that are making debt deteriorate and then everyone getting more worried and then the debt deteriorates further, etc. With the original Eurozone crisis, that was the ECB's famous whatever-it-takes…

Shahin Vallée

I think we will need two things. One is we will need to have some national consensus emerging on fiscal policy. And, you know, I said some critical words earlier about the German dead break, and I stand by that. I think the German dead break was poorly designed. But I think the good thing that…

Joe Weisenthal

Jehanne Vallée, thank you so much. That was an excellent description of what's going on. Really appreciate you coming on Oblots. Maybe we'll talk again around election season.

Speaker names from our own diarization · position estimated from where the line sits in the episode
“At some point, she's going to have to disappoint someone. Either she will have to disappoint markets by saying, actually, what I committed to fiscally, I can't deliver, or she'll have to disappoint her electorate by actually saying, well, my commitment to fiscal orthodoxy means we have to put the pension age back to 65 or plus.” — Shahin Vallée, Odd Lots

Vallée was describing Marine Le Pen's proposed constitutional fiscal rule, which he says would be stricter than Germany's debt brake. She hasn't said how she would deliver it, including on pensions. He thinks that gap can't last through the campaign.

Odd Lots · 2026-10-16 Permalink → Listen →
Odd Lots Around 19:35 into the episode
Shahin Vallée

…of, you know, I think, politics in most Western countries, but, you know, politics in France in particular, where you actually have now two clear contenders, Le Pen and Mélenchon, coming from, you know, the opposite sides of the political spectrum and pretty much nothing of relevance in the middle.

Tracy Alloway

…or fiscal stance? Because I see these headlines that, you know, she wants more public spending cuts, but then I also see headlines that are like, oh, and also... We're going to reduce the pension age again, which I always thought was, you know, one of the sources of fiscal weakness in France.

Shahin Vallée

It's a very important question and a very difficult one because there has been different views expressed by the Rassemblement National on its fiscal policy. I think there's been a turn that was initiated by Jordan Bardella, which was to basically make the party or the political line a lot more fiscally orthodox. And he came up with the possibility of moving the pension age higher. And he kind of gave, I think, all the signals to French businesses and to markets that he could be compatible with a traditional sort of center-right neoliberal economic policy. Le Pen comes from a place where she, I think, is more committed to social spending. She's more committed to protecting pensioners. And so I think she hasn't quite made that U-turn. What's very interesting, however, is that last week, on October 6th, she presented a new and very bold fiscal rule that she would want to introduce in the French Constitution by way of a referendum. And that fiscal rule basically mandates a very significant fiscal adjustment. So she wants to bring the deficit back to the debt-stabilizing deficit. So that's roughly cutting the…

Joe Weisenthal

What do you mean by that? And tell us a little bit more about Mélenchon, some of the economic things he said. I think he's talked about like canceling French debt. Didn't he also have like he went after the French central banker, etc.? Talk to us a little bit more about those Varoufakis parallels…

Shahin Vallée

The Varoufakis parallel is to illustrate the fact that Varoufakis actually had a lot of political support in Greece and in fact won the referendum that he called for, which was opposing the fiscal adjustment program. And yet he was not able to deliver on the fact that he had won that referendum.…

Tracy Alloway

Maybe this is a good point to ask about the French bank. So in Eurozone crisis 1.0, and I'm hoping no more numbers come after that, but in the original Eurozone crisis, one of the worries was we got this sovereign bank doom loop, basically. So, you know, government bonds would sell off. European…

Speaker names from our own diarization · position estimated from where the line sits in the episode

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