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Monday, September 12, 2011

The Dead Parrot

German politicians are now daring to say in public what everyone has known for sometime, namely that Greece is heading for bankruptcy and that it will leave the Eurozone.

Philip Rösler, German Economy Minister, wrote in Die Welt:

"In order to stabilise the euro, we must not take anything off the table in the short run.

That includes as a worst-case scenario an orderly default for Greece, if the necessary instruments for it are available."

Rösler has recognised that Greece's problems cannot be solved by the Eurozone (ie Germany, the largest provider of funds for Greece's bailouts).

What are the "necessary instruments" to which Rösler refers?

Horst Seehofer, state premier of Bavaria, has helpfully provided the answer. He told ZDF that Greece must leave the Eurozone.
"If, despite all their efforts, the Greeks do not manage, then you can't rule out this possibility."

In fact the executive committee of the CSU, the sister party to Chancellor Angela Merkel's Christian Democratic Union (CDU), will today approve a motion that calls for highly-indebted states to leave the eurozone.

The wheels for removing Greece from the Euro are now in motion, the only question is will the expulsion of Greece be enough to stop the rot?

The answer to that is "no".

The Euro, as an experiment in its current form, is finished. Sadly, for the people who live in the Eurozone, the "political elite" of Europe refuse to see that reality and will continue to wreak economic havoc in Europe and beyond, by continuing to prop up the "dead parrot" of a currency until the very end.

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