The Greeks (and who can blame them?) have had enough already with Eurozone "austerity" which, afterall, was a cruel "hoax" (zero chance of success) the Eurozone imposed on Greece in order to "save" French and German banks, and now the endgame is playing out--
Brace, brace. Dark times ahead as Greece heads for the exit - Telegraph: " . . . If Greece redominates all its debts in cut price drachmas, the ECB and its backers – in particular the German Bundesbank – will take a terrible hit, but it won't be terminal. The Bundesbank would most likely simply write off its Target 2 lending to Greece, which would certainly be a major curiosity given its abhorrence of debt monetisation but wouldn't of itself destroy either the Bundesbank or the euro.
The threat comes instead from market contagion to other eurozone countries worst hit by the debt crisis. To Germany, Greece has always been a special case, a nation which cheated its way into the euro, whose citizens are lazy and won't pay their taxes, and is in any case basically ungovernable. There is a very different attitude to Spain and Italy. Germany's determination to make the rest of the eurozone work should not be underestimated. . . ."
As the Telegraph points out, once Greece leaves the euro, the Germans will begin to realize the euro could all come down (as a flawed currency, it probably will inevitably) and focus diligently on (and be preoccupied with) Spain and Italy--but what about Greece? Greece may be small but its membership in NATO and its strategic location make it too important to be left adrift--Bernanke and Geithner better be ready to step into the breach and extend Greece a "helping hand."
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Tuesday, May 15, 2012
The Greek Drachma Cometh--are the Fed and U.S. Treasury ready?
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