Tuesday, 16 June 2015
Greece: Acropolypse now
This must be the 50th piece I have written on Greece, but I do find the story so interesting. For so many years I thought it would be Spain that blew up the Euro; it just seemed so obvious, the housing bubble, corrupt Government, total lack of balance in the economy. As it turns out Spain for a while made austerity sort of work.
It won't in the long term and if Podemos get near power then we can expect a Greek re-run next year (just in time for our referendum - better than a present from Santa!).
But Greece has beaten even the Spanish to it. World class tax evasion and Governmental corruption has seen them lead the field. Allied with a intransigence on behalf of Germany to admit even slightly that their mercantilist policies might have something to do with the crisis in Southern Europe and hey presto, Grexit.
For a long time there was to be Euro-fudge. The Euro could not be allowed to collapse, as in 2008, Politics would trump economics. But the IMF have walked now, the Syriza poly of thinking the lenders will come back to the table is in jeopardy (I say Jeopardy because funny things can yet happen at the 11th hour).
More intriguing is now the talk is of Greece defaulting within the Euro. This is a brilliant idea; currency union has failed so let's wipe the slate clean and stay in the same currency union.
Amazing piece of double-think and only in truth allowed because it will save The ECB's arse on the losses in Target Two funds if they all stay denominated in Euro's.
Gotta love the Euro leaders too, saying how terrible and awful it will be for Greece and how they won't be able to fund rescue help. This is first order bullying bollocks by the Euro leaders, showing perhaps they are more scared than they are letting on - an inkling that perhaps Syriza will get their concessions at the eleventh hour?