We’ve all heard of conundrums and vicious cycles and so on. Well, here is our own European version of one in the aftermath of yet another inconclusive, idiotic Brussels summit.
Why did the original sovereign debt crisis come about in the first place? Because of over indebtedness caused by cheap Euros being thrown down south not least so that the southerners would keep on buying the northerners’ products while impoverishing themselves; and of course because of the vane attempts to shore up Europe’s insolvent banks after the 2008 bubble burst. And of course at the taxpayers expense. The well known scheme of profits are kept private but losses are socialised.
That was the background against which The Markets (proved so horribly wrong with their AAA ratings of Lehman Brothers for one) started getting jittery. These jitters caused the so called spreads, that is interests on the bonds of EU countries to start rising. First victim, the weakest link in the chain, Greece. Spreads soared so high the country crashed and had to go cap in hand to the EU and IMF with all the disastrous results thereof.
Then one after another the weaker countries were targeted. Portugal and Ireland were forced by The Markets down the same miserable and destructive paths. After that, The Markets have been targeting the next weak economies up the line, Spain and Italy, even France a bit. Oh, and in case you idiotic Europeans start getting ideas, we shall eventually target the whole damn bunch of you!
Meanwhile back at the ranch in Brussels, or Berlin rather, the whole exploding crisis was met with dithering, small mindedness, the intelligence of a village grocer, indecision and above all denial that anything at all was the matter.
The EU has now reached an apogee of hysteria over… what? Elections in that tiny less than 2% country Greece, through fears that the Greeks will vote for the “wrong” parties! Disaster! Calamity! They must toe the line! They must continue the self destruction till it is complete! Otherwise they will go back to the drachma and have no access to medicine or petrol! Well, we already have no access to medicines and half the buildings in Athens and elsewhere remained without heating during the winter already. But be that as it may. A threat is a threat.
Now, at the height of the panic induced by the complete and utter failure of The Frau’s imposed policies an informal summit was held in Brussels yesterday. Just another same old same old. Dithering inconclusiveness. Everybody agreeing on “growth” or at least paying lip service to the concept. No one being at all specific on how to achieve this lofty aim sort of like “I believe in peace and apple pie” . Hollande trying to push the Eurobond idea, The Frau against it, as she is against anything at all that could be productive.
And all this against the backdrop of “We shall kick Greece out of the Eurozone UNLESS it sticks to all its commitments to destroy what is left of its economy!” We don’t really want this, but we have made contingency plans! So watch it! Make sure to vote in all those idiots who got you into this mess in the first place, rather than anyone who might just be able to get you out.
So while the EU is squabbling and threatening and the established bully girl is trying to keep her place in the school yard because there’s a new boy in town who might threaten her… The Markets have gone hay wire. Up and down, stock markets fall, the Euro drops, in short havoc all over the world. Some might say it serves The Markets right. They were the ones to get us into this mess, they should pay the price for it. Full circle. The Markets caused the crisis, The Markets find themselves paying for it. Poetic justice.
But others might just venture a question. If Greece is such a pain in the ass and creating such terrible problems for Europe and the world, then why did The Markets not soar at the loud threats and perceived imminence of a Grexit? Surely, since we are assured that contingency plans for such an eventuality have been made, that would be problem solved. Greece would be left to its fate, outside the Eurozone, and the rest of the world could carry on nicely.
But quite obviously, The Markets did not see it that way. They did not see it that way at all. Why?