Fri Jun 17th, 2011 at 08:00:11 AM EST
I wanted to write something in a diary. I wanted to say that down down deep in my brain I thought something about the European crisis that my conscious brain was not aware.
I need to explain..and I need therapy...I need social support. I need comments telling me that I am wrong.
front-paged by afew
In the last couple of days I have become aware that my symbolic brain had thought about the crisis without me being aware of the fact.
I now realize that I thought that Germany, ECB and France will push all the Mediterranean countries towards austerity measures that would be accepted, in ex-change for moving the greek debt in private hands towards public hands in the next two years. And once all the debt was in public hands, Greece, Portugal and Ireland would default. Not Spain, Spain was too big to fail, the ECB would buy Spanish bonds in case of a bond attack, as long as Spain promises to grow at 0.5 % during 3 more years to guarantee the Spanish debt in European banks.
I though the euro will survive, as always, with banksters getting the money, and workers paying the price.
Now I see that a Greek defualt will never be a possibility for the ECB (the fact that Greece may revolt at anytime will just bring the outcome forward), now I see that Greece can not threat to default without starting a Minsky run, and a capital flight. So a default and leaving the euro is the same thing for the crazy nuts in the ECB.
And there is no chance that Europe will become a transfer union any time soon. More worrisome, all media treats the greek debt that the ECB has as something dangerous for the ECB!!!for chirst sakes, this means they do not get anything at all (or they do). The ECB can print money!!! well.. it should be able to print money!!! but maybe the European framework does not allow the ECB to print money??!! Is it true? can it be possible? I think it is, written in law or in fundamentalist ideology.
And no fiscal transfer, no ability to print money, no way to pay back debt, and equivalence of default and ECB triggered Greece bank-run leaves only one option. This last option.. with Portugal following.. and Ireland.. and then Spain, deciding what to do, or maybe without any option but leaving the euro.
It is the end of the euro. Roubini is right... and my unconscious brain was wrong...it is time to be scared.