I warned you. Do not underestimate the power of German culture to stear events in the EU. I told you this over 20 months ago. It is very clear that closer union integration in the EU is not a possibility.
Mother Merkel said just today that no debt sharing would occur while she’s alive.
Well then what are we doing here? Spain can’t afford to pay its bills today. It’s not going to be able to pay them tomorrow. It needs to restructure its debt load. The market’s not extending risk to Spain. So that’s not happening without default unless debts are going to be shared.
Issuing joint debt was the inevitable hope for any cessation of sovereignty to Brussels. Without the prospect of joint area debt, there’s no carrot here; just a stick. How is it that the rest of the nations are supposed to navigate the field, when the only outcome is getting whipped?
But then, this has been a false choice from the get go. The fallout has been the only guarantee; I can’t say I blame Germany for calling the game and taking their chips off the table. They have the choice of contraction by a stronger, newly issued Deutschmark, and contraction by extending liability to their idiot neighbors.
Might as well pick the course that keeps you master of your own life, even if it’s a rough life to live. The only other option has them losing sovereignty, any way you look at it.
So the EU is going to break up. Merkel is channeling the spirit of Hjalmar Schact. The euro and the dollar are going to par. We’ll probably need quantitative easing in the next two months to stave off the selling.
The Europeans have chosen their path. They hate each other too much to function under a coalition that’s only adhesive is trust for one another. 1,000 years of culture trumps 10 years of colorful papers.