Incredible the major Criminals we have running the Euro zone now!!!

so true !

but you should send also to the EU-non elected dictators whose only achievement per todate is the impoverishment of millions of Europeans.

The problem with the Edgy Optimist’s post is that he is paying too much attention to market moves. The euro wasn’t dead over the summer, and it wasn’t fixed in the fall and winter. Hence, the current market does not indicate pessimism among market participants. PIIGS bonds yields and stock markets have declined in response to-who knows-what but profit-taking and the shrinking of the ECB balance sheet are as good explanations as the political machinations in Italy and Spain.

The euro is causing the slow decay of the Eurozone economy. Its very existence causes imbalances among its members. As long as the euro exists, so will these imbalances. As long as the system remains weak, its survival is in doubt no matter what you think the market is telling you.

The cult of the euro loves to paint the euro as this great love-fest that has prevented war on the continent for almost 70 years. This characterization is wrong.

What prevented war in Europe was NATO, millions of American and British troops standing in harms way in Germany and trillions of dollars spent by the U.S. and a broke U.K. during the Cold War to counteract Soviet aggression. The Nobel Prize should have been awarded to the troops who manned bases in West Germany until the dissolution of the USSR, not the eurocrats.*

It is optimistic to believe that the EU prevented WWIII, but it is realistic to know that trained, armed soldiers and the best weapons in the world are really what did the job.

At least author admits his bias, and this is what leads him to misunderstand the costs of a euro dissolution. He fails to see that the costs will not be borne equally by the members.

Creditor countries like Germany with large Target2 credits will be hit the worst. The Germans will also revert to a fairly valued mark that will crimp exports. Debtor countries like the PIIGS will immediately be relieved of crushing debt through a devalued currency that will create an export boom at the price of high inflation in the short-term. See Iceland and Argentina from 2001 for examples.

As long as some countries may benefit from an exit, the eurozone is in danger of dissolution, and that is a realistic assessment, not a pessimistic one.

*My father and the fathers of my friends selflessly went to Europe to preserve the peace during the Cold War, so please forgive me if I become a bit jingoistic when discussing this topic.

Post with charts and links here dareconomics.com

B. These amateurs are the most Momo-chasing, easily persuaded participants in world markets.

C. They are manipulated like crazy as foot soldiers for the relatively few professionals.

D. And the vast majority of the professionals are utterly crazy.

E. Meanwhile, we participants in non-currency markets have to suffer for their excesses, again and again.

The only way out of this is the same as it has been for a long, long time now: Impose a large enough worldwide coordinated Tobin Tax on currency trading and greatly limit acceptable leverage, for amateurs and professionals alike.

Currency trading must cease and desist being the mammoth tail that controls the animal of world markets.

“The European Union was born of hope for security and prosperity sealed by common bonds of currency and government. It has achieved that.” I respectfully disagree on both counts.

Only an osterich with head in sand might describe the current European economic situation as “prosperity”.
The latest Iranian missile capability and rhetoric show Europe in the cross hairs of an irrational and unpredictable radical muslim theocracy and American “protection” both questionable and fragmented by misguided and futile attempts to appease a stupid but still vicious Russian bear. The seeds of their own destruction are the very differences between the economic successes of northern Europe and the economic failures of southern Europe. The destruction of national societies is as absolute whether by war or economics.

Until Europeans figure out that they have to PRODUCE AND SELL enough to pay the economic cost of all those “free” holidays and health benefits they have NO “future” or any “way forward” but collapse.

Those who were predicting a cataclismic collapse that would occur in a matter of days or weeks were wrong, but then was that ever realistic? The reality is that the situation is bad and growing worse. What could be worse than that for the largest collective economy in the world?