Comments on: Looking at Europe from Uruguay A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: mhmani Wed, 18 Aug 2010 14:57:12 +0000 Felix-
The problem with Europe is exactly the sheer size of the debt. Eurozone debt is 3X the size of US debt relative to GDP. What makes it more of a ticking time bomb is the fact that the general shape of European banks is flat out catastrophic. This debt needs to be restructured. Trichet along with the ECB will play the ponzy extend and pretend game all the way to the bottom. This is the only end game for Europe. The EU Stress Tests were a complete joke. How in the world with all that we know about the PIGS, that EU institutions only need to raise some 3B? How is this? If US Stress Tests were a joke than the EU tests are quite comedic. Trichet is jumping for joy over the fact that the Sovereigns are able to sell bonds. Are they really? Most of the direct takedowns in the Spain auctions were BBVA and Santandor. These institutions buy these bonds then immediately REPO then with the ECB. It’s a total farce.

Restructuring of EU Sovereign Debt is 100% inevitable. When does it happen? Like all good ponzy schemes, it will end when there are no new buyers.

Its no different than Madoff and Stanford.