Thursday, September 20, 2012

Gaming the OMT

Yanis Varoufakis explains why he thinks Mario Draghi's threat to enforce harsh austerity in exchange for unlimited liquidity is not credible.

4 comments:

Mitch Guthman said...

I think this analysis is largely correct. I have always felt that Greece, for example, has far more leverage over Germany, France and the rest of Europe than most people realize. As it becomes clearer that things are not going to get better in Greece and indeed are likely to get much worse during the coming decade of murderous austerity, there will be increased calls for Greece to exit the euro. I have always thought this to be the wisest course of action for Greece.

It’s true that leaving the euro is likely to be disastrous for Greece but, really, how much worse than what Greeks will endure for decades under the austerity enforced by the ECB? If Greece stays in the euro, it will endure decades of austerity, the looting of it historical patrimonies by eurotrash elites and perhaps the collapse of civil society altogether. Yet, Greece will be no better off at the end of those decades because of the structural problems with the eurozone will relegate it to loser status. On the other hand, leaving the euro could hardly make things worse for Greece and the hardships will be borne more fairly across the whole of Greek society. The potential for economic recovery and even the eventual of prosperity are much greater for a Greece outside of the euro.

James Brown said...

I am left to wonder if such a scenario described above, which is very plausible, will become relevant for Spain, Portugal...Italy even.

James Brown said...

Another point is that I can easily imagine the whole save-the-euro circus going on for many years into the future.

Anonymous said...

in the meanwhile, Marine Le Pen focuses on what really matters: people who wear hijab or yarmulke on the street.
http://tempsreel.nouvelobs.com/topnews/20120921.REU6496/marine-le-pen-pour-l-interdiction-du-voile-et-de-la-kippa.html