The smart thing to do would have been to let Greece default. It is now clear Greece is going to default anyway. History will show the world will not end. It will also show that bailouts to date have done nothing but harm.
The Greek government is in a gigantic financial hole and is teetering on the brink of defaulting on its debt. It has been able to limp along since last year only with bailouts from outside of Greece.
Clearly Le Pen is an anti-Euro, anti-immigration candidate and that is just the kind of message that can easily catch fire in this environment. Elections in Germany or France may seal the direction, unless we see exodus by countries before the election.
Raising taxes on the dead cannot possibly help. Yet, that is precisely what Germany, the IMF, and the EU want Greece to do.
In spite of the fact most of us realize lies will not help, and most often makes matters worse, governments repeatedly resort to lies, platitudes, and wishful thinking when they get caight in a jam.
President Obama’s latest vision on taxes once again singles out energy companies, successful high-end earners, and small-business entrepreneurs for future tax hikes, rather than across-the-board rate-flattening and deduction-ending.
For now, European developments remain negative. As long as there’s not a breakdown of the euro itself, we think the global growth outlook depends more on structural reforms in Italy and Spain and the U.S. Unfortunately, none is moving in a growth-oriented direction.
The granddaddy speculation of them all is the possibility Merkel might drop her opposition to common Euro bonds. That is the "nanny state" option I have written about many times recently. Fearing the common bond nanny state possibility, Otmar Issing, former ECB president issued a statement called the backers of common bonds "Euro Gravediggers".
As Greek 2-year debt yields hit 39.15% the bond market finally forced the ECB's hand, and the Trichet group comes out looking foolish, not only on his "we say no to default" stance, even temporary defaults, but also on his ridiculous bluff repeated for the nth time just 2 days ago regarding the acceptance of Greek bonds as collateral.
It was seven months ago that Mohammed Bouazizi, a vegetable peddler in Tunisia set himself and the Arab world on fire. The 26-year-old staged his suicidal protest on the steps of the local city hall after a municipal inspector took away his unlicensed vegetable cart thus denying him the ability to feed his family of eight.
Republican Senate Minority Leader Mitch McConnell announced the “backup plan” on the debt limit he has been mentioning the last few days. And bond yields are spiking in Europe.