Nick Rowe on the Euro-crisis

Well, first by analogy, but you’ll have to click through to get the title:

First, he summarizes the problems with and likely outcomes of the Eurozone:

In good times, without a solvency and liquidity crisis of sovereigns and banks, it would be possible to dismantle a currency union in an orderly fashion. Difficult, but possible. These are not good times for the Eurozone.

The European Central Bank can’t function as an effective lender of last resort without some form of political union. All proposals for saving the Euro amount to political union in a shotgun wedding because she didn’t take the pill like she said she did. (Maybe that’s a better metaphor).

And the alternative is a disorderly breakup of the Eurozone, after banks and sovereigns have already defaulted.

Then, as bloggers ought, he ends pithily:

There are two big economic problems facing the world economy right now. The problem in the US is solvable. The problem in the Eurozone isn’t. It can’t get where it wants to be from here.

(Don’t expect a pithy ending from me, though; I’m just linking to greatness.)


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anarchocapitalist agitprop

Be advised

I say fuck a lot



Statistics FTW


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