Get a cup of coffee. This is a fabulous, readable but nevertheless carefully argued and therefore long post on the drivers of the Eurzone crisis and what the parameters for a sensible resolutions are.
Read more...This post dovetails with the Michael Pettis article today. Hot money is the bane of emerging markets, but the opposition to regulating capital flows remains fierce.
Read more...Some brief updates, with more on Monday.
Read more...If you are not part of the solution, you are part of the problem.
The Troika’s willingness to turn Greece into a failed state first, as a side effect of its “rescue the French and German banks” operation, and now, as part of its German hegemony protection racket, is killing people and in the longer term will only accelerate the rise of extreme right wing elements in the Eurozone. As Ilagi wrote last week:
Does the EU have any moral values at all? And if not, why are you, if you live in the EU, part of it? .
Read more...Because you don’t have any, either? And if you do, where’s your voice? There are people suffering and dying who are part of a union that you are part of. That makes you an accomplice. You can’t hide from that just because your media choose to ignore your reality from you.
As we describe in our earlier post today on Greece, the ECB’s hit job on Greece is an continuation of the destructive and ultimately self-defeating practice of letting the pet needs of banks trump those of governments and social orders. The ECB is willing to turn Greece into a failed state out of what looks like sheer brutality, with the apparent rationalization that punishing Greece will serve pour decourager les autres, meaning the other periphery countries, and potentially even France, that are calling for relief from failed austerity policies.
Read more...Even by the standards of bank thuggishness, the move by the ECB against Greece last night was a stunner. Americans have become used to banks taking houses under dubious pretexts when both the investors and borrowers would do better with a writedown. But to see the ECB try take a country is another matter entirely. As one seasoned pro said, “If anyone had tried something like this against a country with a decent sized military, the tanks would be rolling.”
Read more...We’ve cautioned readers that Greece is in a very weak bargaining position relative to its financial overlords in the Troika. As much as Finance Minister Yanis Varoufakis is making sound, logical arguments and presenting proposals that if anything are too accommodating, despite initial cool reactions, many of Greece’s soi disant partners are diehard neoliberals and/or are politically constrained. Varoufakis is approaching them as if they can deal in good faith, when their idea of “good faith” comes from a punitive parallel universe.
Three important meetings today will provide a better sense of whether Greece is gaining any political ground in its uphill battle to roll back austerity.
Read more...We said that the ECB held the trump cards in dealing with Greece, via being able to impose conditions on its access to the Emergency Liquidity Authority. We thought the ECB would send an initial signal as to how opposed it was to Finance Minister Yanis Varoufakis’ bold proposals in whether it imposed conditions and how severe those were on the Greek Central bank’s request to access ELA funds, which it is sure to approve to tomorrow.
It turns out the ECB isn’t waiting that long to let its views be known.
Read more...While most NC readers are skeptical about quantitative easing and negative interest rates, those reactions are often aesthetic: they are so far away from any normal operation of financial markets that something has to be wrong with the idea. The problem is that while that instinct may be (and we’d argue is) correct, policy wonks who have drunk the Fed’s Kool Aid will treat those who have visceral negative reactions as simply having a case of novelty aversion, which means they can be ignored.
Ed Harrison provides comparatively short and accessible explanation of why QE and negative interest rates are bound to bomb. I encourage you to send his post to friends and colleagues who’d like to be able to discuss in a more rigorous manner why these approaches are deeply flawed.
Read more...Is Syriza’s bold promise of hope for Greeks about to become a false dawn?
Read more...Victims of austerity and their allies around the world may be placing too much hope in Syriza.
Read more...Seldom have well-credentialed and well-meaning people worked so hard to produce so little of substance.
Read more...While the election results in Greece have sent shockwaves through European technocratic elites and have rattled investors, it is not clear how successful Syriza will be in getting big enough changes implemented in Eurozone policies and its own bailout terms to end the humanitarian crisis, rather than just create the sort of bounce off the bottom growth that analysts like to depict as progress. Indeed, once you walk though the likely bargaining positions of the various parties, there is little reason to be optimistic on Syriza’s behalf.
Read more...We’re having two posts on the Greek elections tonight, since the media accounts are so slanted as to merit discussion. The notion that a democratically elected government would put broad social interest over continued, self-destructive sacrifices to financiers and their allies in European governments is so threatening that a large swathe of media outlets seem […]
Read more...I was going to start out saying yesterday was the saddest day in Europe in 50 years, or something like that, because of the insane and completely nonsensical largesse the ECB permits itself to launch, aimed at once again saving a banking system, but which will not only not help the European people, it will make things even much worse than they already are. Which is also, lest we overlook that ‘detail’, entirely thanks to the ECB/EU/IMF Troika.
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