Crunch Day at the European Central Bank.
The end of the single currency has been unavoidable for some time. The Irish rescue package clearly cannot work. Belgium, Portugal, Spain and others stand in line unable or incapable to wean their electorates from the soft options of the fantasy worlds in which they seem to pass most of their days.
The end or final destination is obvious to all thinking people, the route by which we arrive at that dreadful point might become clearer from gleaning what flexibility the German government is prepared to lend Trichet in his vain cause of clinging to his position, power and perks for as long as he possibly can, even to the extent of crippling future generations of Europeans with unmeetable debts à la Alan Greenspan.
If Europeans accept eventual German economic governance as the price for a brief period of extra excess consumption, the necessary correction will eventually be that much tougher, blamed on the Germans and almost certainly lead to violence and eventual revolt. If Germany agrees to further ECB bond purchases or some form of money printing dressed up as ECB Quantitative Easing then the day of reckoning will be merely only somewhat delayed.
Abandoning the common currency and the present institutions of the EU to allow a fresh start for a free trade area of sovereign states with their own currencies, parliaments and laws is the only sane way forward. Regrettably, I believe, too many corrupt and powerful people have invested their futures in the EU for that sensible proposition to be heard in Frankfurt today.
A report on the ECB meeting today is linked here.
This blog will provide its own appraisal of the press conference later today.