Living in the EU Loony Bin!

The following dose of rare common sense comes from an article in the Telegraph this morning, linked here:

Mark O'Sullivan at Currencies Direct pours scorn on the ESM. He says:

“The irony of asking both Greece and Ireland, who both had to be rescue last year, to contribute €31 billion to the newly formed ESM did not seem to bother eurozone leaders.

“This once again showed that eurozone leaders just do not get it: asking sovereign states who are in effect insolvent to actually borrow in the debt markets to contribute to their own rescue fund.

“The Portuguese are a classic case. They still refuse to ask for a bail-out, but are more than happy to bring down the government when the austerity measures that are needed are voted down, forcing the prime minster to resign, and pushing them ever closer to the bailout they are trying to avoid.

“So Portugal - now a government-free zone - is also being asked to stump up €18 billion towards the ESM, despite the fact they could be weeks away from themselves being bailed-out. The eurozone would be much better suited if the next rescue package had the acronym HELP, as until bondholders are forced to take a haircut the problems in Europe are being either ignored or compounded into an unworkable mess.”

NB This blog editor added the emphasis to the last sentence of the quote!