Friday, September 07, 2012

Irreversibility of €uro now only backed by Draghi, Merkel, Hollande, Rajoy and Monti!

The five politicians named in the headline to this post, in spite of their past poweful positions, probably lack the assets to build a new royal yacht for Queen Elizabeth II.

Even if the assets and future pension payments of Jean-Claude Trichet, the retired head of the ECB, were to be sequestered as improperly obtained and thrown into the pot guaranteeing the irreversibility of the euro would any difference be made to the complete absurdity of the stance now taken by the Euro Group's leading national politicians and all the apparatchiks of the EU lumped together. Had all the plans being discussed today, such as a joint Eurozone Parliament etc., been on the table at the start of the crisis serious intent may have been inferred, now it cannot be!

Yesterday's bond plan, see Reuters from here, announced by Draghi of the ECB, like all its predecessors is fatally flawed as it is undeliverable, lacking as it does the support (democratically obtained or otherwise) of the voters and taxpayers of the countries who must ultimately pay.

Because the Euro MUST now eventually be reversed, any amounts pledged by the ECB both in the past and for the future, must eventually be accounted for and balanced. National Central Banks may mostly ignore that frightening truth in nations that are mostly not prone to revolution. TARGET2 imbalances again become significant.

Nothing now cements the Euro Group together, therefore the Euro will be reversed and consequently actions by the ECB carry no weight because facing up to reality has been deferred for too long.

In Britain this reality is becoming clearer with this suggestion, of today, from a leading and influential MP on the Government benches, to kick out the proposed EU Budget for the years 2014 to 2020.


Blogger Sue said...

All this has done is given the impression that they will do anything to keep the project going. Not an incentive for countries like Greece who have so far, not managed to get their spending under control. They can just keep on borrowing now, at lower rates and they can carry on spending in the knowledge that the Euro is "irreversible".

7:42 AM  

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