The EU will undergo years of painful convulsions, precipitating a new treaty that imposes greater centralisation and restrictions on the fiscal independence of nation states" Now, this was predicted years ago for the case when the real debt for the EU cluster increased faster than the real growth the debt being the current nuclear glue. In theory, given the assurance of a cluster of states with very different economies, a single currency can only benefit a few or none a all and many economies cannot tolerate the level of the euro. Greece and Ireland are hopeless cases where there is no possibility of either generating enough revenue to service and pay down the debt principle in less than several decades. The structural problems of the Greek and Irish economies are rigid and soon Italy will join in with talks and such over debt centered on forgiveness. The Germans, who have a strong economy and run surpluses, have a fine structure with modest salary rates and are superbly suited to participate in world commerce using the euro. For this, they are unfair and seem to be the ones who should subsidize weaker economies just because they are successful. This intractable situation persists and grows in the US states as well with California and other states having staggering debts although some 48 are presumed to have some balanced budget laws that prevent excessive debt. The credit ratings of California and Zimbabwe are identical in principle. No wonder that many are fleeing to Bitcoins and other variants of money to escape the pregnant moment when their banks will close for a few days and then put in capital controls and lose much of their savings. There is really no option for many countries not to do this if Greek and Cypriot cases were handled with minimal blood shed or social unrest... The EU is risking the creditors money to play hardball and force regime change on Greece, to force the PIIGS to surrender sovereignty. Instead of playing the EU's game and risking huge losses maybe it is for the creditors to stand up to the EU and impose their will. It seems to me the EU is intent on brinkmanship in the hopes of bring down the Greeks and setting an example to the rest of the PIIGS. The EU is using economics to play politics of the worst sort. "Economic Genocide" is the bets description I have heard so far of their malignant outlook.
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