Let that Athens fail !
Posted on May 7, 2010 by christopher
The Greek titles were downgraded to junk, while Portugal went from A + to A-. Portuguese debt is only 77% of GDP, the level of France. But this state is very solvent because it has a high debt for households and businesses, bringing the total debt of 240% of GDP. It also has a hole in the external balance. Much of its debt in the portfolios of foreign banks and they fear that the government in Lisbon is unable to repay loans due to end. Germany is known, makes his help in harsh conditions in Athens that Greece, home to merchants, has tried since then to reduce wasting time. Some say that if “Greece falls, breaks down the euro as a whole. It calls for a European rapid rescue of Athens.
But it is a wrong argument, which is cleverly exploited by both Greek and French and German banks are full of debt Greek. The rescue of Greece, at the expense of all the countries of Euroland, is really yet another relief to big banks in Europe and elsewhere have bought the debt of Athens. But there’s a reason why Greece, since it is unable to honor its debt, should leave the euro.
It signed an irreversible commitment to stand in the euro and can not get out. There is, then, the expulsion from the euro. It is not written, nor in the Maastricht Treaty or in other constitutional laws degree comparable to it, that a state which is in the euro area can not fail. When Italy had the pound, and the City of Naples was in debt that could not pay, it would fail. There is no law that says municipalities can not get into debt fail. The Italian government, however, for social reasons, he decided to write off those debts. The banks that had lent money to Naples rub their hands and the City, then did other debts.
Germany does not want to do with Greece the error that we did with Naples and other municipalities with debt and health of the Regions. Which have been regularly written off by the State, one year after another. If the Italian state had not absorb all these debts, now the general government of our country, including state government and regional and local governments would have a public debt below 80% of GDP, not a debt which travels to the 115 . The State would have less debt because they would not have taken those of others. Moreover, the Italian Regions and local authorities would not have done all the debts that, gradually, they did, because banks would not have risked giving them much credit, not relying on the intervention state.
Greece is now asking for help of the IMF, which can increase the intervention. Then, if you pass the exams of the IMF, Athens will have European support. Or fail. Portugal will strive to be credible, it is possible that the EU may request that member states launch a lifesaver in Lisbon for 30 billion, as for Greece. This would mean for Germany a new loan of 8.5 billion, for France and Italy by 6.5 from 5.5. Also, if the rescue greek from going through, knowing the day before, the international banks that now speculating downwards, commenced operations in term upward derivatives, namely the differential prices of the securities. And that, unless the focus downward on Portugal, left alone. If we help him, then would the turn of Spain and Italy. Nobody would have the means to help us. In this scenario, we must help ourselves. The euro is not a ‘free lunch’ or discount, as he did believe Romano Prodi. The storm is mounting and we must guide the ship to stop. Therefore it is time the government disputes. It would be better to have, as in France, a Presidential system or, as in Germany, a prime minister with great powers. But we have a parliamentary system by its nature not compatible with the euro. Lombardo will forget the party of the South and Fini look out of favor. Calderoli also must be cautious with the tax changes as well-intentioned. And Carlo De Benedetti will not to bring a sheet, which could also fall on the public debt and reducing taxes on labor shock. Are possible only filings. There is no tripe for cats. This is the notice to all