Wednesday, July 25, 2012

Europe is sleepwalking towards imminent disaster

 The euro has completely broken down as a workable system and faces collapse with “incalculable economic losses and human suffering” unless there is a drastic change of course, according to a group of leading economists.

Europe is “sleepwalking towards disaster”, according to the 17 experts, who warned that over the past few weeks “the situation in the debtor countries has deteriorated dramatically”.

“The sense of a neverending crisis, with one domino falling after another, must be reversed. The last domino, Spain, is days away from a liquidity crisis,” said the economists. They include two members of Germany’s Council of Economic Experts and leading euro specialists at the London of School of Economics, all euro supporters.

“This dramatic situation is the result of a eurozone system which, as currently constructed, is thoroughly broken. The cause is a systemic failure. It is the responsibility of all European nations that were parties to its flawed design, construction and implementation to contribute to a solution. Absent this collective response, the euro will disintegrate,” they added in a co-signed report for the Institute for New Economic Thinking.
Read the rest here.
HT: T-19

2 comments:

Eurasleep said...

Indeed. Thus, my Google moniker. And once again, history repeats itself, with Germany and much of northern and central Europe economically on top, while southern Europe is a horrendous basket case. What comes next? Another war? Popular revolution to steal from the wealthy productive nations that are left?

Eurasleep said...

Interesting post in the comments under the article, such as this one:

"Allow me to get out of the economic policy weeds and offer a superficial anecdote here. On a recent trip to Scotland, I listened with amazement to a Scot telling me that Germany needed to "pony up" with money to all of the other profligate countries in Europe, because Germany was bailed out after WW II and "owes them". Germany, she said, just needs to "give that money back" and all will be well. The alternative option: that the failing European economies abandon the socialist utopian policies that landed them in this mess, was not even on her horizon.

Until the latter option is not only on the horizon, but put into effect, Europe is doomed. All the rest is empty gesture."

To quote 10 Years After:

"Tax the rich, feed the poor
Till there are no rich no more..."