Can’t Rescue States With Deficits – EIB
This may hurt European pride
Can EU ignore Greece …
If Greece is left to fend for itself, it may reduce the credibility of the EU among its own member states.
European Investment Bank President Philippe Maystadt said the bank can’t rescue member states struggling with budget deficits.
“The EIB’s mission and statute do not allow for bailouts in terms of budget deficits or balance-of-payments support to individual member states,” he said in a statement posted on the Luxembourg-based lender’s Web site today. (via EIB Says It Can’t Rescue States With Deficits (Update1) – BusinessWeek).
The problem with EU
Race to the bottom ...?
Greece may turn out to be the acid test for the EU and the Euro. Britain and Sweden are suggesting that IMF is better suited to handle the Greek situation – rather than the ECB. Germany and France, being the economic and political leaders of the Euro-pride brigade, are worried about IMF entry into Europe.
The crisis has exposed the EU’s Achilles’ heel — states remain independent to spend as they wish, but their decisions can affect all 16 eurozone nations. Countries that help Greece risk having their own borrowing costs rise as a result, and could see other struggling eurozone economies get in line for aid. (from Star Tribune)
Meanwhile, the Greek Prime Minister winged his way to India – and announced that Greece will solve its own problem – and does not need either the EIB, ECB or the IMF.
Touche.
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Who’s amung us
Any credit currency bubble is a pyramid scheme (ponzi scheme)… which provides good returns to early investors at the cost of the late investors.
An independent pyramid scheme has only two options – keep growing or collapse. However, what we have today around the world are various pyramids that are connected to each other.
So now individual pyramids can grow – at the cost of other pyramids and some can even deflate.
So – unless – one studies every pyramid and their connections – you can never predict which pyramid is going to collapse and which can be saved by another pyramid.
One thing is certain – there are several that will collapse… right now the posturing is all about which cannot be allowed to collapse.