Losing Faith in the “Power” of Central Bankers
By Eric Fry
Laguna Beach, California – Global equity markets are sinking again today, as the euro zone credit crisis deepens.
According to the rumor mill, a default by the Greek government is not merely inevitable, it is imminent. As a result, the cowboys up in Germany and France are circling the wagons.
“Germany may be getting ready to give up on Greece,” Bloomberg News reports, “as the credit markets signal growing concern about the smaller nation’s ability to repay investors. Yields on Greek two-year notes rose above 60 percent today for the first time.
“After almost two years of fighting to contain the region’s debt crisis and providing the biggest share of three European bailouts [to Greece, Ireland and Portugal],” Bloomberg continues, “German Chancellor Angela Merkel is laying the groundwork for what markets say is almost a sure thing: a Greek default.”
Of course, a Greek default has been a sure thing ever since the European Union and IMF started shipping euros down to Athens more than a year ago. Bailouts, rescue packages and official protestations to the contrary are all part of the “Inevitable Default Playbook.”
Over the weekend, Greek Prime Minister, George Papandreou, vowed “to save the country from bankruptcy.” The Prime Minister promised, “We will remain in the euro.”
Ergo, a default is both inevitable and imminent.