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In any case, you continue to not address the issue of why the periphery should accept depression conditions rather than the core accepting some inflation.

I'm not arguing for any of those solutions, as I see both as unacceptable. I want to see widespread sovereign defaults, bank recapitalizations and the emergency funds of the ESFS spent on infrastructure spending in the periphery as a way of offsetting austerity.

Investing German surpluses outside the Eurozone does nothing to address the intra-Eurozone imbalances, by the way. And buying existing shares just inflates asset prices, it doesn't improve the capital base of the periphery (or of the EU as a whole) and so doesn't really constitute "surplus recycling".

The important point here is not improving capital bases as such, but of financing CA deficits without debt to buy enough time to restore competitivness.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Dec 14th, 2011 at 08:48:39 AM EST
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