Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
We told Jerome two years ago that they would come for France. He didn't believe it. France was not Greece, we were told. "Niemöller moment" is precisely the right term for the shocked realisation that they are in fact coming for France now.

We even called the order in which they would come for Eurozone countries after Greece: Portugal, Spain, Italy, France, with Belgium either just before or just after Italy, depending on how much being white and speaking decent English counts for. And lo and behold, it happened exactly as predicted. Because we were right in our fundamental analysis: This is not a debt crisis. It's a currency crisis with some cheap lipstick smeared on.

The people who claimed that this was a debt problem and (implicitly or explicitly) that the ECBuBa would not thrown France under the bus were wrong.

So maybe, just maybe, you should put your righteous indignation on hold long enough to consider the possibility that we may have an objectively superior understanding of what is going on here than you do, and than the people you usually get your news and views from do. We certainly have a better track record at the whole "empirical predictions" thing.

Incidentally, the fact that it is a currency crisis and not a debt crisis means that Germany bears the lion's share of the blame for it. For the precise same reason Germany bears the lion's share of the responsibility for the breakup of the ERM in 1993: Germany has the largest internal current accounts surplus, which means it falls to Germany to perform employer and market maker of last resort functions. That's not just some arbitrary rule or distributional policy demand - it's a fundamental requirement for a stable currency union.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Sep 7th, 2011 at 07:21:57 AM EST
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