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1. As opposed to the hard feelings already developed?

I mean, if Greece agreed to subject itself to two years of high-grade IMF treatment rather than default two years ago it was in order to avoid hard feelings. Also, apparently to take Barroso and Bini Smaghi's words at face value, in order to preserve democracy in Greece. See how well that's worked.

2. You mean the current policy path doesn't lead to two currency blocks (or a much diminished Euro bloc serially shedding members) with France a borderline case?

I believe you missed the evolution in real time of my Euro crisis scorecard. We had been predicting an endgame with a small core Euro and France on the boundary for a long time before France fell off the core last August.

tens of millions of people stand to see their lives ruined because the bureaucrats at the ECB don't understand introductory economics -- Dean Baker

by Migeru (migeru at eurotrib dot com) on Fri Feb 24th, 2012 at 09:33:24 AM EST
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If we assume that the current policy can be maintained, you are right. It's a policy that too few people benefit from, though (including in Germany). I don't believe it can be maintained for much longer.
by Katrin on Sat Feb 25th, 2012 at 05:32:26 AM EST
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The question is less whether it can be maintained - it obviously can't - and more how ugly its failure is going to be.

If it's pushed to the point where blood starts flowing in the streets of Athens, we'll be struggling to keep the Union alive, nevermind the Euro.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Feb 25th, 2012 at 05:37:04 AM EST
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I suspect when that happens the EU Council may just decide to strip Greece of its voting rights according to Article 7 and get on with their business...

tens of millions of people stand to see their lives ruined because the bureaucrats at the ECB don't understand introductory economics -- Dean Baker
by Migeru (migeru at eurotrib dot com) on Sat Feb 25th, 2012 at 05:39:20 AM EST
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It's not only Greece. It would be a coup that would quickly spread to more countries. Do you really see that this can be enforced? I don't.
by Katrin on Sat Feb 25th, 2012 at 06:09:33 AM EST
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