The difference between austerity under a common currency and austerity under a unilateral exchange rate peg is that it has to get a lot worse before a country is ejected from a common currency than it has to get before a country can no longer defend its unilateral peg.

That's the difference between the depression of the American trade bloc following the panics of 1929, and the depression of the Asian developing economies following the end of the Yen carry in 1998.

- Jake

Friends come and go. Enemies accumulate.