That is almost a certainty but at what cost to Europe as a whole and individual member states. Most recent data indicates that the Eurozone is being dragged down by the prolonged crisis – Eurozone manufacturing slumped for the first time in 2 years. The next week or so will be decisive, and it is almost inevitable now that Greece will have to leave the Eurozone for the sake of Euro and to help itself recover with less hurt and more rapidly. (We have anticipated this since the “Greece Crisis” began early this summer - diplomaticallyincorrect.org/films/blog_post/greek-default-sooner-or-later-by-ambassador-mo/30326 ). Greece can much more easily endure a default than it can a highly demanding austerity program, with one condition: that it can adjust its currency to be more competitive, which means devaluation. That cannot happen as long as Greece is in the Euro, which the European Central Bank is committed to insulating from inflation. Thus, Greece will sooner or later have to look to leave the Euro for its own good. Similarly, the wealthier Eurozone economies are coming to the realization that they are throwing good money after bad in trying to rescue Greece. Greece cannot back to self-sufficiency without a currency devaluation – which means no Euro. This is a classic “Catch 22.” The only two other arguments for throwing more money at Greece are to proceed toward an orderly unwinding, which still means default. It is to keep contagion in check (i.e. big European banks holding substantial Greek debt from sinking toward insolvency and/or liquidity problems). However, European banks and even countries are increasingly being more contaminated and subjected to rating agency downgrades. No amount of fig leaves will convince other global financial institutions that EU banks and economies are not exposed. Eurozone pride may have been the other rationale, even if not explicitly enunciated, to keep Greece afloat. However, the German deep pockets are less inclined to pay as the situations drags on, with ever-greater resolution and no clean solution in range. Perhaps it also has something to do with Ocyoberfest season and lederhosen have much less deeper pockets – or do they have pockets at all? Latest ARTICLE – “US-Europe-Rising Risk of Recession” - diplomaticallyincorrect.org/films/blog_post/us-europe-rising-risk-of-recession-imf-mo-by-ambassador-mo/35278 By Ambassador Muhamed Sacirbey



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 Much more at “International Financial Crisis Channel” - diplomaticallyincorrect.org/c/international-financial-crisis