This page has been archived and commenting is disabled.
"The Genie Is Out Of The Bottle" - The Moment The Euro Became Reversible
Some are calling the "deal", which is in reality just a framework for further discussions, that Greece achieved over the weekend a "Pyrrhic defeat." That is certainly one way of looking at things, however an even more accurate assessment of events in the past 48 hours is that this is the moment the "genie was out of the bottle" and the Euro was finally seen as reversible, what ultimately happens to Greece and its soon to be 200%+ debt/GDP notwithstanding.
Here is Sky News' Ed Conway with one of the more accurate summaries of this weekend's epic fiasco:
However this story ends (and we have no idea what the next few hours will bring), Sunday 12 July will go down as a landmark moment in European history?—?alongside Rome in 1957, Maastricht in 1992 and Cannes in 2011.
For the first time, the leaders of the 19-member euro area officially discussed plans for the departure of one of their members. According to the draft proposals handed by the eurogroup (the finance ministers) to their leaders for their overnight meeting, among the clauses to be debated was one worded as follows:
In case no agreement could be reached, Greece should be offered swift negotiations on a time-out from the euro area, with possible debt restructuring.
It is difficult to overstate the significance of this. For its entire life, the euro was conceived as a currency from which there could be no exit. This was not accidental: the disasters that befell the Exchange Rate Mechanism in the early 1990s convinced European leaders that the only way to create a lasting single currency was never, ever, to countenance anyone leaving it. The euro was “irreversible”, to use the word Mario Draghi has frequently used.
Except, tonight in Brussels it transpired that it is far from irreversible. That euro finance ministers are now actively discussing giving Greece a “time-out” from the currency.
Now, one should insert a major note of caution at this stage. The clause quoted above was not agreed by all the euro members here in Brussels. It was put into square brackets, meaning it is yet to be agreed by all member states. It may well be excised by the time the leaders have honed the draft document away to produce their final statement.
Nonetheless, it was on the table. And that means that to some extent, the genie is now out of the bottle. Brussels is officially discussing how to engineer Greece’s departure. The euro is not irreversible. Clearly, they will not do “whatever it takes” to keep it together.
The big question now?—?beyond whether there actually is a Grexit?—?is how markets react. After all, since the euro is now no longer an irreversible currency but a collection of nations tied into a currency from which they could, indeed, leave?—?in other words, a fixed exchange rate system?—?do markets begin making bets about that happening? Do they ask questions about Spain, or Italy, too?
Even on top of the specific Greek issues (and the scale of compromises they may be forced to seek) this is a big moment for Europe and its leaders. They have taken a step into the unknown.
- 19242 reads
- Printer-friendly version
- Send to friend
- advertisements -


So the genie is "almost" out of the bottle, huh? Not really exciting, somehow.
Rub Rub
https://www.youtube.com/watch?v=_VFCQNdgDHE
Fatally flawed European Union blueprint produced an inherently defective Eurozone and Euro destined to crash and burnWe've got a shot here....don't screw it up.
Stop thinking...and just do it.
if greece wanted to go full machiavellian it could sell all its public assets, amass a fortune of euros from the sales and bail out loans and then proceed to default before paying back any of the debt. print drachma and use the euros and central banks gold to back the new currency. although the nail guns would be a serious issue.
They had entered, and appears to have remained in the Twilight zone.
No exit, until all "19" sovereignties handed over.
" Merkel confirmed interest-payment grace periods and longer maturities will “be discussed once there is a successful evaluation of the new Greek program”
Here comes Spain, Italy, and the rest of the PIGS looking for "help".
the genie is out of the bottle.
ZH and all of us have officially no clue of how or when this ends./
On a long enough timeline, the survival rate for everyone drops to zero.
Do you really believe the ECB would allow Greece to exit, given that in doing so, they would lose hundreds of Billions of Euros? Not happening. Do you know what the real Genie is that has been let out of the bottle???? It happened when politicians agreed to allow bankers to transfer their private losses onto the public via "bailouts". Do not think for one second bankers will agree to take a haircut if Greece exits the Euro. The public will own those losses.
The only thing that has changed is the increased pain inflicted upon those who do not follow orders in a timely fashion. As always, this crisis was intended to provide the leverage required in order to create a fiscal union. Otherwise, Greece would've been kicked to the curb already. Only now does Germany have a policy tool large enough to keep the rest in line.
So this 80 billion Euros is a "going away" present to the Greeks? That would make sense in a kicking the can sort of way but as someone said earlier the can is in low Earth orbit now and will surely burn up in 6 months.
Time to break out that 12yr old bottle of ouzo. You're still in the EU/EMU. Well played Greece. I thought you were going to show backbone for a minute. Well, the backbone of the elderly is admittedly fragile. It is time to sells off your assets to pay the creditors. You are a disaster Greece. A complete and utter disaster. Let this be a warning to every single fucking human fucking being on the planet.
Sell your roads, water, rail, ports, increase taxes, VAT, reduce pensions. You are a vassal. You are a province of the EU bureaucracy. Sell your future. Sell out your children.
ATTENTION ALL GREEK YOUTH, BORROW SOME EURO FIAT FROM YOUR PARENTS AND BUY A ONE WAY TICKET TO CANADA OR AUSTRALIA.
fuckin A
Remember when Berlusconi's Finance Minister asked Brussels for "a 2 year holiday from the Euro" ?
Brussels said no.
At around the same ime , Spain wanted to print 2-Euro paper Notes to curb inflation
Brussels said no.
Whats truly amazing is the lengths the scum in charge have gone through to keep this flawed system in place. In the end though no matter how many band aids they apply it will crash and burn, its been overly exposed for what it truly is fraud.
Walmart, Sam's Club expected to make job cuts 1000
http://www.katv.com/story/29524004/walmart-sams-club-expected-to-make-jo...
Like I keep saying.....the Euro is one size fits all.......just like a grave.
I wonder if the Greek state fulfilled the criteria needed to be allowed to enter the euro when it did, or if they needed some magic to do so.
http://glossary.reuters.com/?title=Maastricht_Criteria
I would be surprized if all the countries now using this currency fullfilled the conditions set by the EU to be allowed to adopt the euro.
Supposedly Goldman jerried up the paperwork.
They should sue GS for the money they owe, haha.
Well they had to do something about the different currencies. I was given change in London one time and it turned out to be worthless coins from Ireland or something. But then again I also received as change in Canada, a worthless Toronto subway token and some coin from Columbia. Only good news for me is Canadian quarters still might work in US vending machines. Almost everybody wants something for nothing.
this is when the "radical left" gets incorporated into the EU fold (rest of anti-austerity parties to follow as they gradually become part of their own political establishment - old guard like merk&sch make way)
For all those keen on shorting Spanish and Italian sovereign bonds thinking the euro is reversible: Good luck, you will be betting against the ECB and Draghi.he's no Bundebank hawk, he wont hesitate to implement OMT.
Gold bullion.... anyone.... ??? its only been money for 5000 years... or just keep faith in the fiat.... what could possibly go wrong with fiat??? my dad had a fiat ...broke down all the time...
www.teamramgold.com become an affilate, refer a friend and earn commission and gold