• Sprott Money
    05/06/2016 - 06:03
    The US, in its own decline, is showing this same self-destructive tendency. The worse things get, the greater the inclination of the citizenry to say, “Carry on, everything’s fine.”

The Consequences Of The Unthinkable: Here Is What Happens When The Euro Breaks Up

Tyler Durden's picture




 

As the following image from Spiegel summarizes, three things will happen simultaneously when the unthinkable finally occurs: i) economic output plummets, ii) unemployment rate soars, and iii) consumer prices explode. Of course, this is nothing but merely deferred consequences for Europe partying for over a decade under an unsustainable regime that borrowed from the future (sound familiar?). And now the inevitable hangover. In other words: payback is a bitch.

Source: Spiegel

0
Your rating: None
 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Mon, 06/25/2012 - 11:45 | 2558141 Marginal Call
Marginal Call's picture

LOL.  The Japs have learned the bamboozle from us.  Let them buy up a bunch of shit, tank the market, buy it back for pennies.  Get all your money back.

Mon, 06/25/2012 - 12:14 | 2558278 g speed
g speed's picture

-get all "your shit back too"  ---don't forget you can sell it again ---

Mon, 06/25/2012 - 11:31 | 2558078 Ropingdown
Ropingdown's picture

I don't find the Spiegel numbers so bleak.  They just look like a typical report from Europe in the 1970's.  If that's as bad as it gets it's not a problem.

Mon, 06/25/2012 - 12:22 | 2558341 Jethro
Jethro's picture

Not to mention the Cold War v 2.0. 

I remember the 70's being a very strange time, but I was a child, and watched Land of The Lost...

I have no recollection of gas lines or inflation.  I was blissfully unaware of anything until the oil bust in the early 80's.

Mon, 06/25/2012 - 12:24 | 2558351 gratefultraveller
gratefultraveller's picture

They didn't publish my comment about the 4th comma of paragraph 20 of the german basic law (right of the people to depose the government by force if said goverment betrays the constitution by giving away unalienable powers to supra-national entities) being mentioned more and more frequently in discussions, in fora and even in mainstream media...

Mon, 06/25/2012 - 13:04 | 2558529 Carl Spackler
Carl Spackler's picture

Ghordius, is Spiegel re-making itself into the weekly version of Bild Zeitung?

Mon, 06/25/2012 - 12:22 | 2558344 U6 Alabamian
U6 Alabamian's picture

King nothing.

Mon, 06/25/2012 - 12:56 | 2558487 Clowns on Acid
Clowns on Acid's picture

The King with no clothes !

Mon, 06/25/2012 - 11:02 | 2557899 Northeaster
Northeaster's picture

The next decade will be interesting times.

Mon, 06/25/2012 - 11:06 | 2557923 Dr. Engali
Dr. Engali's picture

I think these are intersting times. We are watching a pivotal moment in history...slow as it may seem. It's still very exciting.

Mon, 06/25/2012 - 11:11 | 2557954 financial apoca...
financial apocalyptic contagion's picture

all this is taking too much time now

all this talk of exponential and nothing has changed on the surface. sure we can see cracks, but the foundations of this ponzi are taking forever to collapse

oh well, winter is coming come on george martin write faster, damn you

Mon, 06/25/2012 - 11:20 | 2558009 N. B. Forrest
N. B. Forrest's picture

The markets can remain irrational longer than you and I can remain solvent. 

Mon, 06/25/2012 - 11:52 | 2558169 akak
akak's picture

No, governments can (and always will) remain irrational longer than THEY can remain insolvent!

Mon, 06/25/2012 - 16:25 | 2559364 Gief Gold Plox
Gief Gold Plox's picture

I seem to have an uncanny ability to convert paper to various metals on almost regular basis.

Irrational markets... eat your heart out.

Mon, 06/25/2012 - 11:23 | 2558035 Ghordius
Ghordius's picture

there are two classes of people on ZH that think it's taking too long: those who wish their shorts to make them rich and those who are too young to appreciate that multi-generational problems most of the time don't move that lightly

Mon, 06/25/2012 - 11:43 | 2558131 i-dog
i-dog's picture

*sigh* ... more false dichotomies....

Mon, 06/25/2012 - 12:02 | 2558221 akak
akak's picture

There are two kinds of people: believers in simplistic (and usually erroneous) dichotomies, and everyone else.

Mon, 06/25/2012 - 12:24 | 2558323 Ghordius
Ghordius's picture

akak, the world is much simpler: those who know better and those who know best. mamas belongs to the latter category.

but hear me, i-dog is being mean to me again. when I try to be serious he claims I'm a propagandist, and when I try to do some humour he claims false dichtonomies. I'm starting to believe he is the white persian dog on Dr. StrangeSchäuble's lap. is there a referee in the club or a rule I can claim? ;-) I resent false dichtonomies charges on stupid comments!!! I demand satisfaction from the cynical canine!

meanwhile I was thinking about you: I was traveling with two crazy girls and visited three parties in three european countries, all organized in complete illegality on abandoned and occupied industrial plants by the very local but highly connected anarcho-syndacalist scene. great recreational stuff, top music, etc. it literally blew my mind (again), it was some 15 years since I have seen that scene, and it's really, really alive. gives me great hopes in youth, as usual... I wish you would have seen that... I just hope that by being syndacalists you don't find them a tad too socialistic...

Mon, 06/25/2012 - 13:00 | 2558510 i-dog
i-dog's picture

I calls it as I sees it, Ghordie. "If you see something, say something"!

And thank you for not lumping me in with Akak as one of them Anarcho-Syndicalist thingies. I wasn't aware that he was one, so I'll be keeping a close eye on him in future. It sounds dangerous.

Mon, 06/25/2012 - 14:07 | 2558844 Ghordius
Ghordius's picture

lol, it's me calling akak anarchist, jokingly, and as a reference to his avatar, I'm not lumping anybody together with anybody. It's me sympathizing with the Anarcho-Syndacalists. Which remind me of the voluntarists you were talking about. me? you know what I profess. but I can sympathize, can't I? ;-) And I can tell you the scenes I have seen have nothing dangerous about them, it's mostly people that organize themselves despite the world that is around them, of the "thank you but leave me alone, I don't need you" type. which is quite a feat, here in europe.

Mon, 06/25/2012 - 11:46 | 2558146 Tydown4fun
Tydown4fun's picture

Since I belong to neither of your two classes, do you wish to add a third?

 

Mon, 06/25/2012 - 11:51 | 2558155 Ghordius
Ghordius's picture

ok, ok, add, "I recognized up to now", with an IMHO and a pretty please. nevertheless, I do see a lot of youthful impatience that translates in radical thinking and a lot of "where are my shorts now?". so, now please give me the third - and note that I'm still commenting on "this is all taking too long..."

Mon, 06/25/2012 - 12:02 | 2558218 CommunityStandard
CommunityStandard's picture

Everyone who wants to be proven right.

Mon, 06/25/2012 - 11:50 | 2558156 disabledvet
disabledvet's picture

Just? Wall Street itself is at risk here...and one need only see the half dozen abandoned cities to see the difference between "places we like" and "places we don't" relative to that set. Trust me "these folks have no problem telling all of us here you got what's coming." you and I don't get the trillion dollar check when we go belly up tho. Should be interesting SHOULD there be a collapse how much blowback there really is. I have suubscribed to a theory that a blow up of the EU leads directly to a massive war in the Middle East and I have not been disappointed. Relative to Brussels "so it becomes quieter." eh...no biggie.

Mon, 06/25/2012 - 12:27 | 2558375 Ghordius
Ghordius's picture

sure, but does preoccupied also mean "impatient to see how the penny drops" and "can't wait, crash now, bitchez"? just asking

Mon, 06/25/2012 - 12:51 | 2558463 i-dog
i-dog's picture

How about adding the "Let's crash this fucker now, so that we can get started on re-building while we still have a planet!" group ... of which I am one?

Mon, 06/25/2012 - 11:32 | 2558083 CPL
CPL's picture

I was more worried about Jim Butcher and his Dresden Files Series.  It'll never be finished.

 

That's the real shame of this mess.  All the little things that helped overshadow the daily annoyances of life.  Like book series.  ...sigh...sucks ass.

Mon, 06/25/2012 - 11:33 | 2558088 potlatch
potlatch's picture

http://www.xtranormal.com/watch/13485882/dead-market

 

very simple reason things are kind of in musical chairs mode during summer...

Mon, 06/25/2012 - 11:20 | 2558007 Caviar Emptor
Caviar Emptor's picture

True, Dr Engali. THings rarely turn on a dime. But they sure are turning

Mon, 06/25/2012 - 12:09 | 2558265 lasvegaspersona
lasvegaspersona's picture

Dr. Engali

you have expressed my thoughts as well. These events are the Super Bowl of economics, no...the olympics...even rarer..a less than once a century event of such porportions that our grandchildren will ask us about nothing but..."what did you do in the transition?"

I have even started a diary of 2012. "Another Journal of Another Plague Year" apologies to DeFoe.

Mon, 06/25/2012 - 19:23 | 2559885 krispkritter
krispkritter's picture

Have to agree but every once in a while I get the sensation that this is like standing next to a very large tree that's being felled...and I'm in its path. Watching in rapture as the age old goliath succumbs to the chainsaw and gravity takes its course...and somewhere in the background I hear the faint, 'timberrrrr...', and only too late realize that I'm about to become a square peg in a round hole.

Then I wake up and have a shot of Scotch and things go back to normal...

Mon, 06/25/2012 - 11:03 | 2557903 kralizec
kralizec's picture

Winning by others losing first.  Yippee...

/

Mon, 06/25/2012 - 13:10 | 2558554 Carl Spackler
Carl Spackler's picture

Such method is frequently referred to as "a war of attrition."

If the method is intended, then such strategy is called "siege warfare" or "being in the right/wron place at the right/wrong time."

 

 

Mon, 06/25/2012 - 11:04 | 2557906 Seize Mars
Seize Mars's picture

Yeah, if the ruler is deposed, everything will be bad.

NOT

Mon, 06/25/2012 - 11:04 | 2557911 i_fly_me
i_fly_me's picture

Bullish.  Long cotton, toner and pitchforks.

Mon, 06/25/2012 - 11:13 | 2557964 AssFire
AssFire's picture

Stay loose, Remington Typewriter IPO coming soon.

Mon, 06/25/2012 - 11:24 | 2558036 GeezerGeek
GeezerGeek's picture

Are the typewriters going to be purely mechanical, like my Remington 870? It's be a bitch to own an electric one when the power goes out.

Mon, 06/25/2012 - 11:05 | 2557914 walküre
walküre's picture

If that's the worst case scenario, let's do it.

The bankers are too scared to let it happen.

Mon, 06/25/2012 - 11:06 | 2557924 mrktwtch2
mrktwtch2's picture

doesnt look so bad..i guess the sun will still rise in the morning..and if the euro dies you will see gold back at 600 as the dollar makes a run to 115

Mon, 06/25/2012 - 11:08 | 2557938 ohhhhhbaaaaahhh...
ohhhhhbaaaaahhhhhhhhhmaaaaaahhhhh's picture

Yes if you have a bad trip on magic mushrooms.

But otherwise the sun won't rise. 

Mon, 06/25/2012 - 12:15 | 2558295 lasvegaspersona
lasvegaspersona's picture

market

FOFOA has suggested a level of 300. (Paper only no redemption in physical)

One must be aware that the current gold market is a market in which to BET ON THE PRICE OF GOLD not to procure the real deal.

Physical is at the best price we will ever see it at now (my guess). Soon when the craziness gets started we will see most physical disappear into hypothecation hell and what you have will be all you'll get for a long time. The market will go physical only but without a viable market to declare the price none will move.

Mon, 06/25/2012 - 11:06 | 2557927 Alejandrito
Alejandrito's picture

So if everyone loses, what interest there is in breaking the euro?

PD: the euro area continues with surplus and eur/usd goes down

Mon, 06/25/2012 - 11:06 | 2557928 monopoly
monopoly's picture

And the above coming to a country in your neighborhood where the almighty dollar will be the last currency on the trash heap. But garbage it will become.

Mon, 06/25/2012 - 11:08 | 2557931 insanelysane
insanelysane's picture

The bus has run out of gas and the engine is blown but at the moment we are coasting down a hill.  When it stops, all of the people will need to get out and push, not just the half that a currently working.  It is not really a bad thing since everyone will finally see what crap costs.

Mon, 06/25/2012 - 11:45 | 2558118 cgbspender
cgbspender's picture

Fear not, the inevitable demise of said bus can be delayed even further with amazing state programs such as BOSS:

http://www.letsgetmoving.org/priorities/boss/

 

I just drove through the BOSS test pilot zone in NC yesterday. I can't wait to see what a nightmare this bizarre plan will amount to.

 

Mon, 06/25/2012 - 11:51 | 2558159 Overfed
Overfed's picture

Bus on Shoulders. Ok, everybody out, now lift on 3! :-)

Mon, 06/25/2012 - 13:09 | 2558547 Goner
Goner's picture

It works great for the bus's. Its a pain for the comuters as the law rests squarly on the sid of the buses. Going from memory but as the bus screams up on the shoulder (no way they only go 15 MPH faster than traffic) and cuts you off, you have to yeild. And I think you are even at fault if you put on your signal and turn to your exit and the collide with a bus coming up behind you on the shoulder.

If I remember right the system is a huge drain on the state as only about 1/3 of the costs of the bus is covered by the people who use it (fares)

 

Mon, 06/25/2012 - 11:55 | 2558173 El Oregonian
El Oregonian's picture

Make sure that when the bus settles at the bottom of that hill that you get those sitting on their ass doing nothing get out of the bus and join in helping push. The bus is heavy enough without pushing the dead weight, also.  There is no free ride.

Mon, 06/25/2012 - 11:09 | 2557933 Dubaibanker
Dubaibanker's picture

If Euro breaks, all hell will break lose....this sure looks like a picture of hell.

One more problem with Spain, Germany and the French etc is that they are not trained to learn English at schools which makes them unemployable in US, UK, Canada, Australia, India or in Dubai.....which makes remittances and new money flows into these countires in crisis times as not an effective strategy. They will end up choking on their own unemployment. Tourism also gets slower as people travel less into countiries where it is frustrating for English speaking people to travel and spend less in USD terms and get more in Euro terms, even artifically, because these people wont speak damn English.

Rant over!

Mon, 06/25/2012 - 11:22 | 2558016 i-dog
i-dog's picture

 

"this sure looks like a picture of hell."

That's the intention! ... the propaganda machine has been turned up to '11'.

Somebody please explain to me how EVERY country's economic output will fall simply because of a change in the name on a currency note?

I call 'bullshit'!

Do NOT follow this link or you will be banned from the site!