"The Euro Is Dead; Long Live The Euro"

Tyler Durden's picture

By Clive Hale from View from the Bridge

"The Euro Is Dead; Long Live The Euro"

Despite all the stories of apocalypse now there is a fighting chance that Greece will stay in the eurozone for the time being. This is the real tragedy of course, but unfortunately for all involved there just isn’t the political appetite for “Grexit”. The Germans have done their sums and if Greece leaves they are in deep, way above the top of their lederhosen. The Greeks of course want to stay on the euro gravy train, but it is German gravy and Siemens almost certainly built the loco. Merkel is increasingly isolated but being from the old East Germany she is almost certainly dangerous when cornered. The option for her may not be kicking the Greeks into touch, but taking Germany back to the DMark and leaving the French to sort the mess out. This is something her Finance Minister, who looks increasingly like one of Peter Sellers’ characters in Dr Strangelove, would heartily approve of and might even get her re-elected.

The game of bluff and double bluff is pretty much over although no one has told Rumpy Pumpy who is quite happy for Greece to stay as long as they “stand by their commitments”. The chances of a pro-austerity government being elected second time around are improving and if that happens they will surely be given another chance only for it all to go horribly wrong a little way down the road when they hit an enormous pile of tin cans.

It was however nice of Christine Lagarde to lecture our chancellor about letting the Bank of England loose with more printing ink, which they almost certainly have in mind without her misplaced encouragement. The question is will the Fed or the ECB beat us to it? In the US, ex auto sales, which are massaged by “Gubermint” Motors solely to pump up GDP (they sell cars to their dealers, who stick them in the back of the garage lot to pretend they haven’t actually been sold) growth would be below 1%. The story is much the same across “austerity” Europe and let’s not mention the UK.

But I am afraid we will have to. First quarter GDP actually shrunk by 0.3%. Had it not been for an increase in government spending (Austerity? What austerity?) of 1.6% it would have been even worse and Mervyn King now tells us that the Jubilee celebrations will knock a few more points off GDP in Q2. It must be a truly miserable life being a central banker…but then again if the only people you are looking after are other bankers it is bound to be isn’t it? Crank up the presses Merv and put a smile back on your face; any chance you could helicopter a bag of fresh fifties down to 27 Elm Avenue? What’s that you say? RBS need it all? Ok then maybe next time or the time after that…

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Conman's picture

The blatant fear-mongering of greek politicians only serves to add more confusion to how the re-elections will play out. Samaras is leading the polls because he tells people the sky is falling, meanwhile he promises them the moon. Greek people want bailouts without honoring commitments to bailout terms. How it will all end will be interesting.

Colombian Gringo's picture

It will not end well. The Greeks should be booted out,  and their politicians jailed, but most likely they remain in the eurozone due to a last minute reprieve. The euro is politically driven, as a key part of the new global one world government

Ahmeexnal's picture

Is there an online gambling site where to place bets on which day Greece will DUMP the euro?

Chatting the breeze's picture

Yep, IG Index have made a market offering bets whether Greece will leave the euro this year. Paddypower are also taking bets on first country to leave, I suspect others are too.

He_Who Carried The Sun's picture

Merkel is increasingly isolated...

That's just wishful thinking and mindless

leftist propaganda.

Talk to the Dutch, Austrians, Slovaks, the Baltic countries,

the Fins etc...

Other than in the US in the EU it takes only

one vote to turn EU policies in to the garbage

bin which is where EURObonds belong anyway as

long as there is no fiscal and political union ...

Would you give your indebted neighbour your own

creditcard? Yes? Stop kidding yourself!

What have you been smoking lately...?



Winston Churchill's picture

The English bookies have stpped taking bets on the Grexit

as they cannot layoff the book.

Zero Hedge available.

Tsukato's picture

 Online I found a list of "bad words" which red flag emails, texts, etc. by the authorities. I thought to myself " most people are too afraid to ever rise up against the man, but perhaps there is some passive-aggressive action that most people could be bothered to do, and could keep the g-men busy/overloaded". This list of words should be spread to everyone, and attached at the end of every message we all write online, during chat, emails, etc. Please take this list, and pass it along to everyone you know. Thanks and vaya con Dios. Here is where to find the list: http://www.dailymail.co.uk/news/article-2150281/REVEALED-Hundreds-words-...

Joe The Plumber's picture

I actually think a parallel currency will be introduced sort of like the california IOU but that it will be acceptable for payment of taxes. This currency will be directly printed by the greek government, as advocated by the Greenback movement or Greenbackers of the 19 th century

And that ostensibly they stay in the eurozone but can go ahead and have their internal devaluation.

Conman's picture

Well according to the pro bailout parties, the very core of their argument to stay in the euro is that issuing their own currency will be the doom of Greece. Wouldn't a parallel currency be the same? Any wavering from this hard line will be the political death of them. I see them defending their probailout pro euro stance to the death.

Joe The Plumber's picture

Theywont call it a currency. It will be an IOU like california did but they will allow people to use it instead of euros to pay taxes. If they do that it will circulate like money. But none dare call it money

tom a taxpayer's picture

Breaking News: EU Unveils Carbon Tax To Save Euro 

EU plans to save the Euro by backing it with a Carbon Tax. 

The EU proposal for a carbon tax faces headwinds from other countries, such as: India warns EU over airline carbon tax



Non Passaran's picture

Old news and China and India will sue and win over this at the WTO.

Sudden Debt's picture

All the guessing will lead to a euro brakeup. My guess is greece out by august and by that time we'll get a total priced in marketplace.
Gold and silver ay up
Euro at 1.22 to the dollar
Oil at 80$

Banksters's picture

In an uncompromising interview with the Guardian, Lagarde insists it is payback time for Greece and makes it clear that the IMF has no intention of softening the terms of the country's austerity package.

Asked whether she is able to block out of her mind the mothers unable to get access to midwives or patients unable to obtain life-saving drugs, Lagarde replies: "I think more of the little kids from a school in a little village in Niger who get teaching two hours a day, sharing one chair for three of them, and who are very keen to get an education. I have them in my mind all the time. Because I think they need even more help than the people in Athens."

"I think they should also help themselves collectively." Asked how, she replies: "By all paying their tax."


What a CUNT.

Joe The Plumber's picture

Personally i think that is one of the best things she has ever said. Honestly greeks are whiners. I will feel sorry for them when I see greek kids with distended bellies and flies in their eyes

nicxios's picture

Does she pay tax on her income? No, that's for suckers. Does she care about little African children? Yes, they make good slaves.

RiverRoad's picture

When the Euro dies it will die with a whimper having been talked to death.

francis_sawyer's picture

Hey I found a can! Let's kick it & pretend the sheep don't notice... Boy are we smart! Let's celebrate by giving ourselves more bonuses...

Can people be more pathetic?

resurger's picture

more bonuses = Healthy Economy/Recovery

The sheeps are subhumans

LeBalance's picture

sure they can.

let's take a trip back to 1922 and have a look see in Berlin.

see the 10 year olds selling their bodies for sex for a crust of bread?

Let's go back to 1390s Europe and see what destruction of confidence in commerce has wrot.

Black Plague.  (ahem) Bitchez! (ahem)


bankers (whose product is illusion) certain get lots of folks to think the crisis is real, don't they?

and it's not.


just start trading in some limited quantity item.

let's make one up, notched branches.

where the notches indicate the amount of new currency issued.

worked in England very well for 700 years.

Tally sticks they were called and the Empire was built on them.

falak pema's picture

the greatest story of the week is the imminent death of the euro. Its the universal song sung on the netmedia. When will it come, we are waiting for it and its any time now. A bit like singing in the Eurosong contest, they all seem to sing the same song and in the same style; that's euro uniformity for you, in life as in death. 

All those who push now for greek death and tragedy must remember that its the risk of banksta contagion that has dragged this out. Death by a thousand cuts. And cowards always die a cut at a time. They have one life and a thousand deaths, its only appropriate for those who only live for greedy gain, forgetting the blood sweat and tears of normal people; collateral damage. 

q99x2's picture

Fuck the Euro. Long live the revolution.

Ahmeexnal's picture

Yes, of course! Hence the name: movement. It moves a certain distance, then it stops, you see? A revolution gets its name by always coming back around in your face. You tried to kill me you son of a bitch... so welcome to the revolution.

LeBalance's picture

fuck spinning in circles, aka revolution.

super durrrrrrrr.......

casey13's picture

If Germany leaves the Euro they will end up like the Swiss. Buying Euros to keep their exports from collapsing.

nawerdenn's picture

At least the Swiss can then STOP buying Euros since Germany is the target of a whopping 19% of Swiss exports, and the next two larger still-Euro countries France and Italy only make up for a combined 12% or so.

Cdad's picture

Wow!  This article [or perhaps more accurately this "blurb"] is so far below ZH standards that it is a bit shocking to read this here.  I'm not at all sure how it works, who gets linked and why...but this one pretty much is crap.  It's contradictory, it contains presumptions that cannot be presumed or are flat out incorrect, it is poorly written, it is too brief to be complete and, as far as I can tell, it has no purpose.  It isn't even funny or clever.  

What gives?



Yen Cross's picture

Please Elaborate C-Dad. You are a fantastic teacher! You have certainly taught me a thing or two.

Cdad's picture



The game of bluff and double bluff is pretty much over although no one has told Rumpy Pumpy who is quite happy for Greece to stay as long as they “stand by their commitments”. The chances of a pro-austerity government being elected second time around are improving and if that happens they will surely be given another chance only for it all to go horribly wrong a little way down the road when they hit an enormous pile of tin cans.

The above  paragraph serves as a good example.............of every single criticism I posited...all of them in one small place...within the larger small blurb.

Yen Cross's picture

 I compile your posts in my mind C-Dad.  Trust me> < you!  Your comments are held in a smart part of my mind!


Hulk's picture

Tyler just wanted to see what you would have to say if he did it. Know he nows...

Yen Cross's picture

Now he Knows? I get the jist of it Hulk.

mjk0259's picture

I remember when the Euro was .85 USD. After all this sturm und drang, it's 1.24. What crisis?

Japan is supposed to be in drastically worse shape than Europe in terms of debt to gdp, etc. Their currency keeps hitting new highs.


Both the Japs and the Euro's owe their debts primarily to themselves.


That's easier to get out of then the US situation.

Ahmeexnal's picture

Chairman Mao would strongly disagree.

JeffB's picture

"Both the Japs and the Euro's owe their debts primarily to themselves.

 That's easier to get out of then the US situation."

I'm not quite sure how to follow that logic to its conclusion.

It's easier for the Greeks to get out of their debts to the Germans, French, Spanish, Norwegians etc. because they owe it to themselves because they're all Europeans after all?

I've heard the same argument used with respect to the U.S., that it's all OK because we owe most of it "to ourselves". So we don't have to honor our IOUs to those on Social Security & Medicare because we're all in this together? Ditto for the pension funds, and bonds granny's holding for her retirement?


mjk0259's picture

China has $2 trillion US debt and Japan has $1trillion. During the last financial crises, the US government rushed to guarantee mortgage debts of which China was one of the biggest holders partly at their demands.  So, we could not pay but then they would of course confiscate all US company assets in China and cut off most exports without which we could not even build weapons. So it won't happen.

JeffB's picture

Sure, it wouldn't be easy for the U.S., and it's not ALL owed "only" to ourselves. But our "official" debt is coming up on $16 Trillion, so it's still true that "we owe most of it to ourselves". If you take in the unfunded liabilities, it's even more lopsided.

My point isn't that that would make things much easier, though. I cringe when people seem to make light of our debt and liability issues by saying that it is in essence not that big of a deal since "we owe most of it to ourselves".

I think it would be a VERY BIG DEAL to default on bonds even if it was "only" to our own citizens, pension funds, corporations, social security recipients etc. I think taking our commitments so lightly is a travesty of justice. We should never have let it get anywhere near this point and it's going to cause a lot of wailing and gnashing of teeth, as they say.

I was thinking the same thing is probably true of Europe. They may "only owe it to themselves", but I doubt the holders of the paper that defaults will find it any more palatable that those that won't repay them are fellow Europeans than if some foreigners had shafted them. Similarly, I have to wonder whether those doing the defaulting will feel any better about it knowing that they're defaulting on loans to their European neighbors rather than Americans or the Chinese. The economic fallout will in fact probably be worse because it's so close to home.

shovelhead's picture

According to Krugman, If the debt is owned in house then we can print it away 'into the cornfield' ala The Twilight Zone. Skittles and unicorns and all.

Apparently, if you get brutally sodomized by your neighbor in a default, it's a public service

rather than a rape by furriners.

It's a neo-Keynesian thing, I guess.


CTG_Sweden's picture



My impression is that the German social democrats want eurobonds, monetization of debt and a political union while Angela Merkel and parts of the CDU/CSU do not want that.


If they had launched a political union and eurobonds and had begun printing on a large scale last year I guess they could have reduced some short-term problems. However, I suspect that the printed money would not be used for dealing with the debt problem but rather for consumption in Southern Europe. Perhaps this problem could have been reduced somewhat if a central European government had taken over most tax revenues and expenditures from member countries. However, the consequence of this would definitely have been paying for consumption in Southern and Eastern Europe by printing money as fast as possible or less spending on welfare, health care, education and so on in poorer countries or considerably less spending on welfare, health care and education in countries like Germany.


Perhaps the intention was to use the current crisis as an excuse for a more closely integrated union. I am not sure whether the political leaders in countries like Greece and Spain knew what they were doing. Mainstream politicians seem to have two principal objectives: To win the next election and to have a more closely integrated union in order consolidate the political power of their mainstream parties. A housing boom helps you win the next election if the bubble does not pop before the next election. Furthermore, if the future electorate does not blame the government or parties which allowed the creation of the bubble, which is quite likely, no real harm is done from a political point of view.


I really wonder whether Merkel´s opposition to eurobonds and monetization was expected. If it is true that somebody tried to assassinate her in a faked helicopter accident this may perhaps indicate that some people expected problems due to Merkel.


I also must say that Spain should have left the Euro while their national debt had not begun to grow. If vacations in Spain and Spanish products had become less expensive, aggregate demand would soon have picked up in Spain. Unemployment would have been reduced. Demand for housing would have picked up if young, unemployed people would no longer be forced to live with their parents. But the longer they wait, the more expensive will debt denominated in foreign currencies be if they reintroduce the peseta. Finally, they will reach a point when it is no longer possible to go back to the peseta without defaulting.


I also suspect that Germany would be better off outside Eurozone than inside the Eurozone if the EU intends to print for consumption. The Germans can print D-marks and invest that money in domestic energy production, such as wind farms, and farmland intended for ethanol production in Brazil and thereby prevent the D-mark from appreciating too much. My impression is that Germans feel safer if they are thoroughly embedded into a tighter European Union. The question is how much they are willing to pay for this perceived security.

Sandmann's picture

the German social democrats want eurobonds,


Sigmar Gabriel is a very fat former schoolteacher who is clueless and dim and just did a 180 after making his party unelectable by hyping Hollande. Eurobonds are meaningless unless you can find PIMCO gagging to buy them. Bonds are being destroyed by QE. Just who wants 30-year Bonds issued by an insolvent ECB ? 

The only way urobonds work is if Pension Funds and Bond Funds are brought under EU control. So simply take over the Bond Funds and Pension Funds by fiat. The obvious way is NATIONALISATION

Day_Of_The_Tentacle's picture

Do you have a source/link to the assassination attempt story, please?

JeffB's picture

He was speculating about a possibility of one, I assume.

Here's a story about her helicopter incident:

German leader's narrow escape after her helicopter falls 3300ft following an engine failure Read more: http://www.dailymail.co.uk/news/article-1368093/Merkel-narrowly-escapes-helicopter-crash-engines-fail-mid-air.html#ixzz1w2N9I16g
CTG_Sweden's picture



I´m sorry for not posting a reply until now although JeffB already has posted a link.

I don´t think any mainstream media was speculating about an attempted assassination of Angela Merkel. I don´t remember where I saw this information. I think read about this theory on some kind of message board. At that time I didn´t really pay much attention to this theory, and perhaps I don´t do that now either. But in case Angela Merkel proves to be obstructive to plans other EU leaders agree on, this might be another argument for the attempted assassination theory. To me, it seems unlikely that Merkel should be some kind of obstruction to a more closely integrated Europe or something else which is important to Western mainstream politicians. But sometimes unexpected things happen.

Furthermore, I am not 100 % sure that the EU-leaders in the Eurozone know what they are doing. If their intention is to create problems in order to strengthen the case for a political union, then I think that they perhaps know what they are doing. But if the problems in Spain or Greece have not been created deliberately, well, then I doubt that they know what they are doing. To me, it would have made more sense if Spain had left the Eurozone in 2011. The earlier a country which needs a depreciated currency can leave the Eurozone the better. If they wait too long the national debt will have grown to much which means that the country in question has to default.

slewie the pi-rat's picture

+ jive, clive!

hail hale!

Anton LaVey's picture

Germany leaving the Euro! AH! That would be so funny if it wasn't simply impossible.

Listen, it really is very simple - it only takes two steps:

1) Germany leaves the euro-zone and goes back to the DMark. OK, fine. It's Germany we are talking about here so these people are nothing if not organized and disciplined, so the Euro to DM step will be carried out promptly and efficiently.

2) "The French are left to sort out the mess" - No, no, no, "mon ami", this is all wrong. The French (who, by the way can be pretty efficient and organized as well!) will simply move the ECB mothership from Frankfurt to, let's say, Strasbourg (or Brussels). Next thing you know, they will demand that the entire upper management is replaced by Frenchmen or other (cooperative) nationalities. Hey, the Germans got out of the Euro nd back to the DM, why should they have a say in this matter, right?

Then, the printing of Euros begin in earnest. Here, Greece, need a couple of trillions to tide you up? Let's do this, here is your money! Spain, got bank problems? No more problems, here is a few hundred billions for ya! What are you saying Italy & Belgium? Debts got you down? Naaaah, no problem, what's a few more trillions between euro friends? What did you say? Beggar thy neighbour? Oooooooh yeah, baby... Euro-revenge would be so sweet.

Before you know it, everyone in Europe has invested all their money in DM and Swiss Franc (or real money like Gold and Silver, etc). Economy all over Europe is booming (hey, this exporting thing is easy when your money is worth US$ 0.5 for 100,000 Euros!)... And the Germans are thoroughly f*cked. Sure, they can live like kings for months for a few 100 DM, but their economy is BUSTED.

One thing you have to understand, and this is something the Germans KNOW: the rest of Europe does not (really) need Germany. Sure, German cars are nice, but, let's face it, you can buy something cheaper and less gaz-guzzling from dozens of other European manufacturers. German food? Ah! Don't make me laugh - I'll see your sauerkraut and raise you a nice Pata Negra Ham any time. German tools and engineering? OK, you have a point, but there are a lot of talented engineers in the rest of Europe.

AND, an added bonus would be that inflation could very well be (somewhat) contained, since the largest share of European exports are... within Europe. I'll trade your nice Feta cheese for my French cars, and Irish lads export Guinness in exchange for Italian wine and so on and so forth. German producers -- ANY German producers -- would simply be decimated by cheap European imports. And I do mean decimated.

On the other hand, "Gross Deutschland" really badly need the rest of Europe to export, export, export - which is the only way for them to maintain a facade of success (behind the facade, of course, Germany is already going to Hell in a handbasket, just like the rest of them). And, actually, the German economy is already suffering because of the Greek/Spain/Italy issues. Going back to the Deutsche Mark would be like playing Russian Roulette with 5 bullets in the chamber. Nice side effect? All the non-Eurozone nations would suffer the exact same fate, and would probably cry and beg and do anything to be admitted... in the Eurozone.

And, with the DM back in place, forget about exporting to, let's say, China and Russia or the rest of the BRICs: why would these countries buy nice-but-way-overpriced stuff from Germany when they can buy pretty much the same thing from, let's say, France or Italy at a 95% discount vs the German price? These countries are not crazy: just because it's made in France (or Italy, or Spain, or Belgium, etc) does not mean the final product is junk. Au contraire!

Do you think I am inventing this? Absolutely not! And, again, the Germans KNOW this is what's going to happen... Because this is exactly the way other Europeans behaved vs the DM before the Euro arrived! France saw its currency depreciate vs the DM and pretty much everyone in Europe did the same. Germans are not stupid - they know leaving the Euro would, in the end, create exactly the scenario I described above.

This is why the Euro is a trap - and, I should say, a trap which is working exactly as planned - the goal of the Euro has always been to anchor Germany into Europe and preventing it from "going it alone" and becoming too independent. This was always the goal, since every single European leder remembers all too well what happened the last time Germany was the dominant power in Europe...

So, next time you read some nonsense like "Germany is about to leave the Eurozone", just smile and nod your head. Not gonna happen. Or else.

Sandmann's picture

why would these countries buy nice-but-way-overpriced stuff from Germany when they can buy pretty much the same thing from, let's say, France or Italy at a 95% discount vs the German price?


Because they don't make the same stuff and the technical quality is often lower. It is absurd to suggest that Germany with 33% EU manufacturing capacity is somehow uncompetitive. Germany is a global producer with factories around the world just like Japan. "Made in Germany" is much more likely to read "German Made" or "Engineered in Germany" today  Whoever writes this tripe forgets that Germany produces in Romania, Poland, Turkey and assembles the items into a "Made in Germany" product.

ZH is amazing because of the ignorance about industry displayed by its posters. Do they really think Germany exports to the EU as opposed to the EU states importing from Germany. The cost of living of Germans has been inflated by the Euro and deflated German purchasing power. Cheaper foodstuffs into Germany would be just like Repeal of the Corn laws in England in 1846 - it would lower wage pressures in Germany and raise living standards increasing employment. German Consumption is suppressed by the Euro.

There is so little General Equilibrium thinking suggesting few economists or industrialists post here. Without German trade surpluses Club Med states could not afford their oil imports. The Euro pools German trade surpluses to fund oil trade deficits. Europe withoit a German anchor would turn to import controls against non-EU states and capital controls.

German cars are exported from US factories to Europe - BMW X5, Z4 and Audi engines come from Hungary. German Mittlestand companies have supply chains in Eastern Europe and Turkey and China. So much Bosch equipment comes from Hungary or China or Malaysia. Siemens holds a stake in LG. Germany is the world's No3 food exporter and overtook France in 2007. It is a major exporter of dairy products, meat, pizzas, confectionery. It is a major producer of women's clothing - France simply licenses and does not manufacture. Germany is a major producer of shoes in factories in Romania, Czech Republic, Spain, Portugal, Italy.

Many of the factories in France, Italy, Spain, are German-owned