Sunday, July 5, 2015

A "No" Vote Was The Only Sensible Outcome

A "yes" vote would have prolonged and made worse the inevitable.  Greece cannot pay its debts.  No facts on the ground would have changed that -- now or ever.  Facing up to the unpayable nature of Greece's sovereign debt is the main result of Sunday's "no" vote.

It is a shame that the survival of the Euro was made, by politicians, contingent upon sovereign fiscal solvency.  Had that same politics prevailed in the US, Detroit would have recently exited the Dollar.

There is no reason why Greek debt problems have anything at all to do with the Euro.  The only reason there is a connection, is that the other European nations made a connection by embarking on bailouts for Greece, Spain, Italy, and Ireland, none of which were necessary.  Each of those countries should have defaulted on their debt and stayed in the Euro.

But, politicians always think they know better than markets, so now catastrophe looms for Greece and likely for most of the other Eurozone countries in  time.

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