The troubled euro area just can't catch a break. S&P is putting a bunch of those countries on review for credit downgrades. The continent's credit was as solid as the Rock of Gibraltar when the euro was created. Now that rock may have to be sold to BRIC investors if deadbeat nations can't pay their sovereign debts. China's not bailing anybody out so maybe I'll pony up a buck fifty to buy what's left of Europe out of receivership.
Seriously, Europe isn't going to save itself with any more financial tricks like pretending the EFSF can buy its own bonds. The productive core countries of northern and central Europe will have to expel the PIIGS and others who won't make pro-market reforms. I remain convinced that the only salvation for the euro as a viable currency is to curtail its membership to roughly the former lands of the Holy Roman Empire. France, Germany, and the Low Countries make sense as a currency and fiscal union but they cannot succeed if they must prop up southern Europe. The "Holy Roman Euro" can adjust to harmonized taxation and centralized finance. The rest of the continent's denizens should be left to their own devices.
Seriously, Europe isn't going to save itself with any more financial tricks like pretending the EFSF can buy its own bonds. The productive core countries of northern and central Europe will have to expel the PIIGS and others who won't make pro-market reforms. I remain convinced that the only salvation for the euro as a viable currency is to curtail its membership to roughly the former lands of the Holy Roman Empire. France, Germany, and the Low Countries make sense as a currency and fiscal union but they cannot succeed if they must prop up southern Europe. The "Holy Roman Euro" can adjust to harmonized taxation and centralized finance. The rest of the continent's denizens should be left to their own devices.
