Posts Tagged Eurozone

Cagle Post – Political Cartoons & Commentary – » Rays of Hope Shine on America in 2013


Rays of Hope Shine on America in 2013


We end 2012 besieged by all kinds of huge economic problems – a fiscal cliff, a jobless recovery, a long-term debt crisis, a list that sometimes seems endless. Yet I look forward to 2013 genuinely optimistic about the economic future of the United States.

Perhaps our biggest and most important immediate challenge is to find jobs for millions of unemployed or underemployed Americans. We start the year with an unemployment rate of 7.7 percent, but we all know the rate would be higher if it included people who simply have given up looking for work. I don’t think we will bring that rate down to an acceptable rate in the next year, but I do believe we will see real progress.

Pat Bagley / Salt Lake Tribune

Corporate profits hit record numbers in the last few months, and U.S. corporations ended the third quarter with $1.74 trillion in cash and liquid assets. Standard & Poor’s said that the accumulation of cash and the lack of corporate investing is “unsustainable and if left unchecked, underinvestment could lead to loss of competitiveness and in turn, lower profitability, potentially hampering issuers’ access to credit markets in time of need.” I predict that in 2013 corporate America finally will begin investing in their growth again and start generating new jobs.

After past recessions, the housing industry was the leading engine of recovery. We created such a gigantic housing bubble before 2008 that this has not been the case this time. When I talk to those in the industry, they tell me that a major cause of a stalled housing market has been the reluctance of banks to lend money until they see positive signs of recovery. Well, in November, housing sales were up 14.5 percent nationally. There were nearly 900,000 housing permits, the highest level in four years. Prices in all three counties in Delaware were up, reflecting a trend in many other parts of the country. It looks like housing is finally coming back, creating new jobs and boosting the economy.

Beyond these positive signs, I see real reasons for optimism when I look at the future position of the United States in the world economy. Clearly we need to do much more to ensure competitiveness in the areas of job training, education and a major emphasis on all the things that drive innovation. If we do these things reasonably well, I think we will have the best environment in the world for business growth.

Much of that outlook has to do with the decline in the environments of our major competitors. The 17-nation Euro zone is now in recession. Countries like Greece and Spain are falling down a slippery slope in which budget cuts to meet Euro zone (read German) demands for balanced budgets lead to falling GDPs, lower tax revenues, and even larger budget deficits. Germany and the European Central Bank keep saying they will do whatever it takes to keep the Euro zone intact, but if Greek and Spanish slides continue I think the internal political climate in Germany may make that impossible. Yes, it is an unfortunate mess, but for the foreseeable future the U.S. will be a much more attractive place to build plants and businesses.

Our other major competitor, China, has a different but also intractable set of problems. Just as one would expect, the last few years of double-digit annual growth in China’s GDP has led to rapidly increasing costs of labor and real estate. American and European corporations that set up major operations in the country are becoming increasingly disillusioned. Endemic corruption, blatant disregard for intellectual property rights, and an uneven and undependable application of the rule of law are all adding to the real costs of foreign corporations doing business in China.

I think the situation is best summed up by a statement in a recent report from the Boston Consulting Group: “We estimate that the relocation of manufacturing from China, combined with increased exports due to improved U.S. competitiveness compared with Western Europe and other major developed markets, will directly and indirectly create 2 million to 3 million jobs in the U.S., reduce unemployment by 1.5 to 2 percentage points, and lower the non-oil-related merchandise deficit by 25 [percent] to 35 percent. In fact, given the many changes sweeping the global economy, we believe our estimates are conservative.”

A lot of possible pitfalls lie in the way, but right now I would not trade places with any other economy in the world.

Happy New Year.

 Cagle Post – Political Cartoons & Commentary – » Rays of Hope Shine on America in 2013.


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Europe Takes a First Step « naked capitalism

MONDAY, JUNE 25, 2012

Europe Takes a First Step

By Delusional Economics, who is horrified at the state of economic commentary in Australia and is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.

It’s another week and another summit for Europe. The latest EU summit will be held in Brussels on Thursday and Friday and once again it is a ‘summit to end all summits’. Last Friday saw the leaders of the four largest Eurozone economies meet in Rome and the outcome was relatively positive:

The countries with the four-largest euro-zone economies agreed on Friday to an economic growth program with a total value of €130 billion ($163 billion). The sum represents 1 percent of the European Union’s gross domestic product, Italian Prime Minister Mario Monti said in Rome after a meeting with German Chancellor Angela Merkel, French President François Hollande and Spanish Prime Minister Mariano Rajoy.

Germany, France, Italy and Spain all agreed that growth measures undertaken so far have not been enough to pull Europe out of a debt crisis that is threatening to unravel the continent’s common currency, the euro. They also agreed that budget discipline alone will not be enough to fuel economic growth and create jobs for the mass of unemployed Europeans.

Chancellor Merkel said the plan was the “message we need.” She also admonished Europe to venture even closer political integration.

Although much of this wasn’t new money I think it is an important step forward because of the acknowledgement that the current ‘austerity only’ plan is failing to fix the Eurozone’s problems. I’ve always thought that ‘austerity alone’ would be a total disaster for Europe and that the idea would eventually be abandoned but that it would probably take the effects of the policy to start effecting one of the largest economies before we saw some reversal of policy. Now that contagion is lapping at Italy’s shores and the latest PMI data suggests that Germany is getting dragged down as well there is a chance we will finally see the beginnings of a co-ordinated response at this week’s summit. Emphasis on ‘beginnings’.

Obviously, given the myriad of previous failed attempts, I could well be premature in my optimism as there is a history of disagreement followed by half-baked resolutions that fall flat on their face. There was little sign in Friday’s post-meeting press conference that Angela Merkel had moved from her position of political/fiscal union first everything else second. There was no discussion of Euro-bonds and she made it very clear that “liabilities and controls go together”, meaning that there will be no shared issuances of any kind until nations have given up their fiscal controls to a central authority. This is all years away.

In the meantime Mario Monti is still pushing for a banking union, including a European supervisor and a deposit guarantee fund. A banking union would certainly relieve the stress on periphery banks as there would be no reason for a Greek or Spanish citizen to shift their deposits to Germany if all banks of significants were seen as ‘Euro’ banks. But in order for a banking union to work it would require a cross-border banking resolution and insurance funding which brings us back, once again, to liabilities and control.

On Wednesday Francois Hollande and Angela Merkel will meet again in an attempt to get the Franco-German game plan worked out before the summit. Obviously there are large differences in their positions so we are unlikely to see anything more than what has already been agreed to. That is , some more detail on the growth pact.

In the meantime the crisis rumbles on…

Greece’s new government has begun asking for changes to its bailout and German finance minister, Wolfgang Schaeuble, has replied:

The most important task facing new prime minister Samaras is to enact the programme agreed upon quickly and without further delay instead of asking how much more others can do for Greece.

The banking problems move to Italy:

Italy’s Banca Monte dei Paschi di Siena is in talks with the Treasury and the Bank of Italy about issuing at least 1 billion euros of government-backed bonds to plug a capital shortfall, two sources close to the matter said on Saturday.

If the Treasury and the Bank of Italy give the go-ahead, Italy’s third biggest lender would become the country’s first bank to resort to state help as the euro zone debt crisis deepens.

“There are very close contacts with the Bank of Italy and the Treasury, although there is no final go-ahead,” one of the sources said.

A second source said: “They are negotiating actively, but the Bank of Italy has to give the final approval.”

Monte dei Paschi has been struggling to fill a 3.3 billion euros capital deficit by end-June to meet tougher requirements set by the European Banking Authority (EBA).

And the Bundesbank is taking swipes at the ECB over Spanish collateral:

As Spanish banks scramble for collateral to use in the refinancing operations that are keeping them afloat, the Frankfurt-based ECB said it will cut the rating thresholds and amend eligibility requirements for some asset-backed securities. While the move will give stressed banks greater access to ECB liquidity, it may also increase the amount of risk on the central bank’s balance sheet.

“We’re critical of this,” Bundesbank spokesman Michael Best said yesterday. In terms of collateral, “we won’t accept what we don’t have to accept,” he said.

Just another week in Europe then.

 Europe Takes a First Step « naked capitalism.

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The European Central Bank Needs More Power –


Europe Needs a Federal Reserve

Published: June 20, 2012


As the world economy teeters again, pressure is mounting on central banks to reopen their spigots, make it even cheaper for companies and households to borrow money, and prop up commercial banks to prevent another financial crisis. On Wednesday, the Federal Reserve, which had already promised to keep short-term interest rates near zero until the end of 2014, extended its latest, modest strategy to keep long-term rates down, too.


The Fed’s counterpart, the European Central Bank, was created in 1998 to maintain price stability in the new euro zone. With so many depositors taking their money from troubled banks in Greece and Spain, observers are urging the central bank, based in Frankfurt, to fire another round of the “big bazooka” — the roughly 1 trillion euros in cheap loans that it granted to banks in December and February.

But even if it is willing to do this, the central bank is not equipped to do so without putting Europe’s financial system at risk. Its design is flawed. To save the euro, the 17 countries that use the shared currency will not only need a more unified fiscal policy. They will also need a single institution to tide over troubled financial institutions, and a single banking authority to supervise banks and, if necessary, close or merge them.

Bizarrely, although the deutsche mark, franc and lira are gone, members of the euro zone still have their own national central banks, which can step in and lend euros. Since 2007, the credit extended by the central banks of Italy, Spain, Greece, Portugal and Ireland has increased tenfold, in part because the criteria for the collateral put up in exchange for central-bank loans were relaxed significantly in 2008 (and later, in Greece,Ireland and Portugal, almost completely discarded).

What ails the euro zone is not a Teutonic allergy to inflation, or a timidity about extending loans, but what economists call the tragedy of the commons. Here’s an example: A group of people go for a drink and agree to split the tab. They tend to drink a bit more than when each goes alone. Each person gets to enjoy 100 percent of the marginal benefit of an additional drink, yet she is responsible only for a portion of that drink’s cost. So she has an incentive to outdrink her friends and exploit the common pool of money that will be used to pay the tab.

The central bank system in Europe is akin to letting the government of California issue bonds, pledge them as collateral at the San Francisco branch of the Fed, and then get fresh dollars to pay for its budget deficit. If this were reality, imagine the strong temptation for California to tap Fed resources to indulge imbalanced spending and borrowing.

If the system isn’t fixed, it will lead to another financial crisis. In the past, many countries that pursued expansionary credit policies to avoid economic turmoil precipitated only a deeper crisis. In 1994, for example, Mexico’s central bank significantly increased loans to private banks, in an attempt to forestall a recession before a presidential election. The result: capital flight, a speculative attack on the peso and a financial crisis.

Europe is heading toward a similar mess. Since 2008, hardly any banks have been shut down in the euro zone, while American regulators have closed hundreds of institutions. Bank “stress tests” in countries like Spain continue to underestimate the true extent of bad loans. Greek banks were deemed solvent — and therefore eligible for loans from Greece’s central bank — even as nervous depositors withdrew hundreds of millions of euros.

Only the European Central Bank, not national regulators, should have the power to decide if a bank is financially sound, and eligible for central-bank loans.

If the European Central Bank were to gain this power, it could shut down insolvent (zombie) banks, limit excessively high levels of central-bank credit, and make it clear to the euro zone’s members that help from Frankfurt cannot go on forever.

Under Jean-Claude Trichet and now Mario Draghi, the European Central Bank has forestalled a panic and avoided setting off inflation so far — a priority for Germany, Europe’s largest economy. But it has been powerless as bank insolvencies mount, and it has failed to pressure governments to lower their budget deficits and implement economic reforms.

The national central banks — including Germany’s Bundesbank and the Bank of France — should become subsidiaries of the European Central Bank like the 12 Federal Reserve Banks (in New York and San Francisco, etc.). Voting rights at the European Central Bank should be reorganized so that they are proportional to the share of the loss that each country would bear in case of default. Those who bear the largest share of the cost should have greater say as to when the drinking should stop.

To bolster ailing banks in southern Europe, some have called for the European Central Bank to insure deposits. Fine, but in exchange, all banks, not only the biggest ones, should be under the supervision of regulators in Frankfurt. They should have the sole authority to shut down, or merge, failing banks. When they offers credit, they should accept only marketable securities as collateral.

Without these reforms, zombie banks represent another financial crisis waiting to happen.

 The European Central Bank Needs More Power –

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IMF to Spain: You’re Screwed – 24/7 Wall St.


IMF to Spain: You’re Screwed

Posted: June 15, 2012

The International Monetary Fund (IMF) has published its preliminary findings following its meetings with Spanish officials. The outcome is neither unexpected nor good news for Spain.

First the IMF states the obvious:

The economy is in the midst of an unprecedented double-dip recession with unemployment already unacceptably high, public debt increasing rapidly, and segments of the financial sector needing recapitalization. This calls for a commensurately ambitious policy response and communicating it within a comprehensive medium-term strategy. This strategy should be based around concrete measures to deliver the needed medium-term fiscal consolidation, a roadmap for restructuring the weak segments of the financial sector, and structural reforms to boost growth. The prospective Euro area financial sector support is an important opportunity to implement such a strategy. Spain’s prospects will also be helped by further progress at the European level.

Here are the problems:

·         Spain cannot meet its 2012 target of a 5.3% of GDP deficit due to revenue shortfalls, structural changes that are needed in the country’s regions, and a compressed timeframe due to the delay in passing a budget.

·         No one believes that Spain can do what it says based on its failure to be honest about its 2011 budget woes.

·         The banking system is in tatters and no bank can raise private funds despite the recent LTRO program and the $125 billion bailout.

·         Unemployment stands at 24% for the entire population and above 50% for the young and deleveraging by Spanish citizens suggests that output will contract through 2013, meaning no or little job growth.


The IMF offers hope that successful labor reform, the bailout, and improved competitiveness “could lead to a significantly better m
edium-term outlook.” That assumes that Spain can somehow muddle through for another two or three years.

There’s nothing new in the IMF’s analysis of what’s wrong with Spain. But the solutions on offer are simply wishful thinking — and not very upbeat wishful thinking at that. Spain is essentially on its own now and there’s no evidence that the country will be able to stand by itself.

The IMF’s report is available here. 

Paul Ausick

IMF to Spain: You’re Screwed – 24/7 Wall St..

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How Greece Squandered Its Freedom –


How Greece Squandered Its Freedom


Published: June 14, 2012


Jonathon Rosen

MY country is hurtling toward an election that will decide its fate — whether Greeks will fight on to remain part of Europe’s core or succumb to their own weaknesses and turn inward, choosing isolation, anger and uncertainty greater than that from which they wish to flee.

The vote on Sunday will change our lives — determining not only whether we remain in the euro zone but also the nature of our society and the fate of the democracy that was re-established just 38 years ago after a dictatorship. We are bitterly divided between those who want to carry on with the reform process and those who want to turn back the clock. Our partners in the European Union are frightened of the consequences of our vote, but seem otherwise indifferent to our fate.

At a moment when the choices should be as clear as possible — between reform and stagnation, between Europe and isolation, between painful progress and the deceptive comfort of surrender — the issues are hopelessly confused by false expectations, by false choices and by the total failure of a political class that can’t propose solutions to the country’s problems and can’t forge a minimal national consensus on what is at stake and what needs to be done.

We face a choice between two deeply flawed alternatives. On one hand, there is New Democracy, a center-right party that has done much to undermine Greece’s economic reform and revival over the past two years. It refused to support the bailout agreement signed by the Greek government, the European Union and the International Monetary Fund on the grounds that it would stifle growth and so it undermined initiatives like tax reform that would have helped combat tax evasion by self-employed professionals and businesses. Yet it is now presenting itself as the responsible force that will stick to austerity and keep Greece in the euro zone.

On the other hand there is Syriza, a fractious coalition of 12 radical groups that has anointed itself the herald of leftist change throughout Europe and declares that it will immediately annul the bailout agreement while demanding that our partners continue to lend us money. The latter course could lead to the country’s swift exit from the euro and a chaotic and unpredictable future.

Since last October, after the first suggestion that Greece might be forced out of the euro zone, we have lived with desperate uncertainty. Suicides, once few, are on the rise as the pressure becomes too much for some. Meanwhile, families and the disorganized and underfunded social security system can no longer cope. In a country of fewer than 11 million people, more than a million are jobless. Everyone else lives in fear that he or she may be next as companies close or lay off workers. Migrants are leaving and Greeks are emigrating. A recent study conducted on behalf of Panteion University in Athens suggests that 7 out of 10 Greeks between the ages of 18 and 24 hope to seek their fortune elsewhere.

This uncertainty has inspired radical choices. A cousin of mine, and his wife, left with their young child a few weeks after she was offered a job in Dubai, in the United Arab Emirates. They reasoned that one job in Dubai was more secure than two in Greece. In villages around the country, the unemployed and pensioners from cities and towns are returning to the land to clear fields and grow crops that they feel they and their extended families will need if the economy gets even worse. A friend, a successful lawyer, is thinking of going into farming as he sees his clients falling by the wayside. My elderly parents follow the news carefully, anxious about possible shortages of medicines. Having lived through many ups and downs, they are more sanguine than most: “Whatever happens to the many will happen to us as well,” my mother says.

The insecurity shakes us to our core. When I go to the A.T.M., I hold my breath until I hear the reassuring whirring sound that says the machine will give me what I’ve asked for. I wonder whether I will be so lucky next time. My wife and I have been working for more than 25 years, saving for our children’s education, because even though about half our salaries go to taxes and social security, we know that we must pay for private schools, that we cannot count on state hospitals, and that our pensions are not guaranteed. (All this because others do not pay taxes, and because successive governments did not do their work.)

Every day we wonder whether we have done the right thing, jeopardizing our savings in a stubborn statement of confidence in a country that, since its founding, has declared bankruptcy several times. How will we tell the children that their lives would have been better if we had been less inert, less idealistic, more adaptable to circumstances? In a few years’ time, will they be able to travel and study abroad as easily as we once did? We don’t know.

The choice Greeks face on Sunday might appear simple — between tightening our belts and remaining in the euro or leaving it and facing an economic meltdown. But politics is never simple here.

The discredited New Democracy party, which governed Greece from 2004 to 2009, represents the failed political system that allowed Greece to fall so deeply into debt in the first place and then signed on to harsh austerity measures.

And a coalition led by the left-wing coalition Syriza wouldn’t be the breath of fresh air that its 37-year-old leader, Alexis Tsipras, would like us to believe. Its platform is populist to the point of nihilism as it tries to suck up the support of those who’ve abandoned the mainstream parties and their failed policies: it promises to annul the reforms and austerity measures of the past two years, nationalize banks, block privatization plans and even take back some of the state companies that were recently sold off.

Meanwhile Pasok, the socialist party that until May had been Greece’s other major political faction, alongside New Democracy, has withered to near irrelevance because it is blamed both for policies that stacked the public sector with political clients and bloated state spending, and for implementing the austerity and reforms demanded by our creditors.

None of these parties have advanced a serious agenda to avoid disaster. Those who are deeply in debt — or who aspire to gain at the expense of others — hope that the economy’s slate will simply be wiped clean. Those who have stashed their money abroad will be able to buy assets on the cheap if Greece leaves the euro zone. But the people who work hard and pay taxes, who have a stake in reform and progress, who carry the burden of every mistake, have no credible representative to vote for. Those who want a better Greece have to look for the least bad option.

The widespread feeling of loss is worsened by the understanding that we wasted most of the past four decades — the longest period of peace and prosperity that the country has known. Greece made great strides toward achieving the standards of its European partners, with major infrastructure projects, hospitals and schools, and with European Union subsidies and markets helping to create a booming economy and a new middle class. But we allowed development to become a bubble. We lost the self-discipline, moderation and inventiveness that once helped the Greeks achieve great things, and we succumbed to political expediency, delusions of grandeur and a fatal sense of entitlement.

EVER since the Greeks began their war of independence against the Turks in 1821, these different aspects of the national character have been in perpetual conflict, resulting in breathtaking swings between glorious heights and desperate depths. The heroic resistance to the German occupation in World War II was followed by a terrible civil war between left and right that still cripples our politics; the inspiration of the Athens Summer Olympics in 2004 was followed by the economic, social and political ineptitude that brought us to today’s collapse of the main political parties, and what is turning out to be the destruction of the country’s backbone: small businesses and the middle class.

We hear that about 80 billion euros has been pulled from bank accounts and that 500 million to 800 million euros is being withdrawn each day. Some of this goes toward paying bills, while the rest is being hidden or moved abroad. And yet, last month there was still about 170 billion euros in Greek banks, despite the growing chorus of economists declaring that Greece will leave the euro. Why? Maybe when the volcano rumbles, when the thugs come for our neighbor, when a society gives up the fight for progress, the familiarity of our routines numbs us to the dust and roar of the coming stampede. Maybe we do not think bad things will happen to us.

Maybe that’s what the people of Constantinople felt before it fell to the Ottomans in 1453, or the Greeks who were swept out of Asia Minor in 1922, or the innocents sucked into the civil war of 1946-49.

What I want to remember from Greece in 2012 is how laziness and years of intellectual sloppiness can waste the gift of freedom and leave open the gates of the city — how we allowed our leaders to pander to us until we had no one capable of leading us, no one next to us at the barricades.

Nikos Konstandaras is the managing editor and a columnist at the Greek daily newspaper Kathimerini.

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Against The Grain: Germany Should Just Exit The Euro – 24/7 Wall St.


Against The Grain: Germany Should Just Exit The Euro

Posted: June 14, 2012

Here is a fresh take on the Eurozone and the Euro for you.  With all of the talk about the PIIGS and the Euro, the angle always seems to be rather Greece, Spain, Portugal and Italy can ultimately remain in the Euro.  What about another take out there on this matter entirely?  What if Germany just preemptively throws in the towel and exits the Euro? That is what a TrimTabs report is suggesting as Germany’s best so
lution right now.

A German exit would create massive financial turmoil.  Even after the latest election results, it seems almost impossible that Germany’s leadership would embrace an exit of the Euro today.  Still, that is today’s stance. TrimTabs calls this move as “the only practical solution to the debt crisis in Europe is a breakup of the Eurozone.”  The warning is rather dire: “Germany needs to salvage what it can financially and leave the Eurozone as soon as possible.”

TrimTabs suggests that there are no good solutions to the Eurozone debt crisis as debt is reaching such a high figure.  The report even says “the market pressure is so intense that it’s now a matter of choosing the best of bad options.”  The move would allow Germany to establish its own strong currency and salvage what it can financially.  The warning admits that Germany would suffer big losses on its euro-denominated holdings but ultimately it will be dragged down with Eruozone partners if it does not exit and that the global economy will end up being much worse off.

TrimTabs even refers to the Eurozone efforts as fatal structural flaws and the report calls other widely advocated solutions unrealistic regarding more bailouts and more currency printing.  And here is the real crux of the argument over the effort and the timing: “They’d require changes to treaties and constitutions that would take months if not years, even if politicians could agree on them immediately.  The markets won’t wait that long.”

What TrimTabs is proposing here is a twofold argument: it is unique, and the stable market theorists would call this financial heresy.  The argument is even harder to consider when so many investors think of the Euro as just a watered-down Deutsche Mark.

Just yesterday Charles Biderman showed in this video that central banks cannot solve the problem… those central banks are the problem.

Again, the talk is almost always regarding whether or not Greece, Spain, Portugal, and Italy can ultimately stay in the Euro.  This is a 180-degree thought.  If Germany just pulled the ripcord now there would be a massive shakeout in the markets.  But what if that is the best solution?

Scary on the surface… but food for thought.


Against The Grain: Germany Should Just Exit The Euro – 24/7 Wall St..

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Should Greece Default? –

February 13, 2012

Should Greece Default?


A protest in Athens on Sunday.

Yannis Behrakis/ReutersA protest in Athens on Sunday.


As Greek lawmakers passed a deeply unpopular austerity bill amid huge protests to secure another bailout, many are wondering whether the country should embrace a default.

The Irish Independent thinks it’s only a matter of time. “At some stage over the next few weeks, maybe just days, matters will come to a head, Greece will default on its debts and the country will either leave or be ejected from the euro.” Stefan Kaiser, of Der Spiegel, agrees: if negotiators tried “being honest for a change” they would realize that there’s no option but bankruptcy.

For Panagiotis Sotiris, of the Greek Left Review, the real “question is not if Greece is going to default but how.” That’d be better anyway, writes Costas Lapavitsas in the Guardian: Athens should abandon “the charade of voluntary haircuts” and instead “default in a sovereign and democratic way by immediately declaring a cessation of payments.”

There are skeptics. A default could help strengthen the euro in the long term,writes Heather Stewart in the Observer, but it “would be a costly and chaotic process.” The Irish Times also argues that no matter how a default were managed, it “would prove disastrous for Greece, damaging for the euro zone” and hurt “other debt-laden peripheral economies.”

Some also question the big creditors’ motivations. M.E. Synon writes in the Irish Daily Mail that “the Germans may want to trigger a disorderly default in Greece so that Greece falls out of the eurozone — and out of the domestic political problems of Angela Merkel.”

For Greece, pride, not just economics, is at issue. “If we cannot stay in the euro zone, if we find ourselves on Europe’s edge, we will be defeated, humiliated and alone,” writes Nikos Konstandaras in the Athens-based Ekathimerini.

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