by John Galt
June 17, 2012 15:15 ET
And in his usual direct, factual, and intellectual manner, Ambrose Evans-Pritchard delivers a blunt bit of honesty to address the insanity which will follow in the weeks and months ahead in his column from tonight’s U.K. Telegraph:
Greece will have to leave EMU whoever is elected
(Click on the title above to read the article in full)
The following excerpt sums up the instability the world is about to experience quite nicely:
The Bundesbank’s Jens Weidmann could hardly have been clearer. “We must not allow any country to blackmail us,” he said.
If Syriza admitted that euro exit is the price that must be paid to restore sovereignty and a viable currency, one might cheer them on.
What Alexis Tsipras invites is the worst outcome: rupture on hostile terms; a return to the Drachma without stabilisation support. He is trifling with his nation’s fate.
Ultimately, Greece will have to leave EMU whoever is elected. No government can carry out an “internal devaluation” for eight years, and nor should it try. But it matters a great deal for Greece how exit is negotiated.
As for the threats of Mr Tsipras, they are by now empty. He does not have the means to pull the plug on monetary union, or Europe’s banks, or anything else.
Private investors have already lost 75pc of their loans to the Greek state, and what remains is trading at a default discount.
Game over. Good night now.
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