In response to an FT article by Kerin Hope, Henry Foy and Peter Spiegel on 7th July 2015, entitled 'Lack of trust threatens to scupper any Greek deal'
The politicians and the media have done a very thorough job of describing the drama, the caricatured personalities and the intrigue in this very real soap opera. Not so much the big picture.
This isn't a Greek crisis. This is a Eurozone crisis. It is the inevitable result of, amongst other things:
1. Creating a half-baked monetary union resting on 19 separate bond markets
2. Obfuscating the designers' motivation for this to be a half-way house to Federalism; failing to confront the fact that without fiscal union, the Euro is nothing more than a glorified peg, and pegs always break
3. Going through the motions of having a set of rules that have been bent, twisted and ignored from day 1
4. Inviting countries ill-equipped to cope with having their debts effectively converted into Deutschmarks on day one. Compounding this error by ignoring their off balance sheet liabilities and other little peccadillos e.g. turning a blind eye when Goldman Sachs rigged the Greek application
5. Bailing out the banks by transferring their bad loans to European tax payers
6. Pretending that Eurozone banks are fit for purpose, when it is clear to anyone paying attention that if their assets were marked to market, they would be insolvent
I'm not trying to defend the Greek politicians - they are socialists and I believe in free market capitalism (not to be confused with the crony capitalism and 'socialism for the rich'). However, the most honest statement I have heard throughout the whole crisis was from Mr Varoufakis when he said 'Greece is bust'.
Greece is bust, that is a done deal - horrible as this is for the poor, the old, the sick and the young people of Greece...Greece is bust and this is the opening scene of something much bigger. The crisis is in the Eurozone. If I were the Greek government I would get out of the Euro, replace Euros with Drachma at 1:2, and take the pain standing on my own feet. The Euro is heading for collapse with or without Greece. Germany and the North will be OK; Italy, Spain, Portugal and even France will suffer badly. For the poorer countries, it will be a nightmare.
For me, the thing that is saddest of all is that next Sunday the 28 leaders of the EU will get together to decide 'what to do with Greece', and in doing so they will be totally missing the point.