I will have a more thorough analysis of my thinking on the sovereign debt crisis in Europe but over the weekend kicking around some ideas with some friends, I had this one thought which pretty much encapsulates the environment.
I am under the assumption that European Power Brokers and Policy Makers just want to kick the can down the road just a little more. To buy some more time as to say that time is in infinite supply. This just reminds me of Wile E Coyote in suspended animation running off the cliff. They (The Audience) all know that poor Wile E is going to crash to the bottom of the canyon but if he can just stop time maybe he doesn't crash after all? We all know how this ends for the lovable Coyote.
The point of all this is that policy makers in Europe which basically are from the French & German persuasion want to just pile all of this bad debt which can't and won't ever be paid off unto the backs of the taxpayers from the banks books. The meme will be that they need to recapitalize bank balance sheets so that any future crisis can be contained. The real meme here is we need to maintain the current elitist banker status quo. Any bailout of any sovereign nation to maintain banker status quo will only be achieved if the peripheral economies actually grow. The taxpayers will stupidly support this only if they see growth in the economies. But how to get growth when it looks like austerity is the current peripheral business plan?
Its a total scam.
I am under the assumption that European Power Brokers and Policy Makers just want to kick the can down the road just a little more. To buy some more time as to say that time is in infinite supply. This just reminds me of Wile E Coyote in suspended animation running off the cliff. They (The Audience) all know that poor Wile E is going to crash to the bottom of the canyon but if he can just stop time maybe he doesn't crash after all? We all know how this ends for the lovable Coyote.
The point of all this is that policy makers in Europe which basically are from the French & German persuasion want to just pile all of this bad debt which can't and won't ever be paid off unto the backs of the taxpayers from the banks books. The meme will be that they need to recapitalize bank balance sheets so that any future crisis can be contained. The real meme here is we need to maintain the current elitist banker status quo. Any bailout of any sovereign nation to maintain banker status quo will only be achieved if the peripheral economies actually grow. The taxpayers will stupidly support this only if they see growth in the economies. But how to get growth when it looks like austerity is the current peripheral business plan?
Its a total scam.
Remember, Wile E Coyote only fell when he acknowledged that he should be falling. The FED, ECB, etc are all playing the same game - as long as they pretend there is solid ground underneath then there will be. Bullish sentiment continues because the bullish sentiment is continuing.
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