“We have to adjust to lower growth,” said Thomas Mirow, president of the European Bank for Reconstruction and Development, referring to both Europe and America. “It is of course going to be very painful. But leaders have to speak frankly to their populations.”
The uncertainty about Europe’s future has been driving the gyrations of financial markets since the summer. Earlier this week, stocks rallied on euphoria that a new, more powerful bailout was near, but the rally fizzled Wednesday when cracks began to appear among European nations over the terms of money being given to Greece.
On Thursday, markets were mostly up again after the German approval of the 440 billion euro ($600 billion) bailout fund, intended to keep the crisis from spreading beyond Greece and Portugal to other European countries. Several other nations still have to ratify the agreement, but it now looks likely to be in place by the end of October.
Even this fund, however, is already seen as inadequate. Some worry that it still fails to fully address one of Europe’s most pressing needs: fully recapitalizing its banks.
Coming from the the NYT home of the Keynesian clown Paul Krugman this may not have been a total surprise. But it does point the insanity that the Keynesian clowns live with. I am wondering exactly when they do consider something a crisis ?
Europe is in a crisis and "fully recapitalizing it's banks" is political class doublespeak for passing the losses off onto the taxpayers.
With the lack of leadership both in Europe and in the U.S. and the politicians and bankers continuing to steal money from the taxpayers to cover their risky financial behavior, I agree things will only get worse, but it is already a crisis.
A crisis they are only making worse. when bankers and politicians start saying we all have to share the pain, while only they share in the profits - Things can only get worse.
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