The Lehmann
Letter (SM)
Is Europe’s
drama just high-stakes bluffing? Or do these folks mean what they say? Is it
possible that the situation is so fluid that the authorities’ positions are
evolving? More darkly, are some Greek politicians “kamikaze pilots” (as a
recent New York Times article put it), bent on self-destruction for the nation
they seek to lead?
Stock markets
began today with losses stemming from continued concerns over Greece’s
struggles and their impact on Europe.
This letter
believes that Europe will, once again, muddle through. But today’s news reports
are so contradictory it is difficult to get a grip on events.
For instance,
The New York Times began an article
with the title, “Softening, Merkel Says
She Is Open to Stimulus for Greece,” with this paragraph:
“Chancellor
Angela Merkel of Germany said Wednesday that she was ready to discuss stimulus
programs to get the Greek economy growing again and that she was committed to
keeping Greece in the euro zone, signaling a softer approach toward the
struggling country.”
Consider,
however, these words in a Wall Street Journal article captioned, “Greece Sets Showdown Vote Over Euro:”
“Officials from Germany and European Union
authorities reiterated Wednesday that Greece needs wrenching economic overhauls
to stay inside the common currency…..
“German and European Central Bank officials
have suggested in recent days that the euro zone would be able to deal with the
financial fallout from a Greek exit, and that contagion in other struggling
euro members would be manageable…..”
But:
“Syriza's popular leader Alexis Tsipras
dismisses the threats to force Greece's return to the drachma if the country
abandons austerity, calling it a "caramel that has already melted,"
and saying Greeks, having "already been so sorely tested, cannot be
blackmailed further."
Wow! Fighting
words…….
We’ll see.
(To be fully
informed visit http://www.beyourowneconomist.com/)
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