Madness is the real 'contagion' in Europe

When European financial commentators talk about "contagion," what they mean is the domino effect of a Greek default spreading to encompass big banks and other nations like Portugal and Ireland. But the real contagion will be madness demonstrated by ordinary citizens who refuse to grapple with the loss of their government benefits and, more fundamentally, the realization that the free lunch is over. It is nothing less than a loss of faith in social democracy. The Greek parliament is set to vote on a property tax increase that will make middle class living a distant memory for many. People in their thousands are demonstrating against it. Except, if the measure fails to pass, the Greek's debt holders and the IMF will not release another $11 billion increment in the bailout scheme agreed to last July. This will result in a "hard default" where those bondholders are likely to get little or nothing on what's owed them and the government won't be able to meet its payroll obligations (one in...(Read Full Post)