Long Live the Wily Greeks !

They deserve our gratitude!

As I had suggested in my last post, the wily Greeks have done it again. Far from destroying the Euro by exposing its soft underbelly, with their cunning and creative public accounting they've selflessly given us Europeans, members of the Euro zone, a helping hand.

Finally the press has caught up with the news, and French and German exporters are reportedly happily crowing that the Euro at last is giving them a breather. About time people realized the benefits of a weaker Euro! Meanwhile, with the Fed tweaking upwards one of their discount rates, the dollar has strengthened somewhat, giving an additional push to what the Greeks had started.

This said, there is little doubt that the Euro has a dangerously exposed underbelly: the richer Euro-zone members (meaning Germany and France) may very well have to bail out Greece's national debt. This is likely to be a hugely unpopular measure and the Germans in the street - guys like you and me who know little about economics and public accounting, and rarely think about it - are already grumbling, saying that they don't want to help out people who've been on a free ride (meaning the Greeks) while they were tightening their belts (because of the slowdown in exports). But they're wrong: they should thank the Greeks for lowering the Euro and making it easier for them to sell their stuff abroad!

Moreover, and that's very fortunate, Greece is a small country and the bailout, if needed, should not be too expensive. Think what it would cost if it were Spain! And there's a silver lining: with the speculative attack on the Euro brought on by Greek profligacy and total disregard for Euro rules, the institutional weakness of the Euro has been at last fully exposed. As long as the Euro was flying high, no one had noticed. But now, hopefully, something will be done about it.

And something really NEEDS to be done. Or else, the next villain - I mean country - will be Spain, or worse (why not?) Italy. Then any bailout would cause intense suffering - not to mention the collapse of the Euro.

Seriously, will our governments take note? I hope so.
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