Financial markets were quiet last week, which is well nigh incredible. Europe's situation Overseas, Europe is un-gluing again. The only thing holding the Euro zone together is the euro currency itself -- poll after poll indicates exhaustion with Brussels and “one Europe,” but even in Greece, “keep the euro.” Any nation can have a solid, non-inflationary currency whenever it wants, just by accepting German-style discipline. No nation in Europe (except semi-Germany) has been willing on its own to adopt German discipline, but all now have good German money in their wallets -- and although hating everything about accepting German discipline via Brussels do not want to let go of the euro. Despite that currency wish, Greece is again at the exit moment, and Italy not far behind. China is leaking currency reserves again. And its effort to control its currency, domestic interest rates and credit, and international capital account all at the same time is guaranteed to fail. Not...
- The only thing holding the Euro zone together is the euro currency itself.
- Here in the U.S., other voices have begun to speak to the politico-economic situation.
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