Our piece at the Harvard Business Review is here.
This is a terrific post in telling the story of the Next Spanish Inquisition. The policy actions thus far speak to the great experiment of forcing structural changes on the peripheral euro economies as the populations in those nations either: are blindsided and accept unrelenting austere futures as tax slaves; see what is coming and revolt; or throw in the towel (as the young and educated have done) and flee to seemingly greener pastures. For me the great irony is that little has been learnt from Japan's decades long demise. It is difficult to combat the inevitability of demographics, debt-deflation and zombie banks in isolation but if you consider that all three are the future of EMU --as well as sub-optimal monetary policy courtesy of the ECB-- then there is a better understanding of the gravity of the situation. The European money markets (EONIA, EURIBOR) long ago (i.e. 2008H2) decoupled from the ECB's target refi rate whereas in the past they were tightly in line with it. What we have know from policy makers is a seemingly deliberate attempt to inflict as much pain as possible on the working person. In the past when pain went beyond an acceptable threshold this meant revolution but people appear to be sleepwalking towards neo-feudalism; Yanis Varoufakis' Global Minotaur is broken -- who can stand up as an architect for a new paradigm lest we face years of depression?
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