Streetwise Professor

November 9, 2011

Shhhh. Intellectuals at Work.

Filed under: Economics,Financial Crisis II,Politics — The Professor @ 8:48 pm

France and Germany are finally coming to realize that if they don’t amputate, they will die of gangrene:

The discussions among senior policymakers in Paris, Berlin and Brussels raised the possibility of one or more countries leaving the euro zone while the remaining core pushes on toward deeper economic integration, including on tax and fiscal policy.

The change has been discussed on an “intellectual” level but had not moved to operational or technical discussions, the EU official said. A French finance ministry spokesman denied there was any project in the works to reduce the currency bloc’s membership.

Yeah.  What’s the hurry?  Italy is just imploding.  Greece is a lost cause.

The time for putting on berets and sitting around smoking Gauloises at the cafe while discussing oh-so-intellectually the economics of optimal currency zones has passed.  Operational and technical discussions should have taken place long ago, on a contingency basis.  For the contingency has arrived.

The Europeans have consistently been a step behind.  Many steps actually.  This article, presumably intended to demonstrate how far their thinking has evolved, does the exact opposite.  It shows just how far behind events they are.

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  1. Great imagery Professor. How long will it be before Merkel calls the German embassy in France and asks-Is Paris burning?

    Comment by pahoben — November 9, 2011 @ 10:45 pm

  2. Thanks, pahoben. Not long, methinks.

    The ProfessorComment by The Professor — November 10, 2011 @ 9:00 am

  3. No one will do anything until they are forced. An optimist would say our fifty plus years of occupation has infected them with Churchill’s description of America in that we will do the right thing, but only after trying everything else first. My take on this is that they are stuck in the first phase, because the right thing is too big a change to the Weltanshauung they have lived with for the same time (how’s that word for deep intellectual Europeeing (not a typo) sophistication?).

    Comment by Sotos — November 10, 2011 @ 1:25 pm

  4. But Jim Cramer says that dastardly Ron Paul would just let it all fail and take your 401k with it! Print print print says Jim! The Fed has got to DO SOMETHING and save my naked shorts YAAAAAAARRRRRRRRRRRRRRGGGGGGGHHHHHHHHH (turning off CNBC now)

    Comment by Mr. X — November 10, 2011 @ 1:27 pm


    Comment by Mr. X — November 10, 2011 @ 1:27 pm

  6. Damn. My theory was that you *were* Jim Cramer, Mr. X. But maybe you’re just being clever and trying to cover your tracks.

    The ProfessorComment by The Professor — November 10, 2011 @ 1:32 pm

  7. Re Cramer. Please, Professor, don’t confuse monomania with AADHD!

    Comment by Sotos — November 10, 2011 @ 4:21 pm

  8. @Sotos–too true! My bad!

    The ProfessorComment by The Professor — November 10, 2011 @ 5:17 pm

  9. Thou shalt not question the Federal Reserve. Hell, Cramer loves em’, as do just about every other mainstream respectable media person.

    Comment by Mr. X — November 10, 2011 @ 6:20 pm

  10. Uhm, again–I’ve questioned & criticized the Fed quite a bit. Do you actually read what I write?

    The ProfessorComment by The Professor — November 10, 2011 @ 7:02 pm

  11. To continue my proud tradition of marine analogies, if Russia is a flimsy ship, likely to sink in a big storm, and the EU is the Titanic after getting hit by the iceberg (with the PIGS constituting the lower bulkheads), then the US is the Aquatica undersea base in the movie Deep Blue Sea – imposing and apparently impregnable, but unbeknownst to its denizens, the mutant man-eating sharks are on the verge of breaking free and devouring them all.

    Comment by Sublime Oblivion — November 10, 2011 @ 8:36 pm

  12. In none of my business efforts in Europe have I ever been given the impression that there is a common economic union exhibiting anything like an economy of scale. I know of no product I can sell between Romania and UK that does not require unique country consideration from inception through manufacture, packaging, shipment, tax and sale.

    I have paid no attention through the years to the politics of the EU. I have no understanding of their favorite accomplishments beyond a common currency, labor mobility and herding each other’s governments to avoid collapse. A common currency is easily accomplished without the political rigmarole, labor mobility requires no bureaucracy, and the third is a farce partly because of the method used to create the Euro.

    We argue for small government first and foremost because bureaucracy, especially political bureaucracy is inversely proportional on a logarithmic scale to intelligence and adaptability, blissfully unaware of its own negative externalities while it crows about everyone else. We move to normative moral argument and freedom of choice only after the first argument somehow does not resonate.

    Comment by Jim — November 11, 2011 @ 2:37 pm

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