Europe clings to scorched-earth ideology as depression deepens

The Telegraph ^ | 12/9/2012 | Ambrose Evans-Pritchard

[Rockingham]

Even if the Greeks be made to behave like Germans — which seems unlikely — that would be the task of a generation. In the meantime, some solution must be found that permits monetary expansion in Greece and other debt impaired Eurozone economies. Otherwise, Greece and her sisters in the South will suffer chronic economic stagnation no matter how much lending they receive.

[bruinbirdman]

"The central problem is that the Euro imposes a uniform monetary policy and facilitates the flight of liquidity from impaired economies that need monetary expansion "

Kinda like every EuroZone country is using a foreign currency over whose value they have no control.

yitbos

[Rockingham]

Except for Germany, which, sets the terms for the entire Euro zone. Other countries tolerate this because German cash is now keeping the Euro afloat, while the cost for Germany is offset by being able to buy and sell throughout the Eurozone on favorable terms. And, although no longer issued, the German mark is still a valid currency.