Planless G8 Leaders Face the Abyss

EXTRACT: Interestingly, the Greece paper Kathimerini carried a relatively lengthy article on May 23 arguing - quite cogently - that an exit from the euro would need to be squeezed into a 46-hour window; that being roughly the amount of time the country’s leaders would have to ‘organise’ or ‘control’ any departure from the single currency while global markets are largely closed from the end of trading in New York on a Friday to Monday’s market opening in Wellington, New Zealand. Hence we read that during this hypothetical weekend - though watch this space closely - Greece would need to freeze bank accounts, put troops along the borders to prevent a capital flight and start stamping existing euros to work as a new currency whilst drachma notes are being printed and then reintroduced. Of course, Greece’s banks could well be shut down for several more days after that. Now, how do you think the markets would react to that?
Given these circumstances, therefore, you do not need a particularly lurid imagination to envisage the effective collapse of the entire euro project. Eurogeddon. Nor necessarily have to be a fantasist to think that a near automatic corollary of such a scenario would be a series of worldwide bank runs, failed states - this time in Europe and not Africa - and a global slump/depression potentially more devastating than the 1930s. The United States, for all its mighty dollar and even mightier military, would not be immune from such an economic tsunami and would inevitably get dragged down into the mire. Not even China would be able to come to the rescue of capitalism - a truly deluded notion.

READ MORE