British embassies in the eurozone have been told to draw up plans to help British expats through the collapse of the single currency, amid new fears for Italy and Spain.
James Kirkup
The Telegraph [UK]
25 Nov 2011
As the Italian government struggled to borrow and Spain considered seeking an international bail-out, British ministers privately warned that the break-up of the euro, once almost unthinkable, is now increasingly plausible.
Diplomats are preparing to help Britons abroad through a banking collapse and even riots arising from the debt crisis. The Treasury confirmed earlier this month that contingency planning for a collapse is now under way.
A senior minister has now revealed the extent of the Government’s concern, saying that Britain is now planning on the basis that a euro collapse is now just a matter of time.
“It’s in our interests that they keep playing for time because that gives us more time to prepare,” the minister told the Daily Telegraph.
The article continues at The Telegraph.
Related: It is now becoming clear Germany has had enough of this euro mess
The Anglo-Saxon world is feeling smug this weekend. UK and US policymakers are counting their blessings they’re not directly embroiled in the historic debacle that is the single currency…
…The longer this eurozone crisis continues, the more likely it becomes that “contagion” threatens the fiscal stability of Germany itself, the region’s economic powerhouse. Anyone who doubted that received a stern wake-up call last week, when an auction of 10-year German sovereign bonds was seriously under-subscribed, with investors buying just €3.9bn (£3.34bn) [$5.12bn] of a €6bn [$7.93bn] offer. Bund yields spiked across the board, taking them above those in the UK…
…While the eurozone endgame is impossible to know, I still think the most likely outcome is that several of the peripheral nations will leave, re-denominating their debts in pre-euro currencies, so allowing the core countries to stabilise. This, I believe, is what Germany really wants.
Scaling-back monetary union would take us to a better place, with the big eurozone economies no longer seemingly on the hook for everyone else’s debts…
Read the whole thing.
Also, Margaret Thatcher knew that capitalism must deliver for the masses
…In 1987, Mrs Thatcher flew to Moscow to meet the Soviet leader Mikhail Gorbachev. In their famous conversations (not shown in the film), Gorbachev rounded on her. As she recalled it, “His view was that the British Conservative Party was the party of the ‘haves’ in Britain and that our system of ‘bourgeois democracy’ was designed to fool people about who really controlled the levers of power.” But she hit back: “I explained that what I was trying to do was to create a society of ‘haves’, not a class of them.”…
…Free-market conservatism is absolutely opposed to the concept of “too big to fail”. This is partly because bigness threatens individual dignity and freedom. It is also because it is only through failure being admitted that success comes. If we keep on propping up failure – whether it be nationalised industries in the Eighties, or the current eurozone in the 2010s – we reinforce it….
Update: Another Danger Sign: US Debt Eclipses Economic Output
The United States has joined the rogues gallery of nations whose debt has exceeded its annual economic output, or gross domestic product (GDP).
The U.S. national debt has broken $15.033 trillion, higher than the $15.032 trillion gross domestic product, meaning as of now, the country’s debts are higher than its annual output, according to usdebtclock.org, citing government data…
