After you do the maths it still doesn’t add up.
It can’t add up.
Given today’s institutional structures- pension funds, insurance reserves, etc.- that include massive, tax advantaged, demand leakages where private sector credit expansion is bound to periodically fall short full employment levels. And with the private sector necessarily pro cyclical, counter cyclical fiscal adjustments are, for all practical purposes, entirely in the realm of the issuer of the currency- the ECB, and not the users of the currency- the euro member nations.
In other words, as previously discussed, the maths can’t add up without the ECB, directly or indirectly, writing the check.
And that includes the banking system, which, to serve public purpose, requires credible deposit insurance, again meaning support from the issuer of the currency.Read it at The Center of the Universe
Greece after math
by Warren Mosler