Yves Smith — Ilargi: Europe Is Crumbling Into Collapse

Yves here. The word “collapse” may seem overwrought when applied to Europe, but cold-blooded, clear eyed colleagues who have good connections and have spent a bit of time there recently say things that are broadly similar to Ilargi’s take. Despite the conventional wisdom that the cost of a Eurozone breakup is catastrophically high and thus will never take place, that confidence may prove to be the currency union’s undoing. Ideological rigidity about austerity is leading to policies that are crushing large swathes of the population. And Europe, unlike the US, had enough of a tradition of popular revolt that that uprisings, either on the street or in the ballot box, are real possibilities, as the sudden rise of the anti-EU right shows. 

My sources, who also read the foreign language press, say that political fracture is underway and the Eurozone leadership is not taking anything remotely resembling adequate measures to halt its progress. That does not mean upheaval is imminent. But the flip side is this sort of unraveling tends to progress not via an clearly discernible decay path, but through sudden state changes.

Naked Capitalism
Ilargi: Europe Is Crumbling Into Collapse
Yves Smith