Europe: The new market cliff

What we are seeing in Europe are the last, long drawn out death rattles of Socialism. It will reach Australia and we will go through the same one day.
But it will take many more years for people to work out that they can't get paid for not working and not working productively when they do work.
Socialism is a polite way of extorting money from the few who do work productively and don't vote for you and using it to buy votes from the majority who have no idea what hard work means but who willingly vote for you to get an easy, undeserved life spending other peoples' money.
Of course it won't work. But it is taking a long time to die, because it was the best vote winner in the history of the World.
And why is Socialism dying? Because wealthy, productive people like me have worked out how to use Globalisation to outwit the Socialists without going to jail. Now that we have turned off the money tap the Socialists and their voters are going bankrupt. And there is not a thing that they can do about it. If they raise the taxes on us we simply leave. We are going to watch them go bust while we laugh all the way to the bank.
So let Europe go broke; we just don't care. Hard work is the only answer to their problems and they are a long way yet from working that one out.
The same goes for Australia (Europe: The new market cliff, December 10).

Merkel's real cash would have had to have been used to rescue German Banks (Europe: The new market cliff, December 10). It still has to be if countries collapse, default or leave the Euro and devalue.
The growth in Target 2 balances of the peripheral states have made things all the more complicated.
Continuing trade/current account imbalances will the debt position of the periphery worse each year.
Little can change unless there is huge investment in periphery countries to promote industry, but China and now potentially the US will be more favourable places to invest in manufacturing, so why invest in new more productive capacity in Greece, Spain or Portugal unless labour productivity and wages can be assured.
The most productive young people can easily flow to where the jobs are available, particulalry if they are multi lingual. The rest are doomed to German and other charity until their countries can devalue to regain competitiveness or accept the need for different ethos and complete internal rebalancing.
I am surprised that internal politics has allowed austerity and internal rebalancing to get this far. I will be more surprised if it completes sufficiently to make investment in the periphery other than perhaps Italy attractive.
For most of the periphery I regard leaving the Euro, adopting a national currency and devaluing as far more likely.
In any event the bank debt that "can't be repaid" by banks because of losses on real estate and sovereign debt is going to be repaid across all Europe by the ECB and other institutions as it is clear bank bondholders will not have to bail in. This will probably include Target 2 balances where necessary.

John's comment "What we are seeing in Europe are the last, long drawn out death rattles of Socialism" is a triumph of desperate delusion over reality. It is sad that I should need to note that the winners in both Europe and the U.S. are the 0.1%, the losers thus being everyone else - 99.9%.
Paul's comment "young people can easily flow to where the jobs are available" omits the issue of what those "young" people will face when they are no longer young, fit, and able to survive permanently in a backpacker's hostel or shearers' quarters.
Capitalism is running Europe, the U.S., and us. We've not seen socialism for a long time, but we need it. (Europe: The new market cliff, December 10).

This is becoming more delicious by the minute. I for one do hope that Italy leaves the euro and that the euro is exterminated because it has been not only a complete failure as a currency for it's members with the exception of perhaps Germany but it is also the catalyst that is driving the entire continent into financial ruin because of it's one dimensional nature (Europe: The new market cliff, Decmeber 10). A currency needs to be 3 dimensional and fluid to serve it's owners and users.
The euro is what is holding back Europe and more particularly the eurozone.

The US calls its issues a "fiscal cliff" to make it sound like a disaster that must be, and should be, averted at all costs; the same set of issues in Europe is called "austerity" (Europe: The new market cliff, December 10).
The Europeans are struggling to hold things together, shackled with disasters like Greece; the Americans have hopelessly insolvent cities and municipalities.
It's hard to see how this will end, either with austerity dooming the young to years of unemployment, or nations becoming even more hopelessly indebted.