Extend and pretend in Europe
I was on the Lang and O’Leary show on CBC last night to discuss the European sovereign debt crisis. I didn’t say anything on the show you haven’t read before here Credit Writedowns. Basically, the goal of policy makers is to extend the life of the existing credit issued by European financial institutions and pretend Greece is not insolvent.
The widening European sovereign debt crisis is a direct result of this dangerous extend and pretend policy. Tomorrow we will see whether the ECB has the temerity to step in and start buying up Belgian, Italian and Spanish debt to stem the tide. If they don’t, things will get worse.
The full video is available by clicking on the image below. My segment is near the 18:00 minute mark.