Here is a link to watch a CNBC video with Michael Spence talking about Greece: he sees Greece's problem having two parts:
- sovereign debts
- lacking competitiveness
No surprise after discussing this for many months; he obviously wants to keep the logical rest of his analysis a secret; may be he wants to be invited back for coffee to be interviewed again; he should have added that certainly all the PIGS or GIPS (or into what ever you mix them) and many more of those in total 17 Eurozone countries face the same twofold burden; in fact Germany might be the only country being still competitive - however, the German sovereign debt problem is getting bigger with every cheque and guarantee signed and with every junk paper the ECB prints money against. In addition Germany's competitiveness will be hit hard, abruptly and brutally once its so-called European partners will be sick to the back teeth with austerity, cuts, unemployment, no-future chances, sell-offs and still more people demonstrating 24/7 against what more and more will be named "The rich Krauts' revenge!".
Michael Spence also mentions a possible sabbatical for Greece from the EURO; that wouldn't change a thing; only once the majority felt like taking one or two or more sabbaticals we might as well turn times back, press reset, to 1979, the year when the very successful EMS was introduced.
I believe this reset is necessary; it is strongly advisable, I hope it will come soon! If it then takes us back to 1979, good! If the reset comes too late it might throw us back further; ante 1958 (Treaties of Rome); hopefully not beyond?