Remember Europe? It's part of the "west" and also has a few sovereign debt problems.
...the Germans aren't always predictable, they do tend to be sticklers for the letter of the law, and there is no question that if the letter of the law is respected, the bailouts will be pronounced illegal....
Vox also adds 2+2:
Insurance on the debt of several major European banks has now hit historic levels, higher even than those recorded during financial crisis caused by the US financial group's implosion nearly three years ago.
That jibes with the noted increase in bank-borrowing from the ECB of yesterday, at 2.25%, a punitive rate.
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The Germans have two choices:
1. Go along with the idea of issuing Euro Bonds in exchange for sovereign debt issued by periphery EMU nations in an attempt to save the Eurozone as is.
2. Tell the periphery nations to go to hell and dissolve the EMU as we know it, all while German banks take massive losses on risky paper that they now own.
There is no way that German citizens will allow their government to back Spanish, Italian, Greek sovereign debt. (which basically the idea behind Euro Bonds).
IOW, the EMU as we know it is over and once things start rolling downhill you better get your assets someplace other than equities and especially Eurozone sovereign debt (if you haven't bailed already like I have).
Wanna bet where U.S. Treasuries are headed Dadster? How about 1.5% on the 10 year? Over/under?
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