Jun

1

One would hypothesize that the euro seems symbolic of the stability of the entire EC. The world has an idea in its grip. That the purpose of life is to give to the needy, and take from the producers and wealthy. For this idea to fail, would involve the loss of many jobs in the EC, I think. All over the world, flexions, politicians and do-gooders will take whatever money they need and give it to the EC to keep those jobs and the symbol of those jobs in high spirits and prosperity. This is how, I believe, Nock would analyze the situation. And I believe it is sensible. However, I don't know anything about macro factors of any kind, and my views are just those of a devotee of Nock, and a believer in the flagitiousness of flexions. 

Gary Rogan writes: 

That was a very interesting statement "the euro seems symbolic of the stability of the entire EC." The question to me always has been this: besides the symbolism, why does the stability of the EC matter so much to the euro? I can understand Greek and Spanish depositors bailing out of their banks and moving into dollars of Swiss franks or whatever, in addition to euro-based deposits in Germany and elsewhere, yes that depresses the euro and it's a clear practical effect. But in and of itself, why does Greece being a part of euro matter so much? Who really cares about where Greece is or what currency it uses? Even if you can't hold this house of cards together, if the whole system disintegrates, these euros at some point will be exchanged for new German marks and french franks.

Is the fear that everyone, especially non-local citizens will take a big haircut on the deal because the governments will find a way to screw them (and their citizens to some degree as well)? I do also understand that the French and German banks wind up taking in the shorts on their PIGS loans, this will hit the euro if they have to provide a ton of liquidity, but I still fail to understand why the stability of the euro zone is so important.

To me this all speaks to the ephemeral nature of modern money where it doesn't really mean anything at all and it's all a confidence game based on the sequentially building chain of loans, starting with government obligation turned into money for no good reason other than some history. The euro projects value right now is really only to the German so they can push their products on the starving underachievers without them having any ability to depreciate their currency, but when the damn thing falls apart, you sill have all the European countries still in existence, so what's such a big deal about the stability of the zone?


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