German economist Hans Werner Sinn has said that introducing more economic coordination in the euorzone wouldn’t lead to stability but to a transfer union by the back door.
He said in an interview in Der Sueddeutsche Zeitung that the financial crisis had become a political crisis after governments had equated bank debt with souvereign debt and that the eurozone could soon implode.
He said the only way to end this crisis was for a debt moratorium or default and by liability for this debt being limited to individual countries and not expanded to the whole eurozone as is currently occuring under the the euro stablity fund, eurobonds, and also plans for more economic coordination.
Sinn said banks should be forced to pay for their own mistakes by being forced to default on their debts that are so big that they have driven states into solvency. Banks should not be allowed to suck tax payer’s money to pay interest on the fractional-reserve banking debts they created in the first place.
He also said that Greece should arrange ist own default with ist banks and the euro stability fund should not be used as this just creates a transfer union and pushes up costs [unless perhaps bondholders get 1% not 70% as the euro stabilty fund head has suggested?].
His remarks come as German Chancellor Angela Merkel and European leaders are disscuing creating more economic coordination to deal with the debt crisis.
A return to sustainable public finances is not possible with the high rate of interest on the loans being given by the IMF and EU because they destroy economies and reduce tax revenues, sending them into a debt death spiral. Greece’s debt is growing in spite of ever deeper fiscal cuts and will absorb every tax euro by 2014.
It doesn’t matter whether debt is sovereign or bank debt it is all fraudulent.It has been created from nothing of value. There is no need for a debt to spiral out of control unless it has been engineered. The only way to set the record straight is for all debt to be cancelled and the those who created the fiscal death spiral to be brought to trial for usury, which is just another form of stealing from the public without them being aware of it.