Circus Circus

"I don't want to do this anymore."
--Jason Bourne (The Bourne Identity)

The EU is organizing a 'stabilization fund' to defend the Euro against 'speculators.' The idea is to borrow money with loans 'guaranteed' by participating governments to buy Euros.

We've seen this movie before. British pound, Thai Baht, etc. Currencies get sold when the underlying fiat systems face intractable problems.

Borrowing more to defend the Euro compounds the fundamental debt problem. The correct solution to this situation involves implementing austerity measures (read: debt reduction and savings) to reverse the real problem.

While a 'Euro defense fund' action might motivate a temporary reprieve in Euro weakness, hard to see how this doesn't increase the chances of outright monetary failure for the bloc.

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