To be worried about all this Euro crisis stuff

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Seriously, what's the worst that might happen to the UK?

What if loaves of bread end up being £100 or the banks refuse to give us our money?

Are we safe in our beds?

Interesting that letter from the Icelandic MP. Essentially saying there is still a big risk that the economy may slip back to a recession and that many of the old debts are still to be written off.

I heard a similar thing today from the Irish Deputy Central Bank Governor. He said that, despite the apparent resurgence of Ireland after the bailout, the majority of the bad loans are still to be written off by Irish banks and that they had only really foreclosed on a relativley small fraction of the defaulted loans which had forestalled the real fire sale of assets. It will take at least another decade to get through writing of the bad debts in my view.

Meanwhile back in the bond market I see Belgium is taking a real hammering.

The question is, I guess, whether they will write off bad loans, or inflate them into worthlessness. Out of many bad options, it seems possible that one of the least worst may be a decade or so of high inflation. Which will, of course, hit the middle classes hard.

It is widely known in the market that the ECB is the only real buyer of bonds from the peripheral countries

And yet even BBC journos, who probably know this and have no need to kowtow to corporate masters as the FT etc do, blather on nightly about how the ECB must still be brought to bear etc etc. Why will no one talk about what is really happening?

"Some commentators think that in the end Germany wil leave the Euro with France and set up their own new Euro bloc with a few other strong core countries and merge their monetary and fiscal union in a much closer union. The weaker countries will be left with the old Euro which will devalue dramatically. I actually think this would work economically and politically and the German people would vote for it."

Its hard to see a long term functional solution that doesn't involve either a new 'core euro' (say France, Germany and the Benelux countries) or some of the periphery leaving.

I still struggle to understand how anyone ever thought that this (ie peripheral crisis of competitiveness) wasn't going to happen with the Euro - its not as if there was any shortage of people pointing out exactly this scenario from the days of the ECU and doubtless even before that.

Hmm. Things coming to a head it seems, Munchau of FT opines that Euro has only ten days left.

Disastrous bond sale on Friday for Italy, hot on the heels of Germany's poor show earlier in the week. Reports that IMF preparing E600bn for Italy, though IMF only has about half that in funding. so how?

ICAP testing drachma transactions. (Though I have only a vague idea of the detail of this) Just to be on the safe side.

Saw on c4 news that the UK government is preparing to help expats who may be caught with no access to money or caught up in civil unrest.

yikes.

I don't know Sinical, it seems like it has been final curtains for ages, yet they pull something out of the bag to prolong it a little more. Maybe 10 days, maybe not.

I won't hold my breath any more, I'm a bit meh about it now, it's being going on so long. Obviously most people are ladida, won't affect me, think I will join them, I'm so skint anyway i would barely notice any collapse.

Here's a very descriptive article of the recent events which I found interesting:

www.bbc.co.uk/news/business-15592197