"100 Italian Economists Say Austerity Will Destroy Europe 

Zero Hedge
June 17, 2010

The Telegraph’s Ambrose Evans-Pritchard points to a letter signed by 100 Italian economists (technically Keynesianites, but in the great Ponzi, the two have become synonymous) in which they note that “the austerity strategy imposed by Brussels/Frankfurt risks tipping Europe into a self-feeding downward spiral. Far from holding the eurozone together, it will cause weaker countries to be catapulted out of EMU. Others will leave in order to restore sovereign control over their central banks and unemployment policies.” Not to mention that Italian university budgets will be slashed. These 100 establishmentarians would be wise to do the whole “look to your left, then to your right, in one year two of those people will be out on the street.” While the core of the complaint has to do with the core premise of austerity, arguing that a fiscal injection is much more needed than a haircut, AEP does have a great point, that while conducting fiscal contraction is possible, it needs to be at least offset by monetary loosening. And the still relatively hawkish ECB has very little room in that regard. Evans-Pritchard’s conclusion is well known in advance: “EMU has become an infernal machine. This will not be the last letter by angry economists.”

Lue lisää