There are two things that strike me about this article. The first is that the writer refers to changing the terms of the Greek bailout as “a revised second bailout.” I aver that this is actually the third bailout of Greece. Euro-euphemisms are funny.
What isn’t funny is the coming of the Euro crisis. The writer talks about September being crunch time, but let’s face it. The last few of the 21 previous Euro-summits have been described as make or break.
We really do not know how long Europe can stumble around before the crisis unfolds. That is the peculiar thing about financial market panics. We can certainly spot an unstable system, but predicting when the unstable system will irretrievably break is impossible.
This is my prediction for the crash: It will happen within the next two years, and it will be caused by a wild card. While we all have our eyes on the usual problems in periphery, it will be something we have not considered that will break the system. Maybe it will be a small bank going bust, or a city or region on the periphery. It will not be something obvious like Spain or Italy having a bad auction.