From Yves Smith:

“This is a lively discussion on RT which starts from the contrarian perspective of trying to find a silver lining in the Eurozone crisis. One of the panelists is Michael Hudson, who has been a vocal critic of how austerity programs are being used to strip Greece of sovereignty (on top of the minor complication that these programs are certain to fail). It also discusses the prospects for the survival of the euro and who the winners and losers would be in a breakup.”

Michael Hudson does a passionate rant against European Central Banks as predatory rent-seekers (not that he loves our Fed).  He describes a few of the differences between the US Fed and European CB’s, and is passionate about the proper function of central banks: lending money to help people, not commercial banks, and engage in deficit spending to help the economy overall, create employment.  In a heated discussion over the advisability of fiscal unity, especially North/South (richer/poorer EU nations) Hudson says:

“If fiscal unity is run by the banking sector, you will have the most right-wing government, you will turn Europe into a Banana Republic… [snip]

“If you have a central bank that wants to screw the economy to help the commercial bankers, then you don’t want them to have power; you want to take them out in the back yard and very politely say, “There’s nothing personal, but we’ve got to shoot you.”

The politics of economic policy has been turned on its head in Europe, too; the socialists are to the right of the conservatives as Obama is further right than the Republicans in many areas…Crazy-making Stuff.

It seems that my friend Robert Alexander Dumas is right: It’s inevitable that Greece will default on its debt soon, the big European Banks will fail soon, and there ain’t enough money on the planet to bail them out.  It looks like… ‘The Party’s Over’ for the big banks. And we can only wish The Real People well; it’s gonna be a wild ride while things go down and before it’s all sorted out.

And it looks as though it will soon be coming to a theater near you.  Er…us.

To wit:  Timmy Geithner is rushing to Poland to meet with the EU finance ministers (Hair on Fire Time);  and Pimco’s El Erian (major bond dealers) says a Euro Crisis is almost full-blown; IMF and World Bank ought to pull out all the stops,  (They already have, it seems…)