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Tough words from chief wonk at European Central Bank: Jürgen Stark

Posted on the February 12th, 2010

Continuing to try and find the god/devil in the details of what the European Union is doing or not doing to help the oh-so-ailing Greece, I came across some helpful clues supplied by Jürgen Stark, the European Central Bank Chief Economist.

In an interview in today’s Spiegel Online International, Stark faces some grueling questions and is unshakable in his tough love fiscal perspective (“‘Everyone Is a Sinner at the Moment'” Feb 12, 2010).

Topics covered include, of course, Greece’s teetering on the brink of bankruptcy, plus the debt of other member states of the EU, and the health of the Euro itself these days.

One of the first questions was about how safe the Euro is at present. Stark’s reply:

Stark: We have been in a global crisis for more than one-and-a-half years now. We still can’t say whether it’s over. But you could just as easily apply your question to other regions. No one talks about whether the United States could break apart because of California’s ailing finances. So let’s not take things too far!

SPIEGEL: Washington and the US central bank, the Fed, would certainly intervene before allowing California to go bankrupt.

Stark: To be honest, I don’t see that they would do that. There are many examples to the contrary in the history, including American history.

If you want info about the Greece-EU-Euro situation, other than the one-note dirge that’s commonplace in the headlines of USA and UK news coverage, this interview’s a good place to begin. (For earlier posts on this topic, go here and here)

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