It is official, the austerity measures proposed by the government of Portugal have failed to pass muster, Prime Minister Socrates had staked his position on passage and now will resign. The bonds have spiked to an all-time high and bail-outs of some sort are inevitable. The EFSF and the IMF are circling to offer a "rescue" package that will reduce the entire state to prole status. The only other options are bankruptcy and/or withdrawal from the Eurozone.
This, of course, will not be allowed to happen. The chimeral dream of the Euro must live on, despite the ever more obvious refusal of certain nations to even attempt to live within their means (although, as an American, I have precious little moral high ground to speak from). German exports are booming due to the Euro so they need it, but as a result of the Euro all of the PIIGS are going under and they are desperate to escape it mortal grasp. The bail-outs will continue as the mad print/extend/pretend cancer eats deeper and deeper into the core of Europe until there is an inoperable debt-tumor in Germany. The wretched victim will then die, hopefully as quickly, painlessly and peacefully as possible.
Thus begins the collapse of the fiat, and all this time I thought it would be the Irish that struck the match.
The most worrisome aspect is that, historically speaking, this sort of situation always seems to end in war.
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