Meanwhile, in Greece...

By this time, I expect that just about everybody has concluded that Greece — and the rest of Europe — would have been better off had Greece never joined the Eurozone.  The big question now is whether Greece should leave the euro behind, and go back to the drachma.  Today's demonstrations (riots?) were pretty clear indications that many Greeks are very unhappy with the austerity demands by the various international lenders which might delay Greek default.

Granted, Greece (like Occupy) makes it clear that letting anarchists lead your opposition movement doesn't work very well.  Nevertheless, I have to sympathize with the Greek protesters, because Greece is not in recession.  Greece, with a 25% unemployment rate, is in depression, and the EU is doing nothing to correct that.  Austerity is the last thing needed to correct a depression.

If Greece defaults, German banks will take a big hit.  Nobody exactly knows how big a hit, but a little inflation in Germany probably would be worth it.  When the Spaniards and Italians follow, Germany will be dead in the water.