Tuesday, June 12, 2012

12/6/2012: Show Some Will, Will Ya?

From EuroIntelligence.com today [emphasis mine]: 
"Christine Lagarde told CNN (via a report in El Pais) that she agreed with George Soros’ assessment that the EU had about three months to save the euro. She added that this was not a precise date, but what mattered at this stage is the demonstration of a clear political will to solve the crisis."

Quick note to Ms Lagarde & Mr Soros: at certain point in any crisis, demonstration of a will to solve it becomes insufficient to dealing with the crisis. That point 
  1. Arrives once actual resolution becomes requisite due to the conditions of the crisis becoming immediately unsustainable (6.5% yields on Spanish & 6.1% yields on Italian 10 year bonds would qualify), and
  2. Usually arises due to continued postponement of the said resolution.
In brief - Christine Lagarde might be right on timing (3 months, but with a margin of error both ways), but she is wrong on the required course of the action. Showing will is no longer an option. Deploying solutions is now the only immediately necessary step the EU can take.
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