Pouring euros down the drain

Richard North in his excellent blog remarks that

... one is still torn between wondering whether the "colleagues" are playing a blinder, or whether their delaying tactics are simply putting off the inevitable disaster.

Nothing at all in any of this manoeuvring on bonds touches the incompatibilities between the south's and the north's economies, which are partly born of cultural differences (the hardest ones to change).

Nothing.

Greece is just an extreme case. It can't be governed effectively. Apart from the euros spent on protecting other countries' banks, all the rest of the euros lavished on Greece will go for nothing.

As we noted, Greece is a deliberately misgoverned state. It's ungovernable anyway. When senior members of the police and armed forces were asked to take a pay cut, they just said No. So more grief for the little people. And

Self-employed Greeks evaded a staggering £22.4 billion of tax in 2009 – almost half the size of the country’s deficit in 2008 and a third of the shortfall in 2009.

Spain and Italy are just less extreme versions of Greece. Spain is worse than Italy. Its finances are in a far worse state than their government wants anyone to know. We've repeatedly blogged on this, most recently here (click the Spain label for more).

When will the eurozone fragment? Richard admits he doesn't know.

As for the euro, we all "know" that it should by now have crashed and burned … but still it exists.

The euro will probably survive. But the eurozone can't survive at its present size.