Every time officials in Europe starts yapping about containing the European debt crisis, the market makes complete fools of them. The latest comments from French President Nicolas Sarkozy may take the cake.
Please consider a few snips from the New York Times article Europeans Move to Head Off Spread of Debt Crisis
Leaders from the euro zone countries signed off on a support package for Greece on Friday night and pledged to take steps to stanch a spreading debt crisis before markets opened on Monday morning.
During a late-night meeting at European Union headquarters, the leaders described the debt crisis as “systemic,” but President Nicolas Sarkozy of France insisted that the bloc could defend the euro by directly attacking speculators.
Speaking at a news conference, Mr. Sarkozy vowed to “confront speculators mercilessly” and warned them that they would soon “know once and for all what lies in store for them.”
The leaders said they would create a so-called European stabilization mechanism, but Mr. Sarkozy declined to give details of the plan on the basis that doing so could undermine its effectiveness.
He said that all 27 European Union finance ministers would hold an emergency meeting on Sunday afternoon to draft the plan to quell gyrating markets ahead of Monday.
So, Sarkozy has secret plans to “confront speculators mercilessly”. However, nobody can know what they are, or the plans won’t work.
Flashback 1720: South Sea Bubble
Among the many companies to go public in 1720 is—famously—one that advertised itself as “a company for carrying out an undertaking of great advantage, but nobody to know what it is”.
Please click on the above link. It is fascinating to read how history repeats time and time again, and how politicians are always in on it.
The South Seas bubble even ensnared Sir Isaac Newton who managed to lose a fortune on it, saying “I can calculate the movement of the stars, but not the madness of men”.
Mike “Mish” Shedlock
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