Draghi at the European Central Bank wishes to avoid the Greek default, that all now regard as inevitable. The cost of a Greek default is bearable on its own terms, if contagion effects are not taken into account. The ECB is scared that the destabilisation of a default event will suck liquidity out of the banking systems, leaving some dried up hag masquerading as a financial system.
The mess continues to drag on. Conditions in the periphery continue to deteriorate as the ECB compounds their misery with interest rate rises. No comment on the hairshirt devotion to an inflation target whilst national economies implode and the central bank volunteers for insolvency. Now the choice is deferred until July as two camps dance between a structured default and non-default. By the time they compromise, events may have rolled them over.
