Your DIY guide to the eurozone debt crisis
Trying to make head or tails out of the Eurozone debt crisis has been a difficult job and our friendly economist, The Stat, has been up to his eyes. Here's his hastily dispatched email - it's as clear as... well... mud.
From: The Stat
To: David Elliot
Subject: Re. What's going on in the Eurozone?
Reports ECB/EU tackling EZ (eurozone) SD (sovereign debt) crisis by levering EFSF (European System of Financial Supervisors) thru EIB as a SIV (aka SPV) to create LOLR for PIIGS. But S-amp;P warns could trigger RIP for German AAA spelling trouble for Merkel's CDU whose coalition partners, the FDP, are asking WT#? which is good news for SDP. Meanwhile, the IMF's Lagarde, who replaced DSK, -amp; US wants a co-ordinated response, which is still WIP, implemented ASAP to avoid UK/US/EZ GDP DD which PMIs pointing to. Would necessitate more action by FED, ECB, BoE -amp; BoJ (including more QE as suggested by MPC) alongside G-20. BRICS OK despite rampant CPI. Potential Greek TKO would trigger CDS payout raising fears of SD contagion in remaining EZ PIIGS. OMG! But Italy TBTF as would BANJAX EZ. VIX would rocket investors would go AWOL sending S-amp;P, DAX, CAC, FTSE down as they pile into UST and USD. I don't know whether to LOL or CRY.
Hope this makes sense,