Greece, Again

Bloomberg View reports that Greece and the euro zone led by Germany continue on a collision course. To date neither has shown any significant flexibility. The Germans are said to prefer Greece leaving the euro zone as it will force France, Spain, and Italy to shape up.

Commerzbank today puts the chances of Grexit at 50 percent, double what it was predicting last week. (snip) We may be on the verge of finding out whether a Greek exit from the euro is a self-contained explosion, or an existential threat to the single currency.

It could be we're about to learn what happens when a nation's politics won't allow it to do what is expected of it. If grexit happens and Greece prospers, watch others follow. If grexit happens and Greece enters an economic death spiral, austerity will become more palatable.