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Cato Institute Senior Fellow Gerald O’Driscoll on the impact of Greece’s debt crisis on Europe and the future of the euro.
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A Greek exit door of -- it is everybody's calling it from the Euro will rattle the markets you know that it's been very difficult to absorb all of the news that comes out of that region but.
That may only be the beginning listened to what the leader of the UK independence party said to the European Parliament.
The real elephant in the room is the -- Greece leaves the ECB the European Central Bank is bust.
-- -- It it has 440 -- billion euros worth of exposure to the -- bailed out countries.
I directed by that you'll need to have a cash goal for almost Ireland Spain and Portugal Greece and everybody you could might give up Goodyear.
If he's a total of outside failure.
This -- the Euro Titanic.
Has now hit the ice bag and sadly that simply album enough lifeboats.
Jerry -- address school's been listening very carefully that he had an op Ed in the Wall Street Journal talking about what an exit by Greece would do to the Euro.
His senior fellow at the Cato Institute former fed officials -- Jerry you think knuckles right you think of the Greeks left.
That would be the beginning of the ultimate demise.
Of the Euro itself the Euro could not survive -- -- -- It might survivor Greek exit but it could be the beginning of the -- -- then what's interesting here is role sort of saying agree get to exit is very possible.
They're basically running out of money with which to pay people so they have to be able to.
Print their own money and that means going back to drop much more training script or circulating IOUs.
But that it did as soon as one of the people being interviewed said if they stay in the Euro it's gonna crush -- economy.
OK if Greece were to exit or be jettisoned -- -- sort of like the tumor being cut out of -- -- somewhat.
Liveable -- -- slightly healthy hosted would then the euros on that be able to move forward without that dead weight of Greece.
I think the cancerous spread that might have been the solution earlier but now we have to face the fact.
But Spain is facing this same problem for Italy is facing a different problem not banks but its inability -- an ever growing debt.
If -- is out by the grass is that there are guard suggested the question -- you.
If -- -- out of the Euro or it's it's it's pretty clear it's going out why does anybody have deposits and Greek banks right now.
Well I've what I've heard is they've been limiting that the ability of people to at least go -- ATM machines and pull cash out as you say it's harder to eliminate.
Or impede.
The movement through the Internet debate funds had been -- flowing out.
And you know it's kind of like Argentina some people just don't realize what's gonna happen when they devalue.
Well if they leave their money in the banks would let them convert to -- months.
Right and that and it'll be worth less than -- sliced right okay we're going back to post war Germany at that point.
Let's let's put -- for -- you talk about how the cancer has spread we know Spain is in distress.
Suddenly Middle -- ten year yields started spiking today getting awfully dangerously close to 6%.
Or 7% rather.
Do you worry about France -- -- just downgraded France in the last two hours.
Paula I'm worried about France some worried about the French banks that all the paper they hold from -- -- Big countries and all so they now have a government that.
Thinks -- going deeper into debt is the way to make the economy grow and that I think they'll be a crisis in France this year.
So you're talking -- you're talking Italy you're talking Spain and now you're talking France and they all that's left -- Germany.
All of that left in Germany that's right well but a lot of the crazy -- survive at all these -- -- And -- could barely survive a Greek exit.
I'd be difficult if impossible survive an Italian next if you throw Spain in the air I mean that's it for the Euro is a dot.
It would be very tough.
You'd be you'd be down to a few countries and.
I don't know what would do difference between you know would really be German dominated currency and it would just be in effect be going back to the mark.
Jerry -- Driscoll the man standing -- football kids at the sign that says the end is near husband I think this -- that thank you very much that he says.
Watch out for real crisis in France this year.
You know when they invented the Euro Milton Friedman said it'll take ten years for it to die.
So I think he was wrong about perhaps was the timeframe on that Gerri thank you very much will drop out between anti.
