Albert Edwards from Société Générale said the ECB will have to act, over a German veto if necessary. “The increasingly frenzied attempts of eurozone governments to persuade financial markets that they can draw a line under this crisis will ultimately fail.”
“The impending threat of a euro break-up will force the ECB to begin printing money, very reluctantly joining the global QE party. The question is whether Germany will leave the eurozone in the face of such monetary debauchery,” he said.
via Europe’s rescue euphoria threatened as Portugal enters ‘Grecian vortex’ – Telegraph.
Germany would initially get boost to exports from lower Euro and increasing bund buying. As yields rise with inflation eventually they could leave Euro return to DeucheMark at a higher exchange rate and therefore dramatically reduce all gov debt. But should make exporters aware now that they should write all their debt and contracts in DeucheMarks rather than USD so they aren’t punished should Germany leave EU.