The latest developments in the EU financial crisis give us an insight into the question of what it is like to be an authority these days when information is readily available and everybody has an opinion on almost everything.
A couple of weeks ago, the solution proposed by the EU for Cyprus bankruptcy crisis set all alarm bells ringing. The judgement of media was unanimous: there are no traces of intelligent life in EU administration.
However, Credit Suisse analyst William Porter is not buying it and he is cleverly wondering apropos: What if they’re not stupid? “They” are the EU authorities. Porter thinks that if we can see something, the authorities can see it too… at least eventually:
It is way too simplistic to relegate them to the dunce corner (FT Alphaville, “So, are they stupid?“)
The key difference is that we can also say what we see. They can’t. And what do we see?
We still see a banking system in deep disequilibrium, with a large number of banks making no money and with no prospect of doing so. We see the Cyprus bank holiday as a foreshock. What does that mean? It means more bail-ins for Europe. It means everybody knows what has to be done in the long run, but nobody wants to say it in the short run (Business Insider, “Dijsselbloem Has Given Us A Glimpse Of The Euro ‘End Game’“)
Are you idiot? Hurry up, this means every man for himself!