We used to supply Greece but british companies are out. In addition the long protracted negotiations were finalised the day before Greece received the good news that possible assistance
to her financial problems was on the go with 'guess who' pushing for all member states to assist.

France and Germany. where or where is Private Eye.

What about option 6? You never mentioned that.

The answer lies in recognising that what we all think we know the word 'inflation' means is not the whole picture.

If you would care to ask me for further information I will explain exactly why, by replacing all government debt with earnings-linked debt, including that of the UK and every other nation (if they so wish) a government can cut the cost of repayments dramatically whilst at the same time protecting pretty well everyone and everything.

The first point to note is this: if debt is index-linked to Average earnings Growth, or to GDPgrowth, it is also linked to the governement's ability to pay: the tax revenue growth rate, at least over a period. In this sense it is cost free. It is just as easy / hard to repay in a year or ten or in a hundred years as it is now. But an agreed term can be set.

If the government sells these bonds to pension funds and other institutions and makes them qualify for reserve assets, it takes the gamble out of buying government stock and so the demand will be significant and the price tag cheap.

The price tag will also be cheap if the risk of default falls dramatically as it would: actual payment of interest of as little as 1% p.a. would suffice to attract most institutions in the days of stable economies and responsible governments, perhaps a little more nowadays.

Compared to the 7% or more tht Greece is understood to be paying (I quote from the current edition of the Economist):
http://www.economist.com/blogs/buttonwood&sa_…

where the analysis of the situation is significantly worse than John's,

this is entirely sustainable. With government debt, on maturity a replacement bond can be issued, so the rate of capital repayment can be whatever is comfotable from time to time, with the government buying back its own debt at any affordable rate.

If the government wishes to repay in a set period then it can, and an affordable schedule can be calculated with ease.

Now this is what the world really needs right now so that we can restore confidence and not cut back too much on spending and jobs, whereupon the recovery can continue as before.

For further information on these and other far reaching researches that I have done, write to me and ask for a copy of my draf book – I am being assisted in writing this by some pretty prominent and capable people. And I have a past reputation to envy all of my own anyway.

THank you
edward.ingram2009@googlemail.com

The Germans did not help themselves by breaking the rules themselves a few years ago. France did too and neither was punished by the EU, whereas when Portugal transgressed it was fined. That's the dear old EU for you. One rule for the Franco-German axis, another for everybody else.

Given recent announcements by the Greek government, we must expect Greece to attempt to wriggle out of their obligations. They will do so for a long time. In extremis, they might default on some of their debt or print more of their own Euros (Where are the Euro printing presses? Who checks on the quantity of notes and coins produced by each Member State?).

Whatever happens, we may expect a long period of unpleasantness and an attempt to get the UK to contribute. In case Gordon Brown has forgotton it, the word is 'No'.

But you are also right to say that it needs a crisis or a sense of (boo! hiss!) nationhood to make it stick.