Would a Grexit be an 'Epic Tragedy?'

     I guess that depends on how you define an epic tragedy. Maybe it's fitting to use the term in discussions with the Greeks of all people?

     The OECD does believe that it could hurt the entire euro recovery.

     "The Organization for Economic Co-operation and Development (OECD) has warned that a default by Greece or its exit from the euro area risks derailing the whole euro zone's recovery.

"Failure to reach a satisfactory agreement between Greece and its official creditors would intensify perceptions of re-denomination risk and uncertainty," the OECD said in its "Economic Outlook" report."

     "The comments come as talks between Greece and its international creditors appeared to be reaching some kind of decisive point, on reports that the International Monetary Fund (IMF), European Central Bank (ECB) and European Commission was to present Greece with some kind of deal that could end months of inconclusive reform talks.

     http://www.cnbc.com/id/102729078

     This talk of a deal coming is typical of what we've had to suffer through since 2010. There is always hope of a breakthrough but until now they have all been false flags. The question of Greece leaving the euro or the entire euro area are 2 different questions. 

     It seems to me that the for the Greeks at least they're better off at least leaving the euro. Leaving the eurozone on the other hand is a different question and I don't think is necessary at the moment. 

     In the previous post I looked at Dennis Gartman on CNBC who pretty plausibly argued that the Greeks should already have left the euro. 

     http://diaryofarepublicanhater.blogspot.com/2015/06/who-loses-if-greece-leaves-eruo.html

     I think Garman also makes sense in arguing that the euro would be healthier without Greece. And that's the problem-this would actually help Greece and the euro but hurt Germany. It's actually the big euro economies like Germany and France who stand to lose from a Grexit. Germany's export business is booming thanks to what negative pull of Greece on the euro. 

     As Greece staying in the euro helps Germany and friends and hurts the Greeks, what will they do to sweeten the pot for the Greeks? 

    "Prime Minister of the Netherlands, Mark Rutte, told CNBC Wednesday that it was "hard to say" whether a deal between Greece and its creditors could be reached, given that negotiations have been ongoing since February without reaching a resolution."

    "The last four months have been very difficult. I know that many people are now working very hard to come to a solution."

     Read More  Greek talks 'progressing'…so where's the deal?

    "Rutte remarked that nobody wanted Greece to leave the euro zone, a so-called "Grexit."

    "Nobody wants it (a Grexit)…What we're all aiming for is a solution where Greece (the Greek government) accepts that they have to do what the previous (government) promised. At the same time, we want to keep them in," he said.

     So they are offering the Greeks the same bad deal they've offered them all along-perpetual pain for absolutely no gain. With this being the case how is there going to be a breakthrough? Gartman's right, the Greeks should have left yesterday. 

     P.S. Bill Mitchell has a book on the eurozone. 

     http://www.elgaronline.com/abstract/9781784716653.xml?rskey=lHJqkJ&result=1

     Basically the entire EZ project has been misconceived from its conception-as Milton Friedman among others argued in the 90s. You can't have a monetary union with such sharp fiscal and cultural differences.