„From the beginning, Merkel and the EU have operated from the position that because Greece took on debt, Greece now needs to pay it back. That position assumed — bizarrely, in hindsight — that debt works only one way: If you lend someone money, that money is repaid.
But that is NOT how free markets work.
Debt is not a guarantee of future payments in full. Rather, it is a risk that creditors take, in hopes of maybe being paid tomorrow.
The key word there is „risk.“
If you’re willing to take the risk, you’ll get a premium — in the form of interest.
But the downside of that risk is that you lose your money. And Greece just called Germany’s bluff. […]
This is how capitalism works. The fact that it took a democratically elected government whose own offices are adorned with posters of Lenin, Engels, and Guevara to teach this lesson to Germany is astonishing.“