Archive for the ‘Uncategorized’ Category

LTV and DTI Limits—Going Granular; From Systemic Banking Crises to Fiscal Costs: Risk Factors

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Sunday, August 2nd, 2015

More cross-country analysis by the IMF on the properties of LTV and DTI limits – here.

Also, new IMF work on the fiscal costs of systemic banking crises – here.

Famine in Ireland 1300 to 1900

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Monday, July 27th, 2015

I posted earlier in the year on Cormac O’Grada’s recently published book on famines. He has also recently released, among several other works, a working paper on the history of Irish famines since 1300. A version is available here and provides a chronology and history of several Irish famines pre-dating the 1840s.

 

 

Call for Proposals DEW Conference 2015

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Tuesday, July 21st, 2015

The Dublin Economics Workshop will hold its annual economic policy conference at the Hodson Bay Hotel in Athlone October 16th and 17th next. Proposals in any area of economic policy are invited and should be forwarded, ideally before September 4th, to both of the following: charles.larkin@gmail.com and colm.mccarthy@ucd.ie.

Programme and booking details will be circulated in due course. The Dublin Economics Workshop is kindly sponsored by Dublin Chamber of Commerce.

More on Greece

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Tuesday, July 21st, 2015

Colm McCarthy and I were up in front of the Oireachtas Finance Committee last week to talk about Greece.  I attach my speaking notes. (Colm’s were essentially as published in the Sunday Independent the other day). I think it’s fair to say that we both kicked to touch on Pat Rabbitte’s question as to what politically acceptable solution could have been pulled out of the hat. This is a question for the diplomats and politicians rather than economists.  The radicals and the establishment parties across Europe had manoeuvered each other so that they ended up painted not so much into a corner as up against an open 10th floor window.  Someone was going to be defenestrated.  And it was never going to be the strong.

Diary Date: Workshop on Well-Being and Recent Irish Economic History

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Sunday, July 19th, 2015

Kevin Denny and I are organising a half-day workshop to look at Changes in Well-being in Ireland over the last 10 to 15 years. Obviously this has been an eventful time in Ireland and we think it would be very useful at this stage to draw together what is known about the Irish case.  Our specific aim is to consider a  wide range of possible outcomes including physical and mental health as well as subjective well-being. Moreover we want to draw on a range of approaches from epidemiology, psychological medicine and the social sciences as well as different types of data. Our intention is to have  around 7 presentations with plenty of time for discussion. The event will be held in the UCD Geary Institute on Tuesday November 17th from 12pm to 4pm. A light lunch would be provided. Further details of the talks and how to register will be provided here in due course. Suggestions on the programme still welcome.

Economics, Psychology and Policy Meetings

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Wednesday, July 15th, 2015

Since 2008 a number of us have organised an annual conference for people working at the interface of economics, psychology and related areas. Speakers have included international thought-leaders in this area including David Laibson, David Halpern, Robert Sugden, Arie Kapteyn, Ruth Byrne and John O’Doherty as well a diverse range of speakers from across economics, psychology and policy in Ireland and they have contributed to maintaining an active discussion of the potential for this area in Ireland. The next one will take place at the ESRI in Dublin on November 27th. At the previous session we agreed to organise some more adhoc meet-ups in between the events partly to disseminate new ideas and also with a view to establishing a more structured network in this area in Ireland. The first of these meetings takes place in Dublin on July 22nd organised by myself and Sean Gill. It will take place at 7pm sharp at the Roasted Brown coffee shop in Temple Bar. There will be 5 short presentations (to be listed here in the next couple of days) and some discussion about future events. Meet-ups around this area are now taking place in several cities including London and Sydney. I spoke at the Sydney event recently and it was extremely lively and led to several useful follow-ups. There are many people interested in this broad area in Dublin and Ireland more generally. This is intended to a broad forum and we welcome attendance and contribution from academics interested in exchanging ideas with a broad audience, people across different areas including students and people with business and policy interests in this area. For now we envisage the events being structured around short talks where a speaker describes briefly an idea they are working on or thinking about and potentially some suggestions for collaboration. Though there are many other event formats that could be considered. If you are attending please drop me an email at liamdelaney2011@gmail.com

Speakers:

Liam Delaney: Overview of behavioural economics, policy and business.

Michael Daly: Psychology, Self-Control and Policy

Sean Gill: Behavioural Economics and Health

Pete Lunn: Behavioural Economics and Regulation

Audience Contributions,

Q+A and Suggestions for Development of Network

Considering the Greek Crisis

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Tuesday, July 14th, 2015

The NBER organised a panel on the Greek crisis last week – video here.

SSISI – 2015/2016 Call for Papers & Barrington Medal

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Friday, July 10th, 2015

The site’s readership might be interested in two announcements by the Statistical & Social Inquiry Society of Ireland:

  1. The first is a general call for papers [PDF] for the Society’s 169th Session, with a deadline of August 7th. Papers are presented to the society and then published in its Journal, which has – if I’m not mistaken – been going since the 1840s, which must make it one of the world’s longest-running social science journals.
  2. The second is the specific call for submissions for the Barrington Medal, which is intended to recognise promising new researchers in the economic and social sciences in Ireland. More details are available here, and the deadline is July 31st.

Thoughts on the Design of Grexit

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Monday, July 6th, 2015

Paul Krugman has a thoughtful op-ed piece in today’s New York Times in which he reluctantly calls for Greek exit from the euro. I share his view on the desirability of Grexit at this juncture, but not his reluctance in expressing that opinion. How could Grexit best be designed, for Greece, for Europe, and for international interests? Below are a few modest thoughts on this. (more…)

Syriza’s illusory ‘silver bullet’ compounded wasted reform opportunities

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Saturday, July 4th, 2015

Today’s Irish Times carries my views on the immense damage that the Syriza-led government has done to the Greek economy in a short space of time. Link is here.

Impact of the economic recession and subsequent austerity on suicide and self-harm in Ireland: An interrupted time series analysis

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Friday, July 3rd, 2015

New article by Paul Corcoran, Eve Griffin, Ella Arensman, Anthony P Fitzgerald and Ivan J Perry - here.

 

Macro-Prudential Policies

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Friday, July 3rd, 2015

The Bank of Lithuania is hosting a conference on this topic today – materials here (including a presentation by Mark Cassidy of Central Bank of Ireland).

Summer 2015 Issue of ESR

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Friday, July 3rd, 2015

Articles

Network Social Capital and Labour Market Outcomes: Evidence For Ireland PDF
Gerard Brady 163–195
Spillover in Euro Area Sovereign Bond Markets PDF
Thomas Conefrey, David Cronin 197–231
A Formal Investigation of Inequalities in Health Behaviours After Age 50 on the Island of Ireland PDF
Eibhlín Hudson, David Madden, Irene Mosca 233–265
Is Fuel Poverty in Ireland a Distinct Type of Deprivation? PDF
Dorothy Watson, Bertrand Maitre 267–291

Policy Section Articles

Deciphering Ireland’s Macroeconomic Imbalance Indicators: Statistical Considerations PDF
Mary Cussen 293–313
Policy and Economic Change in the Agri-Food Sector in Ireland PDF
Cathal O’Donoghue, Thia Hennessy 315–337

 

Perspectives on the Greek Vote

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Friday, July 3rd, 2015

Three interesting contributions:

  • Op-Ed from a group of economists with deep connections to Greece  here
  • Angel Ubide of PIIE on the debate “proxy war” here
  • Landon Thomas on the state of negotiations here

……the unpitied calamity of being repeatedly caught in the same snare….

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Sunday, June 28th, 2015

If an extend-and-pretend deal is done it will be the third Greek ‘rescue’. Without debt relief it will also be the third to break the IMF rule, adopted after the Argentina failure in 2001, to avoid financing countries with unsustainable debts.

In early 2010 the debt/GDP ratio in Greece was predicted at 115% (it turned out to be 130%), the deficit in double digits and GDP sinking fast. The Fund rewrote its rule-book to get involved in the Troika despite the unwillingness of IMF staff to sign off on debt sustainability. See the account from the CIGI think-tank

https://www.cigionline.org/sites/default/files/cigi_paper_no.61web.pdf

The 2012 deal repeated the procedure, this time with haircuts of private creditors.

The Greek economy is again contracting, the budget headed back into serious deficit, the debt ratio headed for 180%. Even with low interest rates and long duration of official debts, no sustainability analysis is likely to look healthy. The bond market, to which Greece must return, agrees.

The IMF cannot credibly repeat the routine of 2010 and 2012 – it does have non-European members after all, and its exposure to Europe is already unacceptable to them. Lagarde, as French Finance minister, opposed Greek debt restructuring in 2010 but there is no guarantee that the IMF board will participate again without haircuts, this time for its European ex-partners. The week could see no deal with Grexit, or Trexit, the end of the Troika.

Ireland in Recovery, Greece in Crisis

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Friday, June 26th, 2015

Adele Bergin of the ESRI and I made a presentation to a mini-symposium on Austerity: the Irish Experience at UCD last week.  Our analysis points out how wrongheaded it is to suggest, as some have done over the last few days, that if only the Greeks would take their medicine the way we did they might be able to expect an equivalent recovery.  This ignores the huge structural differences between the two economies.

Faced with evaporation of the tax base, jittery markets and a need for concessionary funding, our current government and the previous one did what was required on the fiscal side.  In the language of economics textbooks however, consolidation was necessary but not sufficient for the timing and pace of the recovery.

The first structural difference is the vastly greater openness of the Irish economy.  This cushions the domestic economy to an extent, since imports bear some of the brunt of consolidation.

Irish exports, though they took a hit in the early days of the international crisis, nevertheless propped up the economy in a way that the Greek export sector cannot do, because of the share of exports in the Irish economy, the sectoral pattern of our exports and our portfolio of export destinations.

The fact that Ireland was hugely specialised in goods and services for which international demand remained buoyant massively bolstered the economy.  Pharmaceuticals dominate Irish merchandise exports: pharma increased as a share of total US, UK and eurozone imports from 2000 to date (as shown by Stephen Byrne and Martin  O’Brien in the Central Bank of Ireland Quarterly Bulletin, 02, April 2015). Computer and information services dominate Irish services exports:  these increased as a share of  total US, UK and eurozone imports from 2000 to date.  Agriculture and food dominate indigenous exports:  these increased as a share of  total US, UK and eurozone imports from 2000 to date.

Services comprise an unusually high share of Irish exports.  Since transmission is almost costless, these are less geographically constrained and substantially less dependent on EU and North American markets than is the case for merchandise exports.  In the case of the latter, the MNCs can shift export destinations much more easily than indigenous enterprises can, as reflected in an increased US share as the US recovered earlier from the global crisis.  And Ireland of course benefitted much more than other eurozone economies from the weakening of the euro against the dollar and sterling over recent years.

Jobs in export production began to recover rapidly from 2009, driven by labour-intensive indigenous manufacturing exports and by the growth of both indigenous and foreign-affiliate services exports.  Ireland’s export-led recovery then fed into domestic demand.

It would be impossible for Greece to replicate this pattern.

And by way of footnote:  Even though it’s true that most Irish exports are produced by the foreign-owned multinational (MNC) sector, and that any €1 million of these exports creates less domestic value-added than €1 million of indigenous exports, a different perspective emerges when you look at backward linkages per job.  These are particularly impressive in the case of the rapidly growing MNC-services sector.

The Five Presidents’ Report

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Monday, June 22nd, 2015

Here.

The submissions from the Irish government are here and here.

My own submission is here.

Bank Runs as end runs for policy?

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Saturday, June 20th, 2015

The Greek Finance Minister appeals directly to Ireland in the IT here, while on Medium, Karl Whelan puts the blame for the calamitous situation on the official response of the Troika in 2010.

A serious question we do need to answer: are bank runs, or the potential for bank runs, becoming the ultimate backstop in a currency union comprised of creditor and debtor nations?

In the end the Oireachtas banking inquiry is unearthing the powerful narrative threat of the ‘ATMs running dry’ as driving much of the decision to deliver the 2008 guarantee, Cyprus had a bank run precipitate its crisis, at least partially. Iceland had the same experience, and we all know what is happening to Greek deposits right now, ELA or not.

 

A general practitioner’s perspective on the guest blog by Dr Kevin Denny

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Friday, June 19th, 2015

Dr William Behan, co-author of “Does Eliminating Fees at Point of Access Affect Irish General Practice Attendance Rates in the Under 6 Years Old Population? A Cross Sectional Study at Six General Practices”

You can download a .pdf of this blog post with references here. 

Most of the state sponsored; CSO or university department generated statistics on general practice utilisation since 2001 have been based on surveys employing 1 year recollection. Dr. Denny uses Growing Up in Ireland (GUI) the largest database available for the purpose of determining the marginal effect of granting private under 6s patients medical cards. Intuitively this makes sense……or does it when the potential biases of that particular survey data are explored?

We really have to examine biases in statistics collection to determine what is more likely.

(more…)

On the possible effects of free GP care for under 6’s.

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Wednesday, June 17th, 2015

(This is a guest post by Dr Kevin Denny of the School of Economics & Geary Institute, UCD).

The extension of free GP care to under 6’s has raised the issue of what the effect will be on GPs’ practices. Understandably they are concerned about the increased demand on a sector that appears to be under strain. I am not aware of any specific research for this age group (mea culpa if I have missed it).

There are several studies for the general populations (various convex combinations of Anne Nolan, Brian Nolan & David Madden). I heard a very interesting recent interview on TodayFM with a GP Ciara Kelly. In the course of this, she said that children with medical cards visit a doctor 6 times a year while those without visited twice. From this she inferred that the new scheme would triple the demand of those currently without free care.A GP that I was once on a radio panel with said something very similar. I don’t know the origins of these numbers. However the average difference between the two groups is not relevant here: you need to know the marginal effect. Children currently without medical cards are different from those with: on average they are, inter alia, healthier and wealthier.

Estimates from other countries are not informative. I searched in vain for a government document that discussed this. We now have very good data in the form of the Growing Up in Ireland study. Here I report some estimates of what the effect of the reform might be. I use the second wave of the infant cohort – the three year olds who should be reasonably representative of the 0-5 age range. As dependent variable I use the question on “Number of times seen or talked with a general practitioner in the last 12 months”. This is top-coded at 20 but there are very few in that category. The variable of interest is whether they are covered by a medical card. I combine GP-only and the full medical card for simplicity.

I have a long list of controls which covers the usual suspects. They include health of the child and mother, income, education and other demographics. I also have a variable that indicated whether their GP visits are covered by private health insurance. Changes to the controls do not make much difference.

There are numerous ways of estimating such models and I used three. For the cognoscenti these are poisson & neg-bin2 regressions and a finite mixture of poissons. The marginal effects are very similar as is often the case. Before we consider those, what is the average difference in the data? In the GUI the population weighted mean of doctor visits for children covered and not-covered by medical cards is: 3.13 and 2.18 respectively. This is very different from the 6 and 2 mentioned above, the source of which I don’t know.

The marginal effects for the different models vary between 0.632 and 0.713, less than the average difference (as you would expect) and a lot less than the difference of 4 mentioned above. For simplicity I will take 0.68 as a ballpark value. So giving free GP care for under 6’s should increase the number of GP visits per child by less than one per annum. We are assuming homogenous effects: you could generalize this to allow the effects differ in various ways. The marginal effect of having private insurance is about 0.34. Since these are probably the better-off of non-medical card holders, this suggests that 0.68 is on the high side i.e. the effect on the kids of the rich of free GP care is probably lower, if anything.

I also estimated the model using the child cohort (the 9 year olds) for whom the marginal effect is about 0.33 incidentally. Estimates for adults tend to be in the 1-2 visits per annum range. So what might this mean in practice? The maximum number of children who could be covered by the present reform is about 270,000. Multiply by 0.68 & this suggests an extra ~183,600 GP visits a year. There are around 2,500 GPs in Ireland so this is about 73.5 visits a year each. If they work on average 47 weeks a year this would mean about 1.56 extra visits a week from the under-6’s for a GP. It would be interesting to know how much of a GP’s time this is likely to require.

The mean is not the only parameter in town. For doctors whose patients are already covered there will be little or no difference. Doctors in more affluent areas will likely bear the brunt. Doubtless there are additional complications.

For example, not all GP’s will sign up. I am ignoring general equilibrium effects, such as any ensuing change in the number of GPs. Perhaps the main known unknown is the labour supply responses of GPs to a switch from a per-visit fee to a capitation grant which encourages them to take on patients but spend as little time as possible with them. Extrapolation is difficult, especially about the unknown.

I don’t mean to suggest that my estimates are best, I can’t explore every possibility in a blog post. I think they are credible though. Readers may have better knowledge of some of these parameters.

A file with the full results is available at http://tinyurl.com/p9cu8ax

African Demographic Trends and European Policy Responses

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Saturday, June 13th, 2015

The Demographic Transition, which started in Europe in the late 18th century, had a huge positive impact on average human welfare. Population levels and growth rates became dependent upon societal preferences rather than upon famine and disease. The demographic transition has now spread around the world to all continents, except Africa. Surprisingly, Africa has not made the switch. Rather than seeing population growth easing and then stopping, in a typical post-demographic transition pattern, African population growth rates have stayed at a very high rate for many decades. Even in recent years, while many demographers expected a slowdown finally to take hold, African population levels have rocketed up. So for example, from the National Geographic: (more…)

Arithmetic Manoeuvres in the Dark at the Irish Times

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Tuesday, June 9th, 2015

In a week when the Irish Times carried reports complaining about the dumbing down of Leaving Cert maths the paper itself provided us with some beauties.  An article yesterday by a former head of the School of Education at UCD informs us that  “nine per cent of academics at professor level were male and 2 per cent were female”.  What about the other 89 (or 77 or 61 or whatever it is)?

Last Saturday’s paper carried a report on ESRI work on overqualified workers.  The author revealed himself to hold a masters degree from UCD.  The piece (clearly not quoting directly from the ESRI) tells us that “adults whose highest educational attainment is the Leaving Cert earn 31 per cent less on average than those with a higher certificate or ordinary degree, and 100 per cent less than graduates with an honours degree”.  I’m sure we all sympathise with how tough it must be to make ends meet on the latter salary.

Even some of their commentators on economics seem to think that a 200 per cent increase means that the thing has doubled.  But it could be worse: imagine a 200 per cent decrease.

Giving the Game Away: The Economics of Corruption at FIFA

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Sunday, June 7th, 2015

FIFA, the governing body of world football, has been a byword for corruption for decades, stretching back to the presidency of Sepp Blatter’s predecessor, the Brazilian Joao Havelange, when Blatter was number two in the organisation. Under the Havelange presidency millions of dollars went walkabout in murky transactions between FIFA and a company which marketed its TV rights. More recently the World Cup of 2022 was awarded to oil-rich Qatar, to be played in high Summer in temperatures of 40 degrees Centigrade. The Sunday Times has documented wholesale vote-buying on behalf of Qatar. US Attorney General Loretta Lynch has made it clear that the FBI investigations, which have yielded criminal indictments against FIFA officials, cover offences stretching back to 1991.

Sepp Blatter has been a senior FIFA official for forty years and president since 1998. How can his serial re-elections be explained, the most recent two weeks ago after the announcement of FBI action? FIFA is a most unusual organisation and its governance and economic structures make corruption almost inevitable.

Governance: Every national association, in even the tiniest country, has one vote in FIFA elections. Some tiny palm-fringed idyll in the South Pacific, where soccer was unheard of until recently, can form a football association and expect instant recognition from FIFA. It will then have one vote at FIFA congresses, same as Germany and Brazil, the regular world champions. FIFA has 209 members. There are not 209 countries in the world (the United Nations has just 193 members, for example). ‘Countries’ such as Andorra, San Marino, the Faroe Islands and numerous others are FIFA members. The smallest member in population terms is Montserrat, home to 5000 souls. These ‘countries’ are not regarded as eligible for membership in any serious international organisation, since they are not fully-fledged states but remnants of the Dutch, British and French empires. FIFA member Liechtenstein is a remnant of the Holy Roman Empire. It is not difficult, or costly in the overall scheme of things, to re-distribute rents to these minnows to ensure their loyalty. This is the first part of the explanation for Blatter’s repeated majorities.

Economics: The second part is the simple fact that FIFA has had, for the last four decades, quite a lot of rents to dish out. Without economic rent there is no pot of graft. The rent source is a monopoly, the World Cup: it has become, through TV rights and sponsorship, a huge money-spinner. The players, who tend to take the lion’s share of the earnings available in all other major sports, get paid very little for national team appearances. If they wish to play international football at all, they have little bargaining power. Once committed to a national team, usually the country of their birth, they cannot threaten to desert to someone who pays better. If they could, Saudi Arabia would win the World Cup. Most professional football clubs do not make profits: the players, and their industrious agents, make sure that most of the revenues flow through to the performers, which is what happens in every other branch of the entertainment business. In football the World Cup revenues flow to FIFA, an opaque and unaccountable organisation whose leadership is free to perpetuate itself through buying the small national associations around the world. These national bodies in turn have weak, or no, corporate governance. With one brave bound, the money is free.

It is the combination of equal votes for all with billions of unearned revenue dished out behind the curtain which has created the FIFA monster. This is corruption by design.

Hidden Message from the Banking Inquiry: A First-Rate Economist Should Head the Central Bank

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Monday, June 1st, 2015

Some commentators wrongly claim there is little value in the long and (moderately) expensive banking inquiry. There is much to learn from the inquiry. One important message can be gleaned from the testimony of Central Bank and Financial Regulator executives this past two weeks: the coalition needs to appoint a first-rate economist (like Honohan) as his successor as central bank governor. The coalition should scour the globe and not compromise on analytical firepower.

Brian Lenihan pushed through the appointment of Honohan against the tradition of promoting someone from the senior ranks of the civil service. If the tradition had been followed, the Irish economy might still be wallowing in financial instability. A central bank governor without first-rate economic expertise could have made a total hash of the financial restructuring and recovery programme of the last five years. For example, a former senior civil servant would not have made the phone call to RTE Morning Ireland in November, 2010, getting the Troika programme quickly started. Other painful actions taken in recent years, such as the PCAR and PLAR exercises, and the time-consuming and expensive improvements to the financial sector database, might have never started or been botched. The job requires a highly-competent, well-trained and experienced economist. (more…)

Irish Financial Regulation: Guidelines Rather Than Rules

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Thursday, May 28th, 2015

In his testimony this morning, Patrick Neary explained that the mandated bank lending sectoral concentration limits, which were seriously breached by the Irish banks during the credit bubble, could not actually be enforced since they were guidelines rather than rules. This distinction between guidelines and rules has eerie similarities to a classic scene in The Pirates of the Caribbean, where pirate captain Hector Barbossa (Geoffrey Rush) explains to Elizabeth Swann (Keira Knightley) the flexibility of The Pirates Code.

A Finance Minister Fit for a Greek Tragedy?

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Wednesday, May 20th, 2015

NYT profile here.

Resolution of the Irish banking crisis: Hard-earned lessons for Europe’

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Tuesday, May 19th, 2015

Speech by Lars Frisell here.

QUB public policy blog

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Thursday, May 14th, 2015

Queen’s University Belfast have just launched a new blog at http://qpol.qub.ac.uk/ (via Muiris MacCarthaigh).

QPol is the ‘front door’ for public policy engagement at Queen’s University Belfast, supporting academics and policymakers in sharing evidence-based research and ideas on the major social, cultural and economic challenges facing us regionally, nationally and beyond.

Our over-arching vision is to share the University’s independent expertise with policymakers so they can make informed decisions about the most effective and sustainable ways to tackle these challenges, now and in the future.

Our mission is to:

Facilitate the provision of independent evidence-based advice, guidance and information to policymakers, ensuring that policy formulation and law-making are informed by world-class research emerging from the University
Ensure Queen’s as it the heart of the public policy discourse, shaping and driving the debate on emerging challenges, helping policymakers to think ‘longer term’ and more strategically about the challenges facing us today
Cultivate and encourage engagement between the academic and the policymaker through effective methods of communication and mutually understandable language
Accelerate the socio-economic impact of research relating to public policy issues at Queen’s and raise awareness of the influence of the University’s research on government policy and legislation
We want to inspire intelligent debate between democratic institutions, academia and wider society in a vast array of policy areas including the economy, public health, social justice and more.

Submission from Department of Finance to the Low Pay Commission on the National Minimum Wage

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Wednesday, May 13th, 2015

here.

At Last, Eurozone Culprits Identified!

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Wednesday, May 6th, 2015

It is Dark Forces, after all.

Jean-Claude Juncker, the European Commission president, has finally terminated the endless speculation as to the source of the Eurozone’s travails. In a speech yesterday he has fingered the likely source of any threats to the survival of the common currency subsequent to a Greek exit.

Speaking to an audience at the Catholic University of Leuven in Belgium, Jean-Claude Juncker said a “Grexit” would leave the euro prey to forces who “would do everything to try to decompose” what remained of the monetary union.

“Grexit is not an option,” said Mr Juncker.

“If we were to accept, if Greece were to accept, if others were to accept that Greece could leave the area of solidarity and prosperity that is the Eurozone, we would put ourselves at risk because some, notably in the Anglo Saxon world, would try everything to deconstruct the euro area piece by piece, little by little.”

His spokeswoman clarified that the reference to the Anglo Saxon world was not aimed at Britain but was to be construed as a reference to ‘markets and speculators’.

It should be a great relief to all, especially Greeks, to learn that the Eurozone is an ‘area of solidarity and prosperity’. The news that the dystopia of ‘markets and speculators’ is confined to the Anglo Saxon world is a further comfort.

Most importantly if the Great Experiment ends in tears there will be no need for an inquest. It was the Anglo Saxons!

Anyone remember Harold Wilson and the Gnomes of Zurich?