$115 billion was the sum being mentioned (in credit management circles last night) about the ‘deal’ Greece has struck with the Eurozone/IMF axis of lending necrophilia. I have no more desire than the next man to see Greece fall apart, but we could bring an end to this further episode of chucking good money after bad immediately – by facing up to the fact that the Euro was a bad idea from Day One, and individual EU members should be given the right to leave the Eurozone right now in order to sort out their own devaluations.

The problem with a 25-nation Euro is that it is inflexible: individual countries are forced to fall in with the perspectives of economies quite different to their own. With a further six (at least) Euro members next in line for a deficit crisis, we have to start thinking now about whether the EU exchequer can stand this kind of aggregate battering. If we take the amount – and let’s face it, this is really just the builder’s first optimistic estimate – so far being lavished on one relatively small GDP, then by the end of this year we could be looking at $1.6 trillion as the bill for bailing out member nations whose sole crime has been to take advantage of the European Central Bank’s preferentially low interest rates, and ludicrous bailout guarantees.

I don’t doubt that the Euro’s pockets can cope with this; but do they want to? The German populace clearly isn’t up for it. Nor will be the French – if they don’t themselves become part of the problem.

The EU needs to learn from the disastrous errors of the Brown administration. In an attempt to put off the inevitable, the UK Government first poured in panic-money to Northern Rock – and then bought the whole debt, when it would’ve been far better off letting the market pick at the carcass….rather than letting J P Morgan cherry-pick at the expense of the taxpayer. Let’s face it, rapacious banks would far rather deal with naive governments than tough administrators.

Update: Gavin Hewitt on the BBCNews website this evening:

‘This is a day of humiliation. It was never envisaged that a Eurozone country would need bailing out. Today the EU had to launch one of the biggest financial rescues ever attempted. What the plan does do is to buy time and to shelter Greece from the fierce winds of the markets. What it doesn’t do is to answer the questions of whether economies so fundamentally different as Greece and say Germany can be part of the same monetary union.’