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While this may, in the short term, be a “good thing” as we save Greece from having to pay a logical 10% interest to borrow their next Drachma, what we have really done is have Europe as as a co signer to Greece’s refinancing. This is no longer about Greece learning how to restrain themselves or suffering the consequences, but about Greece learning to restrain themselves or we ALL suffer the consequences. The same obviously goes for the US, who has now directly guaranteed what Whitney and Roubini estimated to be $6 trillion of potentially bad bank debts as well as stepping in behind AIG (NYSE:AIG), Freddie (FRE) and Fannie (FNM) to guarantee tens of trillions more in MBS and CDS securities.

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