NEW YORK ¨C What do Greece, Ireland and the United States have in common?
Each experienced what was termed at the time a ¡°new financial era¡± that produced an enormous expansion of its finance sector. This led to an intoxicating combination of aggressive lending, leverage and recklessness. In each case, the era ended in a financial crisis; perhaps most important, each crisis ended with a bailout of lenders, bondholders and bankers.
This hat trick of bank bailouts hasn¡¯t gone unnoticed in Greece. Yanis Varoufakis, who just resigned as finance minister of Greece, might be a provocateur, but he is apparently no fool. Earlier Monday, in a blog post, he said ¡°the Greek ¡®bailouts¡¯ were exercises whose purpose was intentionally to transfer private losses onto the shoulders of the weakest Greeks, before being transferred to other European taxpayers.¡±
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