Trying to Hold Back the Tide

... is a waste of time. It just flows around you because you're so small and the ocean's so big. So it is with trying to stop currency devaluations. And yet, the Euros are making noises about trying to do just that.

May 8 (Bloomberg) -- European leaders agreed to set up an emergency fund to halt the spread of Greece’s fiscal woes, seeking to prevent a sovereign debt crisis from shattering confidence in the 11-year-old euro.

Jolted into action by the sliding currency and soaring bond yields in Portugal and Spain, leaders of the 16 euro countries said the workings of the financial backstop will be hammered out before Asian markets open late tomorrow European time.

“We will defend the euro, whatever it takes,” European Commission President Jose Barroso told reporters early today after the leaders met in Brussels.

They have tens of billions of Euros to commit to the battle. Once. The money flows are constant and in the same amount. Like a sandcastle melting away in the waves on the beach, whatever they commit will dissolve in short order.

For decades, they built a house of cards by creating one entitlement after another and now it's all falling apart. The best thing to do would be to limit the damage and learn from the events.

Elsewhere, Mish points to an NYT article where Nick Sarkozy of France is shaking his tiny fist in impotent rage.

During a late-night meeting at European Union headquarters, the leaders described the debt crisis as “systemic,” but President Nicolas Sarkozy of France insisted that the bloc could defend the euro by directly attacking speculators.

Speaking at a news conference, Mr. Sarkozy vowed to “confront speculators mercilessly” and warned them that they would soon “know once and for all what lies in store for them.”

Carn sarn it! If them spek-a-lators come 'round here, I'll give 'em a blast or two from old Bessie!