Crisis? What Crisis?

Watching an extended item on BBC2's Newsnight last night, I realised that my opinions on how to resolve the eurozone's sovereign debt situation are as valid as anyone's. I covered Latin American debt rescheduling from October 1984 till the summer of 1989 for the Financial Times Euromarket Letter and am familiar with the approach to tackling sticky debt problems. I am also credited in some quarters with 'creating' the Brady Bond that became an integral part of the solution.

The main ingredients in the recipe are: debt forgiveness (in combination with Brady Bonds), debt reprofiling (aka in this day and age 'extend and pretend' or 'delay and pray'), interest rate reduction (a goodly portion is probably paying what now look like usurious rates of interest; reducing those rates to the ultra-low current levels would certainly help) and inflation (I would prescribe a sustained period of 5-7% inflation on the various official measures to help replace the liquidity that has been destroyed; 'ordinary' people can largely avoid the impacts of that inflation by changing buying habits, even to the extent of slightly tightening their belts).

Oh, and patience. 'There is no quick fix,' I remember the great William Rhodes, Citibank's doyen of debt rescheduling, say at an event in London. 'There is no quick fix.'

I am repeatedly baffled by the insistence that 'we are running out of time'. Unless I missed a meeting, or Dr Who is actually a documentary rather than a work of fictional entertainment, or the clever guys at CERN are even cleverer than we think, time as we know it is pretty much infinite.

If there are important rollover dates coming up when a certain level of debt needs to be refinanced, let the refinancing take place. Money is, after all, a man-made construct, and sacrifices made on the altar of monetary purity are pointless and worthless.

If we were to ask the families of those people who died in rioting in Athens in the early days of the crisis whether they would rather have 2% annual inflation or their relatives, I am pretty sure that their answer would involve sticking the consumer price index into a rather restricted and unwelcoming cavity.

That's my helicopter thinking. If any of the world's leading monetary institutions would like to discuss the matter in more detail, I would be glad to act as a consultant in return for (a) cash and (b) public recognition in the form of a knighthood or membership of the Legion d'Honneur, or similar.

My email address is [email protected]. My direct line is +44 1908 234 952.

I personally don't like making a drama out of a crisis...