so, folks shouldn't try to tell the market who is boss yet they should tell the banksters threatening to sink our economy that they won't be bailed out. Did I get this right? Doesn't it strike you as contradictory?
Dude - they're the best friends that all of the private entities that bought bonds issued by the PIIGS ever had! These "eternal foes of the market" like bondholders so much they're willing to inflict the liabilities for every penny of losses on the said bonds on the public.
The public in any country that defaults is going to suffer, but they'll suffer quite a bit more if their governments foolishly commit them to repaying debts that are beyond their capacity to repay under any terms.
Defaulting on sovereign debt is disastrous. Committing to an impossible repayment regime and then defaulting is worse. Europe is going to have to default one way or another. Outright or by devaluing the Euro via inflation.
Ditto for Japan. The combination of exploding public sector debts and spending obligations and an imploding birth-rate means that people who have lent them money are going to take some losses, they're going to have work more, and longer, and live with less in retirement. There's no escape from this.
Dude, it's all because the rich aren't paying their fair share! Just tax them and everything can be paid off!