| Jun. 27, 2012, 6:20 AM
According to the Pragmatic Capitalism’s Cullen Roche, alliances are shifting in a logical manner. The German-French alliance is breaking down in favor of contributor (higher rated credit) countries aligning against recipient (lower rated credit) countries, said Ray Dalio.
Similarly, the terminology to describe who is reasonable and who is unreasonable reflects these parties’ respective interests.
Also, the talk of a fiscal union to resolve these problems has to be looked at in light of the question of whether it is in the interest of fiscally strong contributors to have a fiscal union with fiscally weak recipients in which the majority rules how the money is divided.