eurocrats have spent 18 months bailing out the boat until it reaches sight of land, and that time has been well used by banks to deleverage from greece and for the markets to price in the cost of a greek exit.

if it happens, it will be no lehmans.

there are no good choices, but there is a choice between temporary agony and grinding depression. and the choice will be made by the greek electorate.

good article from the economist:

http://www.economist.com/node/21555916

They say that they want to keep the euro intact—except, perhaps, for Greece. But northern European creditors, led by Germany, will not pay out enough to assure the euro’s survival, and southern European debtors increasingly resent foreigners telling them how to run their lives.

This has become a test of over 60 years of European integration. Only if Europeans share a sense of common purpose will a grand deal to save the single currency be seen as legitimate. Only if it is legitimate can it last.