04/10/2010 05:12 am ET Updated May 25, 2011

Eurogate -- The New Fannie, Freddie and AIG

"This is a statistical recovery and a human recession." -- Larry Summers

It was the best one-liner I heard come out of the recent World Economic Forum in Davos. Of course one week later, speculation rife in sessions entitled, "Will there be a double dip?" were overtaken by the Double Dip itself. Markets began roiling after the European Union's central banker and various leaders admitted that they had not ever undertaken, nor required, independent audits to monitor the financial behavior of the Euro's 16 user-nations. They took their finance ministers' words for it. Sounds like the Bush regime which took their Wall Streeters' words for it.

We enter a new currency melee which gives "Beware the Greeks" new meaning. Greece is only the beginning of a new Euro Plague, whose value will be drubbed by a complete failure to supervise members -- a governance lapse every bit as reckless as the deregulatory religion that brought down the U.S. and British economies. The Euro's woes will drives up the bailouts required by Germany and France, the uber-Euro nations, and will lead to more collapses. Enter the "PIGS" -- Portugal Italy, Spain as well as Greece -- which have been a currency headache to many since 2008. These countries are the Fannie Mae, Freddie Mac and AIG of Europe and the loans required to keep them afloat promise to be Europe's sub-prime equivalents. This is because these basketcase countries are cheaters when it came to the voluntary rules and regulations that were designed to uphold the integrity and value of the Euro.

So much for Sarkozy's Gallic finger-wagging in Davos at the Anglo-Saxon economies and their laissez faire regulatory regime that brought about the world's collapse in 2007-08.

Conclusion? China rising. Too bad we cannot invest in their currency because it would be going through the roof.