Monday, July 23, 2012

Is the End Nigh?

For the euro, that is. As FT Alphaville points out, Spain has €44 billion in reserves and imminent needs to fund a lot more than that in interest and principal turnover:

Italy is not in much better shape. So, will the ECB start buying? Will Germany let it? Will Greece exit, since the IMF is ready to pull the plug? Will a Greek exit precipitate a general collapse or a division of the euro into two zones, a Neurozone and a Seurozone? The old worries are back with a vengeance.

1 comment:

Louis said...

Mario Draghi had a frontpage interview in yesterday's Le Monde to claim very clearly that the euro was "irreversible", because of the "political capital" the member-states had invested in it. He also said the ECB would be ready to act "with imagination".

What to make of it? Cloak and dagger-movements, to hide until the very end a breaking-up of the common currency? Or real commitment? Les voies des banquiers centraux sont impénétrables...