UBS Economic Briefing: Euro Area in Danger

Europe seems to be going through some upheaval.  On one hand, there are those who say if a United Europe was ever needed it would be now.  If Europe cannot be of some help during financial crisis, then what is the big benefit.  I'm sure Greece feels that way now.  On the other hand, some say that Europe won't survive if their members are not responsible.  Anyway, they can't afford the scope of bailout that a mulit-country bailout might elicit.

The bottom line is, there are many from all political persuasions that feel that the Euro and Europe could crumble.  From UBS Economics Briefing with Paul Donavon: 
  • Economically the Euro does not work. In economic terms, it has never worked. It was politics that brought it together, and it is political action that is now required to keep it together. The ECB's Trichet and the IMF's Strauss-Kahn head to Berlin to instruct German politicians on the facts of life. 
  • The Financial Times is reporting that the IMF may offer up an additional EUR10bn (on the assumption that the package is not large enough at EUR45bn). Meanwhile the bloke from Belgium who claims to be President is saying everything is going fine. He is offering leadership to Europe from Tokyo. 

Comments

  1. Taylor,

    You are right on. They came together for political reasons. One was to jointly influence the UN. It was a terrible idea and as the fallout demonstrates, its usefullness is proving useless.

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  2. Good observation Conservative Generation. One of the problems that is the Euro is that it is too big. With the Three Benelux, and maybe Germany and France, I could see a union, but as we see, it is difficult to have a monetary union when one bad apple like Greece can screw your currency.

    Even worse, three or four as we have with Spain, Italy, Ireland and Portugal.

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