Economist Leader–Should Angela Merkel Consider a Controlled Euro Break-up?

….for this very practical woman there is also a practical reason to start contingency planning for a break-up: it is looking ever more likely. Greece is buckling (see article). Much of southern Europe is also in pain, while the northern creditor countries are becoming ever less forgiving: in a recent poll a narrow majority of Germans favoured bringing back the Deutschmark. A chaotic disintegration would be a calamity. Even as Mrs Merkel struggles to find a solution, her aides are surely also sensibly drawing up a plan to prepare for the worst.

This week our briefing imagines what such a “Merkel memorandum” might say (see article). It takes a German point of view, but its logic would apply to the other creditor countries. Its conclusions are stark””not least in terms of which euro member it makes sense to keep or drop. But the main message is one of urgency. For the moment, breaking up the euro would be more expensive than trying to hold it together. But if Europe just keeps on arguing, that calculation will change….

Read it all.


Posted in * Economics, Politics, * International News & Commentary, --European Sovereign Debt Crisis of 2010, Consumer/consumer spending, Corporations/Corporate Life, Credit Markets, Currency Markets, Economy, Euro, Europe, European Central Bank, Foreign Relations, Germany, Greece, Politics in General, The Banking System/Sector, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--

One comment on “Economist Leader–Should Angela Merkel Consider a Controlled Euro Break-up?

  1. AnglicanFirst says:

    Western Europe seems to be at a bifurcation where its constituent nations may go down several possible paths, one of which is ” a controlled break up.”

    It all seems to ‘swing’ on the particular work ethic of the constituent nations.

    Two major divisions are the “hard working north” and the “la dolce vita” south.