How Singaporeans will soon see the EU reported tomorrow!
Too little, too late
Every time eurozone politicians have cobbled together a solution, it has been too little too late, and frustratingly has pushed the EMU system further into crisis. A number of things have been agreed. EU loans to Greece were a first important step. Then the European Financial Stability Facility (EFSF) was set up to help fund stressed issuers. However, in both cases the initial packages have had to be subsequently doubled in size in order to appease market demand for a more credible solution.
The column concludes as follows:
The loss of even one EMU member would be a nightmare. The consequences are unbounded, and we would venture into the absolute unknown which would see financial markets trade worst-case fears, potentially bringing down the global financial system for a period.
This in turn is why we think it will not happen. The only risk to our view is that if Greece itself decides to leave the union - in such a scenario, nothing can be done to prevent this from happening, and we would have to manage the consequences.
The writer is global head of developed debt and rates strategy at ING Bank
Labels: Euro collapse
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