Rudderless eurozone on course for disaster

Rudderless eurozone on course for disaster

The eurozone is at “serious risk” of collapse and is lacking in political leadership as the debt crisis threatens to plunge Europe and the global economy into a recession.

One of the major concerns I was reading somewhere yesterday I think from an Australian perspective is how the Eurozone crisis would adversely effect Australia's economy because of Asia's, in particular China's, reliance on countries in the Eurozone. Even though Australia may not be heavily exposed directly to the Eurozone, our strongest trading partners in Asia are. It's certainly no stretch to suggest a collapsing Eurozone would wreak a global recession, or worse.

Romano Prodi, the former president of the European Commission, said the eurozone had a “problem of power” and that it was unclear who was in charge.

His comments came as one of Europe’s senior economists warned that, without a co-ordinated response, the eurozone could “break into its constituent parts”.

At the close of trading, London’s FTSE 100 index was down 10 per cent for the week, representing a £149 billion loss, as European stock markets hit their lowest levels since the height of the financial crisis in November 2008.

For the first time since the beginning of the eurozone crisis, Italy’s borrowing costs rose above Spain’s, threatening to engulf the single currency’s third biggest economy. Giovanni Perissinotto, the chief executive of Assicurazioni Generali, the Italian insurance giant, warned that a political and economic catastrophe was looming after a day of financial trading that saw his company’s share value slashed amid panic at Italy’s faltering economy and high debt levels.

“Europe faces a serious risk of breaking up into its constituent parts and finding itself and its various member states impoverished,” he warned.

Yet again more ominous alarm bells sounding out of Europe, and increasing dramatic illustrations on the fallout of the Eurozone crisis. Much more talk of 'collapse', 'breaking up' and 'states impoverished' sounds pretty damn ugly. The Eurozone continues its anemic struggle to survive but for how long, remains the question.

reply to post by surrealist

the eurozone could “break into its constituent parts”

At the end of the day this is all that the PTB is concerned about - the removal of their power base, where as the citizens are all just hoping it will happen.

Yes there will be chaos for a while, and oh dear rich people will lose 'money' on the stock market, but then that has never been about reality anyway just about people making money by preying on others instead of doing an honest days work.

An economic zone was fine idea when it all started out. The downward spiral into a monetary and political union was not what, as far as the people were concerned, it was all about. Of course we know this not to be the case. That is just exactly what it was all about, so good riddance if it all breaks up. It will be tough, but we will survive.

There are 2 possible outcomes to the Eurozone crisis, The Euro breaks up or it becomes one whole federal state like the USA. My moneys on the latter. Probably not going to go down too well with the masses though.