Thursday, November 25, 2010

WHY EURO WILL SURVIVE THE CRISIS ''DER SPIEGEL''

''Europe is gripped by a sense of alarm, now that Ireland has become the second euro-zone country to ask for a bailout. Pessimists claim that the crisis means the euro is finished. But that scenario is unrealistic -- in reality, there is little to suggest that the common currency is about to disintegrate.
The mood in Europe is currently one of alarm -- yet again. First, the EU's member states had to pull Greece back from the precipice of bankruptcy. And now they are having to save Ireland from financial ruin.
Earlier this year, when Greece was being rescued, there were those who warned of a domino effect among the euro zone's troubled members. It now appears that their warnings have been confirmed, with the result that advocates of a doomsday scenario now expect the rest of their prophecies to also be fulfilled. As they see it, Portugal will soon be the next to fall, followed sooner or later by Spain and Italy as well. And by then, at the latest, it will be curtains for the euro zone. Game over.
Given the current situation, these scary predictions might seem seductively persuasive. But the fact is that they are rather unrealistic. The situation in Ireland is obviously anything but rosy. And it would be careless to ignore the possible dangers facing the euro. But at the moment there isn't much evidence indicating that the currency union is under any serious threat, let alone that it is lurching into a crisis that will ultimately end in the death of the euro.'' 
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