From the start, monetary union was a political conceit for which many Europeans are about to pay a devastating economic cost.
It might have been a statement of the blindingly obvious, but Mario Draghi’s warning yesterday that the eurozone as it stands is unsustainable, and that Europe’s leaders must clarify their vision for the euro quickly if the single currency is to survive, was no less startling for it.
Every man and his dog have been saying the same thing for the past two years now, and some since long before, yet so far it’s not made a bit of difference. Now that the president of the European Central Bank, no less, has also hit the panic button, will policymakers finally sit up and listen?
Don’t hold your breath. As the ever worsening banking crisis in Spain demonstrates, it may be too late. It’s not just the markets that have lost faith in the euro; previously compliant electorates are also close to breaking point. The die may already have been cast.
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12:02 pm EDT, June 1st, 2012 — It’s a YES: Voters approve Treaty by 60 – 40 majority
12:03 pm EDT, June 1st, 2012 — Euro-zone lessons for Canada (good read)
12:04 pm EDT, June 1st, 2012 — Monti warns of German threat to eurozone
12:05 pm EDT, June 1st, 2012 — No breathing room for Spain
12:06 pm EDT, June 1st, 2012 — Eurozone is ‘unsustainable’ warns Mario Draghi
12:07 pm EDT, June 1st, 2012 — Almost €100bn pulled out of Spain as investors beat a hasty retreat
12:08 pm EDT, June 1st, 2012 — Why Spain’s regions owe so much money
12:09 pm EDT, June 1st, 2012 – Going into final stretch, SYRIZA builds poll lead
12:10 pm EDT, June 1st, 2012 — In U.S., Europe and China, the economic clouds darken
12:11 pm EDT, June 1st, 2012 — Debt crisis: live