Wednesday, May 19, 2010

Eurozone plays ‘beggar my neighbour’

by Martin Wolf

Financial Times
May 18, 2010

Might the eurozone break up? Until recently I would have answered: absolutely no. This is not because I thought the currency union a wise idea. I thought it a risky idea, made more so by the decision to accept member countries so different from those of the zone’s northern core. But the commitment to make it work seemed fundamental to the policies of Europe’s principal powers. Is that still true? I do not know.

So what has gone wrong? What is happening now? What happens next? What does it mean for both the eurozone and the world economy?


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