The end of euro world is nigh
Europe needs a massive war chest to rescue the crippled common currency, writes Marc Coleman
The Mayans believed that the world would end on December 21 next year. It probably won't happen but if by this Wednesday Angela Merkel and Nicolas Sarkozy fail to come up with a convincing plan to save the euro, it might feel like it. A plan of sorts was due this evening, but as Luxembourg Prime Minister Jean-Claude Juncker admitted, European divisions these days are "disastrous".
A second EU summit has been scheduled for Wednesday and meetings between the EU and China have been postponed. G20 leaders are howling at European leaders to sort out a crisis that could plunge the world into recession. And how ironic that the country that gave birth to the civilisation we live in -- Greece -- is at the heart of it all.
At home the world hasn't yet ended but does appear to have been turned upside down: from Europe saving crisis-ridden Ireland last year, this week Ajai Chopra told us that our economy is healthy, our public finances on track and our export growth excellent. Klaus Masuch, another Troika team member (and former colleague of mine) was more reticent about our banks. They are showing "positive signs", he said. From a domestic standpoint, it is hard to see. Just as we exported food during the famine, our current balance of payments surplus shows our now well-capitalised banks are exporting capital while domestic firms and families suffer credit starvation.