Europe delays the inevitable

With the recent downgrading by Standard & Poor’s of the sovereign debt of France and Austria, and the further discounts of the debt of the Club Med countries, the euro crisis could be reaching its denouement. This could be triggered fairly soon by the impasse on the “haircut” on Greek debt, which needs to be rolled over in late March. Or this slow-motion train crash of the euro zone could go on for some time, as its politicians continue to seek various palliatives without recognising the basic design flaw in the euro.

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