With Europe on the brink of a disaster, the euro must be reconstituted as an entity based on economic reality, not ideological folly.****The detail of the disputes over bank bail-outs and the scale of the European rescue fund is tortuous and convoluted. But the underlying problem is simple enough. Europe’s political elites know that for the euro to survive in its present form, it must move – with speed – towards full fiscal and political integration. Yet national leaders, and the voters they answer to, are as yet unwilling to accept the loss of sovereignty, and indeed the shared liabilities, that such a revolution demands.****The question now is how best to minimise the damage, so that the single currency does not take the world economy down with it – and reconstitute the euro as an entity based on economic reality, not ideological folly.
Read the whole editorial at The Telegraph, The single currency is close to collapse
See also, Most Greek bailout money has gone to pay off bondholders by Howard Schneider at The Washington Post.
More than half of the money lent to Greece so far by the International Monetary Fund and European nations has gone to repay bondholders, a transfer of billions of dollars from taxpayers around the world to European banks and pension funds that invested in the troubled Mediterranean nation.
(h/t Edward Harrison at Credit Writedowns)