Krugman:Euro could collapse in a few days time

Discussion in 'Economics' started by Grandluxe, Sep 14, 2011.

  1. The Nobel laureate economist Paul Krugman sees a possible collapse of the euro within reach. The New York Times, he says, "There is no question of one or two years, the euro could fall apart in a few days. Should this be the case, the whole world will suffer. He speaks of a self-fulfilling prophecy as the crisis countries can not intercede on your own central bank, such as the Bank of England.
  2. xiaodre


    So Spain has relatively low debt and yet is still in danger because moralists will not buy their bonds so they can roll their relatively low debt over? And they are going to default on this relatively low amount of debt?

    does. not. compute.
  3. get ready for eurusd 1.40 tomorrow when merkel will save the economy by saying 5 magic words.
  4. Who said Spain has relatively low debt? Its stock of sovereign debt going into the crisis was relatively low (like Ireland), but that's misleading. The aggregate debt of the sovereign and the banking system is very high and they're running a budget deficit that's almost as bad as the Greeks'.
  5. Arnie


    I have an extreme urge to buy the EUR/USD :D
  6. clacy


    The Euro is doomed to failure, IMO, but timing it is another matter. I'm just not sure how politically feasible it is to continue pushing for bailouts of your next door neighbors. It's hard enough to get people to bailout their own banks, let alone Greece's
  7. clacy



    What is your take on the European situation? You seem pretty in tune with the debt markets and such over there.

    Do you see a Euro collapse? Is contagion unavoidable?
  8. Yep, I am in tune, for my sins...

    I have said a few times that I have become increasingly skeptical. To be honest, at this point, I don't know what to think any more. The situation is so messed up that anything can happen. All I can tell you is that I strongly believe that the odds of a "Eurozone collapse" sort of outcome have increased dramatically as a result of a whole variety of recent shocks.

    I do think Macro Man sums it up best here:
  9. Krugmans brain collapsed decades ago.
  10. clacy


    Very well done indeed.
    #10     Sep 14, 2011