How to save the euro

Εconomist
It requires urgent action on a huge scale. Unless Germany rises to the challenge, disaster looms

The failure of austerity and pretence
A rescue must do four things fast. First, it must make clear which of Europe’s governments are deemed illiquid and which are insolvent, giving unlimited backing to the solvent governments but restructuring the debt of those that can never repay it. Second, it has to shore up Europe’s banks to ensure they can withstand a sovereign default. Third, it needs to shift the euro zone’s macroeconomic policy from its obsession with budget-cutting towards an agenda for growth. And finally, it must start the process of designing a new system to stop such a mess ever being created again.
The fourth part will take a long time to complete: it will involve new treaties and approval by parliaments and voters. The others need to be decided on speedily (say over a weekend, when the markets are shut) with the clear aim that European governments and the European Central Bank (ECB) act together to end today’s vicious circle of panic, in which the weakness of government finances, the fragility of banks and worries about low growth all feed on each other.
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Italy and Spain are under attack not because their finances have suddenly deteriorated, but because investors fret that they may be forced to default. For this loss of confidence, blame the pretence. Europe’s leaders have repeatedly denied that Greece is insolvent (when everyone knows it is), failing to draw a line between it and the likes of Spain and Italy, which are solvent but short of liquidity. The excuse is that a Greek restructuring may cause contagion. In fact denying the inevitable has undermined pledges about solvent governments.

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Greece, which is unambiguously insolvent, ought to have a hard but orderly write-down. The latest, inadequate plan for a second Greek bail-out, agreed at a summit in July, should be thrown away and rewritten
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The recapitalisation of Europe’s banks must be based on proper stress tests (which should this time include possible default on Greek sovereign debts). Some banks may be able to raise money in the equity markets, but the most vulnerable will need government help. ... it also makes sense to set up a euro-zone bank fund, together with a euro-zone bank-resolution authority.
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In today’s recessionary world, the ECB could buy several trillion euros-worth of bonds without unleashing inflation.
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The sobering truth about the single currency is that getting in is a lot easier than getting out again.
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The euro has reached the point where nobody is going to get what they want—something that needs to be spelled out to the Germans more than anybody. .... Spell that out clearly to your voters, Mrs Merkel.

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Noμίωζ ότι η ανάλυση είναι πολύ ψύχραιμη. Εξετάζει όλες τις παραμέτρους και προτείνει συγκεκριμένα πράγματα.
Η προτεινόμενη λύση είναι να παραδεχτούν οι Γερμανοί ότι πρέπει να πληρώσουν, όχι όμως χωρίς αντίτιμο, το οποίο είναι ηδη σκληρό για τις μικρές χώρες (εκτός διαδικασιών αποφάσεων).
Η μπάλα βρίσκεται στα πόδια των βόρειων εθνικιστών, το άρθρο λέει ότι πρέπει να βάλουν 2-3 αυτογκόλ και να χάσουν το ματς.