These two excerpts say it all:
Roubini: Italy Is Doomed And Will Exit EMU Unless ECB, Germany Step In - Forbes: "The only way to stop the upcoming disaster, according to Roubini, is quantitative easing. The ECB would have to drop interest rates to zero, effectively helping to depreciate the currency, and begin massively buying up Italian and peripheral debt. The euro would fall to parity with the dollar, Roubini says, and Germany and other “core” countries would have to implement fiscal stimulus plans to compensate for the fall in aggregate demand caused by austerity in peripheral nations."
Krugman: The sad irony here is that the euro is, in reality, essentially an Italian creation. If you were part of the dialogue in the late 80s and early 90s, it became clear that the euro was best understood as a plot by Italian technocrats to get themselves German central bankers. This was not, it turns out, a good idea. http://krugman.blogs.nytimes.com/2011/11/11/original-original-sin/Tweet Follow @johnmpoole