Blog #8 The Future of the Euro
In the past year, the EU has spent copious amounts of money on bailouts in Iceland, Greece, and most currently, the €85 billion bailout for Ireland. All these events have caused the Euro to fail, bringing the surplus European countries, namely Germany, down with it.
The main issue is whether Germany can continue to live under the Euro. Currently, they are fed up with the inefficiency of the aided countries and they fear that the European Central Bank will inflate away the debt.
So, should the Euro be broken up? The economist suggests that it might happen. It goes on to suggest that there are two ways that the currency could be split. One is that the weaker countries may choose to leave to devalue their currency, the other option could be that Germany could leave with the Netherlands and Austria and restore the D-mark. Either way, it would be very costly. However, this may be the reality in the near future.
http://www.economist.com/node/17629661