November 15, 2011
A break-up of the euro zone is increasingly predicted as the result of the current crisis in the region, but economists warn that this could be the worst possible outcome.
“A break-up in some fashion is still the worst-case scenario for Europe in every respect: financially, economically and politically,” Larry Hatheway, chief economist at UBS, told CNBC Tuesday.
The appointment of technocratic governments in Italy and Greece has failed to reassure the markets about the region’s future, and there are still worries that the new leaders will fail to deliver.
“I think the appetite is there, but the mechanisms and the political resolve to take unpopular decisions are missing,” said Hatheway, who doesn’t think that European leaders will be able to shrink the euro zone to fewer than its current 17 members.
This article was posted: Tuesday, November 15, 2011 at 4:13 am