What now for the Euro?

After yesterday’s summit in Brussels it is obvious that European politicians do NOT have an answer to the troubles of the Euro! Or, if they know the answer, it is not one that they are prepared to endorse. In my limited knowledge of currencies and the problems of the Euro, I believe its problems have to be addressed from 2 directions at the same time
1) impose austerity on the weak economies of the south
2) let the ECB print money to cause inflation and thereby reduce the value of the Euro in international markets

Neither one will work on its own. Both together and it stands a chance of saving the Euro. With this 2 directional approach both weak and strong countries take the pain. What we have at the moment is the imposition of the strong on the weak. With the weak taking all the punishment. (Merkels and Sarkozys attitude to Cameron, reminds one off the school bullies in the playground, not of astute politicians.) If this imbalance continues, then it is a slow drift to the inevitable break up of the Euro and ultimately the EU. For the markets will not relent in pursuing the weaknesses perceived in the Euro and its sovereign debt exposure.

As time ticks by, people in the weaker economies of Europe will become more and more restless and frustrated at the imposed austerity and lack of democracy. Military junta’s are not unknown in these countries. At some point a country will reach the tipping point when it will be less painful to leave the Euro than to remain in it. If the countries elected government doesn’t move at that point, I fear that a strong cabal of military leaders will take matters into their own hands.

When will the politicians of Germany and France ‘face the facts’ and do what everybody else can see and do what is bleeding obvious.