The likelihood, however, is that the crisis will go on for much longer. That's because the problems that have resurfaced over the past week have a deeper, structural cause: the flaw in the single currency that has left the weaker countries of the southern fringe deeply uncompetitive in relation to the powerful nations at the core. The traditional remedy – devaluation – is ruled out by membership of the euro, so the affected countries have no choice but to go for "internal devaluations", which means making themselves more competitive by driving down wages, pensions and public spending.
These programmes are draconian and deeply unpopular. In Rome and Athens, technocratic governments have no mandate for them. To make matters worse, austerity is driving Europe ever deeper into recession, making it harder to get to grips with sovereign debt. It is a toxic, and highly dangerous, mix.
These programmes are draconian and deeply unpopular. In Rome and Athens, technocratic governments have no mandate for them. To make matters worse, austerity is driving Europe ever deeper into recession, making it harder to get to grips with sovereign debt. It is a toxic, and highly dangerous, mix.