Tags: Banks | End | Euro

Banks: We're Quietly Prepping for End of Euro

Monday, 28 Nov 2011 03:35 PM

Banks in the Europe, the United States and elsewhere are quietly crafting contingency plans to deal with the collapse and eventual death of the euro.

European leaders like Germany's Angela Merkel have publicly said the euro will live, but ratings agencies are cutting standings in countries like Portugal, Hungary and in Belgium, and some have said they are keeping an eye on France, which has a AAA rating.

"We cannot be, and are not, complacent on this front," says Andrew Bailey, a regulator at Britain's Financial Services Authority, according to the New York Times.

"We must not ignore the prospect of a disorderly departure of some countries from the eurozone."

Big financial institutions like Merrill Lynch, Barclays Capital and Nomura have put out reports addressing the possibility of a breakup of the eurozone.

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(Getty Images photo)
"The eurozone financial crisis has entered a far more dangerous phase," analysts at Nomura wrote on Friday, the New York Times adds.

Unless the European Central Bank (ECB) steps in to help where politicians have failed, "a euro breakup now appears probable rather than possible," the bank concludes.

Calls for fresh European Central Bank intervention in the continent's financial sector are growing, but monetary authorities there say it's up to governments to get their economies out the mess, pointing out that printing money won't solve the problem but working to achieve a fiscal union can.

"Governments cannot expect the ECB to finance public deficits," European Central Bank Executive Board member Jose Manuel Gonzalez-Paramo said in a speech in Oxford, England, according to Bloomberg.

"It is now a time for politicians to be bold and courageous" and "complete as soon as possible the great project begun 60 years ago towards ever closer union."

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Banks in the Europe, the United States and elsewhere are quietly crafting contingency plans to deal with the collapse and eventual death of the euro. European leaders like Germany's Angela Merkel have publicly said the euro will live, but ratings agencies are cutting...
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2011-35-28
 

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