Tags: UK | Euro | Collapse | europe

UK Defense Group Warns of Euro Collapse

Thursday, 08 March 2012 02:14 PM

British defense experts are warning the government to prepare for mass migration and instability if the eurozone collapses.

The United Kingdom declined to join the single currency at its founding, staying with the pound. Now a joint committee on security strategy is calling the end of the single currency “plausible” and argues that the potential risk to the U.K. requires advance planning, according to a BBC report.

"International economic problems could lead to our allies having to make considerable cuts to their defense spending, and to an increase in economic migrants between EU member states, and to domestic social or political unrest," the committee members said.

Editor's Note: Meltdown on Main Street Coming, Prepare Now

Markets await news that the private holders of Greek debt will accept a significant haircut on their positions. Greece is working to cut its national debt while not having to leave the euro.

Athens is reportedly asking its creditors to accept new bonds at a 53.5 percent face value, reports the Associated Press. Greek unemployment was at 21 percent in December and more than 51 percent among the young.

"According to the information I am receiving, about 60 percent of the Greek bondholders have expressed desire to convert them," Italian Premier Mario Monti told reporters. "The resolution of the Greek financial crisis is in sight."

An end to the Greek episode would be a balm, but the contrary — a Greek return to the drachma — might set off a contagion among European banks, traders fear. Beyond relatively tiny Greece lie larger eurozone countries with much larger problems, including Spain, Portugal, and Italy itself.

“Available survey indicators confirm signs of a stabilization in the euro area economy. However, the economic outlook is still subject to downside risks,” European Central Bank President Mario Draghi told reporters recently.

Editor's Note: Meltdown on Main Street Coming, Prepare Now

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