Politics will bedevil resolving the euro crisis

Last week’s widening in sovereign bond spreads and the results of stress tests on Irish banks have reminded us that the eurozone has made hardly any progress in actual crisis resolution – in spite of its pretentious grand bargain. Over the next few weeks, I will try to map out various scenarios of how the crisis might evolve. It is probably the toughest challenge the European Union has confronted in its history. The eventual outcome will depend on a complex interaction of politics, finance and economics.

Murder on the EU Express

With the monetary union coming apart, the finger-pointing has begun. Who really killed Europe?

You remember Agatha Christie’s classic whodunit Murder on the Orient Express? The problem for the great Belgian sleuth Hercule Poirot was that there were far too many suspects. The strange death of the European Union may prove to be a rather similar case.

ECB rate increases to open policy gap with Fed

THE European Central Bank is poised to raise interest rates faster than the Federal Reserve for the first time in four decades, opening up a transatlantic policy gap that may help the euro endure the sovereign debt crisis.

One way to end Irish crisis — let banks go bust

WASHINGTON (MarketWatch) — Missing in the 88 pages the Central Bank of Ireland has produced in determining that the Irish banking system is undercapitalized by some $34 billion (24 billion euros) is a different way to end the euro-zone nation’s financial crisis.

It’s an elegant and simple solution, and one that could prove cheaper: Let all the banks collapse.

Japan Quake, Euro Debt Crisis Cloud Recovery, Wang Says

Japan’s earthquake and tsunami, the European debt crisis and turmoil in the Middle East are adding uncertainty to the global economic recovery, China’s Vice Premier Wang Qishan said at a Group of 20 Nations seminar today.