Too big to save? Europe in crisis

One of the phrases we repetitively heard during the crisis was ‘too big to fail’ – mostly coming out of Washington. Now as we learn new developments in Europe, the problem is not just that some banks are too big to fail, they are too big to save as well. Some of the European countries like Ireland, Greece and Austria may not be in position to save their banking system on their own even if they want to simply because these banks have debts multple times of GDP of their home countries.

Things are getting really ugly. The only way to reach some solution will be consorted effort by countries like Germany and IMF to bailout troubled economies and their banking systems.

If Euro survives this crisis, Euro as a currency will survive any crisis.

More resources:
The latest Roubini interview on European crisis can be watched here.

Yves Smith of Naked Capitalism – “European banks’ toxic debts risk overwhelming EU governments” and “Will eastern Europe will trigger a financial meltdown?”

Simon Johnson of Baseline Scenario – ‘Dublin and Vienna calling’

Tyler Cowen of Marginal Revolution – Easter Europe fact of the day

World Currency Watch on European debts

Stefan Karlsson – rise and fall of Baltic boom

Spin Doctor highlights a different aspect of rising social unrest in Europe amidst this crisis