After the Greek and Irish crises and the spread of financial contagion to Portugal, Spain, and possibly even Italy, the eurozone is now in a serious crisis. There are three possible scenarios: muddle through, based on the current approach of « lend and pray »; breakup, with disorderly debt restructurings and possible exit of weaker members; and greater integration, implying some form of fiscal union. The question stays the same : How Europe’s stronger economies can rescue its weaker ones. – By Nouriel Roubini.
