The eurozone is like a ticking bomb that will explode sooner or later, said one of the founders of the single currency and the first chief economist of the European Central Bank (ECB) Otmar Issing. “One day, the house of cards will collapse,” Issing said in an interview with the journal Central Banking. “Realistically, it will be a case of muddling through, struggling from one crisis from the next. It is difficult to forecast how long,
but it cannot go on endlessly,” the economist added. According to Issing, the ECB is on a “slippery slope”, blasting the system for bailing out bankrupt states. “The Stability and Growth Pact has more or less failed. Market discipline is done away with by ECB interventions. So there is no fiscal control mechanism from markets or politics. This has all the elements to bring disaster for monetary union,” he said. FULL REPORT
