Eurozone is heading downhill
Divorce is often messy and almost always painful. Now imagine a divorce involving 17 partners, and you'll have some sense of what will happen if the eurozone breaks apart.
Alarms are going off all over the world as investors grasp that such a thing looks increasingly likely. Lenders are demanding far higher interest than usual to lend to Italy, and even German bonds, the European gold-standard, are meeting tepid demand amid worries that the whole continent could be dragged down by the collapse of Greece, Italy or other indebted euro nations.
Heaven knows we Americans, with our mortgage meltdown and political paralysis, are in no position to lecture. Yet it seems inconceivable that European leaders will continue their obsessive and inconclusive conferring while Rome and the rest of the eurozone burns.
Earlier action might have contained the conflagration, but at this point there is little alternative to massive intervention by the European Central Bank, the continent's answer to our Federal Reserve. If only the continent had an institution equally unfettered in the face of crisis, or a chief as bold and flexible as Ben Bernanke.
The bitter reality is that it's time for everyone to start planning for a eurozone collapse, which could easily torpedo our own nascent economic recovery and drag the entire world into a recession or worse.
The euro was a mistake from the start, an original sin resulting from ignorance rather than knowledge. But Europe's profligacy, procrastination and pusillanimity ever since offer sobering lessons for any nation that can't conquer its fiscal problems.