1. Troubled countries for time being decide to stay in EU, and richer EU countries decide to bail out the troubled countries with stricter fiscal restrictions.
    1. Rich EU countries such as Germany and France forcing regulations that will monitor regulate and determine the fiscal policies of the rest of the EU countries which use Euro as currency.
    2. Countries that are on the verge of the bankruptcy such as Ireland, Greece, Italy, and Spain will be the first ones that will see these strict regulations.  These regulations will demand cutting social programs such as pensions, medical help, subsidies and privatization.
    3. Strong, violent reaction from the masses i.e. common and ordinary working class, poor folks against political parties, politicians, banks, regulators, and EU.  Rising Nationalistic sentiments over EU identity.
    4. Stronger reactions from masses in troubled countries will force those countries to default on some of the obligations and quit EU altogether.
    5. Domino effect leading to Disintegration of EU.
    6. Death of a potential alternate currency to dollar.  Countries running to convert the Euros into American dollars.  Very high demand for American dollar.
    7. Stronger dollar. US have the capacity to print the dollar and spend it in a way it wants to spend.
    8. Stronger position of US in the World economically.
    9. Tremendous setback to BRIC countries.  i.e. Brazil, Russia, India and China.  I am not sure about Brazil but very sure that it will adversely affect China and India.  India has already seen very week Rupee against Dollar.
    10. Someone may argue that exports would be good for China and India but what about Imports such as gasoline?
  2. One of the troubled countries decides to default on its obligation because the regulations proposed by Germany and France are unreasonable and unjustifiable to the masses.
    1. The country is thrown out of EU.
    2. Domino effect leading to Disintegration of EU.
    3. Death of a potential alternate currency to dollar.  Countries running to convert the Euros into American dollars.  Very high demand for American dollar.
    4. Stronger dollar. US have the capacity to print the dollar and spend it in a way it wants to spend.
    5. Stronger position of US in the World economically.
    6. Tremendous setback to BRIC countries.  i.e. Brazil, Russia, India and China.  I am not sure about Brazil but very sure that it will adversely affect China and India.  India has already seen very week Rupee against Dollar.
  3. What will happen if troubled countries for time being decide to stay in EU, and richer EU countries decide to bail out the trouble countries without any stricter fiscal restrictions?
    1. EU saved for time being, but Nationalistic sentiments o rise in Germany and France.
    2. Nationalistic sentiments on rise in Germany!!!  A major red flag for the peace in the world.

Best outcome

Scenario 3 has its risks but those risks are manageable.  The process of regulating fiscal policies of individual countries should be a gradual process.  Richer countries should write off some debt of the troubled countries.

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