Over the last few days/weeks, a number of articles and blog posts appeared suggesting (and rightly so, IMO) that there are only two ways forward for EU: print new money on the scale bordering with unimaginable (we are talking 4-6 T here) or let the Euro disintegrate. With all the opinions being offered, I feel like throwing my hat in the circle as well. For what it's worth, here goes.
I believe, the Euro printing on a large scale is not going to happen. Not for the lack of trying, mind you - we all know what Powers That Be, also known as They, want. They want to print their way out of this and swear off borrowing forever. Or not - but who cares what happens after the firestorm while in the middle of it and there is not enough water to put it out. I, however, don't believe they will be able to pull it off. They'll try to be sure - but the degree of unity necessary for the monetary operation of such scale is not there and never will be. Sovereign states with vastly different interests won't be able to sign in unison; various political forces of all stripes will tear off attempts to achieve such unity; loss of sovereignty required for "mutualisation" (newspeak of late) of losses won't be accepted both horizontally (between the states) and vertically (between the layers of population).
To sum it up - they will fail to bail, and single currency will be no more. That's my vision for the development. How long for all this to take place? Anywhere from months to 2-3 years... these things take long to ripe and then they occur very very rapidly.
This post is a follow-up to this one.