There are those who argue the single currency will succeed in the long run. They believe it will emerge stronger from its ordeal. I will eat my words (I would be happy to – the economic benefits would far outweigh the personal humiliation). The second scenario is the single currency fails: the Eurozone is eventually torn apart as the structural flaws become too much to bear. That seems to me most likely to happen if Germany concludes that the costs of break-up are less than those of keeping the single currency afloat.  It must be said, thought, that break-up would be a nightmare for all concerned, with unknowable consequences, so huge efforts will be made to avoid it. It is not just a binary matter of transform or break up for the Eurozone, though. There is a third possible outcome: here leaders carry on having summits, and carry on coming up with ‘solutions’ just good enough to keep the currency union going, but in a deeply dysfunctional state. There is no transformation, but no break-up either: instead, the Eurozone becomes a zombie zone.  Unfortunately, that could go on for years.

(Dr. Benny Peiser)