Wolfgang Munchau: Optimal Currency Areas and Governance - The Challenge of Europe (7/8)

The speaker disagrees with Jeff on the nature of the eurozone crisis, arguing it wasn't primarily fiscal except in Greece. The eurozone's political economy is toxic, with small economies forming a large closed one. The 2008 meeting post-Lehman led to a banking crisis turning into a sovereign debt crisis. The ECB's hostility and political risks make default unlikely before 2013. Future scenarios include perpetual bailouts or a fiscal union, with Spain potentially needing EU help due to its housing market issues.

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