Europe is running a giant Ponzi scheme

Commentary feature. The author was governor of Argentina’s central bank and director of the Centre for Central Banking Studies at the Bank of England. He discusses how the EU is dealing with the sovereign debt crises of a number of its members.

Would a bank crisis now be more damaging to the European economy than a future debt write-off? Or, alternatively, is recognising reality and accepting a debt restructuring now preferable to increasing the burden on future taxpayers? At the end, it is a political decision, but it would be refreshing if things are called by their name. Euphemisms may be useful in the short run, but one finally recognises a Ponzi scheme when it persists.