What the eurozone is facing is not a crisis that can be dealt with by a bailout, but a structural crisis that the ECB can’t handle, according to Howard Davies of the LSE, who spoke with CNBC today.
- 1:00 The underlying problem is a weakening in competitiveness for the fringe states in the eurozone
- 1:50 The cheap currency is not a solution, competitiveness inside Europe is the real problem
- 3:10 Still no agreement in the eurozone with the “structural changes” it needs to make, nothing has happened since the crisis broke out in 2008
- 4:10 The ECB handled the crisis well at its outset, but is now not equipped to deal with the problems the eurozone is facing
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