George Magnus calling Europe’s crisis correctly in a comment to a Mohammed El-Erian post over at the FT:
I regard bank recapitalisation and a robust and open-ended commitment by the ECB to buy Italian and Spanish bonds as a double-headed sine qua non for ending the European bond market and sovereign financing crisis. The existential issues that need to be addressed for a viable eurozone can be left until later. But they cannot if the bond market crisis is not resolved quickly. The time for incremental and technical changes to ECB and other policies and instruments is, to use banking parlance, long past due. And while I agree with Mr El-Erian’s policy prescriptions, it is surely not alarmist to say that if the political divisions and lack of determination in policy circles remain as now, we will surely hurtle to our own Kreditanstalt moment – the 1931 collapse of Austria’s largest bank which was how that appalling decade started.