by Paul Hannon
Wall Street Journal
May 31, 2011
Euro-zone policy makers are playing for time, desperately searching for ways to keep those members that have been bailed out in funds, but with no clear strategy for ever getting them off life support.
One approach that seems to be gaining traction is a version of what is known as the Vienna Initiative, or, more formally, the European Bank Coordination Initiative.That was a successful attempt to stop a flight of capital from a number of vulnerable Eastern European nations in the months following the collapse of Lehman Brothers.
But it is unlikely to be as effective in maintaining funding to the governments of Greece, Ireland and Portugal, and even if it were partially to succeed, it wouldn't in any way address the fundamental problem facing those nations, which is that their economies will grow too slowly to allow them to repay their enormous debt burdens.
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