Huffington Post
January 6, 2012
The questions that I most often receive as a Brit commentating in America are: why is the Euro a mess, will it survive 2012 and if it doesn't, how does it impact America? This is normally accompanied by a complaint that most explanations are high on jargon, low on clarity.
So let's strip it down to the basics. The European Union is comprised of 27 countries, which when put together make the EU, with a population of around 500 million people, the largest economy in the world. Seventeen of those countries are members of the Eurozone, nations that use the Euro (thus the UK with its pound is a member of the EU but not of the Eurozone). The Euro has been in general circulation for ten years and the Eurozone is the world's second largest economy, with a population of around 330 million.
Comparisons of what is going on with the Eurozone have been made with the economic meltdown of 2008. Greece has been called the new "Lehman Brothers". We are told that there's "déjà vu" with the sub-prime crisis -- no one knows what Europe's bad debt is worth or what exactly is exposed to it. However, as George Soros, the billionaire investor, just said, the Eurozone situation is "more serious and more threatening than the crash of 2008."
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