A transfer union of the type described here is clearly not a desirable perspective. And the massive volume of transfers is also unlikely to be economically or politically viable. Although such a transfer union could be the logical endpoint of the path which European policy makers are currently pursuing, we consider a transfer union of this type as unlikely. A more likely outcome is a breakdown of the eurozone prior reaching this endpoint. One possible reason for this breakdown is a raise in political tensions among member countries. A second, more likely reason is the bond market’s possible loss of confidence in the sustainability of the whole eurozone.
via www.mpg.de
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