Liquidity risk

This illustrates one of the central problems with EU members (and one mentioned before on this blog): Liquidity risk. This does not happen with countries who control their own fiat currency. AEP is a notorious "Euroskeptic" but the danger is there.

By Ambrose Evans-Pritchard
Published: 8:24PM GMT 03 Feb 2010

Greece rattled by 'hidden debt' controversy. Truck drivers stuck as
tractors block a highway crossing at Promahonas on the Greek-Bulgarian border.

Greece's labour federation immediately called a general strike for
February 24, dashing hopes that Europe's provisional backing for Greek crisis policies would restore investor confidence.

Joaquin Almunia, the EU economics commissioner, said tough measures
were "extremely urgent" to prevent a further flight from Greek debt.
"The huge imbalances from which the Greek economy is suffering are not sustainable in the long run. The fact of the matter is that markets are putting on pressure. This pressure cannot be ignored."

Greece is the word that should strike fear into all those who love the euro Mr Almunia said concerns have spread beyond Greece to other
eurozone countries where public finances are spinning out of control, chiefly Spain and Portugal. "In these countries we have seen a constant loss of competitiveness ever since they joined the eurozone. The external financing needs are quite big," he said.