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Mega-Bank UBS Predicts Dictatorship, Civil War if Euro Collapses

John on September 7, 2011 at 11:07 am

Zero Hedge has a report issued by mega-bank UBS which argues some unappealing things lie in Europe’s future should the Euro collapse:

The economic cost is, in many ways, the least of the concerns investors should have about a break-up. Fragmentation of the Euro would incur political costs. Europe’s “soft power” influence internationally would cease (as the concept of “Europe” as an integrated polity becomes meaningless). It is also worth observing that almost no modern fiat currency monetary unions have broken up without some form of authoritarian or military government, or civil war.

The report goes on to say a bit more:

Even with a paucity of case studies, what evidence we have does lend credence to the political cost argument. Clearly, not all parts of a fracturing monetary union necessarily collapse into chaos. The point is not that everyone suffers, but that some part of the former monetary union is highly likely to suffer.

I don’t know how likely this scenario actually is, but I do know that somewhere Glenn Beck is saying “I told you so” right now.

[HT: Drudge]

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