Draghi kicked the can down the road. Now, here’s that can again…

The eurozone crisis was originally a financial crisis in Europe's southern states. Now it's an economic crisis covering the whole continent, says Matthew Lynn.

They were probably the three most successful words in central-banking history. Two years ago, on 26 July 2012, the European Central Bank's (ECB) president, Mario Draghi, pledged to do whatever it takes' to save the euro.

Back then, the situation in the eurozone could hardly have been worse. For two years the euro had been battered by the markets. Greece had gone bust and had to be bailed out by its neighbours. It was swiftly followed by Portugal and Ireland. Bond yields were rising alarmingly in Italy and Spain, at several points breaching the 6% level at which their debts would become unsustainable. European leaders were convening at crisis summits on an almost weekly basis, coming up with fresh plans to save the currency, few of which survived until the next morning. It was chaos, and to many it looked as if the euro might not survive the year.

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Matthew Lynn

Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years. 

He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.