The scariest prediction we've seen so far for what happens if the euro zone falls apart comes from Citigroup's Willem Buiter, who argues all that's at stake in the debt crisis is a global depression, war, and a European continent as divided as it's ever been since the fall of the Roman Empire. This guy's just being dramatic, right? We sure hope so. The first four points of his five-point prognosis describe economic turmoil resulting from a War of the Roses-like financial divorce across nations that would plunge the entire world (including emerging markets) into economic chaos and a hard-hitting depression. But it's his last point that takes the whole thing over the top:
Even if the break-up of the EA does not destroy the EU completely and does not represent a prelude to a return to the intra-European national and regional hostilities, including civil wars and wars, that were the bread and butter of European history between the fall of the Roman empire and the gradual emergence of the European Union from the ashes of two made-in-Europe world wars, the case for keeping the Euro Area show on the road would seem to be a strong one: financially, economically, and politically, including geopolitically.
Er, yeah, when you put it like that it sure does.