Business Case Studies & Business Publications

Turbulent Times in the Euro Zone

Debaere, Peter

Case

Turbulent Times in the Euro Zone

Debaere, Peter

GEM-0100 | Published April 6, 2010 | 21 pages Case

Collection: Darden School of Business

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Newspaper headlines and editorials revealed the intense attention the euro zone had received in the last few months. The current crisis occurred shortly after Greece announced that its 2009 budget deficit was 13% of GDP?twice as high as previously predicted. For some, this was the beginning of the end for the euro zone. Could it lead to the demise of the euro altogether? Others insisted that expelling Greece might be necessary. In tune with headlines at the time, the exchange markets did not display much confidence in the euro. By summer 2010, the euro had lost at least 10% of its value against the dollar since the beginning of 2010. Financial markets were nervous. What should EU leaders do help stave off a major crisis?