'The Euro's FINNished'
August 22, 2012 • 7:45AM

Thus screams the headline of the British tabloid The Sun, reporting Finland's Foreign Minister Erkki Tuomioja's assertion that everyone is preparing for the coming end of the euro. With the subhead, "So-called 'Grexit' looks 'likely,'" Tuomioja is quoted as saying, "This is something that everyone is looking into. But it is not something that can or should be discussed openly. We certainly do not hope this will happen. But without further support or changes to its program it looks likely."

Nonetheless, the scheming to keep the euro, no matter how many Eurozone countries it destroys, continues. City of London mouthpiece Ambrose Evans-Pritchard writes in today's Daily Telegraph that German European Central Bank board member Jörg Asmussen has signalled that he backs ECB President Mario Draghi's plan for unlimited purchase of government bonds.

Evans-Pritchard cites Asmussen's comments to the Frankfurter Rundschau, in which he said, "A currency can only be stable if its future existence is not in doubt." He added that the surge in bond yields over recent months "reflects fears about the reversibility of the euro, and thus a currency exchange risk."

Evans-Pritchard writes that the "choice of wording" makes clear for him that Asmussen would back bond purchases if it would avert an EMU break-up and be unlimited in scale.

He also reports that the ECB director general of market operations, Ulrich Bindseil, is drafting plans to cap Spanish and Italian bond yields.

He then points to the apparent split between Asmussen, who was "hand-picked" by Chancellor Merkel, according to Raoul Ruparel from the euroskeptic Open Europe, and Finance Minister Wolfgang Schäuble, who on Aug. 19 compared ECB buying of state bonds to drug addiction.

While it is well known that Asmussen, a Social Democrat, is a pro-euro fanatic — Merkel's reason for putting him there, it is another question whether the policy will pass. In any case Evans-Pritchard states, if Draghi's plan goes through, it needs to have Spain drink the Kool-Aid, by signing a bailout agreement, and turning over its sovereignty to the ECB.