Last tango in the Euro Area: Cracks in foundations of the Euro construct

The crisis of sovereign debt and banking system in the Euro Area seriously endanger not only economic stability of the Old continent, but also of the world economy as a whole. In this study, we identify causes of the crisis and point towards plausible solutions aiming at a provisional overcoming of the recession. If, on the other hand, central European countries continue to insist on further implementation of deflationary oriented economic measures in peripheral European economies the break-up of the Euro Area is likely. Final, potentially devastating consequences of this possible grim event are at this moment very hard to predict. [Projekat Ministarstva nauke Republike SRbije, br. 179035]