"... Germany’s political and economic establishment would rather see the eurozone break up than risk its own national prosperity, and political stability, by allowing the ECB – and thus, Germany – to backstop the rest of Europe.
A currency with “no lender of the last resort” – that’s the incoherent reality of the single currency project, a reality that is now being mercilessly exposed.
... Re-denomination is now out there as an officially recognised possibility that could yet spark chaotic retail and wholesale bank runs. Firms and households in Greece, Italy, Spain – and eventually even France – could end up, to the extent they can, transferring domestic balances to German banks to avoid re-denomination risk. If this happens on a significant scale, what then? Capital controls? Within a single currency area? That sounds absurd, of course. But that is where the deeply flawed logic of Europe’s monetary union ultimately leads us."