There are two problems, though, with this approach. One is political. While the concept of Eurobonds (in effect, having Germany co-sign all of the eurozone sovereign debt) offers the best and perhaps only hope of an economic fresh start, Angela Merkel simply cannot sell the idea of a “transfer union” in which Germans become responsible for the debts of the PIIGS (Portugal, Ireland, Italy, Greece, Spain) unless Germans genuinely believe that the only alternative is a huge economic crash. In other words, she can’t take the steps necessary to prevent a crash until the European house is actually falling down around her ears. Similar problems exist in other countries, and one of the consequences of the long agony of the euro is that voters everywhere are becoming more populist and nationalistic in sentiment, and are less confident in and trusting of their elites.

The second problem is institutional. Europe cannot act quickly. France and Germany want every member of the eurozone to pass constitutional amendments mandating balanced budgets, for example. (On this point at least, Europe is turning into Tea Party Heaven.) That means that 17 different countries have to amend their constitutions. Given that every country has a different process for doing that, and that some (as in the US) are deliberately cumbersome and slow to discourage random constitutional tinkering, this cannot happen on the kind of predictable schedule that jittery markets demand.