The latest meeting to resolve the Greek crisis has ended without agreement. The rhetoric is now building to prepare the world for a Greek default. Talk of a state of ‘Emergency’ by the ECB should Greece pull the plug reveals that at last the better part of a continent in denial has woken up to where it is headed. Whether anything can now be done is becoming ever more doubtful, not least because both the Greeks and the Germans have backed themselves into domestic political corners which allow neither any further room for compromise. A marginal concession here or there would not be enough. Another fudge is possible, though whether the markets would accept it is another matter. Yet it could be true that the markets have already moved on and that the big damage would be political rather than financial. It may not be long before we find out.
The worst thing for the euro would be for the Greeks to leave it, go back to the drachma and then recover and prosper. Maybe fear of that will make Germany blink.