Anil K Kashyap and Francesco Giavazzi
With Italy now paying the same rates as Spain to finance its debt, the European crisis has reached a critical stage.
To prevent the possible demise of the single currency, the European Union now must come up with a credible plan to address the future of the euro area. Only a proposal that takes into account the following four painful realities would be credible and stand a chance of persuading markets to resume financing on a sustainable basis.
