Policymakers have done a poor job. The economic crisis and financial markets in Europe are "forcing the world into a depression" and the situation does not seem to be getting any better.
So what is to be done?
According to George Soros, Europe needs to create a common Treasury, recapitalize its banks and protect "vulnerable states."
Soros, chairman of Soros Fund Management who made millions during Black Wednesday when he "broke the bank of England," said the most important thing was to "erect safeguards against contagion from a possible Greek default," according to a recent Huffington Post report.
"Since a euro zone treaty establishing a common Treasury would take a long time to conclude, in the interim the member states have to appeal to the ECB (European Central Bank) to fill the vacuum," he wrote in an article for the Financial Times newspaper.
"Both the banks and bonds of countries such as Italy and Spain need to be protected . . . To relieve the pressure on the government bonds of countries such as Italy, the ECB would lower its discount rate," he said.
Soros claims that the ECB could encourage countries to finance themselves with Treasury bills bought by banks. Those banks could then re-discount the bills with the central bank, allowing countries to refinance for about one percent a year during the "emergency period."
"Neither the ECB nor the EFSF (European financial stabilization facility) would buy any more bonds in the market," he said.
He said the EFSF should be used to guarantee and recapitalize banks who would then have to maintain credit flows under guidance and monitoring from the ECB.
"These measures would allow Greece to default without causing a global meltdown," Soros said. "That does mean that Greece would be forced in default . . . How Greece fared would be up to the Greeks."
"However, he said only public demand for his plan would make it happen, given likely resistance from banks and national governments," reports Matt Falloon of Reuters.