Barry Eichengreen, an economics professor at UC Berkeley, was the closest thing to an optimist present. He expects we'll be talking about the eurozone crisis at next year's Milken Institute conference. Even by then, it won't have worsened much or improved much. It's pretty expensive to hold the eurozone together, he said, but catastrophically costly to let it break apart.
No one else was convinced. James McCaughan, head of Principal Global Investors, envisaged a dark day of reckoning. Domestic banks that bought the debt of ailing European governments get slammed when those bonds can't be rolled over.
Taking up that scenario, James Rickards chimed in. The solution is a "liquidity rush" from the IMF. The global financing agency would flood the eurozone with foreign exchange assets called special drawing rights, or SDRs, the author of "Currency Wars" predicted.
And after that? Who's the real financier of last resort, the godfather whose gift of liquidity comes with an offer Europe canaEUR(TM)t refuse?
China. Rickards believes the Asian giant has been watching and waiting. It wants to buy big-ticket items, ports, sensitive technology, the kinds of things it wouldn't have access to in normal times. When the Europeans get "desperate enough," Rickards said, they will sell.