The Sea of Hope

Now that Ireland has formally admitted that it will accept a bailout from the EU/IMF, the real game can begin.

Irish banks, despite the fact that they will receive a capital injection, are now effectively up for sale - all bidders welcome.

The EU has warned the Irish government about the possible deal breaking problems of an election (to be held early next year). However, the Irish know full well (as does the EU) that the name of the game is "contagion avoidance". The EU cannot afford for this bailout to fail, if it did the risk of contagion spreading (already very high) would rise even further.

Once the bailout is agreed, and short term stability of the Irish economy restored, the speculators and markets will focus their attention on the next in line for a bailout (Portugal).

Make no mistake, the game is not over. One by one the weaker members of the Eurozone will be targeted, and the EU will have to continue to stump up more cash until either its patience runs out or the money does.

The final result will be one of the following:

1 The Euro collapses.

2 Some members of the Eurozone leave the Euro.

3 The Euro is split into two, a weak floating Euro for poorer countries and a strong stable Euro for the rest.

None of these prospects is exactly what the "founding fathers" of the Eurozone had in mind when they floated the Euro on a sea of hope and hubris.