European sovereign debt crisis
|Author:||Mgr. Michael Bořuta|
|Year:||2011 - summer|
|Leaders:|| prof. Ing. Oldřich Dědek CSc.
|Work type:|| Finance, Financial Markets and Banking
|Awards and prizes:|
|Abstract:||Financial crisis exposed the bad state of European public finance. Budget deficits are so
domesticated in Europe, that it is hard nowadays to encounter a budget surplus, or at least
a balanced budget. Greece once again entered the history, but this time Greeks have
absolutely nothing to be proud of. Financial crisis has reintroduced phenomenon known
only from war periods – heavily indebted rich countries. European Union never imagined
such situation could occur and threaten the existence of the Eurozone, so there was no
plan B prepared.
In the thesis we would like to analyze the process of finding the plan B. Hundreds of
billions euro were spent on bailouts of heavily indebted Eurozone Members. Using case
studies of the most affected Eurozone economies we want to decide if the Euro was the
cause of the European debt crisis. In the last part we will discuss institutional changes of
the EU designed to strengthen economic stability of the Eurozone.