A Greek or Irish default could bring into serious question the serviceability of around $2 trillion of European sovereign debt, a magnitude that should not be dismissed for its potential impact on the Eurozone's overall economy.

As NATO summits go, this weekend's meeting of the alliance's members in Chicago may be memorable if only for being the least memorable one in recent history. Of course, quiet summits are not necessarily bad summits. 

Suggesting that an orderly Greek exit from the euro should be manageable because Greece constitutes only 2 per cent of the overall eurozone economy is all too reminiscent of the policy complacency that preceded the Lehman bankruptcy in September 2008.

There will be a further and significant intensification of the Euro-zone debt crisis in the months immediately ahead, and efforts currently underway by European policymakers will fall short.

What's needed is the strong arm of the European Central Bank to remove catastrophic risk from the marketplace without risking the bank's core mission of fighting inflation.

As the European debt crisis now knocks on the Italy and Spain's door, it is well to recall that the Euro was a flawed idea from its very inception. The following considerations make it highly improbable that the Euro will survive in its present form by end-2012.

The collapse of the Papandreou government may undo European efforts to restructure debt and hold the union together.