STOCK MARKET WATCH -- Thursday, 11 October 2012

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12. GOLDMAN'S COHN: Only A 'Small' Chance The Euro Area Sticks Together

http://www.businessinsider.com/goldman-small-chance-euro-area-holds-2012-10

Oct. 11 (Bloomberg) -- Goldman Sachs Group Inc. President and Chief Operating Officer Gary D. Cohn sees a “small” probability that the euro area will stick together, saying it’s more likely that some countries will exit to pursue growth.
“In federalism, you create a unified Europe, where the countries that are thriving because of the currency subsidize the countries that are contracting because of the currency,” Cohn said in an interview in Tokyo today. “I would put a relatively small probability of that happening.”
The European Central Bank program pledging unlimited support to debt-burdened nations if they sign up for economic reforms deals with the “pre-existing condition” but hasn’t addressed the lack of growth, Cohn said. ECB President Mario Draghi pledged to “do whatever it takes” to defend the euro as officials seek to stem the debt crisis.
Europe still needs a “moment” similar to Lehman Brothers Holdings Inc.’s 2008 bankruptcy, Cohn said, reiterating comments made in June. The 17 countries that share the euro must find ways to support economic growth in the weaker members, he had said at that time, adding that austerity programs don’t support expansion.


Read more: http://www.businessinsider.com/goldman-small-chance-euro-area-holds-2012-10#ixzz28zdkPx1e