Crashed: How a Decade of Financial Crises Changed the World

by Adam Tooze

As Draghi later confided to a friend: “I really got fed up! All those stories about the dissolution of the euro really suck.” The expression he used in Italian was apparently rather more colorful.48 So Draghi decided to change the script. The markets needed to understand the qualitative change that Europe was undergoing. The eurozone might have started life as an ill-shapen construction, but under the pressure of the crisis it was developing fast. Global markets needed to appreciate the fundamental changes that were reshaping Europe. Following the December 2011 fiscal pact, the summit of June 2012 was a turning point because for the first time since 2008 all the leaders had restated with a powerful voice that the “only way out of this present crisis is to have more Europe, not less Europe.”49 The forward motion of the EU’s integration machine was resumed. The point that Draghi wanted to drive home to global markets was political. “When people talk about the fragility of the euro and the increasing fragility of the euro, and perhaps the crisis of the euro,” he told the skeptical City of London crowd, “very often non-euro area member states or leaders underestimate the amount of political capital that is being invested in the euro.” These were not empty words because “actions have been made, are being made to make it irreversible.” And there was “another message” that Draghi wanted investors to hear: “Within our mandate, the ECB is ready to do whatever it takes to preserve t...