I've made similar posts before and I am glad to say that I have not been wrong so far *grin*. However, I haven't been as precise as I will be in this post, I think.
Right now I am quite confident that I can predict three precise scenarios of the future of the European Union, more specifically of the European Monetary Union, the Euro.
This is the least likely scenario. The large Mediterranean countries, Italy, Spain and France, consolidate their finances. A low, but stable economic growth sets in. China continues to grow fast for at least the next 10 years (unlikely). With support of all institutions, including the ECB, speculators are less and less able to create panic. Eventually the crisis will be over and Europe will mostly look like it looked five years ago.
This is the second likely scenario. The crisis hits us hard within the next 18 months. Germany has to choose between chaos and Eurobonds. In this scenario our current government, supported by most of the opposition, will draw all jokers and push through Eurobonds, no matter what the population thinks about it. This may be political suicide for the currently governing (conservative) parties, but it will instantly solve the current crisis.
If badly done it will also create a lot of moral hazard that will come back a decade later and kick our asses. Anyway, the current crisis is solved by Eurobonds. In fact, Europeans will find out that the interest rates for the Eurobonds will be as low as the one for U.S. bonds, because it just doesn't make sense to speculate against the Titanic while you are on it. U.S. bonds' interest rates would, however, raise slightly, because there's suddenly an alternative. In my opinion, this is the best scenario. Most people would agree with me a few years later.
This is the most likely scenario, unfortunately. Somehow the crisis is held at bay with the help of the ECB and inflation. However, it lingers in the background for years to come. Eventually it will turn out that one of the large Mediterranean countries is insolvent. However, the long time that has passed, has allowed many Euro-sceptic parties to take seat in the national parliaments. They will not introduce Eurobonds, because that's the prime reason they have been elected by an ignorant population. The monetary union will dissolve and economic consequences around the world will be drastic. Germany's GDP temporarily drops by 20-30%. Political consequences are unpredictable. A third European/world war, however, is impossible due to globalized trade.
We return to the patchwork landscape Europe is famous for. Two decades later most European countries have a nice standard of living, maybe even higher than under scenario (2). European influence on global politics, however, shrinks to an all-time low and remains there for the rest of the century.
One word about a potential forth scenario that includes the creation of a northern European monetary union or the forceful exclusion of Greece. This scenario would cause great harm to all Mediterranean countries and serious harm to the rest of the world; it would transform Greece into a third world country.
Most Germans think that Greece only has to blame itself. That may be so. However, after starting two world/European wars, Germany would never want to have this on its conscience. Historians would rightfully note that Germany blew up the European project. It's morally unacceptable - unthinkable.
A northern European monetary union might be created in the aftermath of scenario (3). But that's pure speculation.
Scenario (2) is the current direction of German media. Even traditionally euro-sceptic newspapers are reassessing the potential of Eurobonds. It is also for reasons of pride that I favour it.
No matter what happens, this is the world's history in the making!
* Note: A "Eurobond" within the context of this crisis is a bond that is issued and guaranteed by all countries inside the Eurozone. That is how the newspapers use the term. Wikipedia defines the term differently.