Will 2011 doom the EURO?

There have been escalating rumours over the last six (6) months that Germany, the EU's largest economy is planning to announce its withdrawal from the EURO in early January 2011. Although these rumours seem a bit dubious, they allegedly stem from a Bund Employee who alleged on a chat site in early June 2010 that new generation Deutsche Marks were being printed for circulation in Germany, Austria, Netherlands and Finland.

Yet the question remains as to whether this rumour will in fact crystallise into reality in early 2011 and whether this would lead to the eventual demise of the EURO?

The geopolitical ramifications of a German led EU currency exodus would be as follows:

1. Shortly after Germany's announcement, France would make their announcement to exit to the Franc.

2. Thereafter the Eastern and Southern EURO 'basket republics' would be left with an unpredictable dud currency. Perhaps these nations would be able to follow the USA's hyper-inflationary lead and print their way out of debt. Nevertheless within days the EURO would likely par with the PESO's in Latin America.