As Sinatra Used To Sing…

“The worst is yet to come and babe it won’t be fine…”

Despite high-profile measures such as the Greek debt deal and mass pumping of liquidity into the banking system, Europe’s problems have merely been delayed for another day, Willem Buiter, chief economist at Citi, told CNBC.

“We have really just paused for breath,” he said. “It (the long-term refinancing operation) really hasn’t solved the problem, and for Europe the worst is still to come.”

He also predicted a further “large-scale ECB intervention” later this year or in early 2013. The European Central Bank injected close to 1 trillion euros ($1.3 trillion) through three-year loans at a very low interest rate into the European banking system in two operations in December and February.

Someday the world will realize that there is no rich uncle who’s going to die and solve our problems for us.

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