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What Europe Needs is Financial "Marshall" Plan !

Many folks have heard about "Marshall" Plan which helped rebuild Europe after WWII which completely destroyed Europe. For a small history lesson, check out details of Marshall Plan.
Europe is on brink of financial disaster again with fears of cascading defaults if Greece is allowed to go under. And that would not only bring down Europe but potential of another great recession across world. It would be 2008/2009 all over again. So what would make Europe hold together and not bring world economy to its knee ?
That's where we can learn from post WWII history.
During the four years that the plan was operational, US $13 billion in economic and technical assistance was given to help the recovery of the European countries that had joined in the Organization for European Economic Co-operation. This $13 billion was in the context of a U.S. GDP of $258 billion in 1948, and was on top of $12 billion in American aid to Europe between the end of the war and the start of the Plan that is counted separately from the Marshall Plan. In total nearly 10% of US GDP help was provided to Europe after WWII which help these economies to grow significantly.
If we have to apply same yardstick, Europe needs to build "European Stabilization Fund" equivalent of nearly $1.5 to 2 trillion and make it available to all European nations who need help in these times. Question is: Where would this money come from. It needs to come from IMF, stronger European nations and maybe even China. It is impossible to think if there is political will in USA to provide more help to Europe. So at this time US can provide only warnings and lectures (especially when whole financial crisis started in US)
If Europe is able to come to this realization and come soon, there is still chance that Europe can be saved. Otherwise - be ready for repeat of 2008/2009 ! So when it comes to investments, stay on sidelines for now.

/Shyam

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