It appears that once politicians become disentangled from the incessant need for happy-speak and propaganda, truthiness is much more capable of flowing from their orifices. During a speech at the World Economic Forum on Friday, Gordon Brown explains what everyone in power knows, yet is loathed to admit, that "The euro cannot survive in its present form, it’s going to have to be reformed dramatically. We are I think at an hour to midnight in the way that we look at this issue." He adds "European banks as a whole are grossly under-capitalized."
A Bloomberg story has some other choice quotes from his eloquently delivered speech that should ring true to any and every market participant, no matter how delusional on the solution set ahead.
"In 2008, governments could intervene to sort out the problems of banks. In 2011, banks have problems, but so too do governments."
"We’ve now got the interplay between banks that are not properly capitalized and sovereign debt problems that have arisen partly because we’ve socialized or accepted responsibility for the banks’ liabilities."
The EFSM is "not enough" and "substantially more resources" are required.