One for All and All for One: The Global Financial Crisis and the European Integration Project

When the global financial crisis hit the shores of Europe, after crossing the Atlantic, the eurozone was considered a safe haven (Jones, 2009; Wyplosz, 2009). Although there were concerns about how the euro would face up to its first major crisis (Feldstein, 2008; Munchau, 2009), the European Union’s (EU’s) single currency was generally viewed as a protective force against the financial storm shaking the world. For instance, The Economist concluded that ‘the Euro has proved a haven in the economic crisis — so much so that no country seriously wants to leave it and plenty want to join’ (The Economist, 2009). Such a view was also shared by sovereign bond investors since, according to Attinasi et al. (2010a, p. 35), there was a ‘flight to safety’ towards the eurozone between September 2008 (when Lehman Brothers failed) and March 2009 (when financial markets began to stabilize). During that period, most eurozone countries saw their sovereign bond yields decline.