The global financial crisis can be divided into several stages: From August 2008 to the bankruptcy of Lehman Brothers in September 2008 was the U.S. sub-prime mortgage crisis; after September 2008 it became the international financial crisis; and as of October 2009 when Greek sovereign debt crisis broke out, the crisis became a sovereign debt crisis. The question is: Is the European currency crisis now in a new stage? And what comes next?

We think the present U.S. and European sovereign debt crisis is the aftershock of the U.S. sub-prime crisis, and also the pre-shock that will bring future international financial market more turmoil and push the world economy into another recession. Recently Standard & Poor's placed the European Union on its watch list, and some countries are preparing for the EU to balkanize, so we must be prepared for this crisis.

As for the euro crisis, I think we need to decide whether to come to the rescue or not.

In rescuing the EU, there are three methods: The European Central Bank issues banknotes to rescue the euro; the euro zone issues euro bonds; or it creates a Europe rescue fund. However, these methods are all difficult to carry out and may trigger inflation.

If not rescued, three outcomes are possible: Southern European countries will leave the EU, which may lead to imported inflation; the euro zone breaks up and northern European countries issue new core currency, which may lead to sharp rises of the exchange rate and their economy may stagnate; or each country resumes its own currency, so that the currency of Germany, the European economic development engine, will appreciate sharply and export of German goods will be seriously affected, then debtor nations such as Greece and Spain will lose aid and collapse.

There is another choice, or the only way out for the euro, which is to advance a uniform fiscal policy and establish a uniform country, just like the United States that was established as a federal country hundreds of years ago. But the question of whether the public and politicians of various countries have enough consensus needs to be researched.