The stakes have suddenly become much higher as the Lehman moment arrives for Europe and only a political shift will help resolve the solvency crisis. Central banks will provide market balm as they look to boost liquidity and the ECB is set to cut interest rates while the Fed may hint at more action. There is also a much higher probability that Germany will finally cave-in and provide a long-term roadmap for Euro-zone salvation. The initial reaction would be a strong rally in risk appetite and the Euro. The Euro, however, would quickly be subjected to very heavy selling and a move towards parity against the dollar as ... (full story)