At the dawn of America's imperial era,Theodore Roosevelt was fond of saying, "Speak softly and carry a big stick," suggesting that the threat of feree could bend others to one's will and make the actual use of feree less likely. European Union officials are hoping the same principle holds true for their new euro support mechanisms. EU authorities put on a confident show before policymakers and bankers at the annual International Monetary Fund-World Bank meetings inTokyo last month, insisting that steps taken since the summer had dramatically reduced the tail risk of the euro's breakup.
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