printing money
Europe's central banks have begun to access money printers in preparation for the doomsday scenario. Reuters

The central banks of Europe have begun preparing contingency plans to re-print old currencies should the euro perish amidst the eurozone crisis.

With the very real possibility of the German Chancellor and French President failing to seal a new treaty before tomorrow evening, banks are preparing for the worst case scenario - a full scale break-up of the euro.

Across the eurozone, banks are evaluating whether they need to secure access to additional printing presses in case they need to change from the single currency back to their old coinage overnight.

The Bank of England and the Financial Service Authority warned last week, that it too had asked its banks to prepare for the break-up of the single currency and it now looks as though its eurozone cousins are following suit.

Institute of Economic Affairs Chairman, Richard Wellings, speaking to the International Business Times UK, agreed that a tighter fiscal union, that Angela Merkel and Nicolas Sarkozy suggest, would not work.

He said: "Tighter controls on countries' fiscal policies will not solve the economic tensions that are inherent to the eurozone. The fundamental problem is that a one-size-fits-all monetary policy inevitably leads to a highly uneven geography of inflation, which in the recent cycle led to very pronounced booms and busts in peripheral countries."

He added: "It is unrealistic to expect national governments to adhere to strict borrowing rules when faced with steep collapses in tax revenues as a result of extreme economic volatility caused by the euro system."

The revelation is a reality check of just how badly the situation has deteriorated in the eurozone this year. At the begging of 2011 a country leaving the single currency was unthinkable. But now, on the eve of 2012, the break-up of the entire euro project is very much a possibility.