World markets expected concrete steps to resolve the European crisis this weekend. They did not get them. The body that sets policy at the International Monetary Fund promised that eurozone countries would do “whatever is necessary to resolve the euro-area sovereign debt crisis”. Sadly, this is based on hope, not evidence.

Hope cannot convince markets at times like these. With luck, Italy may get a credible government of national unity in the next few weeks, Spain could get a new government in November with a mandate for change, and Greece may do enough to avoid riling the markets. But none of this can be relied upon.

So what needs to be done? First, eurozone banks need to be recapitalised. Second, enough funding has to be available so that Italy’s and Spain’s needs can be met, if the markets dry up. Third, Greece has to be managed in a way that does not infect others. All this requires financing, with bank recapitalisation alone potentially needing hundreds of billions of euros – but no new commitments were made in Washington.