As Greece's political and economic conditions worsen, the conventional wisdom about Greece never abandoning the euro will be sorely tested.
Easy global liquidity from quantitative easing in the United States has masked deflation and public debt vulnerability in the European periphery, and the European Central Bank shows little sign of pursuing policies to address these threats.
Angela Merkel’s impressive reelection win indicates little will change in Germany’s Europe policy.
The president of the ECB should not believe his own hype: Europe’s economic crisis is far from over.
Without bold action from the European Central Bank, it is difficult to see how the European periphery can avoid sinking ever deeper into economic recession in the months ahead.
Here are the likely lessons future historians will draw from Cyprus’s sorry experience in the euro.
Any calm bought by the IMF-EU bailout package for Cyprus will be short-lived. Cyprus is all but certain to experience an economic collapse over the next two years, and the country will again question whether it should remain in the euro.
One can only hope global policymakers wake up to the risks of a strengthening euro before it is too late.
German Chancellor Merkel will want a quick resolution of the Cypriot economic and financial crisis so that a bailout does not become a domestic political issue ahead of her reelection bid.
Far from fading, it is all too probable that the European crisis will intensify over the course of the coming year.
A triumph of market forces rather than government planning.
Spain is the euro area’s fourth-largest economy. Bad government policy threatens the whole euro project and the global economy.
The Portuguese economy will be in for the roughest of rides in 2013 if the government goes forward with a proposal to change corporate social security contributions.
Developments in Athens suggest matters are spiraling out of control.
European policymakers have to be concerned that the half-life of their band-aids is getting shorter and shorter while resistance to these measures gets stronger and stronger.
At the upcoming summit, Europe’s northern countries will again reject southern countries’ proposed solutions to the European debt crisis, and the euro crisis will grind on, raising the very real risk of an eventual unraveling of the euro.
The election will just postpone Greece’s inevitable default on its official debt and its unavoidable euro exit by a month or two.
A relatively insignificant southern European country threatens the very survival of the euro in its present form. How did we get here, and what lessons does Greece hold for the rest of the European periphery?
Depending on what happens this weekend, Europe should start bracing itself for a renewed intensification of its sovereign debt crisis.
Two upcoming political events could usher in a new, worse phase of the European debt crisis.