Germany has to relent on the Austerity Mantra to keep Europe united. She's becoming increasingly isolated with France now seeking growth over austerity. A simple study of history would have pointed to the failure of the policy. Did it really have to go this far?
Meanwhile, the Pain in Spain is ratcheting up. Spanish sovereign bond investors are heading for the hills in what can be termed as a plateau move or a staircase. Once the 10 year bond interest rates breach 7%, Spain should be lining up for a bailout.
"BERLIN — Chancellor Angela Merkel of Germany said Wednesday that she was ready to discuss stimulus programs to get the Greek economy growing again and that she was committed to keeping Greece in the euro zone, signaling a softer approach toward the struggling country.
The fierce rhetorical salvos out of Germany in the past week gave way to conciliatory gestures by Ms. Merkel, who throughout the crisis has shown a propensity for managing through brinkmanship. “I have the will, the determination to keep Greece in the euro zone,” she said in an interview on CNBC on Wednesday, in what appeared to be an attempt to relax an increasingly tense situation...."
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http://www.nytimes.com/2...option-merkel-says.html