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Irish Times – European Crisis Not Exactly Contained

Just in case anyone was worred that the debt drama was over in Europe:

” Events of the last week have twisted economic and political feelings towards bond markets, writes DAN O’BRIEN, Economics Editor

THE BAILING out of Ireland was, among other things, designed to contain the euro zone financial crisis. It has failed to do that…

…The ratchet of ever-rising yields has broken Ireland and Greece. It is very difficult now to see how Portugal can avoid the same fate. If – or much more likely when – that fate befalls the smaller of the Iberian states, there is little reason to believe that its bailing out will do anything more to calm the crisis than did the rescues of Ireland and Greece.

Europe’s economic strains are causing political strains, which in turn make containing the economic crisis more difficult. At times they have exacerbated it…

The situation is beginning to feel like the weeks after the collapse of Lehman Brothers in September 2008. Things are on the slide. Policymakers may need some dramatic action early next week if the slide is to be halted.”

Irish Times Article

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