As Crises Spread, Europe Scrambles for an Answer

Even healthier countries now feeling pinch
By Matt Cantor,  Newser User
Posted Dec 1, 2010 10:04 AM CST
German Chancellor Angela Merkel gestures at the begining of the weekly cabinet meeting at the chancellery in Berlin, Germany, Tuesday, Nov. 30, 2010.   (AP Photo/Michael Sohn)
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(Newser) – Financial crises in Greece, Ireland, and Portugal have stoked fears for Italy, Belgium, and the more robust Germany as Europe struggles to find a solution, the New York Times reports. Worry that Germany may have to pay the brunt of bailout costs have prompted the sale of its debt; investor concerns are marked by a euro rapidly sinking against the dollar.

Concern is centered on the fact that Europe’s slow method of individual bailouts isn’t calming the markets, writes Landon Thomas. If bigger economies like Spain or Italy were to need bailouts, Germany could be weighed down “both financially and politically.” Some are now suggesting solutions that would require bondholders to accept some losses—an idea investors don’t like. But attempts to fix the problem have so far “created more doubts than existed before,” said a European Commission economist.

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