"Hardest of all will be finding the political will to curb profligacy. This struggle will become woven into the conflict that now tugs at the political fabric of Europe. German voters have just shown that they will punish leaders who spend their money bailing out feckless foreigners (see article). Hence the German demand that countries swallow savage budget cuts before they get any money—a demand that, taken to extremes, could condemn Europe to deflation and stagnation. On the other side, the violence in Greece is a reminder that democratic governments can impose only so much hardship before people rise up. Even if you accept that deficits must fall and economies must modernise, nobody can be completely sure which will come first, economic growth or social rebellion."
"The debt mountain that brought down some of the world's biggest banks and dragged the international financial system to the brink of disaster has simply shifted to governments. Now it's threatening countries around the globe -- and, if left unchecked, could rip the very fabric of Europe's economic system and wreck economic recoveries in the U.S., China and Latin America."