Germany alone will have to decide

Germany will decide if the euro survives the summer

John H. Makin

The last month has seen two developments that precipitated the full blown financial crisis playing out now in Europe. 

• First, the political viability of the bailout-for-austerity trade-off that has characterized eurozone rescue packages since 2010 has been seriously damaged by the May-June Greek election outcomes that have rejected the March 2012 austerity-rescue package.
• Second, exhaustion of the crisis-rescue-celebration-crisis pattern that has characterized market behavior in the run up, execution and aftermath of bailouts was signaled by the market's quick rejection of the 100 billion euro June 11 Spanish rescue package within hours of its announcement. 

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