I just found this report published yesterday by Bloomberg with German Chancellor Merkel speaking at a CDU campaign rally.
Firing a shot across of the bows of France and Italy she said turmoil in global markets caused by a Portuguese bank underscores the Eurozone’s fragility and shows the need for governments to respect debt and deficit limits.
If we now move away from those rules, for instance on the Stability and Growth Pact, on everything we’ve done to stabilize the euro, we could very quickly get into a situation where we start foundering
The example of a Portuguese bank showed us in the last few days how quickly the so-called markets are roiled, how quickly uncertainty returns and how fragile the whole euro construction still is.
Politicking it may be, but it does highlight the real concerns that exist and why markets went into such a spin on Thursday when Banco Espirito Santo SA, Portugal’s second-biggest bank by market value, had shares suspended after a parent company missed payments on commercial paper
