MILAN — A growing number of European countries are being squeezed by a financial vise just days before a Greek election that could escalate the region’s political and economic turmoil.RTWT.
The rise of Italian and Spanish borrowing costs to alarming levels Thursday heaped pressure on leaders to prevent Europe’s debt crisis from engulfing its largest countries. No grand solution appears imminent.
German Chancellor Angela Merkel opposes solutions that many experts are pushing that would increase costs for Berlin.
Merkel has found herself isolated from the leaders of Spain, Italy and France, who want the 17 countries in the euro currency union to move quickly to bind their governments’ finances and debt.
Such action could take the form of jointly issued debt or European-wide guarantees on bank deposits. Either step would spread the risks that individual countries bear across the eurozone.
Plus, it looks like Britain is stepping to help the rescue effort. See the Guardian UK, "Debt crisis: emergency action revealed to tackle 'worst crisis since second world war'," and Telegraph UK, "Osborne unveils £140bn scheme to kick-start stagnant economy."
And from Alex Brummer, at London's Daily Mail, "Sir Mervyn's speech sent a shiver down the spine: In 40 years I've never heard such apocalyptic talk."