Greek default is a question of when
There has been a wider disaster since the market pressure shown a bit on Wednesday after the central banks had an announcement. There has been expanded credit lines as stated by the central bank announcements Europe is showing the signs of recession. The economists have warned that euro may one day become the epicentre of some of the other global financial crisis. The analysts feel that the Euro crisis has been caused mainly due to the fiscal irresponsibility as they end up in default.
The leaders of Europe has been blaming the spending in the debtor nations and Europe spending as a whole and having more austerity measures. The austerity has played a major role in pushing the situations to even worse position as the year 2008 crisis shows America as. There has been a runaway banking system and a fast raise in the debt but in case of Europe there has been a much of lending. Europe has lending across the border and has been giving funds from Germany and other nations across as these lending shows low risk. The lending has entered into the private sector and not through the government as Greece has been under budget deficit during the good times.
On the eve of crisis the Spain has been actually having surplus while there is a private spending fall in the debtor nations sharply. In-spite of all these the euro zone has responded in the inevitable recession driven way asking the governments of different places to help. The easy money wages along with the prices in the north have made the policy makers to raise substantially faster in many of the places like northern Europe. Southern Europe is under pressure due to the divergence through the faster growth in the north Europe and has deflate the competitiveness.