If anything was accomplished by Thursday’s summit of Euro Zone leaders, it was a photo shot and a one and a half day rally in the stock markets. The euro is now lower against all major currencies. What is everybody anxious about? Despite all the window dressing, the fundamentals aren’t there. Europe may be willing to take care of Greece’s financial needs for this summer. But in the future it clearly won’t work. Nor is it possible to pay for Spain and Italy, if their financial situations continue. After all, they are the Euro Zone’s third and fourth biggest economies next to Germany and France.
What can be done if anything? The European bailout funds needs to be increased. Just giving them extra responsibilities without extra cash is a disaster waiting to happen.