The sovereign debt woes of the European Union are nearing a critical stage. Greece's short-term bonds have recently shot to 60 percent, indicating an extremely high probability that the ancient country will default. Though Portugal and Spain, two of the other “PIIGS” member-states in the EU, are temporarily off the radar screen, neither has solved its fundamental debt problems.
In Finland, the only Scandinavian nation in the eurozone, the True Finns political party has enjoyed remarkable success running largely on a platform of refusing to bail out spendthrift EU members whose expenditure-to-revenue ratios would make full repayment of debt instruments unlikely without outside help. The other Scandinavian nations have become increasingly reluctant to join the eurozone over the last few years.
The sovereign debt crisis originally involved four governments — the so-called PIGS: Portugal, Ireland, Greece, and Spain. What is particularly disconcerting for those attempting to solve the EU's economic problems has been the inclusion of Italy in this group (now known as PIIGS).
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Photo: Bank of Italy, Via Nazionale, Rome