Things to take away right now:
This is political instability:
[/URL]Rajoy knows this. He sees it in protests every day outside parliament. Italians know this as well, since they can barely form a functional government. I don't mean pass legislation, I mean even form a government that lasts more than a couple weeks.
The EU isn't doomed but recent remarks by high ranking officials (Sup Olli Rehn?) suggests they're starting to take note of increasing political instability. And not just in Spain or Italy either...norther eastern european nations are beginning to support Anti-EU parties as well. They remain minority parties but they have gained standing...which is notable. Also notable? Germany isn't as hot as it used to be.
The damage done to potential output of the Euro area is savage and staggering. Brain drain, wages lost, potential output permanently depressed (IMO), etc. I think leaders are beginning to wake up to this...especially as European automakers fail to make up for their losses in Asia. With China cooling and Europe not selling cars at all you've got some rather large German Automakers in the shits. Volkswagen for example...
So yeah. Europe should probably try something new...
