Greece seems unlikely to survive without a further bailout: even if the population were to accept the pronounced austerity measures proposed, they still don't add up. The economy is contracting and that means lower government income which means more austerity. There is an election on 6th May which looks likely to be indecisive, bringing in some sort of coalition, bringing further uncertainty.
Portugal seems likely to need a further bailout in 2012.
Spain will fail to meet its target budget deficit. The banks are in serious difficulty and the Germans won't allow the bailout fund to target banks. Two of them are major shareholders in the Argentinian oil producer YPF and are likely to lose further sums. The property market has further to fall, bringing more trouble on the banks.
Italy has admitted that it will no longer be able to get rid of its budget deficit by 2013 as promised by Mario Monti. 2017 looks like a more probable date but in the meantime the economy is contracting (see above). The proposals to alter the labour laws, making it easier to invest in Italy, have been watered down and are scarcely worth fighting for.
France has had the spotlight turned on it in recent days. The first round of the election is on Sunday. François Hollande, the front runner, has threatened to veto the economic pact if it doesn't contain growth measures (it doesn't, on the insistence of Germany). Meanwhile Sarkozy has said the ECB should discuss with the various countries the euro exchange rate; Germany will never permit this tinkering with the ECB's independence.
It looks like Merkozy have divorced.
Meanwhile effective inflation in Germany has reached 3.5%. As the economy overheats the ECB will be forced to raise, not lower, rates.
€1 trillion of liquidity injected by the ECB seems only to have bought them a couple of months, and they did nothing with this time.
Things are going from bad to worse.
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