FT: Greek crisis threatens European decade of economic implosion

El-Erian at the FT:

From day one, immense challenges faced the coalition of international
institutions that opted for a liquidity approach to address Greece’s debt solvency problems.
Now that this coalition is stumbling and bickering publicly, the
outlook for Greece has taken a significant turn for the worse. Even as George Papandreou,
the Greek prime minister, prepares to reshuffle his cabinet, he must
know his nation’s predicament is now extremely hard to reverse.

A good summary of the Greek problem as it stands.  The EU and ECB  have refused to take the difficult steps required to give any hope to Greece because of Europe's higher priority of protecting the big European banks.  They postpone any real solution in order to buy time for the banks to reduce exposure. meanwhile austerity measures in Greece are imposed that stifle any possibility of recovery. Her Stein once said something along the lines of "anything that cannot go on won't." This is one of those circumstances and "won't" is kicking in.

Furthermore the Irish have seen the future and it is Greece. I do not believe the Irish or the Greek populaces are going to take this much longer. Banks that lent money and bought debt in those countries assumed risk. It is time they paid the price of being wrong along with the citizenry. The cure for this fiscal illness begins with stopping the infection not suppressing the itch.

Exactly the same problem faces the US Congress which so far is not proving up to the task.