Reuters is now reporting that Germany will lead a bailout package to help resolve the debt problems in Greece:
“I would like the leaders of Europe to say to the Greek authorities that in exchange for the efforts you are making, you are going to get support from us,” Almunia told the European Parliament on what was his last day in office.
I’d like to say this comes as a surprise, but it doesn’t. Bailout fever continues. The losers continue to win and the winners continue to lose. Prudence doesn’t pay off in this era of irresponsibility and no consequences. The markets are rallying on the news, but now we get to wait for Portugal to line-up for their bailout and who knows who will line-up after that. This is great for the banks and great for the near-term outlook of the market, however, it does nothing to resolve our long-term problems.