Financial Crisis and Geopolitics

As Spain's credit rating is downgraded a day after Standard & Poor's cut its ratings on Greek and Portuguese debt, how far could the eurozone's debt contagion spread?

Nie wieder eine solche Krise: Der europäische Zentralbankpräsident Trichet ruft die Euro-Staaten zur Ordnung. In der "vielleicht schwierigsten Situation seit dem Ersten Weltkrieg" müssten sie endlich ihre Finanzpolitik konsolidieren, sagte er dem SPIEGEL - und bekommt Unterstützung von Kanzlerin Merkel.

The country's largest banks and trade groups have hired more than 240 former government officials and legislative staffers to lobby on their behalf in Congress, part of a broader campaign by Wall Street firms to limit the impact of proposed reforms on their industry, according to a report issued Tuesday by liberal groups.

Germany's cabinet has passed a draft law to provide for its portion of Europe's 750 billion euro package to prop up the ailing currency. But will the fund work? Experts are warning that the side effects may be difficult to stomach.

Europe has put up 750 billion euros in an effort to stop speculation against the European common currency. Still, it remains to be seen if financial markets will learn their lesson. After all, speculators aren't even being punished for the damage they have caused. But they should be.

First came the real estate crisis. Then the financial system melted down. And now, skyrocketing public debt is threatening entire countries. Star economist Nouriel Roubini tells SPIEGEL that more crises will come and go before world leaders agree on true reform. He says breaking up huge banks would be a good place to start.

At a defining moment for the European Union, its largest country, Germany, appeared divided and its leader absent, raising significant concerns about what kind of leadership Chancellor Angela Merkel can offer as the region tries to stabilize financial markets and shore up its common currency.

Meanwhile, the banks that caused much of this mess are getting all their money back. A more equitable approach would require the banks to pay at least part of the bill - writing down the debts of some European governments or extending their maturities into the future to allow battered European economies time to recover.

The United States officials began talking to their counterparts about an American concept: overwhelming force. "It's all about psychology," said the senior official. "You have to convince people that the government will get its act together."

Like the giant financial bailout announced by the United States in 2008, the sweeping rescue package announced by Europe eased fears of a market collapse but left a big question: will it work long term? And as details crystallized of the package's main component - a promise by the European Union's member states to back 440 billion euros, or $560 billion, in new loans to bail out European economies - the wisdom of solving a debt crisis by taking on more debt was challenged by some analysts.

The International Monetary Fund and the European Union are coming to Greece's aid with a financial commitment worth billions. But is it already too late to rescue the cash-strapped country?

As China gains dominance on the world stage, more and more multinational corporations will need to rethink their assumptions about competing under its state-capitalism model-one in which the government is the principal economic driver. So says Ian Bremmer, president of the political-risk consulting firm Eurasia Group and author of the upcoming book The End of the Free Market: Who Wins the War Between States and Corporations? In this video interview, Bremmer discusses the fundamental distinctions between state capitalism and free-market economies, as well as the strategic implications this has for Western companies and governments alike.

The euro has been rescued for the moment, but European politicians have thrown the foundations of Europe's common currency overboard with their unprecedented bailout package. In the longer term, the dangers of the crisis can only increase, and the flood of billions of euros could also lead to inflation

Parece que Europa no encuentra de manera definitiva el camino de la recuperación. Si ayer las dudas sobre una posible recaída en la recesión hicieron que la Bolsa viviera sus peores momentos desde el inicio de la crisis y la caída de Lehman Brothers allá por septiembre de 2008, hoy es el presidente del Banco Central Europeo, Jean- Claude Trichet, quien califica la situación de "dramática" y de la peor vivida desde la Primera Guerra Mundial.

O governo espanhol anunciou a redução de 5% dos salários dos funcionários públicos, o congelamento de salários e o corte de investimentos públicos para enfrentar a crise econômica que afeta o país. Na Grécia, sindicatos convocam quinta greve geral contra corte de pensões anunciado pelo governo. Para analista do Financial Times, origem da crise da dívida dos governos é a prodigalidade de amplos segmentos do setor privado, e do setor financeiro, em particular. "Os mercados financeiros financiaram a orgia e, agora, em pânico, estão se recusando a financiar a faxina resultante", diz Martin Wolf.

No fundamental, os termos do acordo são os mesmos da proposta oferecida por Estados Unidos, Rússia e França há oito meses, pela qual o Irã deveria entregar ao redor de 70% do seu urânio enriquecido a mais de 5%. A própria Agência Internacional de Energia Atômica já calculara que a neutralização de 1,2 toneladas do minério seria o suficiente para anular qualquer projeto atômico de caráter militar. A formação de alianças fora da órbita imperial, porém, é tudo o que não interessa a Washington e seus subservientes associados europeus. O artigo é de Breno Altman.

Worried about your euros? You're not alone. As the euro plunges, many observers fear a possible collapse of the European single currency.

The 750 billion euro package the European Union passed last week to prop up the common currency has been heavily criticized in Germany. Former Bundesbank head Karl Otto Pöhl told SPIEGEL that Greece may ultimately have to opt out, and that the foundation of the euro has been fundamentally weakened.

On Monday, Brazil and Turkey brokered a deal with Iran that would see it trading enriched uranium for nuclear fuel. Observers in Germany see a diplomatic coup for the rising powers, but warn that it could just be another ploy on the part of Iran.

Rumors of the imminent collapse of the eurozone continue to swirl despite the Europeans' best efforts to hold the currency union together. Some accounts in the financial world have even suggested that Germany's frustration with the crisis could cause Berlin to quit the eurozone - as soon as this past weekend, according to some - while at the most recent gathering of European leaders French President Nicolas Sarkozy apparently threatened to bolt the bloc if Berlin did not help Greece. Meanwhile, many in Germany - including Chancellor Angela Merkel herself at one point - have called for the creation of a mechanism by which Greece - or the eurozone's other over-indebted, uncompetitive economies - could be kicked out of the eurozone in the future should they not mend their "irresponsible" spending habits.