Good morning. Here’s what you need to know:1. Eurozone governments over the weekend failed to agree on the release of a €12bn bail-out payment for Greece. Continued uncertainty about the eurozone’s fiscal crisis is weighing heavily on market sentiment.
2. Wolfgang Munchau writes that it makes no sense for Greece to default on its obligations at this time. And it doesn’t make any sense for Germany to push for a Greek default at this time. So something will be worked out and the eurozone will survive, at least for another year.
3. Richard Haass, president of the Council on Foreign Relations, opines: “In the coming decades, Europe’s influence on affairs beyond its borders will be sharply limited, and it is in other regions, not Europe, that the 21st century will be most clearly forged and defined.”
4. Negotiations on the federal deficit enter a critical phase in Washington this week. The Financial Times reports: “The White House does not want the negotiations to continue until the last minute before the August deadline, because it fears such brinkmanship could have a…damaging impact on confidence even without a default…(N)one of the parties expects an agreement by July 2, the initial deadline.”
5. Paul Krugman and Clive Crook fret over an American “lost decade,” similar to what Japan experienced after its bubble burst. Mr. Krugman argues that the US is well down the policy road toward a lost decade.
6. US defence Secretary Robert Gates over the weekend acknowledged that the United States has been negotiating with the Taliban. The US has made no secret of its desire to achieve a political settlement that ends the war in Afghanistan. The talks appear to be going nowhere.
7. The Washington Post reports: “The U.S. ambassador to Afghanistan, in unusually blunt and personal comments Sunday, responded sharply to President Hamid Karzai’s escalating denunciations of American and NATO forces and aid efforts in Afghanistan.”
8. Former US Ambassador to China Jon Huntsman will announce his candidacy for the 2012 GOP presidential nomination tomorrow. Over the weekend, Obama Administration officials continued their campaign to undercut Mr. Huntsman by portraying him as a loyal member of the Obama team.
9. Texas Governor Rick Perry road-tested his presidential campaign stump-speech at the Republican Leadership Conference in New Orleans over the weekend. Mr. Perry was well-received.
10. The Financial Times reports: “Republican hawks have launched a concerted pushback against what they call a “growing isolationist” trend within their party and its candidates competing to win the nomination to run for the White House in 2012.”
11. Rory McIlroy yesterday won the US Open golf championship. He posted the lowest score (268) in the 113-year history of the championship.
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