Even if you assume that the latest EU announcement will take the immediate meltdown risk off the table, Europe still faces another immediate problem: The economy.
Where’s the growth going to come from?
It’s still all austerity-austerity-austerity, which is not only the opposite of growth, it’s the opposite of budget sustainability.
Citi’s Steven Englander pointed this out in a recent note, that the lack of focus on this matter would likely come back to haunt EU leaters in short time.
The fact that the Germans remain to tightfisted and the ECB is so slow on the easing front (unbelievably slow, really) should make you pessimistic that some big growth spurt is going to happen, and without that spurt, it’s hard to see an end to civil unrest and concerns over budget deficits.