Not a chance. This $1Trillion package just gives the EU cover for coming weakness in the rest of the PIIGS, et al... they'll be "bidness as usual" until they run through the money.... then, they do it again.
Well, arguably, Ireland, Spain and Portugal have tightened and are continuing to move in the right direction... For some anecdotal evidence, look here: http://www.telegraph.co.uk/news/wor...-the-Irish-are-facing-up-to-their-plight.html Greece is, of course, a special case... Maybe they need a terminally ill finance minister and union leaders who can face reality.
The powers that be have shown they will do absolutely everything in their power to keep this bubble inflated and keep everybody spending more than they have. If there was any doubt about that, it's gone now. Time to print & spend money with both hands. May you live in interesting times. Holy moly. This whole thing will a chapter in every econ text a few generations from now.
Greeks prefer austerity cuts to bankruptcy, poll shows http://economictimes.indiatimes.com...bankruptcy-poll-shows/articleshow/5909477.cms
Ireland's a special case the other way. They're pretty used to being poor and their bubble has been deflating. IMO, it looks like Ireland will make corrections, Greece will fail. Portugal's pretty small. So the question becomes, what about the two big PIIGS? I dunno.
Well, Italy's current budget deficit is smaller than that of many other Eurozone countries, so, in terms of their burn rate, they're not doing too badly (in fact, Italy should be running a primary budget surplus this year). They have also done a lot more than other Eurozone countries in terms of pension reform and Italian households and corporates are some of the least leveraged in Europe. Italy's problem is the stock of govt debt currently outstanding. On the other hand, Spain is a big concern, for sure.
I might add that, yet again, Simon Johnson is spot on in his take on the most recent developments: http://baselinescenario.com/2010/05...hen-sink-goes-in-now-it’s-all-about-solvency/ Which of his two alternative scenarios for the Eurozone you specifically deem more probable is a glass half-empty/half-full sorta question.