09/07/2015
In
The Times we are told that Angela Merkel has been warned that she faces the toughest battle of her leadership if she tries to push any deal with Greece through the German parliament.
More than 100 of her MPs are threatening to revolt as public opinion hardens against Athens, limiting the Chancellor's ability to soften her line, all but killing any bid by Greece to secure a huge debt write-off as part of the new bailout plan it needs to stave off banking collapse.
On the other hand, the
Independent reports that Greek leaders appeared to blink first in the stand-off with Germany, promising to "immediately implement" tax and pension-related measures in return for a three-year loan from Europe's bailout fund.
In the letter sent to the European Stability Mechanism (ESM), the Athens government said it would "set out in detail its proposals for a comprehensive and specific reform agenda" that would avert national bankruptcy and an exit from the euro. These would include reforms to the tax and pension system, the letter promised.
So might a national economy smaller than the size of Volkswagen gradually be coming into line, but even if one crisis is beginning to abate (we hope), another, greater one looms. Swamped by the soap opera in Greece, we see news of a
stock market crash in China, which could have a far greater impact on the world economy, as the market has lost a third of its value in three weeks.
"The sell-off in Chinese stocks in recent weeks makes the volatility in European and US indices look like a walk in the park", says one expert.
