Athens’s inability to get a grip on the debt problem is rattling markets and giving rise to talk of a notion that until recently has been considered taboo: a eurozone without Greece, The Christian Science Monitor reported. Greece's introduction last weekend of a new real estate tax and reduction in elected officials' pay are being called too little, too late to address its deep debt.

Germany’s ability to come to the rescue of troubled European partners won crucial backing from the country’s constitutional court on Wednesday, a victory for Chancellor Angela Merkel that also provided at least a temporary reprieve for markets that had begun to worry that Europe’s common currency could collapse, the International Herald Tribune reported. The ruling, which defied some expectations that the court would hamstring Mrs.

Back in May, Chancellor Angela Merkel, little-known for strident pronunciations on foreign policy, lashed out against the indebted countries of Southern Europe, the International Herald Tribune reported. As Greece sought its second rescue package, Mrs. Merkel used an appearance in Meschede, a small town in western Germany, to lambaste the Southern Europeans for not working hard enough, taking long vacations and retiring early. “It’s not just about getting further into debt in countries such as Greece, Spain and Portugal,” Mrs.

The head of Germany's powerful central bank called Thursday for greater co-ordination of fiscal policies in the eurozone as a response to the debt crisis, which he termed its "most severe ever test." Speaking in Hanover in northern Germany, Jens Weidmann said that any solution to the crisis that has crippled debt-laden states on the periphery of the 17-country zone must tackle the problem at its roots, Agence France-Presse reported.

German Chancellor Angela Merkel's cabinet approved new powers for the euro zone's bailout fund on Wednesday, but she faces an uphill battle to convince party skeptics to back efforts to contain the crisis. Concerned that Germany's parliament has little control over the European Financial Stability Facility (EFSF), some members of Merkel's center-right coalition are threatening to oppose boosting its powers when the Bundestag (lower house) votes on September 29.

German Chancellor Angela Merkel is weighing whether to yield to a demand by some lawmakers for a bigger voice in future debt bailouts as a condition to win her party's approval for a stronger euro-zone rescue fund, as a parliamentary vote on the issue was delayed a week, The Wall Street Journal reported. Granting the German parliament the right to approve or reject future bailouts could trigger similar demands from parliaments across the euro zone, whose lawmakers are closely observing Berlin's actions. That could lead to further delays in the EU's approval for the Greek rescue.

German landesbanks WestLB and LBBW said their first-half earnings were weighed down by Greece exposure and restructuring, factors that made it difficult for either public sector lender to give a clear forecast for 2011, Reuters reported. WestLB said ongoing restructuring expenses weighed down first-half earnings as the troubled German bank prepares to break itself up. The lender posted a net profit of 36 million euros ($52 million) in the January to June period, down by half from 67 million in the year-earlier period as it transferred portfolios to the German government's bad bank.

After being held up as a model of strength in a region saddled with debt and low growth, Germany suddenly finds itself in a perfect economic storm that could force it to rethink its approach to the crisis plaguing the wider euro zone, Reuters reported in an analysis. New business sentiment figures from the Munich-based Ifo institute confirmed on Wednesday what tepid second-quarter growth data suggested last week: Europe's largest economy is slowing, and slowing sharply. The reasons are many.

The euro zone's rescue plan to end its sovereign-debt crisis will weaken the foundations of the currency union and could increase states' tendency to build up debts, Germany's Bundesbank warned Monday, taking a hard stance against an agreement that German Chancellor Angela Merkel still has to persuade her government to support, The Wall Street Journal reported.

France and Germany on Wednesday increased the pressure on their euro-zone peers to improve fiscal discipline in the bloc with a proposal to cut off the region's wayward spenders from key European Union transfer funds, The Wall Street Journal reported. The proposal marks an effort to boost fiscal discipline across the euro zone by giving countries incentives to rein in spending and cut their budget gaps. But the idea is controversial and could be difficult to enforce, as well as to sell to the rest of the bloc.