Reuters - Portuguese leaders agreed tough new austerity measures on Thursday, joining a coordinated euro zone push that has so far calmed the markets' worst fears of a Greek-style debt crisis spreading.
It's rare to hear any bit of common sense from political leaders, but today I have a sterling example. Mário Soares, Prime Minister of Portugal from 1976-1978 and 1983-1985, and the 17th President of Portugal from 1986 to 1996 speaks the truth.
FROM Newsbook:European Union leaders have breathed a sigh of relief. Olli Rehn, the EU’s top economic official, said it was a “responsible step for securing the financial stability of the euro zone”. José Manuel Barroso, a former Portuguese prime minister who is now president of the European Commission, said the request would be “processed in the swiftest possible manner”.
Portugal's ruling party is about to get kicked out of office, just two weeks after forming a minority government. The centre-right which has held power since 2011 and formed a minority government following elections in early October looks sets to be ousted by an unprecedented coalition between the Socialist Party (PS), and the far left of Portuguese politics.
THERE are many facets to the crisis in the euro zone, but at heart the problem is fairly straightforward. The euro zone developed a balance-of-payments problem; some of the countries in the single currency accumulated large external debts. To service those debts, the deficit countries need to become surplus countries, which is difficult to do without the flexibility of a floating currency.
Ambrose Evans-Pritchard at The Telegraph says Legal skull-duggery in Greece may doom Portugal.
I suggest that Portugal is doomed whether or not there is "Legal Skull-Duggery". However, it's perfectly fair to suggest that LSD will indeed make matters worse.
From Pritchard ...
Which side is right in the debate over spending cuts and the economy? The truth is that no-one can know. Because the only thing everyone can agree on is that we live in extraordinarily uncertain times.
But the question of how fast to the cut the deficit is one of the most important facing this country today. This week I've summarised the best arguments for each side. You should think about where you stand.