"Weak euro states doomed to slow growth by bailout"

[WhiskeyGirl]

Is America doomed too?

(Reuters) - The euro zone's trillion-dollar financial safety net may stabilise markets but it is likely to doom weak countries on the edge of the zone to several years of agonisingly slow growth.

That is causing economists to worry the zone's approach to its debt crisis risks failing, if it deprives weak countries of the growth they need to work through their debts.

"It is not at all clear where strong growth can come from," said UniCredit bank's chief economist Marco Annunziata, adding that alongside the safety net, Europe needed a convincing strategy to boost the competitiveness of weak economies -- something which it has not yet produced.

But the package does nothing directly to stimulate growth in indebted states such as Portugal, Ireland and Spain. In fact it will probably have the opposite effect; euro zone governments which will fund the safety net have made it clear that countries using it must commit to tough austerity steps to shrink their debts quickly, similar to the steps which Greece pledged earlier this month in exchange for its 110 billion euro bailout.

more here - http://uk.reuters.com/article/idUKTRE64A47X20100511

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