Eurozone crisis

The Eurozone crisis also known as the European debt crisis, was a multi-year debt crisis that happened in the European Union.

The crisis happened due to a currency crisis, which is a stop of the flow from foreign capital into countries that were dependent on foreign lending. The crisis became worse by the incapability of the countries to devalue (reduction of the currencies value) due to the Euro being a shared currency.^[1]^[2]

Controversies

EU treaty violations

The EU's Maastricht Treaty contains information that forbids that partner countries bail out another partner country, mainly to stop the spreading of public debt. The clause is designed to encourage good fiscal policies.

The European Central Bank's purchase of country bonds can be viewed as violating the pa trt of the treaty forbiddinghe financing of budget deficits.

Eurozone Crisis Media

Long-term interest rates (secondary market yields of government bonds with maturities of close to ten years) of all eurozone countries except Estonia, Latvia and Lithuania. A yield being more than 4% points higher compared to the lowest comparable yield among the eurozone states, i.e.
Total (gross) government debt around the world as a percent of GDP by IMF (2012)
European debt to GDP ratios*
  Greece
*
  Italy
*
  Spain
*
  Portugal
*
  France
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  Ireland
*
  Germany
European 10 year bonds, before the Great Recession in Europe bonds floated together in parity*
  Greece 10 year bond
*
  Portugal 10 year bond
*
  Ireland 10 year bond
*
  Spain 10 year bond
*
  Italy 10 year bond
*
  France 10 year bond
*
  Germany 10 year bond
Greek bonds*
  20 year
*
  15 year
*
  10 year
*
  5 year
*
  1 year
*
  3 month
*
  1 month
Portugal bonds during Portuguese financial crisis*
  30 year bond
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  10 year bond
*
  5 year bond
*
  1 year bond
*
  3 month bond
Ireland bond prices, Inverted yield curve in 2011*
  15 year bond
*
  10 year bond
*
  5 year bond
*
  3 year bond
Spain bond rates during Spanish financial crisis*
  20 year bond
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  10 year bond
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  2 year bond
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  3 month bond
Cyprus bonds*
  10 year
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  7 year
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  5 year
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  3 year
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  2 year
The 2009 annual budget deficit and public debt both relative to GDP, for selected European countries. In the eurozone, the following number of countries were: SGP-limit compliant (3), Unhealthy (1), Critical (12), and Unsustainable (1).
Change in national debt and deficit levels since 1980
Animated graph of current account imbalances since 1999