Debt Trap

The E.C.B.'s rate hikes for the first time since 2008 credit crisis digs a permanent hole for Spain,Ireland,Greece and Portugal.In the coming days,people living in the Southern European countries will witness a draconian austerity measure.Yes, I agree that Greece and Ireland so far received a generous amount of money from the E.U. and I.M.F.But the so called'the aid money' /loan comes with a skyrocketting interest rates which could be a herculean task to pay back.

The government of the debted countries will go for a drastic spending cuts which will further depressed the economy.As a result,their pile of debt will touch the Mount Everest in the coming months causing an outright recession.

So,how will those indebted countries escape from the 'debt trap' remains a puzzle.The indebted countries must reject the common currency as soon as possible so they can devalue their own currency.Alternatively,E.U. should divide the common currency into two separate currency,betweenSouthern European countries and Northern European countries or else there is no light at the end of the tunnel.