Where will Portugal and Spain go? Germany Economy Minister says Greek bailout cannot be allowed again

German Economy Minister and Free Democrat Party Leader ( FDP is one of the junior partners in the ruling coalition and stands for its pro-business liberal policies) says he does not expect another bailout . Where does that leave Portugal and Spain which had their debt downgraded last  week by S&P. I am guessing that the minister will change his tune when all the debt laden German banks threaten  to collapse due to any of the PIGS default.He also talks about creating rules and sanctions to prevent this further . I may not be as knowledgeable about the European Monetary Union as the Economy Minister, but I thought that rules on fiscal deficit and monetary debt already existed.Its a different matter that they are never applied.

Germany says will ‘closely examine’ Greek deal– Economic Times

Germany will “closely examine” an agreement between Greece, the European Union and the IMF on a financial bailout for Greece on Monday before deciding on its contribution, Economy Minister Rainer Bruederle said on Sunday. Bruederle said in a statement that he expects Greece to quickly and credibly fulfill the reform measures it has agreed to implement. Chancellor Angela Merkel’s cabinet will review and discuss the agreement on Monday, he said.

“The analysis that we now have received shows quite clearly the gigantic and long delayed need for fiscal reform in Greece,” said Bruederele, whose Free Democrats have been especially resistant to German involvement in a Greek rescue.

“Just as Germany and German citizens will stand for the stability of the euro zone, I now expect the very same from the Greek government – and that they quickly, decisively and credibly implement to the letter of the law the fiscal reforms.” Germany will make the largest contribution to the rescue. Bruederle added that it was essential to ensure that a repeat is prevented. “This can’t be allowed to happen again,” Bruederle said.

“We’ve got to create rules in Europe that allow effective advance counteraction with state fiscal crises. We need an early warning system…if necessary, with sanctions attached.” Bruederle said that there should also be scope for orderly state bankruptcies. “I can only underscore once again my suggestion that there needs to be an orderly state bankruptcies process,” he said.