Telegraph report.

There is now more than a one-in-five chance of another asset price bubble implosion costing the world more than £1 trillion, and similar odds of a full-scale sovereign fiscal crisis, a key report warned.

Investors must steel themselves for the possibility of a second leg to the financial crisis, and should be equally prepared for a fiscal crisis, in which a major economy faces either default or a "sudden stop" in financing themselves on capital markets, according to the World Economic Forum.

Anatole Kaletsky in the Times.

If nothing is done to change the US healthcare system, it can be stated with mathematical certainty that the US Government and many leading US companies will be driven into bankruptcy, a fate that befell General Motors and Chrysler largely because of their inability to meet retired workers' contractually guaranteed medical costs.

Telegraph report.

Theodoros Pangalos, deputy prime minister, said Germany had no right to reproach Greece for anything after it devastated the country under the Nazi occupation, which left 300,000 dead. "They took away the gold that was in the Bank of Greece, and they never gave it back. They shouldn't complain so much about stealing and not being very specific about economic dealings," he told the BBC.

Twisting the knife further, he said the current crop of EU leaders were of "very poor quality" and had botched this month's crisis summit in Brussels. "The people who are managing the fortunes of Europe were not up to the task," he said.

One banker said the situation was surreal. "How can they call the Germans incompetent Nazis and still expect a bail-out?"

Sean O'Grady in the Independent.

Is Britain about to suffer a "Black Swan" event? This, if you follow trendy financial ideas, is the one that shocks observers who assumed such a thing could never happen, just as the first Western visitors to Australia to see a black swan were similarly startled. The idea was popularised by a former financial trader, Nassim Taleb, whose The Black Swan became a bestseller soon after its publication in 2007, at a time when the unthinkable was happening to the big banks and markets every day, and black swans were biting us with painful frequency.

Independent report.

Britain's public finances are in a worse position than those of Greece, according to the latest figures on government borrowing. The Office for National Statistics said yesterday that January alone saw a net shortfall of £4.3bn, far worse than City forecasts and in a month which has always previously shown a healthy surplus. It puts the UK on track for a deficit of £180bn this year, or 12.8 per cent of GDP, economists said, shading the Greek figure, hitherto the worst in the European Union, of 12.7 per cent. In the pre-Budget report the Chancellor forecast a deficit of £178bn for the current year. Warnings that the UK could face a Greek-style crisis of confidence have been building for some weeks, and yesterday saw a sell-off of sterling and British government securities, or gilts, on the disappointing news.

Reuters report.

Greek opposition lawmakers said on Thursday that Germans should pay reparations for their World War Two occupation of Greece before criticising the country over its yawning fiscal deficits.

Financial Times article by Otmar Issing.

Once Greece was helped, the dam would be broken. A bail-out for the country that broke the rules would make it impossible to deny aid to others.

Speculation by Gregory White in Business Insider.

The Greek Prime Minister is set to visit Russia next week in the middle of the biggest crisis in the country's recent history. He will sit down to economic talks with his Russian counterpart Vladamir Putin and it has to be suspected that the debt crisis may be up for discussion.

They'll also be discussing military and energy policy. Could the Greek PM be trying to strike a bargain with Putin to save his troubled country?

If so, this seems like a monster blow to the EU, and posibly to NATO.

Vincent Fernando in Business Insider.

Some banks are exposed to the risk of a sovereign debt crisis directly through bond investments, such as by owning, say, Greek bonds.

Yet even banks without any direct exposure to troubled government bonds could be slammed by a sovereign crisis as well.

Niall Ferguson in the Financial Times.

Yet even a casual look at the fiscal position of the federal government (not to mention the states) makes a nonsense of the phrase "safe haven". US government debt is a safe haven the way Pearl Harbor was a safe haven in 1941.

Even according to the White House's new budget projections, the gross federal debt will exceed 100 per cent of GDP in just two years' time. This year, like last year, the federal deficit will be around 10 per cent of GDP. The long-run projections of the Congressional Budget Office suggest that the US will never again run a balanced budget. That's right, never.

Guardian report.

Angela Merkel, the German chancellor, mounted stiff resistance tonight to any swift bailout of Greece, as a rift opened up between European capitals over how best to tackle the risks posed to the euro.

Despite a show of Franco-German unity on the crisis and the first statement from EU leaders pledging to safeguard the currency's stability, hopes on the markets of a German-led rescue plan to shore up Greece's critical public finances were dashed by Merkel, who repeatedly emphasised that Athens would need to put its own house in order and brushed aside all questions of financial support.

Financial Times report.

Greece's budgetary and economic policies will be subjected to an unprecedented degree of surveillance by European Union authorities as the price of a promise of support agreed on Thursday by Germany and other EU governments.

Pensions and healthcare policies, the public administration, labour and product markets, the use of EU structural funds, financial sector supervision and official statistics will all be rigorously monitored by the European Commission to ensure that Greece is not let off the hook.

Report on CNBC.

The governments of every developed economy will eventually default on their sovereign debts, including the US, the UK and Western Europe, Marc Faber, editor of the Gloom, Boom & Doom report, told CNBC.

"In the developed world we have huge debt to GDP, in terms of government debt to GDP and unfunded liabilities that will come due," Faber said in a live interview via telephone. "These unfunded liabilities are so huge that eventually these governments will all have to print money before they default."

Independent report.

European Union President Herman Van Rompuy, speaking at a summit of 27 EU leaders in Brussels, gave no firm offer of financial aid to Greece, and insisted that Greece hadn't asked for any.

"Euro area members will take determined and coordinated action if needed to safeguard stability in the euro zone as a whole," he told reporters, reading out a statement agreed by all euro members.

Guardian report.

Public sector workers across Greece have begun a nationwide one-day strike in protest at the austerity measures being implemented to try to address the country's financial crisis.

Guardian article by Kenneth Rogoff.

Even as the European Union and the International Monetary Fund lay the groundwork for a giant first-round bailout, debate is swirling about whether Greece can avoid sovereign default.

...

There is an old joke about two men who are trapped by a lion in the jungle after a plane crash. When the first of them starts putting on his sneakers, the other asks why. The first answers: "I am getting ready to make a run for it." But you cannot outrun a lion, says the other man, to which the first replies: "I don't have to outrun the lion. I just have to outrun you."

Greece has yet to put on its sneakers, while other troubled countries, such as Ireland, race ahead with massive fiscal adjustments. Greece's new socialist government is hampered by campaign promises that suggested the money was there to solve the problems, when in fact things turned out to be far worse than anyone imagined.