Sentences to ponder, from Simon Johnson:
But who is really safe in Europe? With France running an 8% GDP budget deficit (for 2010) and a debt/GDP ratio of 83.6%, should we be confident they are safe while Spain is not (with debt/GDP at 65%)? France’s thirty years of budget deficits do not bode well for anyone expecting an immediate strong fiscal response. In many ways Spain appears better placed to take tough actions than France.
I agree with his general point, but I believe that Germany — though perhaps not all German banks — is truly safe.