The rule is well known: If a country falls into the debt trap and its debt rises above 90% of gross domestic product, there is no escape: default appears on the horizon as the spectre that will keep society, the economy and politics on tenterhooks from then on. This is what is currently happening with the eurozone. With the introduction of the euro, southern Europe in particular fell into the credit trap, as the markets regarded Germany's creditworthiness as the general benchmark from day one of its introduction. As a result, interest rates in southern Europe fell dramatically and government debt continued to rise. Today we see France, Italy and Spain as the absolute problem children, basically the entire south of the eurozone.

What can happen when the markets turn their attention to the rising debts of these countries is something we saw last week: the euro in free fall, the flight of capital to safe havens such as German or US government bonds and the Swiss franc was a clear vote against the stability of the eurozone. If you look at the current debt figures for southern European countries, it is clear that a deeper recession than the current one will lead to a fiscal catastrophe if unemployment figures rise, tax revenues collapse and capital seeks its way out.