The Financial Times is reporting that Portugal is likely to need an extension of the three-year bailout plan it received in 2010. This is a disaster for the euro zone and I am writing this post to explain why. The most pressing issue is bailout fatigue in Germany. And this is important given that it is an election year there in 2013. But equally problematic is the mounting social unrest through the periphery. Here are some thoughts on the political and economic ramifications of peripheral countries requesting more bailouts.
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