The sovereign debt crisis is heating up in Europe. The so-called PIGS (Portugal, Italy, Greece and Spain) have weak economies, very large deficits, and no national monetary policies to ease their sufferings. Many are skeptical of whether or not they can internally resolve this problem and if they can't whether the EU can or will bail them out.
It is not impossible that we are looking at the end of the Euro as we know it, as one or more of these countries may have to drop out and inflate a new national currency to get out from under their fiscal situation. I would put this probability at something like 37%.
The situation appears to be getting worse rather than better as Greek workers have started striking and Portuguese legislators appear to be thinking about increasing spending and raising rather than lowering their deficit. The Spanish stock market fell 6% today, Portugal's 5% and Greece's 3.5 %
And to think that last year I finally stopped telling my students that, despite its apparent success, it was from from obvious that the Euro would really last as it had yet to weather a major crisis.