Merkel is still struggling to square the circle between EUSSR ambitions and the German voters, explaining why she continues to send out mixed messages about Greek membership of the Euro Zone.
Plan A was to parachute a Quisling into Greece to take over the control of Greek Government policy.
That failed because the Greeks insisted on holding a General Election and replacing the EuroImplant with a Prime Minister of their own choosing.
The election failed to produce a viable Government and so a new election was held leaving Greece without a hand on the tiller of state.
The second election produced just enough votes for a shaky coalition that was in favour of staying in the Euro but on the condition that Germany continued to fund a ballooning Greek deficit by delaying the date, by two years, when the austerity measures already promised by the Greeks come into effect. The Greeks were also demanding that they should pay a lower interest rate, citing Spain as a bailout example at lower rates.
For Merkel this has to be unacceptable because she would have to stand for election before the Greek cuts even started to be implemented, leaving her Party decimated and bringing in a new German Leader.
So Merkel is damned if she does and damned if she doesn’t.
If this week is seen to have ended in another attempt to delay the inevitable, the markets will be even more nervous and likely to react very unfavourably.
Its easy to see why she is promising an apparently open ended support for Greece, while also stating that a deal is a deal and no action by the Greeks will mean no money from the Germans.
If the Greeks don’t receive more money very quickly they will be unable to pay bills and more and worse civil disorder is highly probable.
Until there is a final solution to the Greek problem, the world economy will remain weak and continue to show low confidence.
If that is not cause enough to be concerned, the Iranian situation is emerging once more with the Israelis moving towards their final solution to the Iranian nuclear weapons threats.
Iran is much more volatile than many thought. The Shar’s widow has recently been attempting use the Internet to clear through propaganda from the Islamic hard liners who have ruled in Iran since ejecting the Shar and his family. From the Internet response from Iranians, it appears that the regime is far less popular than it was taken to be (which may be hard to believe). It may now be a race between Iranians rising up against a hated and oppressive regime in an Iranian Autumn and Israeli warplanes delivering a decisive pre-emptive strike on Iranian nuclear weapons factories. Which ever even comes first, the Middle East and its oil looks set to move into another period of major world threat. Coming at a critical point in global trade and the global economy this is exactly the most unfavourable situation. The drums of war are beginning to beat louder.