TELEGRAPH: EU rescue costs start to threaten Germany itself. “Germany cannot keep paying for bail-outs without going bankrupt itself.”

UPDATE: Tyler Cowen: “In a nutshell, we’re watching the most pitched, highest-stakes, most determined battle between politics and finance which has been staged. I am expecting finance to win.”

ANOTHER UPDATE: More from Arnold Kling. “The question is whether the Eurocrats can beat back the speculators. I find the whole situation much too complex. I can only come up with a list of things that I wish I knew.”

MORE: Euro-Zone Debt Crisis Escalates.