Crashed: How a Decade of Financial Crises Changed the World

by Adam Tooze

But no deal emerged from Washington. The troika was only beginning to haggle with Athens over the terms of a rescue loan. Markets were left hanging. On April 28, 2010, the bottom fell out. The official chronicle of the German finance ministry is, as one might imagine, a sober document. This is how it describes events in Europe’s sovereign bond and interbank money markets that day: “The crisis becomes dramatically acute. Risk premiums for government bonds in some Eurozone member states such as Portugal, Ireland and Spain increase rapidly and reach levels equal to that which prevented Greece from accessing the financial markets in April. In an echo of the final dramatic phases of the financial crisis [of 2008], there is virtually no interbank lending between European banks. Within a very short period, there are overall signs of an acute pending systemic crisis.”43