China markets 'bounce' on support, but still very uncertain; screws tighten on Greece; economic data positive but drowned; UST 10yr yield 2.32%; oil sinks; NZ$1 = 66.9 US¢, TWI-5 = 71.2

why not simply burst the bubble so the correction benefits investment in productive economy and young people so they have more spare cash to spend?

maybe they are trying to rescue a situation where they have encouraged their people to margin invest in stocks and now they have lost a lot of money

I dont think so on China, its one huge empty bubble inside IMHO.

It appears the European Union was doomed to be a failure from the very beginning.

"The crisis has required strong financial support measures, but in particular it has revealed the deficiencies of the Stability and Growth Pact (the Pact) in terms of either controlling disorderly budget processes or tackling economic disruption originating in the private sector....The project of monetary union was open to countries of the EU whose economic structures were highly diverse. According to economic literature of the 1960s, in particular the work of Mundell, a monetary area can scarcely be ‘optimal’ (ie, ‘feasible’) in such conditions, because the limits of tolerance to tensions imposed by the discipline of a single currency would be very different in heterogeneous economies.\

For years, this reflection inspired the German caution in respect of the project. It was obvious that German public opinion would never agree to getting rid of a stable and solid currency if the project could entail the risks of fiscal and monetary disorder which for many years had characterised the economic policies of France and Italy, not to mention countries like Spain and Portugal, which initially did not even appear to be candidates with possibilities. Consequently, Chancellor Kohl made his agreement conditional upon the creation of a European Central Bank in the likeness of the Bundesbank, and upon compliance with a series of economic policy criteria, first during the access phase and later during the project’s lifetime.

Furthermore, it was thought that monetary stability and the increase in intra-EMU trade flows would bring significant improvements in productivity in the weaker economies and would therefore boost their process of real convergence (it is hardly necessary to highlight how ill-founded that optimism was)...

.Secondly, surrendering to (amply justified) German fears of the fiscal excesses of some candidates, the Pact did not take into account the possibility that budget deficit and growing debt might be a consequence of economic crises triggered by the excesses of private-sector investors (or unpredictable external shocks such as a global financial crash). The academic debate, at the time, focused on the mechanical aspects of the Pact, ascertaining, for example, that a debt of 60% is sustainable with recurring deficits of 3% provided that the economy is growing at a nominal 5%...

And the opposite is also true: although public accounts might be orderly, the private sector could be unwinding savings and incurring a sizeable external debt. The negative current account balance will reflect this difference in performance, but the Pact’s warning systems would not be triggered despite the serious macro-economic threat posed to the country. That is what happened with Spain and Ireland’s property-market bubbles: neither of the two countries had breached the 3% deficit criterion since the Eurozone’s creation in 1999. However, the Pact’s alarm sensors were set to detect excesses in the public sector, so they were not triggered by the accumulation of deficits and external financing in a private sector that was immersed in a euphoric frenzy of investment."
http://www.realinstitutoelcano.org/wps/portal/web/rielcano_en/contenido…