These days, it seems that the eurozone is policed and dominated by Germany, with the group snapping to attention and doing the bidding of Europe’s powerhouse.

We are, of course, talking about the latest declarations on Greece’s ever increasing likelihood to default. Make no mistake. The country is edging very close to an unsustainable position. German Finance Minister Wolfgang Schaeuble has gone on the record in saying that if funds are not released soon, “there is real risk that Greece defaults”.

Mr Schaeuble sent a letter to the European Central Bank and the International Monetary Fund heads, saying that a return to the capital markets (borrowing at commercial rates) is highly unlikely for Greece by 2012.

When one factors in that Greece now has an unemployment rate of 16%, the complete disregard for government austerity measures and the constant protests out on the streets, it seems highly unlikely that the country will ever come back on stream.

EU leaders are now set to discuss another aid programme for Greece. If Greece is to remain in the eurozone, the EU should better come up with a plan, quick smart. It is clear, that the people of Greece simply will not go back to the pre-euro life of low wages. The people simply will not accept that austerity is needed, hence the protests by workers and professionals.

Granted, the Greek Socialist Government inherited a dire situation from the outgoing government of Kostas Karamanlis. But not enough is being done, both by the state and the private sector. Even US President Barack Obama has said that the US’ economic growth depends on what happens in Greece. Everything is so intrinsically linked that one simply cannot leave Greece to its own devices. Some have called for Greece’s expulsion from the eurozone, and many believe this has not happened as it would result in a huge knock to the euro’s credibility as a currency.

While this is part of the truth, there is another issue which causes worry from all states when an economy is close to default – it’s the banks. Banks are all linked, in terms of investment of savings, share ownership and debt purchase. It is entirely conceivable that a bank in Lithuania (for example) is owned in part by or has major exposure to, say, a Portuguese bank. In turn, the Portuguese bank might be linked to a US bank. And this is why there is all the fuss. When Lehmann went under, it dragged a whole raft of other companies with it. If one were to transpose what went on there with the possible default of a national economy, then we are surely in for a very bumpy ride over the next decades.