EUROZONE: Tensions Remain; Merkel Still Resists Increasing Bailout Fund.

GUARDIAN/ Ian Traynor / 
OPINION/ ANALYSIS/

   Allegedly, Portugal's PM José Sócrates (pictured) begged Angela Merkel for bailout aid last week.
TRAYNOR:  "He asked Merkel what he should do, promised to do anything she wanted, with one big exception. He would not ask for money – for a eurozone bailout with extremely tight strings attached.
Merkel asked Strauss-Kahn about Sócrates' dilemma. The German-speaking IMF chief was dismissive. The Portuguese plea was pointless, he said, because Sócrates would not follow any advice he was given. The exchange, which occurred last week in Berlin, highlights what a senior German official describes as "Europe's big communication problem'."

ALSO:  Nobel Prize winning economist Paul Krugman outlines 4 options for the euro's "woes" in a long Sunday mag cover story entitled "Can Europe Be Saved? He calls the current euro situation "...a tragedy not only for Europe but also for the world, for which Europe is a crucial role model."
http://www.nytimes.com/2011/01/16/magazine/16Europe-t.html?_r=1&ref=todayspaper&pagewanted=all

EUROLAND: Germany Resents Being EU's Piggybank.

GUARDIAN.UK/ Ian Traynor/
"For 50 years, Europe has been Germany's passport to peace, prosperity and power. When Germany pursued its national interests, it did so effectively, benignly and called it "Europa". Those days are over. The German elite feels maligned and misunderstood. In public, and much more frankly in private, senior figures talk of robustly asserting the German national interest.It may be new for Europe that Germany is representing its interests with new vigour," said Thomas de Maizière, the interior minister and a Merkel confidant. "But for Britain, France or Italy, this was always a matter of course." "The mood among the Germans is quite defensive. They feel people are ganging up on them," said an EU ambassador."