I realize that Grease is the Word but why must Germany lend more money to Greece? If Greek public sector workers want to continue to live the good life (and retire at 50), why doesn't the nation sell some of its valuable assets to Germany? My parents just had a wonderful trip to Greece. Here are just a couple of examples of the unique cultural tourist destinations that Greece has to offer. Following basic environmental economics, a simple travel cost methodology could be used to price these assets and Germany and Greece could agree to a trade. Germany would supply cash and Greece would hand over these treasures. Think of the efficiency gains! German precision would make the tourist lines shorter.
These unique geographical assets would act as a bond. Germany would know that Greece would not be happy to cede these assets and will seek to buy them back in the future. There will be no risk of future default if valuable equity is handed over. Debt vs. equity; folks --- this is a classic question in finance. Why isn't the EU talking about this?
Now, what am I doing? I'm flying back to LA to manage the debt crisis from there. I will be at UCLA and will be happy to answer your questions.