Europe decided to continue its policy of covering its ears and telling the market that they can't hear them. Today, the Bank of Italy unveiled rules which allows Italy's banks to ignore changes in market value of their European government bond holdings in their available for sale portfolios.
Not to be outdone, Germany decided to prohibit naked short selling and credit default swap speculation on European debt.
In response to this news, the Euro sold off 1.5%. So if they are trying to create a weak currency in order to help Greece out, they are at least succeeding in that. However, instead of seeing the markets as their adversaries, they should consider them as advisers that are telling them that something is really wrong and drastic austerity measures still need to be taken.