Did Tsipras Outwit Merkel?

At the conclusion of last month’s negotiations between Greece and its European partners over the terms of a bail-out, most analysts judged that Greece had been thoroughly humiliated, the German government having fully imposed its will on Greek Prime Minister Alexis Tsipras. However, I wrote then that in the long run, Greece might come out the better — for having succeeded in establishing the precedent of a debt write-down. As further details of the bailout agreement have emerged in recent weeks, it is now looking like that optimism was correct. As David Marsh wrote yesterday on marketwatch.com, it is now looking like the German government was outflanked by the Greeks — and may come to regret it.

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