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"We are seeing a sense of disarray with several voices speaking at the same time," said Clara O'Donnell of the Centre for European Reform. "But even if the EU is keen to help, the Israelis do not consider it reliable enough. There is not much Europe can do until the Americans move."

As Philip Whyte observes in a piece for the CER (Eurozone governance: Why the Commission is right), Germany's position is "one-eyed". When the global financial crisis erupted in 2007-2008, Spain was running a budget surplus, not a deficit, and its present difficulties have very little to do with government irresponsibility. They have been caused by a housing market bubble, an over-extended banking sector, very high levels of private sector debt and a rigid labour market that has exacerbated Spain's long-term loss of business competitiveness.

Some candidates "would be better members than many of the existing ones," says Simon Tilford of the CER. "But the spectre of Greece means there is very little stomach for taking on new members."

But a better atmosphere will not necessarily translate into an ambitious summit agreement, said Katinka Barysch, deputy director of the CER. "The relationship looks better, feels better, smells better," said Barysch. "Whether that can be translated into concrete achievements remains to be seen."

"This is the worst possible message they [Germany] could be sending the markets because it suggests they are still not acknowledging what the underlying problem here is," said Simon Tilford, chief economist at the CER. "Far from reassuring the market and stabilizing market sentiment, this will further undermine confidence in the ability of eurozone governments and policymakers to get on top of the crisis. It will aggravate the situation further."

"Essentially, you can't have a single currency without a single economy," says Simon Tilford, chief economist at the Centre for European Reform. "For it to work, there needs to be much greater political and economic integration."

Part of the reason why southern European nations like Spain and Greece are currently in so much debt is that the northern European nations were prepared to lend to them the cash in the first place, explains Simon Tilford, chief economist at the Centre for European Reform. The construction boom in Spain, for example, wasn't financed out of nowhere: it was fuelled by enormous sums of cheap cash borrowed at very low rates.

"The problem is that when countries signed up to the single currency they were not made aware that it would require such integration. Political elites need to start explaining why it does," said Simon Tilford, chief economist at the Centre for European Reform in London.

"EU diplomats exude optimism when asked about China," wrote Katinka Barysch of the Centre of European Reform. "Chinese leaders, unlike most Russians and Americans, like and respect the European Union." … "Wishful thinking," was how European analyst Charles Grant termed Europe's China fixation. … Grant says "We have suffered more from yuan manipulation than the US."… the EU "should abandon the fiction of a 'strategic partnership' which cannot be meaningful when the values of the two sides are so different."