[digi_owl]

Bad loans very much created the situation.

But not loans to governments, but loans to individuals, industry and finance.

What then happened was that the crash of '07-08 came and spooked the private banks issuing those loans. Only then did the various governments step in and underwrite the bad loans to effectively bail out the private banking system.

This, along with the number of companies etc that shut down, has put a massive economic burden on said governments.

Thing is that before the euro, Greece could have depreciated its currency to make its exports cheaper. But with the euro the currency is set to the export situation of Germany.