They began by signaling that Portugal would get a much more lenient interest rate on its bailout loans than Greece or Ireland. This in itself amounted to an admission that the onerous rates charged earlier would, as many economists warned, so depress their economies that they would never get out of debt.

But once Portugal had been given the easier ride, the Irish and Greeks understandably began to demand the same treatment. But even the Portuguese are facing a grim future. They don't at present have a sovereign debt crisis but they soon will. They are being lent $116 billion, which is almost 50 percent of the country's gross domestic product. The loans will take Portugal's debt to more than 120 percent of GDP.

Even though the Portuguese government was unable to get parliamentary approval for its own austerity plan, forcing its resignation with new elections due next month, Portuguese Finance Minister Fernando Teixeira Dos Santos announced that the politics of the loan had been resolved. The leaders of the country's main opposition parties had all approved the new loan agreement with the European Union and the International Monetary Fund.

But Dos Santos also said that he expected Portugal's economy to shrink by 2 percent this year and again next year, so critics immediately asked whence would come the growth that would be needed to repay the loans. It is a fair question, one that had previously been asked by the Greeks and the Irish.

For the Greeks, the question is becoming a matter of life and death. Their sovereign debts total $327 billion -- 160 percent of GDP -- and the markets simply don't believe that Greece can or will pay. Interest rates for Greece's two-year bonds are now more than 26 percent. The insurance rates on Greek debt have reached surreal proportions. To insure $19 million of Greek debt for five years now costs $1.37 million a year -- more than $7 million, with compounded interest.

But the Greeks have very few cards to play. The only serious one is the nuclear option: a unilateral withdrawal from the euro and a massive devaluation of the new national currency plus a default on all debt.

This would plunge the European Union and its central bank into crisis and force heavy losses onto a number of French and German banks. It would probably leave the Greeks condemned to fierce austerity for years to come but at least they would inflict some real pain on their EU "partners." Indeed, Jurgen Stark, chief economist of the European Central Bank, has warned that it would provoke the same kind of crash as the Lehman Brothers bankruptcy of 2008.

So when the German magazine Der Spiegel reported last week that a secret meeting of top eurozone finance ministers was being planned for Friday evening at a discreet chateau in Luxembourg, the immediate reaction was to assume that Greek was threatening to go nuclear. The euro accordingly dropped on the currency markets.

The Greeks instantly and loudly denied the story. But then they would, wouldn't they? And once the Friday night meeting had taken place of the Greek, German, Finnish, French and Italian finance ministers, along with EU Finance Commissioner Olli Rehn and hosted by Luxembourg Prime Minister Jean-Claude Juncker, it emerged that this emergency meeting of the eurozone's main creditor nations had a much wider agenda.

Officials claimed the agenda included the Portuguese bailout, the ongoing disputes over a successor to European Central Bank President Jean-Claude Trichet and the precise mechanism of the new emergency financial program to help troubled members that is due to start in 2013.

Questions instantly arose: if that was the agenda: Why was the Greek finance minister present and not his Irish and Portuguese colleagues? If this was really a board meeting of the eurozone to discuss the 2013 crisis program, why were only a handful if its members present?

The credibility of the eurozone leaders hasn't been high; it is now shredded. Clearly the Greeks precipitated some kind of crisis last week and the meeting of eurozone creditors was called to deal with it. And perhaps because the news of the meeting leaked, whatever was decided on the Greek issue wasn't revealed to the voters nor to the markets.

The only decision was to continue along the same old path of the last two years, using short-term measures to try to fix immediate problems and then muddle through. The indications are that Greece will get some modifications to its debts, perhaps with a long maturity period and lower interest rates.

"We think that Greece does need a further adjustment program," said Juncker, chairman of the eurozone finance ministers, speaking after the Friday night meeting. "We're not discussing the exit of Greece from the euro area. This is a stupid idea -- no way."

German officials have talked of "biting the bullet" and easing the Greek repayment terms, which is what Athens wanted all along, but there has also been talk of new "collateral" that Greece would have to post to reassure its creditors. Beyond real estate and these state assets that remain after a crash privatization program, it isn't at all clear what they could be.

Even if such collateral can be arranged, the fundamental problem is that the Greeks, Irish and Portuguese have debt crises that are being addressed (and certainly not solved) by the EU partners issuing yet more debt. But the price of that new debt is a degree of austerity and budget cuts that make it difficult to see how the debt can be repaid, even as public opinion in the creditor countries is complaining at good money being thrown after bad.

The hole is deep but they all keep digging.

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