German Finance Minister Wolfgang Schaeuble said yesterday there could be no taboos in trying to solve the Greek debt crisis and the government had to consider all eventualities.
"It would be a bad government if it didn't try to prepare for things you can't even imagine," he said.

His words came as Greece's deputy finance minister said yesterday the government only had cash to operate until next month, highlighting the urgent need for the next emergency loan to stay afloat.

Growing fears of a Greek default sent a hurricane through heavily exposed French banks yesterday and hit the euro as investor confidence in the European currency area's ability to surmount a sovereign debt crisis ebbed.

Shares in Societe Generale , BNP Paribas and Credit Agricole slumped by more than 10 per cent amid expectations of an imminent downgrade by credit ratings agency Moody's, due largely to their exposure to Greek bonds. European stocks in turn tumbled to a two-year low with the FTSEurofirst 300 index of top European shares ended down 2.7 per cent at 890.98 points in strong volume, after falling as much as 3.7 per cent earlier in the session Schaeuble told ZDF broadcaster, asked if the government was planning for a Greek orderly insolvency: "A taboo to think about something is one thing, talking about everything at all times is a different thing." Economy Minister Philipp Roesler, who leads the junior coalition party the Free Democrats in Chancellor Angela Merkel's centre-right government, said earlier yesterday that to stabilise the euro there could "no longer be any taboos". "That includes, if necessary, an orderly bankruptcy of Greece, if the necessary instruments are available," Roesler, who is also deputy chancellor, added.

However, an economics ministry spokesman said yesterday no such instruments were currently available, and a government spokesman insisted there was strong agreement between Roesler and Chancellor Angela Merkel on the eurozone debt crisis. "We want to stabilise the whole eurozone with all member states," government spokesman Steffen Seibert told a news briefing.

Asked about talk of a suspension or expulsion or voluntary departure of Greece from the eurozone, he said: "The legal position anyway stands in the way of such steps."
Seibert added that if Athens did not meet its fiscal commitments to the EU, ECB and IMF, that would automatically lead to non-payment of the next tranche of aid.
Meanwhile, growing fears of a Greek default sent a hurricane through heavily exposed French banks yesterday and hit the euro as investor confidence in the European currency area's ability to surmount a sovereign debt crisis ebbed.

Shares in Societe Generale , BNP Paribas and Credit Agricole slumped by more than 10 per cent amid expectations of an imminent downgrade by credit ratings agency Moody's, due largely to their exposure to Greek bonds. European stocks in turn tumbled to a two-year low with the FTSEurofirst 300 index of top European shares ended down 2.7 per cent at 890.98 points in strong volume, after falling as much as 3.7 per cent earlier in the session Greece resumed suspended talks with international lenders on a vital €8-billion aid instalment after announcing a new real estate tax on Sunday to try to plug yet another gap in its 2011 budget deficit. Athens has only a few weeks' cash left.

EU finance ministers are scrambling to settle disputes over a planned second Greek bailout, including a spat over Finnish demands for collateral, in time for a Friday meeting in Poland.

The rescue package has been put in doubt by Greece's repeated missing of fiscal targets agreed with the EU and the International Monetary Fund, plus uncertainty over the scale of private sector participation in a bond swap and debt rollover. "We have definitely manoeuvring space within October," Greek deputy Finance Minister Filippos Sachinidis told television channel Mega when asked how much longer the state would be able to pay wages and pensions.

Greek power workers threatened to sabotage the new property tax announced by the government on Sunday as a last-ditch effort to please foreign creditors, which authorities plan to collect through electricity bills to ensure swift payment.

Trade unionists at power utility PPC said they would obstruct the issuing of bills and order employees not to cut the electricity of customers who refused to pay the tax.