Europe is in between a rock and a hard place. The way I see it, austerity isn't working. Just look at Ireland which has followed the austerity route since the beginning (it is also supposedly one of the most if not the most business friendly country in Europe). Its bond rates are worse than Spain or Italy even though austerity is supposed to restore confidence in the markets. Now the Europeans are willing to try growth which is obviously a lot less painful if it works. However, if it fails they will be in even worse shape so they are essentially doubling down.

I bet Iceland is feeling pretty glad they aren't on the Euro. They simply defaulted on their debt and are back to growing again. No such option for the Eurozone countries.