With the elections in France and Greece Sunday, both supercharged by debt, deficits, and economic desperation, Europe is about to take a dramatic new direction. The eurozone is turning away from stringent austerity policies and toward those that stimulate demand. President-elect Francois Hollande, the first socialist president since Mitterrand, plans to raise taxes on the rich to meet some of his growth objectives. However, without a credible debt reduction plan, Hollande risks a loss of confidence among investors and bondholders.
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