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Hope springs eternal about Europe's ability to finally resolve its sovereign debt crisis. For despite a double dip economic recession and despite the clearest of signs of austerity fatigue, the markets appear to be buying European policymakers' reassurances that the worst of the crisis is now behind us. The markets do so seeming to have forgotten previous hollow European policymaker reassurances since the start of the crisis in early 2010. They also do so in seeming disregard of the underlying economic and political forces now at play in Europe. Those forces offer little hope that the European periphery will soon extricate itself from its seeming downward economic and political spiral, which could make 2013 yet another challenging year for the Euro.

2012 was not a...