This is a subject many times explored in this blog. In many previous blog posts I have warned for a real possibility of deflation in the euro zone. The best response to this crisis is being given by the US. Through the use of Quantitative Easing (QE), the US were able to close the gap generated by the housing market collapse. On the other hand, the Euro countries clung to the German ideology. The result is that only the Germans are benefiting from this state of affairs, but I think that even this can backfire if deflation materializes.
Again we see Europe on the verge of a crisis, without any visible leadership. The future seems dreadful in this bitter old Continent.