Greek PM Papandreou got the backing of his cabinet to hold a referendum on EU bailout terms. He meets today with France's Sarkozy and Germany's Merkel, who have said renegotiating is not an option.
The shocking news of a Greek debt referendum this week has prompted European leaders to hold an emergency meeting today ahead of the G20 summit in Cannes, France.
Referendum to be called in Greece: Prime Minister George Papandreou called for a referendum that may further destabilize the economy in Europe and undermine euro.
The Greek bailout isn't the only thing in doubt after Prime Minister George Papandreou said he will put what Europe took to be a done deal to a referendum. His government could fall this week.
After months of having their pride savaged by the rest of the continent, the Greeks have astounded Europe by announcing a referendum on the debt crisis plan.
Stock markets in the US and Europe fell Tuesday, stunned by news that Greeks will vote in January on national austerity measures tied to resolving Greece's sovereign debt woes.
As developed economies deal with debt and emerging economies like China ramp up, the G20 must spearhead coordinated, complementary policies to navigate the choppy waters ahead, especially for Europe. Austerity alone won't do the trick.
Stocks drop 1 percent or more on major European indexes because of concerns about Italian debt. Japan limits losses with yen intervention. US stocks expected to open lower.