Kash Mansori has an excellent post about the origins of the euro crisis. He documents the fact — which the Germans cannot bring themselves to acknowledge — that fiscal irresponsibility had very little to do with it. And he shows that what really predicts who found themselves in crisis was capital inflows:

The key point here is that countries within the euro zone have no policy tools with which to manage their balance of payments, so that this was hardly a case of policy sin.

I’d add that it is very difficult in real time to convince people that capital inflows pose a threat, no matter how obvious the numbers seem. Somewhere in the years just before the crisis I was at a meeting in Barcelona where Olivier Blanchard tried to tell the Spaniards how dangerous the situation was getting; he got trashed and ridiculed for his pains, just like those who warned about the US housing bubble.