L-Pap rejects new austerity measures for Greece.
Italy sells 5-year bonds for 6.3%- highest ever yield.
Merkel says Europe in worst hour since WW 2, and fears Europe would fail if the Euro fails.
Nothing like a Manic Monday.
Italy had to pay a euro-lifetime record yield of 6.3 percent to sell five-year bonds with investors wary of buying its debt until prime minister-designate Mario Monti can undertake profound economic reforms.
In a first sign of trouble for new Greek Prime Minister Lucas Papademos, the leader of the main conservative party rejected any toughening of austerity and refused to sign a letter sought by European authorities pledging support for a new 130 billion euro bailout.
"Europe is in one of its toughest, perhaps the toughest hour since World War Two," Merkel told her Christian Democrats, saying she feared Europe would fail if the euro failed and vowing to do anything to stop this from happening.