Merkel says Europe facing toughest crisis since WW Two

LEIPZIG, Germany Mon Nov 14, 2011 6:40am EST

LEIPZIG, Germany Nov 14 (Reuters) - Chancellor Angela Merkel said on Monday that the euro zone sovereign debt crisis has plunged Europe into what is perhaps its most difficult crisis since the end of World War Two.

Merkel said in a speech to her conservative party that she feared Europe would fail if the euro fails and vowed that she would do everything she could to prevent that from happening.

Merkel said that it is time for a breakthrough to a new Europe. She said that rescue measures were needed to keep the euro intact. She said the European Union needs to develop new structures -- and that would mean more Europe, not less.

She also said automatic sanctions were needed to punish countries that violate Stability Pact rules. She also renewed her calls for taxes on financial market transactions, bank levies and bans on short selling, at least in the euro zone if not on a wider basis.

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