Prime-minister resigns, next steps?

And the announced path has been walked down half-way - the portuguese prime-minister resigned today, after the new austerity measures have been rejected in Parliament.

Does it mean they will not be applied? hardly the case, most likely the measures

will adopted, and since several, if not most, would take effect only next year, there is still time for this or another government to apply them.

Does the political crisis bring a bailout closer? it is difficult to say, but again it is hard to believe it should, as there are not many policy options; in particular, it is not predictable the government entering a spending frenzy to gain elections - people are aware and concerned about the budget prospects and the costs it will entail.

Solution to the political crisis? several options are available, including finding another government solution within the current parliament, with some sort of majority in parliament. We have to wait for the meetings the President will hold with the main political parties, though the first reactions of parties point to elections. If another solution is attempted, then it means a very active role of the President backstage.

Will elections solve political instability? I give a 50% chance it may keep everything the same.

Are elections needed? probably yes, people in the street feel the need to express their views, and probably want some hope and common purpose, let's see how much of it politicians are able to deliver if elections becomes the way forward