10 years ago, the bond spreads of sovereign bonds would have reflected this accurately, where Greece would have a higher YTM than Germany.

The idea of the euro is convenient, but since the crisis of 2007-2009 + various (Greek) scares, it's devolved into a "cake and eat it" situation.

A country cannot devaluate its currency (Sweden still has this freedom if it so wanted).

I'm not sure what the solution is, but to start, I would homogenize corporate tax rates, and discourage tax-shopping inside the EU.

Those politics will likely never work.

I think eventually this will lead to the breakup of the Euro... Fixed exchange rates generally don't work long-term without fiscal transfers to balance things out (like the US's federal budget does for the states). I don't think the EU can keep this up for that much longer - at some point they'll either have to consolidate fiscally or break up the monetary union.