Germany sold the euro equivalent of $5.8 billion in two-year bonds carrying a zero percent coupon, evidence that the Greek crisis has investors increasingly on edge, says Jim O'Neill, chairman at Goldman Sachs Asset Management.

German debt often serves as a safe-haven investment amid times of uncertainty, and the fact that investors would put their money in such bonds for nothing in return reflects escalating anxiety that the Greek crisis will come to a head soon.

"The markets are putting together a higher probability for the end-game in the eurozone, otherwise why would you do that?" O’Neill says, describing strong demand for zero-coupon bonds as "uncharted territory."

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Greece went to the polls on May 6 to elect a new parliament, and enough fringe politicians won due to anger over harsh austerity programs, which ate into power traditionally enjoyed by the country's more established New Democracy and PASOK political parties.

The fragmented parliament failed to agree on a coalition government, and the country will hold new elections on June 17, which is seen as a proxy on austerity measures.

Previous administrations agreed to belt-tightening measures such as layoffs and tax hikes to streamline the country's bloated public sector in exchange for bailout money.

Critics say such policies have obliterated the economy and destroyed prospects for growth, while supporters say that pain today leads to lasting recovery tomorrow.

A Greek exit from the eurozone will reverberate across the continent.

"Once one exits, it breaks the notion that it’s a true currency union, and that is a big moment," O’Neill says .

"They have to respond and ring-fence clearly, and make it clear that no one else will leave."

Germany has rejected calls from across Europe to take part in a eurobond issues, which basically takes some of the debt burdens off countries like Greece and puts them on the back of richer countries like Germany.

Concerns have been growing that France, now under the leadership of socialist Francois Hollande, will disagree more with Germany over how to steer the continent out of the crisis going forward.

The two countries shared similar policy views under France's previous president, Nicolas Sarkozy.

"Differences between France and Germany on the topics of eurozone bonds and growth versus austerity have led markets to believe that nothing substantial will emerge," Marc Chandler, strategist for Brown Brother Harriman, writes in a market note, according to CNNMoney.

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