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The growth promised by tech companies is dramatic and such growth is hard to come by as fears about a European debt crisis and a faltering U.S. recovery persist.

"The demand on the margin will be more for tech than for anything else," said Josef Schuster, founder of Chicago-based IPO research and investment house IPOX Schuster.

Jack Ablin, chief investment officer at Chicago-based Harris Private Bank, agreed. "Tech is growth," he said.

"IPO buyers are like wildcat oil drillers," he added. "They want a piece of everything in the hope that one of the deals works out and they get the next Google."

Harris Private Bank has $55 billion under management.

The two biggest venture-backed tech IPOs currently in the U.S. pipeline are Zynga, the top publisher of games on Facebook that plans to raise up to $1 billion, and Groupon, which offers subscribers coupons for local businesses and plans to raise up to $750 million.

Zynga was founded in 2007. In less than three years, the company increased its revenue to nearly $600 million and turned a profit. This year it is on pace to increase revenue even more, though if the first quarter is representative, its profit will be smaller than last year's.

Groupon is not profitable, but has also grown dramatically. Its revenue has gone from zero when it began operations in October 2008, to $1.5 billion for the first half of 2011.

The company's business model has some question marks, including the fact that it is relatively easy for competitors to mimic it, and drive down its revenue.

Groupon and Zynga declined to comment.

Still, Internet tech IPOs look the most promising of the IPOs set to hit the market. Deals that priced earlier this year have performed well.

Professional networking site LinkedIn Corp (LNKD.N) posted a surprising second-quarter profit following its IPO and projected faster-than-expected 2011 revenue growth. More than three months after its blockbuster debut its shares are up nearly 80 percent above their IPO price.

Likewise, shares of real estate and housing data company Zillow Inc (Z.O) are up nearly 75 percent above their IPO price more than a month after its IPO.

A handful of tech companies are on file for smaller IPOs.

Also on file for big U.S. IPOs are a number of private equity portfolio companies and real estate companies. The success of the real estate companies will largely depend on the dividends they are able to offer. The private equity deals could struggle based on slides in the share prices of other recent buyout-backed IPOs and general investor skepticism about high debt and savvy sellers, experts said.

"Everyone knows (the PE owners) are sellers. They need a more robust environment," said former Wall Street equity capital markets banker Bruce Foerster, who now runs advisory firm South Beach Capital Markets.

(Reporting by Clare Baldwin, editing by Bernard Orr)

Concern is mounting over a deterioration in Europe's long-term growth prospects that, unaddressed, will make it even harder to tackle the banking and debt problems underlying the current life-or-death struggle over the euro.

The financial crisis that has been rocking the global economy since 2008 has permanently reduced trend growth across the industrial world. The Organization for Economic Cooperation and Development in Paris reckons the potential output of its 34 member countries has dropped by about 2.5 percent.

"A lot of countries are going to take a permanent hit to their trend rate of growth. This is not an ordinary recession and so we're not going to see countries bouncing back to pre-crisis rates of growth," said Philip Whyte, a senior research fellow at the Center for European Reform, a London think-tank.

As firms have gone bust, capacity has been lost for good. With demand subdued, profitable companies are not replacing old plants.

And as high unemployment persists, skills atrophy. This weakens productivity and shuts people out of the job market for longer and longer periods -- a danger stressed by Federal Reserve Chairman Ben Bernanke at the U.S. central bank's Jackson Hole symposium last month.

Apart from sapping animal spirits and forcing governments to raise taxes or cut spending, diminished growth closes off one route for lowering the high sovereign debt to gross domestic product ratios that have locked Greece, Ireland and Portugal out of the bond markets and are unnerving investors in Italian and Spanish debt.

Against this background, and with the scope for fiscal and monetary stimulus all but exhausted, politicians might be expected to grasp the nettle and push through reforms to improve the supply side of the economy -- policies such as making it easier to hire and fire, promoting greater competition and investing more in training.

Far from it. Pier Carlo Padoan, the OECD's chief economist, says he is less optimistic about the prospects for deep-seated change than he was at the start of the year.

"I see that measures are being announced. I would like to see them being implemented," Padoan said.

With policy ammunition running desperately short, he said it was time for governments to overcome their squeamishness about confronting vested interests opposed to change. "This is a luxury that many countries cannot afford any more. The situation does not allow it."

SOUTHERN DISCOMFORT

The vicious circle of rising debt and falling growth is made worse by the fact that those countries drowning in debt on the periphery of the euro zone are also the ones that have dragged their feet on freeing up their product and labor markets or modernizing their education systems.

"They're going through some truly horrible times. I'm very worried about the whole southern European fringe, not just on an 18-month to 2-year view but looking out a decade or longer," said Whyte with the Center for European Reform.

Germany, by contrast, derided a decade ago as the sick man of Europe, is being held up as a model, at least when it comes to jobs.

"The remarkable resilience of the German labor market in the last few years, where wage moderation and flexible time accounting shielded the economy from excessive job destruction, illustrates admirably the promise of well-structured reforms," Jean-Claude Trichet, president of the European Central Bank, said approvingly in Jackson Hole.

How much are countries missing out by not pressing the reform button?

Padoan says Europe's trend growth has fallen in recent years to an average of just 1.5 percent a year, but he says some members of the 17-nation euro zone could almost double that rate with a supply-side jolt.

Italy needs to liberalize its service sector, open up professions to new entrants and improve energy efficiency, Padoan said. Greece needs to do all that and overhaul its labor market and competition policy at the same time.

POOR ADVERT FOR FREE MARKETS

Germany, too, could grow faster still if it liberalized services, which would trigger increased investment.

These policy prescriptions are well worn. Leaders of the European Union enshrined them and a host of other reform goals in the 2000 Lisbon Agenda, which they promptly ignored. The pledges have since been repackaged as the Europe 2020 Strategy, but Whyte says the havoc wrought by the near-collapse of the international financial system will make politicians more wary than ever of the social disruption that reforms entail.

"The Great Financial Crisis hasn't been a great advert for free-market capitalism," said Whyte. His research outfit publishes a booklet this week exploring how Europe could take off by embracing innovation. But in this area, too, Whyte fears the political climate means policy is likely to be increasingly hijacked by incumbent firms hostile to competition from start-ups.

Europe is not doomed to go down Japan's path of economic stagnation. Its potential growth rate is low but stronger than Japan's -- estimated by the Bank of Japan at just 0.5 percent a year because of a fast-shrinking working-age population.

But the specter of a renewed recession is a reminder for governments that, even if they can spirit away the euro zone's currency and debt woes, they have still to find the elixir for growth.

"I'm not saying politicians will implement reform, but they should," Padoan said. "Some politicians resist reform because they are captive to interest groups. Well, the price for those governments in terms of sustainable growth will be very high."

(Reporting by Alan Wheatley; Editing by Ruth Pitchford)

A court ruling may reduce the freedom of the German government, the biggest contributor to the euro zone's bailout fund, to finance rescues of crisis-hit countries such as Greece.

The European Central Bank, internally split over its bond market intervention to protect Italy, is expected to review the program. And Greece will find out how successful it has been in persuading private investors to take part in a bond swap designed to cut its 340 billion euro debt mountain.

None of these challenges looks likely to doom policymakers' frantic attempts to keep indebted euro zone countries afloat while they try to regain the confidence of financial markets.

But this week's events may underline how vulnerable those attempts are to worsening political currents in the euro zone, and how far the 17-nation bloc remains from finding a lasting solution to the debt crisis.

COURT RULING

On Wednesday morning, Germany's Federal Constitutional Court will deliver its ruling -- awaited for over a year -- on suits claiming Berlin is breaking German law and European treaties by contributing to multi-billion euro bailouts of Greece, Ireland and Portugal.

Legal experts think the court is highly unlikely to block the contributions altogether. But it is expected to give the German parliament a bigger say in approving them.

With German public opinion turning against providing more aid to Europe -- a survey published last week suggested two-thirds of Germans think parliament should not ratify more money for the bailout fund -- that could be a dangerous concession. At the very least, it might further slow and complicate Berlin's responses to the debt crisis.

It could also encourage parliamentary opposition to bailouts in other disillusioned euro zone states. In Slovakia on Sunday the head of a junior party in the ruling coalition said the Slovak parliament would not vote on expanding the powers of the regional bailout fund, the European Financial Stability Facility, before December at the earliest.

Euro zone officials have been hoping national parliaments around the bloc will finish approving the EFSF reforms by early October. The threatened delay in tiny Slovakia may not be disastrous -- diplomatic pressure may be put on Bratislava to speed up approval, or a legal subterfuge found for the EFSF to use its new powers pending Slovak approval -- but it underlines how the bloc's crisis plans rest on shaky political ground.

Politics have also turned ugly in some of the euro zone countries which need aid. The ECB's monthly policy meeting will grapple with this on Thursday as it debates how to handle Italy.

Early last month, the ECB's 23-member Governing Council decided to begin buying Italian government bonds to prevent a disastrous jump of their yields, overriding the opposition of a small minority of council members who felt this compromised the central bank's monetary policy.

The ECB's intervention was launched on the understanding that Italy would rush through an austerity plan to regain market confidence. But efforts by Prime Minister Silvio Berlusconi's embattled government to do this have been plagued by disputed figures, policy U-turns and cabinet rows.

Now the ECB will have to decide whether to continue its bond-buying -- or whether the purchases are actually worsening the situation by reducing pressure on Italy to reform its finances. Italian bond yields have started rising back in the past week; some traders think the ECB may deliberately be permitting this in an attempt to obtain leverage over Rome.

The ECB is widely expected to maintain a substantial level of bond-buying in coming weeks because an Italian yield surge could destabilize the whole region. But it may not purchase enough to keep yields at comfortable levels for Italy, especially if the strengthening of the EFSF is delayed and the fund is not able to take over buying in October as hoped.

Meanwhile, Greece has set a deadline of Friday afternoon for European banks to express their interest in its bond swap; the banks will be required to commit by mid-October.

Athens wants 135 billion euros of outstanding bonds to be swapped or rolled over, which translates to a high take-up rate of 90 percent. It has warned that the whole scheme, and conceivably even its plan to receive a second international bailout, could be threatened if that target is not hit.

Greece appears likely to come close enough to the 90 percent threshold to declare the operation a success; the chief executive of Intesa Sanpaolo, Italy's biggest retail bank, said on Saturday he was hearing positive indications from the Institute of International Finance banking lobby group.

But even if the debt swap is fully taken up, analysts think that combined with other planned measures, it will only produce a drop in the ratio of Greece's debt to its gross domestic product to around 120 or 130 percent over the next few years, from above 150 percent now. So another, more painful Greek debt restructuring may be inevitable down the road.

RADICAL STEPS

This helps to explain why markets are unlikely to react with much optimism even if events this week turn out positively -- and why a growing number of past and present policymakers are advocating more radical crisis steps.

European Commission President Jose Manuel Barroso insisted euro zone policymakers were doing everything possible to resolve the crisis.

"I want to be clear here. The European Union and the euro are strong and resilient. We are doing all it takes," he said on Monday in Australia after talks with Prime Minister Julia Gillard.

Still, Italian Economy Minister Giulio Tremonti repeated his call on Sunday for euro zone governments to issue bonds jointly, saying the measure was vital to resolve the crisis. Germany has strongly resisted the idea on the grounds that it would penalize financially responsible countries.

Former German chancellor Gerhard Schroeder on Sunday called for the creation of a "United States of Europe," saying the bloc needed a common government with a unified budget policy to avoid future economic crises.

Schroeder, a Social Democrat who ran Germany from 1998 to 2005, said European Union member states would have to return to the negotiating table and hammer out a new treaty covering the bloc's institutional framework.

Steen Jakobsen, chief economist at investment bank Saxo Bank, said governments had great political will to protect the euro zone, and were likely to take drastic action eventually to head off disasters such as an Italian exit from the zone.

But for this to happen, he said, "Germany needs to step up to the plate in a way it has not done so far."

(Editing by Neil Fullick)

European stocks were expected to drop too, with financial bookmakers calling the major indexes down more than 1 percent. .L .EU

U.S. employment data on Friday showed the world's biggest economy failed to create any jobs last month for the first time in nearly a year.

"Even if you take out the effect from the Verizon strike, it is still a lousy number and people are concerned that growth is not there any more," said Dominic Schnider, head of commodity research of UBS Wealth Management in Singapore.

Europe, meanwhile, faces a string of political and legal tests this week that could hurt efforts to resolve its sovereign debt crisis and increase pressure on governments to try more radical solutions.

"In this atmosphere, foreign investors are likely to remain risk-averse and inactive," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management Co in Tokyo.

Demand for safer assets drove up Japanese government bonds, while the yen firmed a touch and gold lost only a little ground after spiking on Friday.

Tokyo's Nikkei share average .N225 fell 2 percent, while MSCI's broadest index of Asia Pacific shares outside Japan .MIAPJ0000PUS fell 2.6 percent, leaving it more than 17 percent below its April high. .T

Energy and materials -- both sensitive to expectations of industrial demand -- were the hardest hit sectors in the MSCI index, shedding between 3 and 4 percent.

OBAMA SPEECH

Stocks on Wall Street and other major exchanges closed down more than 2 percent on Friday after the U.S. Labor Department report, which also sparked a rally in safe haven investments such as gold, Treasuries and the Swiss franc.

U.S. S&P stock futures fell 0.6 percent in Asia, extending Friday's weakness, although Wall Street is closed on Monday for the Labor Day holiday and investors are looking ahead to a speech to Congress by President Barack Obama on Thursday for details on how he plans to boost the economy.

"Some don't expect much in the way of concrete measures from Obama. There won't be any magic rebound," said Fumiyuki Nakanishi, strategist at SMBC Friend Securities in Tokyo.

The worsening outlook also piles pressure on the U.S. Federal Reserve to embark on a third round of money creation via bond purchases, known as quantitative easing, which could cheapen the dollar and encourage buying of riskier assets.

A year ago a signal from Fed Chairman Ben Bernanke that a second bout of quantitative easing, dubbed QE2, was in the pipeline triggered a rally that saw the S&P 500 rise about 30 percent from August to May, although some analysts are doubtful that any "QE3" program would have a similar effect and the central bank itself appears more reluctant.

"This is likely to bring further calls for quantitative easing, despite the Fed's apparent aversion," said CMC Markets market strategist Michael McCarthy in a research note.

EURO WOE

In currency markets, the euro hit its lowest level in three weeks against the dollar while currencies affected by expected demand for commodities, such as the Australian dollar, also came under pressure.

A court ruling in Germany on Wednesday may limit the ability of the euro zone's biggest economy to finance rescues of crisis-hit countries such as Greece.

"Concerns about high debt in Europe has resurfaced, and those poor payrolls results certainly got people worried about the U.S. economy and the global economy as well," said Joseph Capurso, strategist at Commonwealth Bank in Sydney.

The euro eased to $1.4138, reaching lows not seen since August 11. It was later trading around $1.4165, down from $1.4198 late in New York on Friday. This helped drive the dollar index .DXY back to one-month highs.

The yen firmed slightly to around 76.76 per dollar.

Japanese government bond September 10-year futures rose 0.46 point to 142.72, while the benchmark 10-year yield fell 4 basis points to 1.020 percent.

Gold held most of its gains, inching down around 0.4 percent to about $1,876 an ounce after jumping more than 3 percent on Friday.

Oil eased on concerns that a "double dip" recession would slow demand, with Brent crude falling 0.8 percent to $111.49 a barrel while U.S. crude eased around 0.9 percent to $85.65 a barrel.

(Additional reporting by Vikram Subhedar in Hong Kong, Ian Chua in Sydney and Lisa Twaronite in Tokyo; Editing by Kim Coghill and Ramya Venugopal)