Posts
As widely predicted, French President Nicolas Sarkozy and German Chancellor Angela Merkel met...and accomplished little to settle the unsettled Eurozone crisis.
Oh, wait...they proposed...a reheated tax on financial transactions, some official meetings...and the "golden rule" for member governments.
But both gave a BIG NO vote...for creating Euro bonds.
No rescue fund enlargement.
In other words, no quick fix.
Sarkozy delivered the bad news.
He said Euro bond sales may come eventually...but selling them now would put the “most stable countries of the euro zone in grave danger."
“Euro bonds -- we can imagine having them one day,” he said. “But it will be at the end of a process of integration, not the beginning.” Right now, “in their current state, European institutions,” are not ready for this.
This is sweet music...especially to German ears.
They see their nation primarily bearing the brunt of any new Euro bonds as the chief guarantor...while delivering only higher borrowing rates and bigger liabilities.
“It’s hugely disappointing and what they say is not going to work,” opined a Jefferies economist. “They think they have all the time in the world and they don’t.”
AND: A small crack in Berlin's wall of opposition to Euro bonds may be forming...reports Der Spiegel....but only with "strict conditions".
http://www.spiegel.de/international/europe/0,1518,780520,00.html
