(Reuters) - Germany's highest court said on Wednesday that parliament must have a bigger say in euro zone rescue packages, in a landmark ruling that may make it more difficult for Europe to respond swiftly in delivering aid to crisis-hit member states. The German Constitutional Court rejected a series of lawsuits filed by euroskeptics aimed at blocking the participation of Europe's biggest economy in bailout packages for Greece and other euro zone countries, as had been expected. But it said the government must seek the approval of parliament's budget committee before granting aid and spelled out that the ruling should not be misinterpreted as a "blank cheque" for future rescue packages. "The constitutional complaint has been rejected," said the president of the court, Andreas Vosskuhle, in a ruling closely watched by policymakers and investors because of its impact on the decision-making process in the 17-nation currency bloc. "This was a very tight decision. But it should not be mistakenly interpreted as a constitutional blank cheque authorizing further rescue measures," the red-robed judge told the plaintiffs, government officials and members of parliament in the courtroom in Karlsruhe. Greece, Portugal and Ireland have already received aid from Europe and the International Monetary Fund while Italy -- the third largest economy in the euro zone -- looks increasingly vulnerable as it struggles to implement a savings program. The prospect of having urgent rescue decisions bogged down in legislation in Germany -- and potentially other euro zone parliaments, if more states follow suit -- will not please policymakers trying to streamline that process. Chancellor Angela Merkel already faces a revolt in the Bundestag (lower house of parliament) over European leaders' decision in July to grant new powers and extra funds to the current bailout fund -- the European Financial Stability Facility (EFSF) -- which goes to a vote on September 29. Parliament also has to ratify by the end of the year the fund which will replace the EFSF from mid-2013 -- the European Stability Mechanism (ESM) -- and the court ruling is likely to influence how it allocates rescue funds in future too.
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Wednesday, September 7, 2011
German High Court - ruling against Germany and the German People
(Reuters) - Germany's highest court said on Wednesday that parliament must have a bigger say in euro zone rescue packages, in a landmark ruling that may make it more difficult for Europe to respond swiftly in delivering aid to crisis-hit member states. The German Constitutional Court rejected a series of lawsuits filed by euroskeptics aimed at blocking the participation of Europe's biggest economy in bailout packages for Greece and other euro zone countries, as had been expected. But it said the government must seek the approval of parliament's budget committee before granting aid and spelled out that the ruling should not be misinterpreted as a "blank cheque" for future rescue packages. "The constitutional complaint has been rejected," said the president of the court, Andreas Vosskuhle, in a ruling closely watched by policymakers and investors because of its impact on the decision-making process in the 17-nation currency bloc. "This was a very tight decision. But it should not be mistakenly interpreted as a constitutional blank cheque authorizing further rescue measures," the red-robed judge told the plaintiffs, government officials and members of parliament in the courtroom in Karlsruhe. Greece, Portugal and Ireland have already received aid from Europe and the International Monetary Fund while Italy -- the third largest economy in the euro zone -- looks increasingly vulnerable as it struggles to implement a savings program. The prospect of having urgent rescue decisions bogged down in legislation in Germany -- and potentially other euro zone parliaments, if more states follow suit -- will not please policymakers trying to streamline that process. Chancellor Angela Merkel already faces a revolt in the Bundestag (lower house of parliament) over European leaders' decision in July to grant new powers and extra funds to the current bailout fund -- the European Financial Stability Facility (EFSF) -- which goes to a vote on September 29. Parliament also has to ratify by the end of the year the fund which will replace the EFSF from mid-2013 -- the European Stability Mechanism (ESM) -- and the court ruling is likely to influence how it allocates rescue funds in future too.
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Germany's Constitutional Court rejected on Wednesday a series of lawsuits aimed at blocking Germany's participation in bailout packages for Greece and other euro zone countries, but
said parliament must have a bigger say in future rescues.
Caspar Benson | Getty Images
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The country's highest court in Karlsruhe said the German government must seek the approval of parliament's budget committee before granting such aid, a requirement which could further slow down Europe's response to the debt crisis.
German Bund futures extended losses [FGBLC1 Loading... () ] and the euro briefly rose against the dollar [EUR= Loading... () ] after the court's rejection.
Bund futures were last 80 ticks down at 137.81, having fallen as low as 137.53 following the announcement.
The euro jumped to a session high of $1.4150 after the German court ruling from around $1.4104 beforehand. It was last up 0.6 percent on the day, paring some of those gains, to trade at $1.4083.
"It's being taken as good news, they can carry on bailing out the euro zone," one trader said. "But it's the decision that was expected, we need to see what the caveats are or whether it makes any difference to the bigger picture."
Thorsten Polleit, Europe economist at Barclays Capital said: "We expected a ruling like this. I think a great dose of uncertainty is going to remain with us. It is not yet clear how the rescue mechanism might look as from the middle of 2013 when the EFSF is going to expire and there is still a discussion going on about setting up the European Stability Mechanism and in a number of countries this issue hasn't been discussed in great detail."
If Europe was still comprised of individual currencies it would all be over now, as it is not our "friends" are having to work harder and longer.
Would it be legal to put the names of all those involved in trying to topple the Euro in the papers, how much they move on the markets each day, how they invest and recoup, and where from and to? It would also be interesting to see a list of names investing in the hedge funds, just of course to ensure there are no criminals or bogus government investments there. There is also the matter of where these "entrepreneurial" folks are putting their profits? Let's face it when the propensity to do so much damage exists the process has to be transparent, hasn't it! .?
Let's face it all you need is one tiny thread and all sorts can come out, like in politics or the media!
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