The talks between the leaders of Germany and France are hoped to tie together a financial rescue package of up to €2 trillion (£1.3 trillion), via the European Central Bank, the IMF and the European Financial Stability Facility (EFSF), ahead of a final summit of all European leaders on Friday. Monday's Paris "work lunch" between Mrs Merkel and Mr Sarkozy is intended to settle differences between the two core members of the single currency about how a fiscal union might work. Both leaders agree that ultimately some nations, including those with excessive debts such as Italy and Spain, will have to sacrifice some independence on setting national budgets in exchange for financial support from their wealthier counterparts. Italy's cabinet last night adopted a new €30bn austerity programme in order to ease the pressure on the embattled country. The "grand European bargain" envisaged by Mrs Merkel will involve a framework of automatic penalties and oversight through a new "stability commissioner" to keep countries in check. ...FINALLY : So, let's see if I've got this right. All the eurozone banks - who ran out of money...give money they haven't got...to the IMF, which has no money of its own... and the IMF passes on this (non) money...to countries in the EU that are more or less bankrupt. This stabilizes the euro.... how? and promotes strong eurozone growth... how? Meantime, Germany's control of the EU moves up a notch...with facile France in its dutiful wake.
Access Investments-Building Awareness - European Union-ROMANIA
Monday, December 5, 2011
The talks between the leaders of Germany and France are hoped to tie together a financial rescue package of up to €2 trillion (£1.3 trillion), via the European Central Bank, the IMF and the European Financial Stability Facility (EFSF), ahead of a final summit of all European leaders on Friday. Monday's Paris "work lunch" between Mrs Merkel and Mr Sarkozy is intended to settle differences between the two core members of the single currency about how a fiscal union might work. Both leaders agree that ultimately some nations, including those with excessive debts such as Italy and Spain, will have to sacrifice some independence on setting national budgets in exchange for financial support from their wealthier counterparts. Italy's cabinet last night adopted a new €30bn austerity programme in order to ease the pressure on the embattled country. The "grand European bargain" envisaged by Mrs Merkel will involve a framework of automatic penalties and oversight through a new "stability commissioner" to keep countries in check. ...FINALLY : So, let's see if I've got this right. All the eurozone banks - who ran out of money...give money they haven't got...to the IMF, which has no money of its own... and the IMF passes on this (non) money...to countries in the EU that are more or less bankrupt. This stabilizes the euro.... how? and promotes strong eurozone growth... how? Meantime, Germany's control of the EU moves up a notch...with facile France in its dutiful wake.
Subscribe to:
Post Comments (Atom)
6 comments:
The talk seems to be of some kind of move towards fiscal union - the centralised control of taxation and spending at a European level. Part of the eurozone's problem is that there has been little fiscal discipline imposed on the peripheral eurozone countries, so some kind of centralised structure is needed.
Germany wants a more federal system - the suggestion is that the European Court of Justice might have a power of veto on national budgets.
That is unlikely to be popular around Europe, and Sarkozy himself will find the plan difficult to push through. With an election early next year, the idea of handing sovereignty to Brussels has come under fierce attack in France from socialist Presidential candidate Francois Hollande, as well as far-right leader Marine Le Pen.
All of which suggests that even if the euro is "saved" in the next five days, there will still be plenty of politics to come
8.14am: The markets have opened up, as optimism grows about a sweeping solution to the eurozone crisis.
The FTSE 100 is up 20 points in early trading. The Nikkei was up 0.6% overnight, with Asian markets were broadly positive.
Perhaps the more significant numbers, however, are the Italian ten-year bond yields, which are now below 6.5%. They are down 0.279% on the day to 6.470, as measured on Tradeweb. A big vote of confidence in last night's austerity measures?
Patrice Perois of Kepler Capital Markets tells Reuters it could be a "volatile week":
There are still significant differences between Sarkozy and Merkel. The Risk is that any kind of disappointment could trigger a pull-back
Good morning everyone and welcome back to our live coverage of the eurozone debt crisis.
French president Nicolas Sarkozy and German chancellor Angela Merkel meet today to try to resolve the crisis once and for all. They will put together proposals to present to EU leaders in Brussels on Thursday, ahead of a summit.
The markets appear to be optimistic. Last week saw a big rally, mainly on the back of central bank liquidity measures introduced on Wednesday, but also towards the end of the week on the expectation of some sort of successful outcome in the talks.
There is talk generally of there being "five days to save the euro".
The Work and Pensions Secretary said that any “major treaty change” in the EU should be put to a British vote, a promise that the Prime Minister has so far carefully avoided making.
Mr Cameron will this week attend a summit in Brussels where Angela Merkel, the German leader, and Nicolas Sarkozy, the president of France, will outline plans to resolve the eurozone debt crisis by integrating the tax and spending systems of countries using the single currency.
The far-reaching plans have put Mr Cameron under intense pressure to deliver clear changes in Britain’s relationship with the EU in exchange for his consent to changing the EU’s rule book.
Mr Duncan Smith, the Cabinet’s leading Eurosceptic, made clear he expects Mr Cameron to put any significant change in the treaties to the British people.
The Coalition’s “referendum lock” law would mean a popular vote in the UK, Mr Duncan Smith told Sky News.
Whether or not this is the week that saves the euro, there is plenty going on.
• US Treasury secretary Timothy Geithner is in Europe from tomorrow to urge Europe to take decisive action.
• The ECB and the Bank of England both have meetings later in the week to decide on interest rates, and also the potential for more quantitative easing. A further ECB interest rate cut is said to be on the cards.
• The Greek parliament will vote on the country's 2012 budget tomorrow. US vice president Joe Biden has arrived in the country today, and told the Greeks to "hang in there".
Merkel y Sarkozy anuncian hoy su pactoe.s. / bruselas
Día 05/12/2011
Reglas de gasto: Para lograr el equilibrio en las cuentas públicas de los países europeos Alemania y Francia obligarán a los estados a aprobar «reglas de gasto».
Control de cuentas: El nuevo Gobierno del euro que se está diseñando tendrá un control de los presupuestos de los pasíes «ex ante», antes de ser votados en el Parlamento.
Sanciones: Los países que rubriquen el nuevo Pacto de Estabilidad acatarán las nuevas reglas. Habrá sanciones de hasta el 0,2% del PIB por incumplimiento.
Competitividad: Armonización en materia de competitividad y productividad de países. Se tocarán la fiscalidad y los salarios con el objetivo de reducir diferencias.
Acuerdo a 27 o dos velocidades
El objetivo de Merkel: Convencer a los mercados de que todos los países del euro aceptan la misma disciplina presupuestaria y que eso quedará inscrito en los tratados.
Al mismo ritmo: Alemania y Francia ofrecen el acuerdo a toda la Unión Europea. Si alguien se opone, avanzarán en solitario con los que acepten sumarse.
Mayoría cualificada: La propuesta franco-alemana pasa porque la toma de decisiones en Europa sea por mayoría cualificada. El Tratado de Lisboa lo preveía en 2014.
El papel de la Justicia: El tribunal de Luxemburgo tendrá una función arbitral en la decisión de castigar a los países que excedan el límite de déficit público.
Post a Comment