Tag Archives: Berlin

Opening Quotes: Resisting Europeanisation

The pressure is on.

Geithner expects lots more.

But lest we doubt it – huge – justifiable? – German resistance remains.

Joseph Joffe (Editor of Die Weit) – FT Editorial:

“When Helmut Kohl went to Maastricht in 1992, he thought he could “Germanise” Europe by imposing fiscal and monetary restraint on the rest. Now, the crisis countries want to “Europeanise” Germany: spend, inflate and pay. Germany must cheapen credit for all and shoulder the risk alone. It all adds up to a moral hazard that will perpetuate the maladies of the eurozone.”

“Berlin has already failed once in “Germanising” the eurozone via fiscal probity and reform. Why would Club Med mend its ways as long as Germany is such a good “europayer”? If it doesn’t, the eurozone can look forward to bankruptcy and decay.”

Advertisements
Tagged , , , , , , ,

Monti’s Spin

http://www.bloomberg.com/news/2012-05-25/merkel-may-be-persuaded-on-euro-debt-sharing-compromise.html

Clarifying Monti’s rather <deliberately> optimistic claims:

“Monti’s account of the meeting contrasted with that of Luxembourg Prime Minister Jean-Claude Juncker, who told reporters in Brussels that joint debt sales “didn’t find much support,” particularly in the German-speaking area, while the French-speaking area was more enthusiastic.”

BUT?

“Back in Berlin 15 hours later, Merkel’s coalition and the opposition Social Democrats and Greens agreed that euro bonds “are not up for discussion,” Volker Kauder, the floor leader of Merkel’s Christian Democratic Union, told reporters. At the same time, the two sides will “exchange studies” on the redemption fund before next month’s meeting.

The fund, backed by euro member states’ gold reserves, would be worth 2.3 trillion euros ($2.9 trillion) and help governments cut outstanding debt to below 60 percent of economic output. Limited to 25 years, it would be accompanied by a pledge by states to anchor debt limits in their constitutions and commit to economic reforms.”

In theory the fund allows members to get their debt back to a Maastricht like 60% of GDP.

Hmmmmmmmm.

Big theory.

And this is Europe.

The horror <quote follows> continues.

 

 

 

Tagged , , , , , , ,

Opening Quotes: Job Done?

Austerity bites. Governments continue to fall.

And the ECB has ‘done its job.’

We’ll see.

Bundesbank President Jens Weidmann:

“We shouldn’t get so excited about bond yields rising for a limited period of time,” Weidmann said. “They also constitute an incentive to reform, to embark on consolidation.”

The ECB, which has pumped more than 1 trillion euros ($1.3 trillion) into the banking sector since December in a bid to avert a credit crunch, has “done its job,” Weidmann said. Weidmann added that governments must now press on with budget cuts and structural reforms to encourage economic growth.

“It’s important to get the message to governments, ‘this is your job now,’” Weidmann said.

http://www.bloomberg.com/news/2012-04-23/weidmann-says-bundesbank-is-preserving-euro-stability.html

 

Tagged , , , , , , ,
Advertisements