Posted on 08/31/2011 4:58:29 AM PDT by the invisib1e hand
Some bits from the Bloomberg piece:
Ministers meeting in Berlin today backed a reworked European Financial Stability Facility including sovereign bond- buying powers, raising Germany’s share of EFSF loan guarantees to 211 billion euros ($305 billion) from 123 billion euros. The measures were agreed on by European leaders at a July 21 summit.The way is being paved for Eurobonds, as we told you.
Peter Grottian, a politics professor at Berlin’s Free University, said by phone yesterday. “What’s more painful: risking the collapse of the government and a devastating economic backlash, or gritting your teeth and waving through a bill that may be effective even if you don’t understand it?”We've know how to deal with that! "Just pass it so you can read what's in it!"
Getting Germany to bring more of its taxpayer money to the Union's table will be read (and hailed) as great step in the solution to the sovereign debt meltdown, and panicked bondholders will breathe hurricane-strength sighs of relief. Markets worldwide will rally. And why not? They've acquired the souls of once great nations at fire-sale prices.
It remains to be seen whether the dream of surviving The Great European Sovereign Deleveraging has the mojo to stimulate enough "confidence" to resurrect something akin to a functioning economy. We suspect it will seem so. But the rule of three's suggests we're still in the second wave down of the punishment the world financial system has evaded for so long. Sell the rallies, in other words.
Merkel may as well sign her resignation letter after this.
I don’t think people realize how on the brink Europe is, and what the risks are for the West if she collapses.
They don’t, i have many friends in Germany, they are fed up with bankrolling the EU, they want out.
The Eurozone will go soon, its just not sustainable.
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