European Debt (Deutsch)Mark II

[Jon AS]

I'm not claiming to be an expert on this matter (personally I don't think anybody is actually capable of predicting what's going to happen, whoever turns out to be right in the end will just have gotten lucky), I'm just saying that that's another view of what's going on right now.

[Slurms McKenzie]

methinks the eurozone will probably survive....personally I'm more dismayed by the dismissive behaviour exhibited by the French (especially the French) and Germans towards Britain....we should have a voice on the continent...after everything we have done for them......*unintelligible and grumpy mutterings*....

[Zoë Sumra]

Or because it's wrong. In what way is the situation in the Eurozone not bad?

I think there's a good argument to be made that if the hysterical media weren't being hysterical, the situation in the Eurozone really wouldn't be that bad...

[Dinsdale!]

I think there's a good argument to be made that if the hysterical media weren't being hysterical, the situation in the Eurozone really wouldn't be that bad...

OTOH, if you are a Greek who hasn't taken his money out of his Greek bank yet, what the hell are you thinking? Is there really any evidence whatsoever that the ECB/Germans will provide the liquidity needed to short-circuit a bank run anywhere in the continent?

[Padraig]

I believe 2. What I'm asking you is in what way these new moves towards fiscal union from the ECB constitute a chance in behaviour that will actually solve anything.

In my very first post on this I said "I presume the German government wants to tighten things up before it allows the ECB to change its behaviour". And I have repeated that several times since in various ways. How does that not answer your question?

Is there really any evidence whatsoever that the ECB/Germans will provide the liquidity needed to short-circuit a bank run anywhere in the continent?

Yes there is. Whatever happens, they seem determined not to let a bank go bust.

I think there's a good argument to be made that if the hysterical media weren't being hysterical, the situation in the Eurozone really wouldn't be that bad...

Agreed.

personally I'm more dismayed by the dismissive behaviour exhibited by the French (especially the French) and Germans towards Britain....we should have a voice on the continent...after everything we have done for them......*unintelligible and grumpy mutterings*....

Heh. :) You are not in the Eurozone though. Although, sounds like the British government is weighing with some strong views on financial transaction taxes etc.

[Dinsdale!]

Yes there is. Whatever happens, they seem determined not to let a bank go bust.

And if a country must leave the Eurozone because it cannot service its debts, what do those guarantees matter? Than the nation's banks have Lira/Drachma/etc assets and Euro liabilities. The Euro liabilities will be at an excellent interest rate, but what does that matter if they dwarf the assets?

My presumption is that Germany/Finland/Netherlands want certain political concessions before they allow the ECB to say this, which implies that the ECB might never say this...

[Shryke]

I think there's a good argument to be made that if the hysterical media weren't being hysterical, the situation in the Eurozone really wouldn't be that bad...

I'm not seeing how. It's not the media freaking out, it's the investors. And they are not freaking out cause of the media, they are freaking out cause of the ECB and what it's been up to.

In my very first post on this I said "I presume the German government wants to tighten things up before it allows the ECB to change its behaviour". And I have repeated that several times since in various ways. How does that not answer your question?

Because it doesn't actually give any indication that Germany will actually let the ECB change. Or that the ECB wants to change.

[The Marquis de Leech]

How are they going to save it? What is this new "more fiscal union" proposal gonna fix?

Fiscal union is a solution, It just means that within a Federated Europe, some countries subsidise others for the rest of time. Rather like how in the US, taxpayers in New York subsidise those in Mississippi.

Where it gets ugly though is the political ramifications. Fiscal union without democratic controls?

[Shryke]

Fiscal union is a solution, It just means that within a Federated Europe, some countries subsidise others for the rest of time. Rather like how in the US, taxpayers in New York subsidise those in Mississippi.

Where it gets ugly though is the political ramifications. Fiscal union without democratic controls?

Is that what they are proposing? Cause it sounded to me more like "We get to control your budget" in a continued vain attempt to pretend this was about those damn outer-euro countries spending too much money, rather then Germany and the like subsidizing other countries.

[quirksome]

The UK, Sweden, Hungary and the Czech Republic veto EU Treaty.

Otherwise known as David Cameron shafts the Eurozone while pointing and laughing.

[quirksome]

Some hysterical headlines for you: trending #eurogeddon, #merkozoid

• EU treaty: Cameron blocks crucial changes, UK left isolated

• EU 27 fail to agree Europe-wide treaty changes

• 17 eurozone nations pressing ahead with separate 'fiscal pact'

• Sarkozy says Britain made "unacceptable" demands

• Asian markets fall, FTSE opens lower

• Market rout as ECB dashes bond hopes

Here's an excerpt from the Anti-EU Torygraph's man on the ground:

...An exultant Nicolas Sarkozy hailed a “historic” breakaway “euro plus” bloc that would pursue fiscal and economic union via a new treaty outside the EU.

The [uK] Prime Minister insisted that he had been prepared to support treaty change among all 27 of the EU’s members to allow the 17-strong eurozone to take measures to tackle its debt crisis and to enforce tough new fiscal rules for the single currency.

But after 11 hours of bad-tempered talks, Mr Cameron said that he had blocked the changes because France and Germany and refused to agree to a “protocol” giving the City of London protection from a wave of EU financial service regulations related to the eurozone crisis.

So it seems like the French put in some anti-City regs (transaction tax? not had a chance to research this yet) so Cameron et al refused to sign.

Also:

He denied that Britain was "isolated" and said Britain had "created world market confidence. We do that by controlling our own affairs".

:rofl:

Edit: formatting

[quirksome]

Actually this UK Protocol Demand gives a lot more context as to why Britain refused to sign. Need to analyse this carefully to understand.

What was on offer was not in Britain's interest .. so I didn't sign up to it.

Without protections for the single market and for other key British interests, without those safeguards it is better not to have a treaty within a treaty but to have those countries make their arrangement separately, that is what is not going to happen.

Britain's interest in the European Union, keeping markets open, free trade, selling our good and services with rules over which we have a major say, all those things are protected, they don't change.

But this new round of integration and special powers and surrenders of sovereignty for European countries and other that want to join the euro, they will be carried on outside the EU treaty. So we will not be presenting this treaty when it is agreed to our Parliament.

Edit: formatting

[Padraig]

it doesn't actually give any indication that Germany will actually let the ECB change. Or that the ECB wants to change.

"It"? My post? I might as well say that your post hasn't shown me that the ECB wouldn't change.

I am presuming you are reading more than my posts. :)

And if a country must leave the Eurozone because it cannot service its debts, what do those guarantees matter? Than the nation's banks have Lira/Drachma/etc assets and Euro liabilities. The Euro liabilities will be at an excellent interest rate, but what does that matter if they dwarf the assets? My presumption is that Germany/Finland/Netherlands want certain political concessions before they allow the ECB to say this, which implies that the ECB might never say this...

Those guarantees probably wouldn't matter then. That's probably why those Eurozone countries will make concessions.

[Lummel]

No surprise, business as usual. Cameron has to play to, not just the backbenchers, but the anti-EU feeling in the parliamentary party and balance that with the interests of the City, who donates heftily to the party wanting access to Europe as part of a single market but also not to have its activites as a tax haven limited or restricted, while at the same time Cameron withdrew the party from the european peoples party block so centre right leaders like Merkel and Sarkozy look on him as being a merchant banker and a toss pot.

Still this clears the way for Van Rompoy's plan B I suppose.

[quirksome]

No surprise, business as usual. Cameron has to play to, not just the backbenchers, but the anti-EU feeling in the parliamentary party and balance that with the interests of the City, who donates heftily to the party wanting access to Europe as part of a single market but also not to have its activites as a tax haven limited or restricted, while at the same time Cameron withdrew the party from the european peoples party block so centre right leaders like Merkel and Sarkozy look on him as being a merchant banker and a toss pot.

Fair assessment ^_^

Still this clears the way for Van Rompoy's plan B I suppose.

NOOOOOOOOOOOOOO! CANNNNNNNNN'T!

[Usotsuki]

A crisis so severe it has had a catastrophic impact on board formatting. :(

Quirk, you might want to edit this post

[Serious Callers Only]

Micro-transaction tax?

[ljkeane]

The UK, Sweden, Hungary and the Czech Republic veto EU Treaty.

Otherwise known as David Cameron shafts the Eurozone while pointing and laughing.

I don't agree with Cameron too often but this seems like the right thing to do to me. Why would the UK want to sign on to a treaty with fiscal restrictions and financial services regulations that would probably harm UK interests to protect the Eurozone when it's not even a member of the Eurozone?

[Ser Scot A Ellison]

Triskele,

Krugman is worried.

http://krugman.blogs...letive-deleted/

NO... no... not that... not that...

;)

[mormont]

The issue seems to be that Cameron wanted a guarantee that if a transaction tax was imposed at a future date, the UK could opt out or veto it. If this was really the issue, then - while I'm far from a Eurosceptic or Cameron supporter - I have to give him a pass this time. Whatever you think about the transaction tax, the notion that it could be imposed on the UK against its will when something like 80% of the transactions it covers take place in the UK just isn't, in my view, defensible. I don't think any politician would have agreed to that.