Jan

17

In the Eurozone, Greece is downsided to junk and Portugal is trying to reassure markets (and political leaders) that they can manage without a rescue package. The "strong" continental countries are discussing how to politically make viable a rescue plan that would be paid by thier taxpayers. Aid talks are running in parallel with the effort to establish new EU legislation to strengthen fiscal restraints that failed. In this case, for example, Greece would be sanctioned for never meeting the euro area’s limit on deficits of 3 percent of GDP. "Some" countries are calling for “quasi-automatic” sanctions or for a political vote to fine high-deficit countries be left up to a political vote. In my view it is almost ridiculous, hypocritical and not credible to fine a country that is almost bankrupt when you have to lend the money putting together an emergency rescue package… In the meantime, the Greeks may complain that Germans want to make money lending them money at an inequitable interest rate and "control" politically and economically their country. …..and the Euro gained 3.7% last week on the dollar……


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