European Central Bank decides it better raise capital itself
The euro debt crisis takes another bite at Spain and expands to Belgium. But German opposition to a bigger bailout fund leaves the European Central Bank to fight the problem alone.
The euro debt crisis takes another bite at Spain and expands to Belgium. But German opposition to a bigger bailout fund leaves the European Central Bank to fight the problem alone.
The European Central Bank has been left to literally paper over disagreements among Europe’s political leaders with massive buying of government and bank debt. A meeting of European finance ministers ended with German objections killing prospects for expanding the euro rescue fund or issuing joint euro bonds to finance the fund.
The euro is down so far today after a weekend that exposed how deeply divided the Euro Zone’s political leaders are about what to do next to stem the euro debt crisis.
European Central Bank President Jean-Claude Trichet disappointed financial markets that had hoped for news of a big increase in government bond purchases. The euro, which had traded as high as $1.3217 before Trichet spoke, dropped to $1.3085.
The financial markets have started to do the math they should have done six months ago, and they don’t like the numbers they’re seeing: There might not be enough money to rescue Spain.
Another weekend, more band-aids. Will the latest round succeed in convincing financial markets that the bleeding in the euro has stopped when earlier applications have failed? The results this morning are mixed
Support for the Irish government of Prime Minister Brian Cowen fell apart late yesterday after the Green Party said it would pull out of the ruling coalition. Cowen called for elections early in 2011. Think this made global financial markets happy?