French President Nicolas Sarkozy is muting his view that the European Central Bank play a central role in Europe’s debt crisis. Sarkozy has stated that "propositions for the modification of treaties" will be announced in time for the December 9th summit of EU leaders. In so stating, Sarkozy agreed with a German approach which more strongly unites the 17-nation single-currency zone.
There are 27 EU nations of which 17 are using a single currency. But to change the treaty language requires agreement among all 27 members, including the 10 nations not using the Euro currency.
German Chancellor Angela Merkel has been advocating treaty changes that require member nations to pursue tighter financial stability. Merkel has been meeting with French and Italian officials in Strasbourg, France. Merkel does not want treaty language to change with respect to the European Central Bank, which she sees as a monetary organization, not a fiscal entity.
"In the treaty changes, we are dealing with the question of a fiscal union, a deeper political cooperation ... there will be proposals on this, but they have nothing to do with the ECB," Merkel said. The ECB has the financial ability to print money. Therefore it could provide rapid assistance to nations that are in trouble, even large member nations like Italy. But Merkel wants the bank to be independent of any Euro financial crisis, surely because German borrowing costs are low and would become diluted by eurobonds issued to help weaker members, a policy that would drive up German rates.
At least in the short term, market sentiment and European stock markets would prefer ECB intervention, and those markets have been jittery and downtrending lately.
Merkel noted, "It would be completely the wrong signal to lose sight entirely now of these differing interest rates, because they are a pointer to where something still needs to be done and where we need to go further."
Italian premier Monti said again he is committed t balancing Italy’s budget by 2013, yet he did not advocate specific austerity measures or comment on whether tightening Italy’s government expenses would trigger a recession in his nation, the third biggest economy of the Eurozone.
Summarized from:
http://news.yahoo.com/france-germany-propose-changing-eu-treaties-133250859.html;_ylc=X3oDMTNuZm10YXNjBF9TAzIxNDU4NjgyNzQEYWN0A21haWxfY2IEY3QDYQRpbnRsA3VzBGxhbmcDZW4tVVMEcGtnAzBkNzg0NDM1LWYyNTgtMzJlMy04ZDgwLWQ5YjliMDkyZDEyMQRzZWMDbWl0X3NoYXJlBHNsawNtYWlsBHRlc3QD;_ylv=3
There are 27 EU nations of which 17 are using a single currency. But to change the treaty language requires agreement among all 27 members, including the 10 nations not using the Euro currency.
German Chancellor Angela Merkel has been advocating treaty changes that require member nations to pursue tighter financial stability. Merkel has been meeting with French and Italian officials in Strasbourg, France. Merkel does not want treaty language to change with respect to the European Central Bank, which she sees as a monetary organization, not a fiscal entity.
"In the treaty changes, we are dealing with the question of a fiscal union, a deeper political cooperation ... there will be proposals on this, but they have nothing to do with the ECB," Merkel said. The ECB has the financial ability to print money. Therefore it could provide rapid assistance to nations that are in trouble, even large member nations like Italy. But Merkel wants the bank to be independent of any Euro financial crisis, surely because German borrowing costs are low and would become diluted by eurobonds issued to help weaker members, a policy that would drive up German rates.
At least in the short term, market sentiment and European stock markets would prefer ECB intervention, and those markets have been jittery and downtrending lately.
Merkel noted, "It would be completely the wrong signal to lose sight entirely now of these differing interest rates, because they are a pointer to where something still needs to be done and where we need to go further."
Italian premier Monti said again he is committed t balancing Italy’s budget by 2013, yet he did not advocate specific austerity measures or comment on whether tightening Italy’s government expenses would trigger a recession in his nation, the third biggest economy of the Eurozone.
Summarized from:
http://news.yahoo.com/france-germany-propose-changing-eu-treaties-133250859.html;_ylc=X3oDMTNuZm10YXNjBF9TAzIxNDU4NjgyNzQEYWN0A21haWxfY2IEY3QDYQRpbnRsA3VzBGxhbmcDZW4tVVMEcGtnAzBkNzg0NDM1LWYyNTgtMzJlMy04ZDgwLWQ5YjliMDkyZDEyMQRzZWMDbWl0X3NoYXJlBHNsawNtYWlsBHRlc3QD;_ylv=3
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