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Very interesting first roundup of the year from Eurointelligence: A year of truth for the eurozone
In an editorial, [Frankfurter Allgemeine] noted that Germany could count on Estonia for support of a northern European monetary union - without the countries of the Mediterranean.
So, does Germany really want to split the Eurozone into an exporters' union and an importers' union? That would nullify the advantages of Euro membership for Germany.

Trolling from the FAZ editorial pages aside, there's more:

Nobody, of course, has switched any substantive positions. A good example was the comment from Wolfgang Schäuble in a German newspaper interview:  "The higher yield level expressed in so-called spreads is both incentive and sanction... That's why this mechanism should not be put out of work through a collectivisation of the yield level, including in the form of euro bonds."
But the most interesting bit is

Is Merkel ready to drop Axel Weber for the ECB job?

Frankfurter Allgemeine has an interesting if speculative article about why Merkel might drop Weber in the race for the ECB presidency. The theory goes like this: Merkel is getting closer to Sarkozy on the euro because Germany wants the ECB to help out where governments are constrained for political reasons  - through bond purchases, continuation of flexible lending policies, and low interest rates. For example, Germany opposes an extension of the EFSF's size and mandate, while the ECB wants governments to solve the problem. Weber might not be the most conducive candidate for a compliant ECB. The paper quotes an official close to Merkel as saying that Germany was no longer pushing for a German central banker at the top of the ECB, but for the most qualified central banker. The authors of the Herdentrieb blog predicted that Klaus Regling would get the job.

Who is Klaus Regling? Would we like him as a Central Banker?

Of all the ways of organizing banking, the worst is the one we have today — Mervyn King, 25 October 2010
by Migeru (migeru at eurotrib dot com) on Mon Jan 3rd, 2011 at 06:12:19 AM EST
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